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Travel agency industry - statistics & facts

Travel agencies are businesses that operate by selling tourism and travel-related services to the public on behalf of different travel suppliers. In addition to recreational tourist activities, they also provide accommodation and transportation services, as well as handling the logistics of booked trips, among other services. Travel agencies include both brick-and-mortar establishments and those based entirely online. The market size of the global online travel agency sector alone reached roughly 432 billion U.S. dollars in 2020. This number was expected to rise in 2021, as companies gradually recovered from the impact of the coronavirus (COVID-19) pandemic.

Leading travel agencies worldwide

Though brick-and-mortar travel agencies have been a cornerstone of the industry since its inception, in recent years the rise of the online travel market has transformed this sector, with many travel agencies emerging solely as online entities which are referred to as online travel agencies (OTAs). In this respect, OTAs such as Bookings Holdings and Expedia Group were among the leading online travel companies worldwide ranked by the market cap in 2021. While consumers can now book vacations with travel agencies and other travel companies completely online, they also have access to many travel websites that offer reviews of potential destinations. One such website is Tripadvisor, which was one of the most visited travel and tourism websites worldwide as of January 2022, ranking just behind Booking.com. Although the travel agency sector is currently largely web-based, other companies also rely on physical stores. This is the case of TUI AG, whose worldwide revenues reached almost 19 billion euros in 2019 before sharply declining in 2020 and going down further in 2021 due to the health crisis.

How did COVID-19 affect the travel agency industry?

During the COVID-19 pandemic, worldwide travel was severely limited as countries made efforts to reduce the spread of the virus by enacting travel restrictions. This had a significant impact on all aspects of the worldwide travel industry, including travel agencies. The market size of the U.S. travel agency sector alone dropped by roughly 16 billion U.S. dollars in 2020 following a period of steady growth. Even though it was forecast to increase by around 67 percent in 2021, it was predicted to stay below pre-pandemic levels. Overall, many of the leading travel agencies were hit hard by the impact of COVID-19 in 2020 but experienced a partial recovery in 2021, as travel demand gradually increased. For instance, the worldwide revenue of Booking Holdings fell by nearly 55 percent in 2020 over the previous year, then rose by four billion U.S. dollars in 2021. Expedia Group also experienced a similar trend, as Expedia’s worldwide revenue across all categories more than halved in 2020, then went up significantly in 2021 but remained below the figures reported in 2019.

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