Travel markets in the US have shown a marked improvement this year and are set to recover all the ground lost during the recession which began back in 2007, yet we shouldn’t get too excited as this growth is about to hit a brick wall, reports Travel Weekly.
According to the report, so strong is the US travel market’s recovery that this year could see it surpass the level it reached pre-recession in 2006, with a high of $277 billion being projected by PhoCusWright, the travel industry research authority.
PhoCusWright published their findings in the 11th edition of their U.S Online Travel Overview, but pointed out that while this year was a success largely due to the continuing rebound in corporate travel, the outlook for the future remains uncertain.
The research company revealed its predictions during its recent annual conference, where senior director of research Douglas Quinby warned those in the US travel industry not to become complacent about this year’s success:
“Do not let travel’s impressive performance in 2011 mask some concerning underlying trends. The gains have largely been fueled by the corporate travel rebound and tight airline capacity. The leisure environment overall is soft, and continued high unemployment and consumer pessimism over the state of the economy make for a challenging outlook for 2012.”
PhoCusWright also predicted that growth in US online travel markets would slow down significantly in the next couple of years. While the online sector has seen growth of around 10% in the online leisure/unmanaged business sector, reaching $109 billion for 2011, this is not expected to continue. In a kind of corroborative, talks of sustainability from Fiona Jeffery at the WTM, reflect a great need for understanding and dealing with the fluctuating industry trends here.
The firm says that the US travel industry is maturing, and while online markets in the US currently total 39% of all travel bookings made in the country, this percentage is only projected to increase by 1% over the next year:
“After years of unabated growth, online sales are practically in sidestep with the total market, growing only slightly faster on the strength of continued shift from offline to online channels.”
In other words, the internet already has its share of the pie, and it’s not likely to increase any time soon. Other discussions going on; rate parity, Tom Magnuson‘s “new free market” discussions, and sagging OTA credibility, not to mention the EU’s woes, represent potential and obstacles we will all have to address before growth is possible.