1. SEA is noticing increased interest in travel from local tourists

There has been a major increase in tourism interest starting in early 2022 across Southeast Asia with most countries noticing increase in search interest for travel and hospitality. Exceptions to this case are Vietnam and Thailand where the interest is delayed to mid-late 2022 due to local issues such as lockdowns being extended or restrictions being in place well into 2022.

2. Luxury and premium travel options to garner larger demand than pre-pandemic; consumers willing to spend a higher share of their disposable income on travel

Travel preferences have changed for consumers; due to the pandemic, more consumers are carefully planning their stays and prefer premium and luxury options to guarantee safety and hence increasing their spend per trip. This trend is expected to stick due to lingering concern for health and safety created during the pandemic.

3. Consumer expenditure on tourism is also increasing with average trip value rising online; high scope of growth for online players

While the pandemic period saw major decline in consumer spend on travel, there has been a steady bounce back and increase going forwards, leading to high potential for travel industry as a whole; where online travel is experiencing higher growth in consumer spend driven by longer trip durations and more willingness to spend on travel.

4. The key decision criterion for choosing a player for online bookings are wider variety and loyalty membership benefits, while inauthentic quality of listings and cumbersome refund processes are the key pain points

Consumers look for variety and membership benefits on online travel platforms, which bodes well for travel agency and booking platforms and the platforms have seen major increase in MAU across the board. While there are a high number of consumers visiting the platforms, conversion to transactions is the next step where key issues such as inauthentic descriptions of listings and cumbersome cancellation process need to evolve.

5. Positive sentiment towards online travel players relative to other internet based industries will drive higher adoption of online travel going forwards

Travel players in Southeast Asia have noticed a significantly higher NPS than pandemic period due to a very positive consumer sentiment towards travel going forwards. This will drive adoption and also increase in spend on online travel from consumers.

6. Bounce back in the sector funding and deals indicate rising interest levels of investors in the sector

Fund raising is also rising, reaching a higher level than the pre pandemic levels. Majority of the funding is going towards the hospitality segment with hospitality startups garnering majority of the funding in 2021. Travel agencies have also received funding recently as the userbase on these platforms grows rapidly.