Slow recovery in spending on digital travel ads

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Travel data [Credit: Chainarong06/Shutterstock.com]
eMarketer estimates travel now accounts for less than 2% of digital travel ads in the U.S., down from 4.2% in 2019. Photo Credit: Chainarong06/Shutterstock

The continued reduction in travel -- particularly for business and across borders -- will keep digital advertising spending in the United States significantly down for the next few years.

According to eMarketer, it will take until 2023 for U.S. digital ad spending in travel to reach $4.54 billion -- putting it close to 2018 levels of $4.8 billion but still far behind 2019's spending of more than $6 billion. 

In 2020, as the pandemic shut down travel -- and focused what remained of marketing on messages related to hygiene, safety and flexible policies rather than booking -- digital ad spending in the U.S. plummeted to $2.99 billion, a $3 billion loss compared to 2019.

According to eMarketer, no other industry declined as fast or spent as little in 2020.

This year the company estimates the U.S. travel industry will spend $550 million more than last year, reaching $3.54 billion. 

Whereas travel accounted for 4.2% of all U.S. digital ad spending in 2019, eMarketer estimates travel now accounts for less than 2% of the industry.

"The U.S. travel industry is not seeing quite the same bounce-back in digital ad spending as other industries have seen in 2021, and a lot of this is due to stunted business travel and international travel. Regional airlines, small to medium-sized hotels and independent travel agencies may have to shutter as their budgets decrease," eMarketer says. 

In 2019, Booking Holdings and Expedia Group spent $4.97 billion and $6.03, respectively, on marketing.
Last year, both companies slashed marketing budgets, with Booking Holdings spending $2.2 billion and Expedia Group spending $2.5 billion. 

For the first six months of this year, Booking Holdings has spent $1.45 billion on marketing and Expedia Group has spent $1.86 billion. 

Source: PhocusWire

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