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Greece’s Major Tourism Markets Depend on Internet Use

Germany and the UK, two markets that make up more than half of all arrivals to Greece each year, have become very dependent on online travel. The German online travel market alone has multiplied in the past two years, outpacing the rest of Europe, according to a new report published by PhoCusWright Inc. titled European Online Travel Marketplace Update 2002-2006: Focus on Germany.

After more than doubling in 2003, online travel bookings in Germany grew by an estimated 62% in 2004, reaching a projected 3.3 billion. The report covers leisure and unmanaged business travel gross bookings in both Germany and the European Union (original members).

All of Europe is projected to grow by 51% to reach 19.2 billion in 2004 following actual 65% growth in 2002-2003. The German online market is expected to continue to grow in the range of 60% annually through 2006, at which time Germany is projected to represent one-fifth of the European market.

“Because of Germany’s strong tour operating business and slow development of the online business, this large market is now ripe for consolidation,” said Olivier Jager, PhoCusWright European travel analyst and author of the report. “Dynamic packaging and other flexible travel solutions have the strongest growth potential in Europe.”

The report details the following topics and findings regarding the European and German online travel markets:

Sixty percent of the European online travel agency market is in the hands of the top five agencies.

Seventy percent of the German online travel agency market is in the hands of the top five companies.

Fragmentation in the online travel agency market is still high when compared with the U.S., where 93% of the online travel agency market is held by three companies.

Tour operators face serious challenges from low-cost carriers and online agencies.

Significant opportunities abound in the extremely fragmented hotel sector.

There has been a dramatic shift in sales toward supplier sites from agency sites in both Germany and Europe as a whole.

The explosive growth of budget air will continue to drive sales to supplier sites.

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