The German tour operator market is set for the next round of consolidation due to increasing financial pressures, a leading market researcher forecast at the fvw Kongress in Cologne.
Markus Heller, managing director of market researchers Dr. Fried + Partner, explained that technology-driven price transparency is putting extreme pressure on the package holiday margins of traditional tour operators.
In addition, tour operators – in particular the top three (TUI, Thomas Cook and DER Touristik) – are growing less than the overall tourism market, which is being driven by online sales, he pointed out in a presentation of an exclusive study based on interviews with 20 German travel industry executives.
The consequence is clear, according to the experienced market researcher. “In the coming months we will see strategic investments by large tour operators who take over smaller ones,” he predicted.
In contrast, the travel agency market is unlikely to see major changes in the coming years as long as the sector retains its legal status as sales agents, Heller told an audience of top managers from the German travel industry. However, tour operators will try to steer travel agency sales more than in the past, he forecast.
The biggest structural change, however, will come from consolidation of the online travel market, according to Heller. Google, for example, will start to play a more prominent role by placing itself more and more at the front of the booking process for flights and hotels, he predicted.
At the same time, Booking.com could create a ‘travel ecosystem’ by linking its various acquisitions, including flight metasearcher Kayak and restaurant portal OpenTable to its core accommodation booking portal, Heller said. This could turn the group into ‘the Amazon of travel’ in future.