Similarweb Travel Report: Strong Rebound for Online Bookings

Similarweb has just released our annual Travel Industry Insight Report, based on trends taking place across the travel industry as seen through Similarweb’s web metrics estimates. As COVID-19 fears subside, the travel bug is spreading. Our report correlates what’s happening in the online world with the real-world travel landscape. We look at key benchmarks prior to COVID-19 and up through the present to make predictions based on where we see the industry is heading.  Airlines, OTA’s, and Hotels are all showing strong gains in online visits, and are almost back to pre-pandemic levels.
Following are key takeaways from the report.

Key Takeaways

• Estimates show a 181% increase in mobile and desktop website traffic from the pandemic-related low point in April 2020 to February 2022, surpassing levels prior to the start of COVID-19
• Online Travel Agents (OTAs) are seeing a sharp rise in traffic and engagement. From the trough in April 2020 of 30.6 mil. visits, OTAs have seen a 327% increase in traffic to 130.7 million, but this level still lags pre-pandemic highs
• Low-cost carriers are growing faster than the rest of the airline industry, both in the U.S. and Europe
• The accommodation sector is rebounding, with particular strength at vacation rental websites, especially airbnb.com
• With some markets still closed or having more stringent requirements related to coronavirus, there has been an uptick in destination travel, including local entertainment and regional locations

Airline Demand Climbing

Traffic to airline websites, generally speaking, is a good proxy for demand and overall interest in air travel, as it’s often booked far in advance. Similarweb estimates highlight how uneven the rate of recovery has been in the industry. The chart below shows the overall ebbs and flows of website traffic to 10 of the largest global airlines from January 2020 through March 2022. Initially, there was a massive drop in website traffic as COVID-19 hit in March and April 2020, followed by a slow bounce along the bottom as quarantines took hold and destinations closed. Traffic began to recover in early 2021 and peaked that summer.  However, the rise of coronavirus variants delta and omicron again led to drops in travel demand. The start of  2022 has seen broad increases in web traffic across most of the global airline industry.

Within the U.S., actual passenger traffic has followed the trend of web traffic. Most recently, for the week of March 21-27 2022, overall U.S. airline passenger volumes were 10% below 2019 levels with volumes on domestic flights down 9% and passenger volumes on international flights down 20%, according to Airlines for America (A4A, the U.S. airline industry trade association and lobbying group). At the same time, departures were down 16%, with domestic flights down 16% and international flights sliding 20%.

The below chart shows mobile web and desktop traffic to the top 100 air travel websites from March 2020 through March 2022 and highlights the drop in traffic at the start of the pandemic and the gradual recovery over time since.

Low-Cost Carriers Grow Market Share

2021 saw ongoing pandemic-driven disruptions in the airline industry, as recovery moved at a maddeningly slow pace despite the deployment of vaccines (which started to be widely distributed in March and April of that year.) Among the many changes that grew more acute over the course of the year was the growth in traveler preference for low-cost airlines at the expense of the traditionally dominant “full-service” airlines. Part of the reason for this shift was the continued growth in demand for VFR (visiting friends and relatives) traffic, as well as the fact that passengers were flying to the few destinations that were actually open. These trends played right into the strengths of low-cost carriers, such as Southwest Airlines, Spirit Airlines, and Frontier Airlines, who have carved out a space for themselves by offering “no-frills” service to budget-conscious travelers.

Converting Online Visitors Into Customers

While Southwest has been the leader in web traffic over the past two years, American Airlines has maintained a solid lead in average monthly visitors and conversion rate. A look at search traffic for leading U.S. airlines from 2019 through March 2022 shows that traffic has been rising. Rising search traffic has come despite higher inflation squeezing customers’ wallets and the uncertain geopolitical situation in Ukraine.

What’s clear from Similarweb’s conversion and website traffic estimates is that American Airlines is emerging as a clear leader in both of these metrics. The table below shows the conversion rate for the average of January 2021 to March 2022.

Digital Travel Agents Still Popular

Following a sharp decline in the early days of the pandemic (March-April 2020), and a long slow recovery, visits to online travel agency (OTA) websites have risen sharply. A look at the chart below shows that visits to the leading OTAs saw a huge plunge in March 2020, a slow recovery after, and a spike in summer 2021. Of the group, Expedia remains the largest in terms of website traffic. Still, the recent turmoil in Europe could pressure Booking more than Expedia, given its broader penetration in the area. As of March 8, 2022, Booking’s Eastern European exposure sits at high-single digits. Despite this, Booking’s web traffic worldwide is trending positively, as seen below.

Overall, monthly visits for OTAs are nearing pre-pandemic levels. The chart below shows leading OTAs excluding booking.com (which is so large it skews the chart). The data clearly shows traffic trending strongly in the right direction during the first three months of 2022.

Similarweb’s referral traffic highlights that OTAs get most of their visits from direct and organic searches, indicating high brand awareness. However, paid search does play a major part. Over the past nine months, expedia.com got 20.9% of its website traffic through paid search, the most among the peer group, followed by kayak.com at 14.0%. These sites are paying the most to drive traffic to their sites; this could weigh on their customer-acquisition costs.

Who Made It to the Winner’s Box?

The travel industry has suffered greatly from the pandemic, inflation, and war in Ukraine. But, there were certainly companies whose business models were more optimized for the tsunami of change that has swept across the industry. The Similarweb Travel Industry Insight Report declares a winner in the space. But to learn who it is, you’ll first have to download our free report.

Please note, that this blog post is based on Similarweb’s 2022 Travel Industry Insights Report, researched and written by: Jim Corridore, Seema Shah, and Alisha Kapur.

Download the Report

For more detail, download the full report. The Similarweb Insights Newsroom is available to pull additional or updated data on request for the news media (journalists are invited to write to press@similarweb.com). Please link back to this post as a reference for readers.

by Similarweb