TBF 2011- Patricia Rasore: “Analizing the Emerging Online Travel Market in Latin America”
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TBF 2011- Patricia Rasore: “Analizing the Emerging Online Travel Market in Latin America”

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The Latin American travel industry is vast, diverse, growing fast and changing even faster. The region features rapidly emerging economies, a fast growing ecommerce sector, some powerhouse travel......

The Latin American travel industry is vast, diverse, growing fast and changing even faster. The region features rapidly emerging economies, a fast growing ecommerce sector, some powerhouse travel companies with an eye toward global expansion, and tremendous opportunity for a still under-penetrated online travel market. PhoCusWright is conducting a comprehensive study of the Latin American travel marketplace, with a focus on online distribution and marketing. This research delivers an in-depth understanding of this increasingly important yet understudied part of the global online travel landscape

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  • Pie ChartUpdated 3/22/11
  • Pie ChartUpdated 3/22/11
  • Which is the market that is growing the most in the period 2010-2012?ArgentinaBrazilMexicoWhich is the fastest growing market in that same period?PeruColombiaBrazilWhich is the market that sustains the largest online penetration?MexicoBrazilChile
  • Pie ChartOther regional otas
  • Latin America LCCs represent 31% of the airline market, but account for almost the same online gross booking volume as traditional airlines ( $2.2B vs $3.0B)Dynamic LCCs are challenging the legacy domains of Brazil, Mexico and Colombia.LCCs will represent more than one third of airline revenue by 2012.LCCs in Latin America in 2010 have nearly four times more online gross bookings than online travel agencies ($7.6B vs. $2.2B).LCCs in Mexico and Brazil, along with airline Andes (Argentina), operate 100% outside of the GDSs. AZUL (Brazil) and all secondary airlines in Chile are accessed through the GDSs.On December 10, 2010 Interjet from Mexico signed an agreement to guarantee inventory distribution through the Amadeus system.On January 27, 2011 Amadeus announces global distribution agreement with TRIP Linhas Aereas from Brazil .
  • Roughly 80% of Latin American hotels are independent, inherently slowing the overall pace of online penetration in the sector. Only 11% of hotels in Latin America have a global chain affiliation, compared to 70% in the U.S. and 25% in Europe.

Transcript

  • 1. May 5, 2011 Tourism Branding Forum
    Tying Latin America to the World
    Patricia Rasore
    Director, Latin America
  • 2. Latin America: evolving from being peripheral to a powerful player in its own right.
  • 3. Research Revelations
    Urban consumers, the new middle class (275M people), are fueling the travel industry - US$10 billion in new sales projected in two years
    Online bookings are growing at more than three times the pace of the overall market – and soon will represent one fifth of all travel sales
    Online growth varies widely among markets and segments; though airline websites lead, hotels and OTAs are biggest opportunities
    The air sector in Latin America has some of the strongest passenger growth in the world
  • 4. Market Sizing
  • 5. Polling
    Question #1
    What was the size of the Latin America travel market in 2010?
    $39 Billion
    $58 Billion
    $72 Billion
    $85 Billion
  • 6. The Latin American Online Leisure/Unmanaged Business Travel Market, Total Gross Bookings (US$B), Online Growth and Penetration, 2008-2012
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 7. Four Regions: Total and Online Leisure/Unmanaged Business Travel Gross Bookings and Online Penetration, 2009-2012 (US$B)
    Note: 2010-2012 projected.
    Source: PhoCusWright’s Global Online Travel Overview Second Edition, 2011
    Online
    Penetration
    Total Gross
    Bookings
    +12.7%
    +7.1%
    +11.3%
    +5.7%
    +5.9%
    +10.2%
  • 8. Market Share by Region, 2010
    Note: 2010-2012 projected.
    Source: PhoCusWright’s Global Online Travel Overview Second Edition, 2011
    Total
    Online
  • 9. Market Share by Region, 2012
    Note: 2010-2012 projected.
    Source: PhoCusWright’s Global Online Travel Overview Second Edition, 2011
    Total
    2012
    Online
    2012
  • 10. Polling
    Question #2
    What country boasts the largest online penetration?
    Mexico
    Brazil
    Peru
    Chile
  • 11. Online Leisure/Unmanaged Business Travel Market, Total Gross Bookings (US$B), Online Growth and Penetration, for All Analyzed Countries in 2010
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 12. Online Leisure/Unmanaged Business Travel Market, Total Gross Bookings (US$B), Online Growth and Penetration, for All Analyzed Countries in 2012
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 13. Online Gross Bookings Is Not the Only Indicator
    Online Leisure/Unmanaged Travel Gross Bookings by Market (US$B), 2010
    Note: 2010 projected.
    Source: PhoCusWright’s Global Online Travel Overview Second Edition, 2011
    ~
    $120
  • 14. Highest Growth Rates are Found in the Latin American Region
    Online Leisure/Unmanaged Business Travel Gross Bookings Average Annual Growth Rate by Market, 2010-2012
    Note: 2010-2012 projected. Growth percentages for European markets are based on euros to be more reflective of actual trends.
    Source: PhoCusWright’s Global Online Travel Overview Second Edition, 2011
  • 15. Pockets of Opportunity Lies Where Penetration is Below 35%
    Online Leisure/Unmanaged Business Travel Penetration by Market, 2012
    Note: 2010-2012 projected.
    Source: PhoCusWright’s Global Online Travel Overview Second Edition, 2011
  • 16. Intermediaries
  • 17. Retail travel agencies retain their stature
    Attributes
  • 18. Latin American Online Travel Market (Leisure/Unmanaged Business); Direct Gross Bookings by Segment (US$M), 2008-2012
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 19. Latin American Total OTA Travel Market, OTA Shares (%), 2010 vs. 2012
    Note: Figures may not total 100% due to rounding.
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
    Main areas of investment for Global OTAs in Latin America:
    • Local language
    • 20. Payment options
    • 21. Local content
  • The Two Biggest OTAs in Mexico and Brazil in 2010
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
    BestDay.com
    Despegar.com
    Decolar.com.br
    Submarinoviagens.com.br
  • 22. Airlines
  • 23. Latin American Airlines: “Simply the Best”
    Increases in demand as well as in efficiency
    Expected to continue enjoying a virtuoso moment
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 24. Latin American Airline Total Gross Bookings (US$B) and Supplier Website Penetration (%), 2008-2012
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 25. Total Latin American Airline Market, LCC vs. Traditional Airline Shares (%), 2010 vs. 2012
    Note: Figures may not total 100% due to rounding.
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 26. Lodging
  • 27. Polling
    Question #3
    What percentage of hotels in Latin America are affiliated with global chains?
    11%
    30%
    47%
    68%
  • 28. Lodging
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
    Low online penetration
    Lodging represents 44% of total travel market but only 15% of online market
    Early stages of revenue management practices in local/national markets
  • 29. Latin American Hotel Gross Bookings (US$B) and Supplier Website Penetration (%), 2008-2012
    Source: PhoCusWright's Latin America Online Travel Overview, 2011
  • 30. Latin America: What´s Now, What´s Next
  • 31. Latin America: What’s Now, What’s Next
    Demand for travel technology solutions accelerates
    20% smartphone penetration critical mass to be reached by year end
  • 32. Latin America: Having a Mobile Strategy (Whether It’s App or Mobile Web Led) is Now More Important Than Ever
    Source: International Telecommunication Union, 3G Americas, Bernstein Research
    Latin America: among the most “mobile” regions in world
    (3 units/PC)
    Mobile momentum in emerging and faster growing economies
    Brazil: sixth largest worldwide market in mobile
    Mobile in Brazil: second most expensive in world
  • 33. U.S.: A Golden Opportunity to Reach Consumers During the Mobile Trip Research Phase
    Source: eMarketer, February 2011
    12M will book a travel product in 2011
    One third of smartphone users will research a trip in 2011 (25M)
    Mobile travel related activity will grow to 34% in 2012, from 30% in 2010
    Mobile travel research will continue at a steady pace 
  • 34. Latin America: What’s Now, What’s Next
    Demand for travel technology solutions accelerates
    20% smartphone penetration critical mass to be reached by end of 2011
    Biggest opportunity in online media is social media
  • 35. Influence of Travel Information Sources, by Membership in Online Social Networks
    Source: PhoCusWright's Traveler Technology Survey, 2010
  • 36. Social Media Networks Are Not Direct Commerce Platforms
    Social networks are already a much larger source of traffic than news and media sites, and that gap will only grow larger
    Source: PhoCusWright Inc.
  • 37.
  • 38.
    • Latin America had a shallow recession
    • 39. Expanded consumer market across the region
    • 40. Expansion of intra-regional business
    • Travel technology adoption still lags
    • 41. Conversion is delayed
    • 42. Personalization and innovation should be areas to explore
  • Expanded consumer market across the region
  • 43. Foster business innovation to capture dynamics of the new online audience
  • 44. Related Release:
    PhoCusWright’s Latin America Online Travel Overview
    Go to www.phocuswright.com
    for more information!
  • 45. Thank you