THE TRAVEL MARKETERS GUIDE TO THE U.S. DIGITAL TRAVEL LANDSCAPE Phocuswright White Paper December 2017 Prepared for Written and researched by Douglas Quinby The Travel Marketers Guide to the U.S. Digital Travel Landscape / December 2017 2 2017 Phocuswright Inc. All Rights Reserved. Base: U.S. travelers with online access (N = 1,662) Source: The Travel Marketers Guide to the U.S. Digital Travel Landscape Digital Travel Is Travel As online travel in the U.S. enters its third decade, the distinction between online and offline travel is blurring. Speak to any travel marketer today and they will almost cer- tainly agree: there is no more “online” vs. “offline” travel marketing. There is only travel marketing. The overwhelming majority of travelers well over nine in 10 engage with digital in some form when planning, booking or experiencing a trip. Online channels are especially influential as travelers work their way down the travel booking journey. Nearly 80% of travelers turn to digital to compare travel products and pricing, and slightly more (83%) have purchased travel online (see Figure 1). As travel brands look to build their marketing strategies for 2018 and beyond, digital must consume a substantial and yet still growing share. The online travel marketing landscape along with online travel booking has grown rapidly in the ability to reach and engage new customers. However, it has also grown far more complex and demands even greater sophistication from travel marketers. Along with more demand and more opportunity for both performance and brand marketing, there are also more channels, more tools, more approaches for measurement and attribution, and certainly more challenges. This paper, based on new, proprietary consumer and industry research conducted by Phocuswright and commissioned by Bing, provides a map of the digital travel land- scape with the modern travel marketer in mind. This analysis outlines the essential trends of online consumer behavior across travel shopping, booking and advertising en- gagement. It also provides key perspectives from travel marketers on the state of online travel ad spend and top marketing priorities and challenges facing travel brands today. Figure 1: U.S. Traveler Use of Digital for the Travel Booking Funnel PLANNED SHOPPED BOOKED 71% 79% 83% (select a destination online) (compared and chose travel products) (purchased travel products) Percent of U.S. Travelers Who 2017 Phocuswright Inc. All Rights Reserved. David Pann General Manager, Microsoft Search Advertising Douglas Quinby Senior Vice President, Research, Phocuswright Inc. The Travel Marketers Guide to the U.S. Digital Travel Landscape / December 2017 3 2017 Phocuswright Inc. All Rights Reserved. About Phocuswright Phocuswright is the travel industry research authority on how travelers, suppliers and intermediaries connect. Independent, rigorous and unbiased, Phocuswright fosters smart strategic planning, tactical decision-making and organizational effectiveness. Phocuswright delivers qualitative and quantitative research on the evolving dynamics that influence travel, tourism and hospitality distribution. Our marketplace intelligence is the industry standard for segmentation, sizing, forecasting, trends, analysis and consumer travel planning behavior. Every day around the world, senior executives, mar- keters, strategists and research professionals from all segments of the industry value chain use Phocuswright research for competitive advantage. To complement its primary research in North and Latin America, Europe and Asia, Phocuswright produces several high-profile conferences in the United States, Europe and India, and partners with conferences in China and Singapore. Industry leaders and company analysts bring this intelligence to life by debating issues, sharing ideas and defining the ever-evolving reality of travel commerce. The company is headquartered in the United States with Asia Pacific operations based in India and local analysts on five continents. Phocuswright is a wholly owned subsidiary of Northstar Travel Media, LLC. The Travel Marketers Guide to the U.S. Digital Travel Landscape / December 2017 4 2017 Phocuswright Inc. All Rights Reserved. Contents Table of Contents Digital Travel Is Travel 6 Research and Methods 6 Terms some 41% of travelers who recalled an ad cited price as a memorable factor. Travelers clearly recall and respond better to advertising that is visual and relevant. Nearly half of travelers who recalled seeing an online ad specifically cited recalling a visual element or picture (see Figure 10). 2017 Phocuswright Inc. All Rights Reserved. 2017 Phocuswright Inc. All Rights Reserved. The Travel Marketers Guide to the U.S. Digital Travel Landscape / December 2017 11 2017 Phocuswright Inc. All Rights Reserved. Figure 8: General Search Travel Ad Recall by Age Base: U.S. travelers who read or viewed travel-related ad online (N = 1,662), U.S. travelers who cl