Industry Stats: 20% of all hotel bookings will be done online

Forrester Research found that 69% of US leisure travelers prefer to buy online directly from a supplier, while just 27% prefer to buy from intermediaries.

This year over 13% of all revenues in hospitality will be generated from the Internet (PhoCusWright). Three years from now, the Internet will contribute over 20% of all hotel bookings. 53% of all Internet bookings in hospitality will be direct to consumer.

By 2005, over 30% of all travel bookings will be completed on the Internet. 20% of all hotel bookings will be done online.

Starkov, Max and Jason Price. Online Travelers Prefer Booking Directly on the Hotel Website. WiredHotelier.com 22 April 2003. Retrieved April 8, 2004 from www.wiredhotelier.com/news/4015607.html.

Online hotel bookings reached $6.2 billion (US) in 2002, according to PhoCus Wright research. They predict that online bookings will account for 20% of all hotel business by 2005.

Weinstein, Jeff. Take Back the Internet. Hotels March 2003. Retrieved April 8, 2004 from <http://www.hotelsmag.com/0303/0303eds.html>

Analysts at Jupiter Media Metrix predict online bookings will more than double between 2001 and 2007 from 7% (US$5 billion) to 16% (US$15 billion).

Oliva, Rebecca. Here To Stay. Hotels June 2002. Retrieved April 8, 2004 from <http://www.hotelsmag.com/0602/0602tech.html>

By 2005 over 30% of all travel bookings will be completed on the Internet. 20% of all hotel bookings will be done online.

Starkov, Max and Jason Price. Online Travelers Prefer Booking Directly on the Hotel Website.

Comments

  1. This article was referenced from April 2003 – it was predicting 2005 numbers. Now that 2005 is drawing to a clear, I will keep my eye out on this to see how close it was to the truth.

  2. Why wouldn’t you want to buy online? It saves money and it’s fast and easy. Not only that, you don’t have to call around to find a good hotel. There are reviews you can view, pictures, etc. It’s a no-brainer.

  3. Cigars,

    Many consumers want to call. sometimes they are just more comfortable. Often they have some questions around their purchase! Sometimes they call to haggle a lower price. Having a world-class call-center / phone reservationist makes a big difference in the conversion rates of web visitors… heck, just answering your phone increases the revenue your website drives if you are a lodging property. We tracked a boutique hotel a while back and tracked and recorded every phonecall from their website. The average phone call generated $60 in revenue.

    Another reason many people call is a bad reason: the hotels website is poor (it frustrates them or doesn’t answer their questions) or the booking engine itself is clunky, which is a common problem

  4. Although I think most would agree that the research is best done online, where you can find rates, descriptions, pictures, and reviews, I do agree that many people choose to call to make the actual reservation. They kind of instinctively assess the quality of the establishment by how the customer service representatives talk to them and make them feel. They can also ask questions and clarify certain details. In general it just puts a more personal face to the hotel. What people really want in a hotel is a personal, comfortable-like-home feel. So while online booking might be a bit quicker, a phone conversation may actually have a lot of value to a customer.

  5. The percentage is still about the same nowadays I think – About 20% of the hotel bookings are being made online. Maybe slightly higher. I do not think it will grow much more. As mentioned in the previous post – still many people prefer making the actual booking by phone call which is kind of normal.