GCC online travel market expected to reach $15bn by 2023: Report
The online travel market in the GCC countries is expected to reach US$15bn by 2023, according to MENA Research Partners, a leading research company in the Middle East.
The GCC online travel market is projected to grow by 20 per cent annually during the period 2019-2023. The online travel market growth rate is well above the conventional travel market, which is progressing at four per cent per year, according to the report released by MENA Research Partners.
It said, compared to global figures the online travel market in the region remains untapped. Presently, the online travel sector only accounts for five per cent of the total GCC travel market compared to the global average of 12 per cent. Potentially, this could mean a boom in the online travel industry which may log in 2.5 times growth.
Anthony Hobeika, chief executive officer at MENA Research Partners said, “Demographic changes and changes in consumer preferences are largely shaping the upsurge of the e-travel market. The growth in the e-travel sector is expected to come from the larger number of young and tech savvy travellers who embrace the digital ecosystem to plan and book their journeys. These travellers have high expectations, demand personalised offers and do extensive online research before purchasing. Our estimates show millennials at 20mn, accounting for a massive 40 per cent of the GCC population, which further indicates a growth in expected demand by this segment.”
The advanced digital infrastructure in the region is another driver for growth and a key catalyst as the region embarks on long-term advancement from its current low e-travel activity base. The Internet connectivity rates in the GCC have crossed 90 per cent in countries like UAE and Bahrain, while rapidly expanding in other demographic heavyweights like Saudi Arabia.
Along with high connectivity, smartphone penetration in the GCC stands at more than 75 per cent, a number which is among the highest in the world. Smartphones are the most popular devices for researching travel offers and online information, and the mobile travel market is expected to further expand the digital travel space in the GCC.
As a result of the digital infrastructure, the travel industry is undergoing massive changes, and the consumer appetite has changed from offline to online booking.
According to the report, the online travel market is expected to become a key component of the overall tourism ecosystem in the GCC due to the shift in the digital landscape. Travel brands are seizing new digital opportunities to engage with their consumers and the rapidly growing young segment of the GCC population.