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Online travel agencies: a key player in reviving European tourism post-COVID-19 Online travel agencies: a key player in reviving European tourism post-COVID-19

When COVID-19 hit, and global lockdowns brought the world to a halt in early 2020, the travel and tourism industry found itself among the worst affected. Yet, despite severe restrictions, online travel agencies (OTAs) continued to bring international guests to European hotels, supporting jobs and boosting GDP. So, what’s the state of play for OTAs today, and have the economic benefits they generate withstood the test of a global pandemic?

Oxford Economics’ 2019 study found that online travel platforms contributed an additional 134 million room nights, supported 566,000 jobs, and provided a €10 reduction in the average daily hotel rate in Europe’s lively ecosystem of hotels, holiday rentals, and guesthouses, which had the added benefit of saving EU travellers more than €20 billion. Fast forward to 2022. How did the above trends play out in the last two years?

International arrivals to Europe have yet to fully recover to the pre-pandemic levels, reaching 81% of its 2019 figure. But despite restrictions and some lingering hesitation among tourists, online travel platforms continued to increase trust and embolden travel decisions.

In the two years leading up to 2022 — at the height of the pandemic — online travel platforms:

  • helped holidaymakers save €8 on average per night;
  • delivered nearly 100 million additional nights to the European hotel market (52.9M in 2020 and 46.7M in 2021);
  • supported 238,000 jobs on the continent in 2020, and 243,00 in 2021;
  • and brought €24.7 billion worth of additional GDP (€12.9B in 2020 and €11.8B in 2021);

according to Oxford Economics study into the economic impact of online travel agencies in Europe between 2019 and 2021.

During the last two years, incremental bookings — which are generated thanks to OTAs — went predominantly to independent small- to midsize hotels. What’s more, when Europe’s overall travel market is considered, sales are almost evenly split between branded chains and independent establishments — but when it comes to online travel platforms, the ratio shifts to 2 to 1 in favour of independent hoteliers in 2021.

Urbanisation vs rustication

Online travel platforms also help to bridge the gap between rural and urban bookings. In Europe — where 75% of the population lives in urban areas — it’s unsurprising that 84% of travel accommodation sales were in cities and towns in 2019. However, the rural-urban split on OTAs tells a different story, as online travel platforms more than doubled the amount of sales in rural areas when compared to the market average of 16%. By offering consumers more choice, OTAs help to spread out tourism away from population centres, and direct touristic — and subsequently economic — activity towards destinations off the beaten path, resulting in localised growth and job creation.

Source: hospitalitynet