Online Travel Giants Set New Record For Marketing Spend In ‘23
Financial figures from Expedia Group, Booking Holdings, Airbnb and Trip.com Group – four of the largest online travel agencies in the world – show the companies spent a record amount of money to promote their brands and attract customers in 2023, as pent-up demand from the pandemic is still driving spending.
Collectively these four brands spent a staggering $16.8 billion on sales and marketing last year (reported by Booking Holdings as just marketing), up 20% from just more than $14 billion in 2022.
It’s a clear sign of the intense competition these companies are facing as they fight to capture bookings and as they compete both with one another and with suppliers such as hotels and airlines that are all vying to drive direct business.
But beyond the eye-popping figure of total spend, Trip.com Group stands out as the company that had the biggest jump in its marketing budget in 2023. After dramatically reducing its spending in 2020, 2021 and 2022 due to persistent COVID-induced travel restrictions in China, last year as restrictions came down the online travel company returned to pre-pandemic levels of marketing spending. In 2023 Trip.com Group allocated $1.3 billion to sales and marketing – an increase of $117% over the 2022 figure of just more than $600 million and on par with its spending in 2019.
But as a percentage of revenue, Trip.com Group is showing increased efficiency in its marketing. The spending was 26% of revenue in 2019, 21% in 2022 and down to 20% in 2023.
In a call with analysts to discuss its fourth quarter and full year 2023 financial results, Trip.com Group CEO Jane Sun said the company is using its marketing budget to enhance its global market presence and also to expand its user base among “elderly demographics” - in the fourth quarter the number of users over age 50 increased by more than 90% compared with 2019.
