How online travel agencies help disperse tourism and drive growth
At Booking.com, we believe travel is a force for good, which is why we wanted to help quantify the impact of online travel agencies on the global tourism industry.
In this three-part series, we unpack the biggest themes to come out of our research with Oxford Economics: “The Economic Impact of Online Travel Agencies,” which covered Europe, Asia Pacific, the US, and Canada.
In this second piece, we’ll look at how OTAs contribute to sustainable travel by (1) spreading tourism to rural areas and (2) boosting local economies.
When we think of sustainable travel, a few things like reusing towels and eliminating plastic bottles come to mind. But there’s a major part of sustainable travel that’s not often talked about – supporting local communities.
As we explored in the first piece of this series, OTAs increase overall travel by, among other things, offering consumers more choice. What the research also shows is how that increase in travel generates job creation and GDP growth. In addition, we see that by leveling the playing field among all properties—be it tourism hotspots or destinations off the beaten track—online travel platforms distribute visitors more equitably as opposed to the market overall.
Off the beaten path
In Europe, online platforms were helping travelers discover rural destinations even before the pandemic. In 2019, only a small fraction of European accommodation sales went to rural areas (16%). Yet, when we talk about the share of total sales via online travel platforms, the number more than doubles (38%).
These lesser-visited destinations were particularly popular in places like the UK (41% of OTA bookings), Germany (39% of OTA bookings), and Portugal (35% of OTA bookings).
While the pandemic had a negative impact on travel overall, rural tourism got a boost with online travel agencies helping connect consumers with less crowded destinations.
In Europe, for example, rural bookings in Denmark accounted for 34% of all OTA bookings in 2021, compared to just 6% of all bookings across the rest of the travel market.
In the United States, OTA activity in rural counties has grown faster than in urban ones. In 2012, 9.7% of OTA nights were in rural counties. By 2021, that number increased to 16%. Several states have seen big jumps in that time span, including Minnesota (10.9% in 2012 compared to 24.2% in 2021) and Nevada (6.2% in 2012 compared to 16.5% in 2021).
As the issue of overtourism gains more prominence in some destinations, these numbers highlight how the choice provided by online platforms spreads tourism away from urban centers and helps consumers discover rural destinations. As a result, those destinations get economic opportunities they wouldn’t have without OTAs.
This is great news for smaller property partners, including B&Bs and alternative accommodations, which also benefit from this distribution since they’re much more likely than larger chains to be located in rural areas.
By increasing overall travel, online platforms are also contributing to job and economic growth.
In Europe, OTAs added an incremental $36.7 billion to the GDP and 566,000 jobs in 2019.
Across the US and Canada that same year, OTAs generated an incremental $19.9 billion to the GDP and 187,000 jobs.
In Asia Pacific, OTAs were responsible for growing the economy by $15.5 billion and 975,000 jobs in 2019.
While growth was significantly smaller during the pandemic, online platforms were part of helping economies bounce back. OTAs continued to contribute to GDP and job growth across the regions in 2020 and 2021. In the US and Canada, for example, they were responsible for 113,000 jobs in 2021, showing signs of recovery relative to the 99,000 jobs they supported in 2020.
By offering more choice, OTAs advance the sustainable travel agenda by spreading tourism to rural destinations and supporting communities through economic growth and job opportunities across a variety of sectors. As the research shows, online platforms generate a large number of nights that wouldn’t be booked otherwise. Without OTAs, there would be fewer overnight stays, which means tourism would have less of an impact on GDP and job creation.
Coming up: In the final article of our three-part series, we’ll look at how OTAs help accommodation partners, particularly independent properties, reach a larger global audience.
- By offering more choice, OTAs help spread tourism to rural areas globally
- In 2019, only a small fraction of European accommodation sales went to rural areas (16%). When compared to the share of total sales via online platforms, the number more than doubles (38%)
- In the US, OTA activity in rural counties grew from 9.7% in 2012 to 16% in 2021
- Online travel agencies help boost economies across regions: In 2019, the total incremental GDP impact was $36.7 billion in Europe, $19.9 billion in the US and Canada, and $15.5 billion in Asia Pacific
- OTAs play a large role in creating jobs, including 975,000 jobs in Asia Pacific and 566,000 in Europe in 2019