The Shifting Landscape of Travel Bookings: Skift Research

Skift Take

Direct bookings surge as travelers prefer supplier websites over OTAs. This means OTAs will need to innovate to stay competitive.

Varsha Arora, Skift Research

The travel booking landscape is rapidly transforming, with direct bookings on the rise and reshaping the competition. What’s driving this shift? Skift Research explores these pivotal changes in our new report: “Direct Bookings vs. OTAs: Analyzing the Shift in U.S. Travel Booking Trends.”

Direct bookings are on the rise, driven by travelers’ preference for supplier websites over OTAs. This shift highlights the need for OTAs to adapt their strategies to stay competitive.

Travelers are increasingly using OTAs for research but opting to book directly. For instance, while 26% of travelers use OTAs to research flight options, a much larger share – 55% – ultimately books directly on airline websites. This 29 percentage point gap illustrates the “billboard effect,” where OTAs are crucial for initial comparisons but travelers seek perceived reliability, better deals, or additional benefits when booking directly with airlines. This underscores the need for OTAs to refine their value propositions to convert research into actual bookings.

While OTAs achieve Net Promoter Scores (NPS) that are on par with direct bookings and strong repeat usage, there is a notable gap in the effectiveness of their loyalty programs. Many travelers remain indifferent to OTA loyalty programs compared to those offered by hotels and airlines. This indicates that OTAs need to enhance their loyalty offerings to make them more appealing and engaging.

Key Takeaways:

• For OTAs: Focus on enhancing loyalty programs, optimizing pricing strategies, and addressing the “billboard effect” to convert research into bookings.
• For Suppliers: Strengthen online presence, offer exclusive deals, and create a compelling direct booking experience to attract and retain customers.

The report also identifies opportunities in promoting bundled services and catering to older travelers who prefer direct bookings. Aligning strategies with these insights will enable both OTAs and suppliers to meet evolving traveler expectations and drive growth.

Explore these insights and more in our full report. Download now to stay ahead in the evolving travel market.

What You’ll Learn From This Report

• The importance of balancing online and offline channels in travel marketing
• Variations in booking preferences across different travel sectors
• Reasons travelers are moving towards direct bookings instead of OTAs
• The “billboard effect,” where travelers use OTAs for research but book directly
• How OTAs can leverage a high Net Promoter Scores to foster long-term loyalty
• Opportunities for OTAs to offer bundled services and connected trips
• The significance of pricing in travelers’ booking decisions
• The role of social media in influencing travel bookings

This is the latest in a series of reports and data products that Skift
Research puts out to help you analyze the biggest trends in the travel
industry. Tap into the opinions and insights of our seasoned network of
staffers and contributors. More than 200 hours of desk research, data
collection, and/or analysis goes into each report.

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