The year has started well for travel with online searches up, but firms have been warned the early year peaks may represent the best they can expect in 2012.
Writing on his blog Steve Endacott, chief executive of On Holiday Group, claims the January booking period has remained buoyant because early bookers still have the money to spend.
However, he said the big winner in this period will be search engine Google that has seen rising searchers while conversions remain difficult to come by.
He said: “Like most companies involved with online travel sector, we have been surprised by the sharp rise in online searches this year with On Holiday Groups B2B search traffic running 85% up year on year, with Google reporting a 26% year on year increase in searches overall for the travel sector.
“Unfortunately, bookings have not risen at the same rate, as it appears customers are searching around much harder for their online holiday deals.
“This in itself is not a massive surprise given the recession, but it does mean that yet again the biggest winner is Google who must be rubbing their hands and whilst many OTA’s are seeing margins eroded due to falling conversion levels.”
Endacott spits the market into two segment, the “haves” and the “have nots”, and it is the latter, due to lack of job security and access to credit, which will not book this year.
This group tend to book later looking for lastminute deals and it is them dropping out of the market that explains the relative weakness of the late booking period last year, he said.
Endacott advised travel firms to make the most of current trading. “Sorry to be the harbinger of doom in such a good sales period, but I can only recommend you fill your boosts now, since its likely to be long hard late booking market.”