Into the future with metasearch, ‘a global phenomenon’

With metasearch now an established presence in Western Europe and North America, the biggest opportunities will be in charting new geographic frontiers, most notably in Asia-Pacific where growth rates are soaring

All major players in the travel metasearch space reported double-digit growth in 2014, which is an indication that yet more disruption – and a whole lot more global competition - can be expected in the coming years. To date, the US and Western Europe have led the way in metasearch, where information-savvy consumers with a growing desire for price transparency, freedom of choice and the best deal have driven growth over the last five years.

According to EyeforTravel’s The Future of Metasearch 2015 report 57.4% of US respondents use price comparison sites to research travel as compared to 34.25% in India. This is indicative of the untapped potential that is going to be increasingly important as online penetration rises and people in APAC travel further afield.

To put some numbers behind it, Tripadvisor has seen revenue from the APAC region rising 28% in 2014 but it is still only 13% of total revenue. Skyscanner says that over 2014 there was a 61% increase in unique monthly visitors from China, as well as a 162% increase in mobile visitors.

However, the Chinese market has a dominant regional player in Qunar, where sales rose 106% year-on-year in 2014 and mobile revenues were up 435%. Chinese giants Alibaba and Ctrip are also looking at metasearch with increasing interest.

In APAC, China’s lanterns may be burning brightest but EyeforTravel warns that outbound growth forecasts may be some way short of the 200m outbound journeys some are predicting by 2020.

“Expectations might need to be tempered somewhat but it’s still the case that China will be the global engine of growth for outbound tourism in the next decade, short of drastic shifts in India,” says EyeforTravel Head of Research Alex Hadwick, who commissioned and edited this report.

Gupta, one of the several interviewees in this 28-page report, also recognises that metasearch is a global phenomenon rather than one skewed to any particular market. Skyscanner is witnessing “significant growth in Asia and America”. 

For Kayak’s Loella Pehrsson, Regional Managing Director, UK, Ireland and Nordics, another interviewee, it has “huge growth potential…especially in emerging markets”. For example TripAdvisor’s revenue from Latin America grew 47%in 2014 (to USD 56 million).

Another driver behind the success of metasearch are hotels, which are increasingly fed up with being fleeced by high commissions and price parity agreements with the OTAs. These have helped to drive ups costs of distribution and erode profit margins and customer loyalty. Hotels also want to more drive direct bookings, which Nikhil Gupta Skyscanner Director of Hotels and Car Hire, says is the route their research shows most consumers prefer to take if it is available.

A global phenomenon it might be but the competition is intensifying and all players in online travel need to strategise for the metasearch age.  For example, one big concern for hotels, particularly in emerging markets, is the practice of tour operators publishing rates on metasearch sites that are undercutting the entire market. Another, says Romain Roulleau, Executive Vice-President of e-Commerce at the Accor Group, is the danger that with such a wide range of hotel choices, brands can become diluted on metasearch.

The Future of Metasearch 2015 report is the culmination of interviews with leading figures from all key verticals, market reviews, analysis, and projections. It contains consumer insight, technology analysis and real world advice to boost conversion,streamline the booking process, and get pricing right. Insights came from a variety of travel brands including Vueling Airlines, Skyscanner, KAYAK, Accor and Triptease. You can access the report here: http://www.eyefortravel.com/distribution-strategies/future-metasearch

For more research go to www.eyefortravel.com/reports or contact Alex Hadwick.

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