E-Commerce and the Travel Industry

The travel industry has benefited hugely through the growth surge in E-Commerce. The travel industry and the Internet has now become a very prosperous pair. According to the global market research firm IDC, online Airline ticket sales, hotel reservations and car rentals make the travel industry are one of the strongest E-Commerce markets in existence today.

According to the senior research analyst of IDC’s e Travel program, Joshua Friedman, the ease of substituting one provider for another and the non-existence of any physical need for fulfilment has made the travel industry ideal for E-Commerce.

The airline industry represents the largest segment of the e travel industry. According to IDC estimates last year in U.S. alone the airline industry made a massive $7 billion, through online ticket sales and is expected to climb further in the next few years. Cashing in also through their e commerce channels, is the hotel industry with earnings over $2 billion in the year 2000. The online car rentals will pass the billion-dollar mark this year.

The biggest factor in stimulating online travel sales through E-Commerce will be websites designed to meet consumer needs. The travel industry should closely monitor consumer online booking habits and their search behaviour through market research and change their websites accordingly.

Strong sales in one segment will have a trickle down effect on the other segments as well. Strong sales in the airline industry will lead to higher hotel reservations as well as increased car rentals since all three industries are interconnected servicing each other.