Revenues and Profits
Trends – Growing? Contracting?

In 2007, Americans for the first time in history are now purchasing more online travel bookings than offline bookings in volume. The gap between online and offline travel will continue to widen as more and more travelers shift behavior to online shopping, buying and planning. Online sales as a whole is rapidly growing, raising 19% in a single year (2007) reaching $174.5 billion. 51% of U.S. travel was booked online in 2007, and it projected that percentage to increase to 56% in 2008 and 60% in 2009. eMarketer estimates that 41.3 million US households will book travel online, representing 52.5% of all Americans that are online households. US online consumer travel sales (consisting of airline, hotel, rental car, cruise and vacation package reservations) will reach $94 billion, up 19% over 2006, according to eMarketer's estimates. Travel products with multiple options, such as full vacation packages, are being purchased less frequently online, while single components such as airplane tickets are more popular.

The internet travel industry is presently rapidly growing but expected to have a decline and plateau effect in growth during 2010-2015. Online sales are expected to remain strong for the industry, but growth rates will decline, according to the report. With 21% growth in '06, the industry will see only 19% growth in '07. Growth rates will continue falling, reaching only 14% industry growth by 2010. One main reason for the decline in growth is the decrease in customers due to the extent of time for transactions. Satisfaction with online travel agencies fell 1.3 percent for the second year in a row. Sales should remain consistent but growth in the industry will plateau.

Reports From:
Travel Industry Wire
NY Times
Biz Report
Airline News Resource

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