With a 3% increase in gross bookings in 2016, Germany’s travel market maintains its position as one of Europe’s largest. The country is a favorite destination for inbound travellers, and although both domestic and outbound travel have been impacted by economic uncertainty and the threat of terrorism, Germans are traveling in record numbers to destinations such as Greece, Spain and others.
Overall, most Germans remain confident about their economic status, thanks to low unemployment and moderate GDP growth. For brands active in Germany’s vibrant travel landscape, here are three trends shaping the market: SUPPLIERS LEAD ONLINE, AND CONTINUE TO GAIN Suppliers controlled 59% of the online travel market in 2016, compared to just 41% for online travel agencies (OTAs). OTAs will lose share to travel providers in the coming years, due to aggressive efforts by suppliers in all segments to drive direct online bookings, as well as pricing policy regulations in the hotel market that favor suppliers. By 2020, OTAs’ share of the online market will fall to 38%.
MOBILE A KEY DRIVER OF ONLINE BOOKINGS
Mobile has become a vital travel-planning tool for Germany’s smartphone users. Half of all trip research is conducted via smartphone, and the leap to mobile transactions will occur quickly as travel suppliers and OTAs develop more sophisticated apps and mobile-optimized websites, and as consumers embrace emerging mobile payment technologies. Mobile travel revenue totaled more than €5 billion in 2016 and will double by 2020.
WHILE NOT SOARING, AIR SEGMENT SHOWS STEADY GAINS
Despite an increase in European terrorist attacks and a strike by German flight controllers, gross bookings for Germany’s airlines climbed nearly 3% in 2016, and the segment will experience similar growth through 2020. Lufthansa, the country’s largest airline, continues to reinvent itself to counter stiff competition from European lowcost carriers (e.g., Ryanair and easyJet) on short-haul travel, as well as Middle Eastern carriers ( i . e . , Emirates , Qatar Airlines and Etihad) on longand medium-haul routes. And for a deeper dive into Germany’s dynamic online travel market, check out Phocuswright’s German Online Travel Overview Twelfth Edition at www. phocuswright.com. The report also includes trends and sizing through 2020 for the broader European travel market