Market Size (2017)
2017
$570.25M
Vertical: ICTBase Year: 20179 Sections
Market Size (2017)
2017
$570.25M
Projected (2023)
2023
$1.13B
CAGR (2017–2023)
12.1%
12.1%Key Players
111+
The scenario of the travel and tourism industry has experienced a tremendous change owing to digitization, increasing inclination of customers towards online transactions, and the introduction of mobile apps. This has encouraged service providers to partner with software developers to develop platforms compatible with desktops, tablets, and smartphones. Tourism has evolved rapidly with the emergence of online travel agencies (OTAs). OTAs help travelers plan their mode of transport, book tickets and hotels, and avail travel services. Online travel platforms provide users with a comfortable booking experience along with personalized package deals to attract a number of customers. With the boost in tourism across geographies and affordable, convenient, and faster-traveling modes, the frequency of travelers has increased which is contributing to the growth of the online travel market.
The growth of the global online travel market is expected to be driven owing to the growing adoption of online travel medium by travelers and the use of social media platforms for travel bookings. Moreover, the influx of big data and other complementing technologies such as automation and augmented and virtual reality (AR/VR) is expected to create opportunities for travel agencies by incorporating these technologies in their existing platforms and applications to deliver better user experience. However, there exists no centralized system that can streamline data between government agencies and private travel agencies thus, creating a gap between them. This, in turn, can hamper the growth of the global online travel market.
The global online travel market was valued at USD 570.25 million in 2017 and is estimated to reach USD 1,134.55 million in 2023 with a compound annual growth rate (CAGR) of 13.16%.
The online travel market has been segmented on the basis of platform type, mode of booking, service type, and region. By platform type, the global online travel market has been segmented into a desktop-based platform and mobile/tablet-based platform. By mode of booking, the global online travel market has been segmented into online travel agencies and direct travel facilitators. By service type, the market has been segmented into transportation, accommodation, and vacation packages. The transportation segment is further segmented into air travel, train travel, bus travel, and others. The accommodation segment has been further categorized into hotels, and guest house/dormitory. The vacation packages segment has been further segmented into in-country vacation packages and outside country vacation packages. By region, the market has been segmented into North America, Europe, Asia-Pacific, and the rest of the world. Market Size
· 2017: USD 570.25 Billion
· 2023: USD 1,134.55 Billion
CAGR
· 13.16%
Key Leading Regions (CAGR %)
· US: 10.76%
· UK: 10.56%
· Canada: 11.25%
· China: 14.09%
· Germany: 11.25%
Key Market Drivers
· Rising Internet penetration
· Use of social media platforms for travel bookings
Key Market Opportunities
· Introduction of big data analytics
Key Vendors
· Expedia Inc.
· Booking Holdings Inc.
· TripAdvisor Inc.
· Ctrip.com International Ltd
· Thomas Cook Group PLC
The Online Travel Market market is projected to grow at a CAGR of 12.1% from 2017 to 2023.
Historical performance and future projections (2020–2030, USD Billion)
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View Subscription PlansOnline travel industry comprises travel and review sites that allow users to choose their preferred holiday package, hotel, and other services to customize and plan itinerary according to their preference. Online travel sites are specialized in selling online tickets for hotels, rental cars, flights, cruise tickets, and trains. These tickets can be purchased directly through the company website as well as from online travel agencies (OTAs). For instance, travel review websites such as TripAdvisor, Thomas Cook Ltd, and Expedia, Inc. among others allow customers to share reviews and experiences of restaurants, hotels, and other online hospitality purchases. The online travel companies mostly generate their revenue through advertisements on their websites. At present, travelers are highly reliable on travel review sites while booking online tickets for traveling.
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View Subscription PlansThis report applies a rigorous multi-stage research process combining primary interviews, secondary data sources, and bottom-up market modelling to ensure accuracy and completeness across all segments and geographies.
Base Year
2017
Historical Period
2017 – 2017
Forecast Period
2017 – 2023
Primary Interviews
150+
Historical data (2017–2017) and forecast period (2017–2023)
Our research process spans primary interviews with industry stakeholders combined with comprehensive secondary data analysis, validated through triangulation across multiple independent sources.
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View Subscription PlansMichael Porter’s five forces model gives a framework that models the global online travel market, which is influenced by five forces. The strategic business managers, trying to create an edge over competing firms in the global online travel market can utilize this model to better comprehend the industry connection in which the firm operates. The components of each of the forces and the degree of impact of each component in the context of the global online travel market have been broken down and analyzed.
1.1.1 Threat of New Entrants
The initial investments in the travel industry create a significant barrier, limiting the entry of new players; however, at present, these barriers are reduced due to the Internet. Moreover, the presence of various efficient communication channels reduces the initial marketing costs and provides the new competitors the access to the potential suppliers and the resources. Even a new entrant in the industry can use the communication channels of large chains to understand the key marketing concepts and lure customers. However, a vital barrier is the differentiation and availability of endorsements. Established firms have successfully differentiated themselves owing to the services, amenities and other qualities which attracts potential clients. This differentiation has also helped the market giants to tie-up with various hospitality segments, such as hotels and airlines, and gain substantial endorsements. This further strengthens the share of the key players in the market. Furthermore, the lack of expertise is a major barrier for new entrants into this market. Therefore, the threat of new entrants to enter the online travel market is likely to remain moderate.
1.1.2 Bargaining Power of Suppliers
The suppliers for travel agencies are primarily hotels, airlines, and bus operators, among others among others. Major companies like Expedia, Airbnb, and Thomas Cook have significant power in price negotiation with suppliers. The companies own some of the hotels and aircraft, which further lowers the cost of operation. This strategy provides the key players with higher bargaining power. However, stringent government regulations are a limiting factor for the travel industry. Therefore, the bargaining power of suppliers in the online travel industry is projected to remain moderate.
1.1.3 Threat of Substitutes
In the travel industry, the threat of substitute products is minimal due to the unavailability of substitutes in the market. As the substitutes in the travel market are scarce, the buyers’ propensity towards substitutes is significantly low. Therefore, the threat of a substitute entering the online travel market is expected to remain low.
1.1.4 Bargaining Power of Buyers
The bargaining power of buyers remains high owing to the greater concentration of buyers in the market and a low switching cost for the fragmented buyer set. Also, low brand loyalty by the consumers towards a specific brand remains low owing to the availability of numerous options to choose from. Price sensitivity plays a crucial role in the bargaining power of the consumers, therefore the bargaining power of buyers in the online travel market is expected to remain high. For companies in the market, demanding customers to pay higher prices, they have to create unique ideas for their tour packages to enhance customer satisfaction.
1.1.5 Intensity of Rivalry
The travel industry remains highly competitive, which is a result of the huge number of entrants in the market and due to the increased spending on advertisements to attract a large customer base. Moreover, the high level of competition among the players in the travel industry has led to higher intensity of competition among the rivals. Therefore, the rivalry among the companies in the online travel market is expected to remain significantly high.
Market estimates by geography (2023)
InsightNorth America leads with $356.92M by 2023, while Asia Pacific is projected to grow fastest at a 14.9% CAGR.
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View Subscription Plans| REGION | 2017 | 2017 | 2023 | CAGR | SHARE |
|---|---|---|---|---|---|
| North America | $192.46M | $240.21M | $356.92M | 10.8% | 31% |
| Europe | $178.72M | $223.43M | $334.76M | 11.0% | 30% |
| Asia Pacific | $148.27M | $205.45M | $341.17M | 14.9% | 30% |
| Rest of the World | $50.81M | $65.66M | $101.70M | 12.3% | 9% |
| Total | $570.26M | $734.75M | $1.13B | 12.1% | 100% |
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View Subscription PlansTotal Market Size
$2.88B
| APPLICATION | REVENUE ($B) | GROWTH RATE | MARKET PENETRATION |
|---|---|---|---|
| Direct Travel Facilitator | $2.24B | 12.1% | 46% |
| Online Travel Agency | $646.50M | 12.1% | 85% |
* Revenue projections based on 2025 estimates. Growth rates represent CAGR 2024–2030. Market penetration indicates current adoption rate within addressable market segments.
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Analytical insights on Online Travel Market covering market dynamics, competitive landscape, and strategic outlook.
The Online Travel Market market is projected to reach $1.13B by 2023, growing at 12.1% CAGR. The Direct Travel Facilitator segment holds the largest share.
The global online travel industry has undergone a sea of change over the last decade, owing to technology advances. Use of technology in the travel industry has come a long way since the global distribution system (GDS) due to the use of mobile applications and rising penetration of internet. This has helped in changing the process of travel bookings, making it easy and swift. The service model of online tour agencies provides multiple services through a single platform. With this, the process for travel booking has experienced a significant shift from physical to web bookings, and now mobile platforms. Online tour agencies have integrated all modes of transport and accommodation options under a single platform which has encouraged users to opt the same. The gradual move from manual ticketing and website-based bookings to the current use of the more convenient smartphones coupled with private and government efforts to promote digitalization has translated to higher footfalls in domestic tourist visits (DTVs) and foreign tourist arrivals (FTAs). From a customer point of view, the choice of selecting the best travel packages from multiple inventories, the ease of bookings and options for seamless online transactions have made traveling more convenient and faster. Additionally, service providers and tour operators have adopted digitalization and automation to develop greater productivity and offer customers unique travel experience.
With a large customer base relying on the online platforms for travel bookings, the online tour agencies can enhance their marketing operations by better understanding consumer behavior. Use of big data analytics helps to keep track of consumer patterns and is expected to be a major turnaround in the digitalization of the travel industry. Big data helps service providers and online tour agencies to implement and customize their offerings according to the needs of the customer. Many service providers are leveraging this technology to provide personalized information to the users directly. The analytical exploration of the data is expected to help hotels and airlines to go beyond their traditional loyalty programs and focus on a more granular understanding of customer behavior, needs, and expectations. Big data analytics helps in retrieving information about the customer buying patterns, grievances and feedbacks to understand the users’ buying preferences and identifying areas to capitalize on by providing a customized experience and cross-selling additional services. The travel industry should, therefore, explore the full potential of big data analytics and implement it in every aspect of travel rather than just booking. Thus, big data creates a good share of opportunities in the online travel market, making the overall process more responsive and focused on the traveler’s preferences.
The integration of data related to the travel industry with the government bodies is currently limited to only sharing and identifying data of domestic tourist visits and foreign tourist arrivals. However, the absence of data from private players such as online tour agencies, airlines, hotels, and travel aggregators is still a common issue with regards to data integration between the government and private entities. Only very few publicly listed companies in the travel industry are under the obligation of providing some insightful data in their annual reports and investor presentations. Presently, there is no centralized portal to facilitate seamless data integration between government and non-government entities which is further hampering operations in the travel industry. Due to such pitfalls related to infrastructure limitations and incompatibility of expensive software integration tools operations such as collecting, managing, and using data generated through digital sources becomes difficult. This in turn negatively impacts the growth of the online travel industry and acts as a major restraining factor.
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Profiles of 111 companies operating in the Online Travel Market market, including revenue, employee count, and market positioning where available.
Showing 111 of 111 companies
eDreams ODIGEO SA
Company Headquarters: Luxembourg Founded: 2000 Workforce: ~ 1,549 Company Working: This global online travel company offers various deals on regular hotels, cruises, flights, low-cost airlines, charters, car rentals, dynamic packages, holiday packages, and travel insurance to its consumers. The company has partnered with the best aggregators and suppliers to offer its customers with the best products and prices. It operates in 33 countries providing around 155,000 flight-routes from more than 600 airlines and about 1,700,000 hotels in 40,000 destinations to its clients. It offers its services through its subsidiary brands, namely eDreams, GoVoyages, Travellink, Opodo, and Liligo. The company also offers a wide portfolio of deals flights, hotels, and tailored holiday packages using its search and booking technology.
Airbnb Inc.
Company Headquarters: US Founded: 2008 Workforce: ~3,100 Company Working: Airbnb Inc. engages in an online marketplace and hospitality service, enabling people to lease or rent short-term accommodations. The company operates through the Airbnb app which enables its users to list, discover, and book accommodations across the world. Through the company’s platform, the residents and commercial property owners can rent private rooms, entire apartments, boutique hotels, castles, tree houses, and other accommodations. Furthermore, the platform allows travelers to search for accommodations by location, price, and room type, in more than 65,000 cities and 191 countries.
Alibaba Group Holding Limited
Company Headquarters: China Founded: 1999 Workforce: ~101,550 Company Working: Alibaba Group Holding Limited engages in online and mobile commerce business through its wide range of products, services, and technology. The company enables merchants, brands and other businesses to transform the way they operate, market, and sell their products and services in China and other countries. It provides the fundamental technology infrastructure and marketing reach, thereby enabling businesses to utilize the Internet to establish an online presence and conduct commerce millions of consumers and other businesses. The company primarily operates through core commerce, cloud computing, mobile media and entertainment, and other innovation initiatives business segments. The core commerce business segment comprises marketplaces operating retail commerce and wholesale commerce in China; and international and cross-border commerce. The cloud segment offers a complete suite of cloud services such as storage and content delivery network (CDN), elastic computing, database, security and management, large-scale computing, and application services. The mobile media and entertainment segment comprise three distribution platforms, namely UCWeb mobile media, game publishing and multi-screen entertainment, content creation, and production companies in film, and music and sports
MakeMyTrip (India) Pvt. Ltd
Company Headquarters: India Founded: 2000 Workforce: ~3,000 Company Working: MakeMyTrip (India) Pvt. Ltd operates as an online travel company in India. The company engages in the ownership and operation of online brands, including MakeMyTrip, Goibibo, and redBus. It operates through two segments, namely air ticketing and hotels and packages. The air ticketing segment operates through Internet-based platforms that provide the facility to book international and domestic air tickets. The hotels and packages segment offer holiday packages and hotel reservations through Internet-based platforms, call-centers, and branch offices. The company offers various travel products and services, such as domestic bus and rail tickets, hotel bookings international and domestic air tickets, conferences and exhibitions, private car and taxi rentals services, and business to business and affiliate services. It provides access to hotels in India and internationally, airlines operating to and from India, Indian Railways, and Indian bus operators. The company has offices in India, New York, Sydney, San Francisco, California, and Australia.
Thomas Cook Group PLC
Company Headquarters: UK Founded: 2007 Workforce: ~21,000 Company Working: Thomas Cook Group PLC specializes in travel services in the UK, Continental Europe, and Northern Europe. The company operates through two main segments, namely, tour operator and airline segments. It owns, manages and franchises 270 hotels primarily under the Casa Cook, Cook’s Club, and Sunwing brands. Additionally, the company has a fleet of over 90 aircraft under the Thomas Cook airlines and condor brands.
Ryanair DAC
Company Headquarters: Ireland Founded: 1996 Workforce: ~ Company Working: Ryanair DAC operates an ultra-low cost, scheduled-passenger airline serving short-haul, point-to-point routes between Ireland, the UK, Continental Europe, and Morocco. The company provides low-fare airline-related services, scheduled services, ancillary services, car hire services, and other related services to third parties and across a European route network. Ryanair DAC provides its own aircraft and passenger handling and ticketing services at the Dublin Airport.
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Online Travel Market