The three publicly traded U.S. online travel agencies (OTAs) continued to lose share in the domestic market, even as international bookings soared, according to a recent report from PhoCusWright.
Expedia, Priceline and Orbitz reported that their total aggregate sales grew 22% during Q3 2011, to $16.7 billion. The OTAs' sales for the first three quarters of 2011 were $48 billion, a 23% increase.
By far the bulk of that growth is coming from abroad. Domestic bookings grew by only 3% during Q3 2011, to $8.1 billion, down from a 14% increase during Q3 2010.
According to the report, the OTAs face challenges in the domestic market owing both to airlines that want to "squeeze them out of the distribution chain" and the rising fares that are steering away leisure customers.
Orbitz, which PhoCusWright characterized as "air-centric," lost the most ground domestically, with third-quarter domestic sales down 3% and year-to-date sales down 5%. Expedia's domestic sales grew 4% during the quarter and 6% year to date.
Priceline bucked the trend, PhoCusWright said; it grew the most in the domestic market, with sales up 13% during the quarter and 14% for the first three quarters. However, with 77% of Priceline's bookings coming from abroad, its domestic sales began at a smaller base than those of Expedia and Orbitz.
Priceline also saw bookings surge internationally, registering a whopping 73% increase in international gross bookings during Q3, to $5 billion. The report said that Priceline leads the pack overseas by way of lodging-focused subsidiaries Booking.com in Europe and Agoda in Asia.
Its international bookings made up 77% of its total bookings during Q3 2011, up from 72% during the same period in 2010.
Expedia continued to grow its share of international bookings; nondomestic sales increased 21% during the quarter, making up 40% of its total bookings, up from 36% during the same period of 2010.
Driven by eBookers, its Europe-based online agency, Orbitz's international bookings jumped 31% during the quarter and now make up 21% of its total bookings, up from 16% in Q3 2010.
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