Consumers across the world are becoming more comfortable making purchases on the internet, and digital travel sales are beginning to mature on a global basis.
eMarketer develops digital travel sales estimates as a subset of business-to-consumer (B2C) ecommerce for 19 global markets, and according to our January 2014 forecasts, only three of those markets will still see double-digit growth rates by 2017: China, India and Italy. China’s robust 20.0% growth rate will be a significant outlier, with Italy and India increasing at 11.5% and 11.1%, respectively. We expect Spain to be the only other country growing faster than 7% in 2017.
Travel’s share of overall B2C ecommerce is often a bellwether for maturation of an ecommerce market overall, since travel tickets tend to be the first items consumers become comfortable purchasing online. In addition, due to its relative price tag in comparison with most retail items, travel often makes up a considerable portion of digital ecommerce before consumers adopt other types of retail purchasing.
eMarketer estimates that only four markets will see travel increase its share of B2C ecommerce between 2012 and 2017: Italy, Brazil, Finland and South Korea (the latter seeing a marginal 0.2-percentage-point increase)—while each of the other countries in our forecast will see travel lose share over the period.
India is a prime example of this general market trend. In 2012, air and rail tickets comprised 95% of the total online travel market, according to the Internet & Mobile Association of India (IAMAI) and IMRB International. As a result, travel totaled nearly three-quarters of all B2C ecommerce. eMarketer forecasts that retail will begin to catch on en masse in India, with a 43.8% compound annual growth rate (CAGR) expected between 2012 and 2017—taking travel’s share to just under 55% of overall B2C ecommerce by 2017.
This trend is not only prevalent in emerging markets. In the US, eMarketer estimates that digital travel sales will grow at a CAGR of 5.9% between 2012 and 2017, while US retail ecommerce will increase at a CAGR of 14.3% in that time period, despite growing from a much higher base. As a result, travel’s share of overall B2C ecommerce will drop from 35.9% to 27.6% between 2012 and 2017.
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