Large Travel Marketers Investing in Digital Advertising

Digital ad spending by travel marketers is poised to increase by double digits this year and next. This growth is being driven by competition between large travel marketers. While big companies like Priceline​.com, Expedia and Orbitz have been spending heavily on paid search,  airlineeMarketer analysts say more consumers are clicking on ads through mobile devices instead of PCs. This trend may prompt the travel marketers to make some changes.

The travel industry accounts for a significant chunk of digital ad spending. This year, about 8% of this spending will stem from travel marketers and by next year their spending will amount to 8.3% of digital advertising. In terms of real dollars, these businesses will pay $3.35 billion for all forms of digital advertising. In 2014, that number will rise to $3.91 billion.

Most travel operators spend their digital resources on online search.  Nearly ¾ of the effort goes to direct response and the rest is brand related. In terms of direct response, these businesses sometimes use a ‘hybrid search and display tactic.’ Once a target is identified via search, retargeting takes place via display ads. These marketers also have to be mindful of the general shift to mobile devices. By the first quarter of this year, 16.7% of the industry’s paid search clicks were coming from tablets and 6.5% from smartphones. That’s a near doubling of market share from mobile devices.

Analysts warn that in addition to optimizing campaigns for the mobile format, large travel operators that are promoting the offerings of smaller vendors are also facing bigger competition from the likes of Google and Yahoo, businesses that are looking for new growth vehicles. This market shift may drive large operators to offer unique deals and this could hold potential for their smaller partners that are looking to distinguish themselves and attract more attention.

To learn more about likely domestic vacationers, check out the AudienceSCAN report available on the Research Store at ad​-ology​.com.

Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.