Online travel sales take off in UK

Fight for a share of the lucrative market will see only a handful of online travel agents survive

The UK online travel industry is predicted to be worth £3.7bn by 2005 according to a new report by Forrester Research, who valued the market at a mere £592m last year.

Online travel sales are set to account for 14 percent of total leisure travel revenue in the UK by 2005. Internet flight bookings will additionally account for 45 percent of the estimated market in 2005, as the number of British people booking online flights increases from 1.6 million in 1999 to 5.7 million in four years' time.

Forrester predicts that only a dozen suppliers and agents will be able to survive the competition, and will have to understand the specific travel needs of various online shoppers.

Forrester has divided online travel buyers into three groups -- hardshells, backpacks and softshells.

Hardshells represent the top three percent of big spenders, but account for 20 percent of of all holiday spending. Backpackers are a much bigger group looking for cheap fares and no-frills holidays, with only eight percent booking through the Net. The largest sector of the market is represented by softshells, who account for 56 percent of the market, but spend the least.

"With UK iDTV (interactive digital television) penetration at 25 percent of households by 2000, many softshells will use this device to book travel online," said Japp Favier, senior Forrester analyst.

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