According to the Travel Demographics Report Series, published by Strategy Analytics, travellers under the age of 35 appear to be less loyal to specific travel providers than older age groups, which, according to the study, shun OTAs in favour of direct bookings.
Most of those polled under the age of 25 appear not to be involved in the travel booking process, with overall low scores. But they still registered a higher preference for OTAs than specific apps. Encouragingly for the industry, those aged 26 to 35 scored higher in terms of travel app use, but much of this use is focused on local travel apps or OTAs. And according to Strategy Analytics, this scenario poses “a big challenge” for hotels and airlines.
“As new technology such as Apple Pay makes booking travel on mobile devices easier, new threats to established players emerge,” said Joshua Martin, Travel Analytics’ research service director. “If younger travellers become loyal to their OTA in lieu of an airline or hotel it makes securing regular and repeat customers difficult.”
And the big question, according to Strategy Analytics, is whether the Gen Y age group’s reliance on OTAs is a result of the stage in their life, or indicative of a broader market transition. If the latter, airlines and hotels will be “hard pressed to pay off the investments they are making to woo millennials”, the company said.
“While hotels and airlines are performing well with those 36+, as a new generation comes of age the companies must keep innovating to remain unique. The continued focus on new technology and features are an important first step to achieving this goal,” Martin added.
Barry Gilbert, Strategy Analytics’ vice president of new ventures commented; “Mobile devices are becoming increasingly relied upon for activities once restricted to the PC. I expect travel to be greatly impacted by this trend and the data in these reports demonstrate that airlines and hotels need to re-evaluate their mobile strategies.”