Consumers are using different platforms to access the internet, the mobile channel is constantly gaining ground, not only due to the use of smartphones and tablets as “personal assistants” but also to make travel bookings.

　　Today, the mobile channel is accounting for a growing share of the online reservations of OTAs (online travel agencies) and hotel chains, but we have also seen the first mobile-only travel agencies (MTAs) entering the market. These are currently niche players focusing on tonight-only bookings made by travellers on the go. However, in an increasingly competitive mobile travel arena, the most successful mobile-only players are expected to reach the mainstream market in the next few years, gaining share at the expense of traditional OTAs.

　　Reaching Consumers through any Screen

　　Today’s consumers are increasingly “multi-screen”, moving from their television to their PC to their smartphone and tablet to consume information and entertainment content, but also for e-commerce purposes. This is why companies, and especially travel companies given the importance of online sales for this industry, need to be active throughout all platforms.

　　According to Expedia’s CEO Dara Khosrowshahi, “with the proliferation of devices coming out there you have to build your technology with very flexible architecture” so that companies are able to reach consumers on any type of device, also now including internet-connected glasses and watches.

　　Evolving Roles for Internet Devices

　　However, different devices are being used by consumers in different ways. Laptop and desktop PCs still currently play a dominant role in online bookings. Mobile devices are clearly acquiring the role of personal assistants for travellers and their importance as a customer service tool is set to grow further over the next few years. The conversion rate of web searches into sales is currently still much lower for smartphones than for PCs, however, while tablets fare better from this point of view.

　　The convenience of smartphones and tablets and a change in consumer habits favouring last-minute bookings when on the go, however, will gradually change this.

　　Mobile bookings have already started to rocket over the last couple of years and are predicted to possibly surpass those made through PCs in some travel categories in a few years’ time.

　　Orbitz says that mobile bookings accounted for 30% of its total hotel reservations in Q2 2013, with the company expecting them to account for over 50% in the next few years, while Chinese OTA Ctrip states that the mobile channel already accounted for 40% of its hotel bookings in July and August 2013.

　　Are We Witnessing a Shift Towards an MTA Era in Travel?

　　The evolving role of mobile devices, which will see them gradually acquire a major and possibly dominant role in travel sales, means that all travel players will need to embrace these platforms and the technological flexibility mentioned by Mr Khosrowshahi.

　　But, are we going to also see a rise in specialist mobile travel agencies?

　　The first developments in this area are already taking place. The above-mentioned Chinese OTA Ctrip is increasingly focusing its growth on this channel, aiming to essentially become a mobile player.

　　Moreover, there are already some online travel agencies which were born as mobile-only players. These include American company Hotel Tonight and European players Blink, JustBook and Hot Hotels/ReallyLateBooking.

　　All these companies were created to focus on tonight-only bookings, targeting on-the-go travellers. However, following the development and increasing importance of the mobile channel, MTAs today have the opportunity to expand from being niche to mainstream players.

　　Challenging Traditional Online Travel Players

　　Among the current mobile travel agencies, Hotel Tonight and Blink appear to have the strongest growth potential. Hotel Tonight raised US$45 million in venture capital funding in September 2013 while in the same month Blink was acquired by Groupon. In particular, the combination of Blink’s mobile booking know-how and Groupon’s hotel inventory make the Spanish MTA a very promising player in this category in the near future.

　　The next few years will certainly witness major new developments in the mobile travel agency space, including the rise of new players, substantial investment in them and some consolidation activity.

　　Some major moves will certainly be made by leading online travel agencies such as Priceline and Expedia, traditionally at the forefront of innovation as far as travel technology is concerned, in order to defend their positions in this rising channel through both organic growth and acquisitions.

　　On the other hand, the most successful mobile-only players will certainly gain some ground in online travel, tapping into the growth of the mobile category.