How to maintain success in the online travel space

Despite the impact of recent shocks, Europe's travel sector is continuing to expand and experiencing steadily growing consumer demand, albeit at a relatively modest annual rate of around 2 per cent to 3 per cent. However, a major shift is now under way in how consumers book their travel. As a result, much of the growth in Europe's travel market is concentrated in the online arena, where the accessibility of the internet - combined with increasing consumer confidence in the online channel - has driven activity and revenues upwards.

As the online travel industry evolves and matures, a number of parallel changes are taking place. This ongoing evolution is significant in scale - and is impacting all areas of the travel market: consumers, suppliers and the operators themselves. In combination, the various shifts now under way mean that the strategies adopted by online travel agencies when initially 'creating' the market may no longer be appropriate.

Not only are online agencies seeing the balance of power move away from them as both consumers and suppliers become more powerful, but they are also facing increasingly intense competitive environment within their marketplace. All of this means that online travel companies will face several emerging challenges - and will have to continue to adapt their offer to the changing consumer and marketplace if they are to remain successful. In this paper, we describe the major shifts we have seen - and continue to see - in the online space, and examine the strategies that successful companies are adopting in order to remain competitive and profitable.

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