Travel Spending on the Web As the largest category of consumer spending on the Web, online travel is clearly an Internet success story. Consumers spent $9.1 billion on travel in the
first quarter of 2003, representing growth of 31 percent versus Q1 2002. This growth rate significantly outpaced non-travel spending, which increased 17 percent versus Q1 2002 to $11.8 billion.
Looking to recover revenue lost due to reduced airline commissions, many online travel agencies have focused on hotels and package sales, which often carry much higher profit margins. By combining a
number of travel components (such as airfare and a hotel room), online agencies can deliver an attractive package price to consumers without revealing the price of any specific component of the trip -
thus protecting each suppliers' pricing integrity. Although Packages and All Other Travel is the smallest online travel sub-category, it grew by an impressive 97 percent versus year-ago.
Online Travel Spending by Sub-Category Q1 2003 Excluding Auctions and Large Corporate Purchases
| Consumer Share of Online Travel Spending | % Change Spending vs. Year-Ago |
| Online Travel | $9,116 | 100% | 31% |
| Airline | $6,127
| 67% | 28% |
| Hotel | $1,613 | 18% | 26% |
| Car Rental | $940 | 10% | 32% |
| Packages
and All Other Travel* | $435 | 5% | 97% |
*Includes package sales, cruise bookings, bus, rail
and other
Source: comScore
Subsidiaries of InterActiveCorp (previously known as USA Interactive), are among the most successful travel agencies at selling hotels on the Internet. Expedia
- the largest online travel agency - has been the leader in selling travel packages online.
Travel Category Unique Visitors (000) May 2003 U.S. Home, Work and University Users
| All Locations | Home | Work | University |
| Total Internet Users | 145,576 | 125,607 | 48,585 | 10,312 |
| Travel Category | 68,802 | 50,159 | 26,501 | 4,255 |
| MAPQUEST.COM | 28,547 | 18,611 | 10,941 | 1,819 |
| Expedia Travel | 16,471 | 10,254 | 6,824 | 804 |
| ORBITZ.COM | 13,140 | 8,010
| 5,582 | 688 |
| Travelocity | 13,117 | 8,075 | 5,724 | 631 |
| Trip Network Inc. | 12,821 | 7,563 | 5,086 | 707 |
| AOL Proprietary Travel | 7,203 | 5,138 | 1,895 | 321 |
| HOTWIRE.COM | 6,757 | 3,688 | 2,841 | 357 |
| SOUTHWEST.COM | 6,492 | 4,049 | 2,521 | 321 |
| PRICELINE.COM | 5,910 | 3,628 | 2,290 | 323 |
| Hotels.com Sites | 5,360 | 3,238 | 2,208 | 230 |
Source: comScore Media Metrix
With the summer travel season heating up, the Hotels/Resorts category grew by 15
percent from April to May. Nearly 5.4 million people visited Hotels.com in May, more than twice as many visitors as the second ranked site in the Hotels/Resorts category.
Hotel/Resorts
Sub-Category Unique Visitors (000) U.S. Home, Work and University Users
| April 2003 | May 2003 | % Change |
| Total Internet
Users | 145,588 | 145,576 | 0% |
| Hotels/Resorts Sub-Category | 16,713 | 19,216 | 15% |
| Hotels.com Sites | 4,642 | 5,360 | 16% |
| Marriott | 2,020 | 2,661 | 32%
|
| Six Continents Hotels | 1,926 | 2,481 | 29% |
| Hilton
Hotels | 1,898 | 2,146 | 13% |
| LODGING.COM | 1,617 | 2,138 | 32% |
| CHOICEHOTELS.COM | 845 | 1,498 | 77%
|
| Worldres Sites | 1,022 | 1,290 | 26% |
| Starwood Sites | 1,014 | 1,244 | 23% |
| BestWestern Hotels | 796 | 1,056 | 33% |
| DAYSINN.COM | 556 | 847 | 52% |
Source: comScore Media Metrix
Travel is a price-sensitive and time-sensitive product for all parties. Unlike other product categories - such as apparel - travel does
not have to be touched or tried on before purchase. Lodging is arguably less of a commodity than air travel. Here the Web adds value to the shopping experience, with the availability of detailed
information, images, and virtual property tours. The Web puts fast, powerful comparison-shopping and buying tools in the hands of increasingly sophisticated consumers
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