Last year was the fourth straight for growth in the U.S. travel market, according to Phocuswright’s U.S. Online Travel Overview Report.

The report states the market grew 5% to a total of $341 billion, and it predicts U.S. travel revenue will reach $381 billion by 2017.

The market is heavily dominated by airlines and hotels/lodging, which account for 83% of the total. The remaining portions are car rental (5%), cruise (5%), packaged travel (4%), rail (1%) and other (2%), which includes travel insurance.

Lodging revenue increased 8% in 2015 following a 9% rise the year before. It pushed past air to become the largest segment of the U.S. travel market at $144 billion and is predicted to grow to $163.3 billion in 2017. The study notes that demand is outpacing supply, increasing occupancy and average daily rate.

Airline revenue grew 1% in 2015, to $139 billion, after 3% growth the year before.

“Airline growth will bounce back from 2015’s near-flat performance, but remain in the low single digits through 2017, when revenue reaches $149 billion,” Phocuswright forecasts.

Car rental growth slowed to 2% in 2015, totaling $18.8 billion, while cruise revenue grew 3%, to $15.5 billion. Packaged travel is growing slower than the total market, and the study says it will grow 4% each year from 2013-2017. Rail revenue was flat in 2015 at $2.1 billion.

Phocuswright’s study found a distribution channel shift. While online channels are growing faster than offline channels, the margin is closing in — and by 2017, the study says the total travel market and online bookings will both grow 6%.

OTA growth continues. According to the study, OTAs will account for 17% of total U.S. travel bookings in 2017, up from 16% in 2014. Other booking channels — supplier websites, travel agents and central reservations/walk-ins — are even at 28% of the market apiece, and Phocuswright said that trend will largely continue through 2017, with central reservations yielding a percentage point to OTAs. Traditional travel agencies had been declining for several years, so the flattening of that channel is good news for agents.

OTA growth has been powered by hotels, with double-digit growth in OTA hotel gross bookings each year since 2013. Hotels made up 46% of OTA gross bookings in 2015. OTAs are responsible for 28% of all mobile bookings, and the study said that will increase to 44% in 2017.

Mobile bookings were up 49% in 2015 with $25.5 billion in bookings made on smartphones and tablets. Phocuswright said mobile bookings will account for more than one quarter of online travel bookings by 2017.

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