The online travel agency market in Russia is an eclectic mix of global and local players, and although online travel agency gross bookings in the country are projected to jump 27% to $6.9 billion in 2014, the online travel agencies as a group are losing ground to supplier websites.
That’s a dynamic detailed in a new study, PhoCusWright’s Eastern Europe Spotlight: Russia’s Online Market Springs to Life.
“While OTAs once commanded nearly six in 10 online transactions in the Russian market, just 47% of online bookings will be made through OTAs in 2014,” the report states.
“And the gap between OTA and supplier website bookings is expected to widen over the next several years as suppliers continue to leverage consumer trust and improve their user interfaces.”
Their respective positions will come nearly full circle by 2016, the report states, as supplier sites are projected to garner 58% of online bookings while online travel agencies will pick up the remaining 42%.
The report notes that consumers in Russia still value price, but trust is increasingly becoming a decisive factor in travel planning and booking.
Online travel agencies’ credibility certainly wasn’t enhanced earlier this year when Eviterra Travel, an OTA, was charged with fraud for selling fake airline tickets by the thousands, the report states.
Both the online travel agency and travel metasearch sectors in Russia are characterized by a mix of global and local players, according to the report.
The online travel agencies generally specialize in either hotel or airline tickets, and the Priceline Group’s Booking.com attracts more than 25% of all online travel agency bookings in Russia even though it only offers hotels.
Air-only online travel agencies OneTwoTrip, Ozon Travel, and Anywayanyday “dominate the air category,” the report states.
The hotel-only and air-only dichotomy in Russia, however is beginning to change as major airlines ceased paying commissions in favor of a less-lucrative bonus system for the bigger players.
That has spurred some of the air-only OTAs to branch out into selling hotels, but Booking.com’s dominance in hotels is a considerable obstacle, the report states.
On the metasearch front, global players Kayak, Skyscanner and Momondo, as well as home-grown Aviasales, Buruki and Jizo are the leading players, the report states.