Traditional Travel Agency Market Expected to Reach $212.9 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Traditional Travel Agency Market," The traditional travel agency market size was valued at $143.9 billion in 2022, and is estimated to reach $212.9 billion by 2032, growing at a CAGR of 3.7% from 2023 to 2032.'

Traditional or offline travel agencies are physical establishments that help customers plan and book their trips in-person. Customers meet travel agents in-person to discuss and make arrangements in the physical offices of these agencies.

Digital tools are being incorporated by traditional organizations to improve their offerings. Clients may browse and book travel alternatives conveniently at their fingertips due to online booking systems, virtual consultations, and mobile apps. The goal of this digital transformation is to close the accessibility gap between customized services and current online expectations. Travelers are looking for memorable experiences that are immersive. Traditional travel agencies are responding by creating customized itineraries that cater to certain interests like eco-tourism, adventure travel, gourmet tours, and excursions with a focus on the outdoors. Travelers can have unforgettable and genuine journeys due to these experiences, which go beyond sightseeing.

Traditional travel agencies are evolving into reliable sources of travel information as they are providing location guides, exclusive insights, and educational content. In addition to demonstrating their knowledge, this engages and attracts potential customers looking for insightful information for their travel. The COVID-19 pandemic served as an example of how traditional agencies may be useful in times of disaster. They are even more valuable in times of uncertainty because of their capacity to help customers rebook, reschedule, and handle challenging situations. Agencies are making modifications to their marketing plans and services to appeal to younger tourists. Since authenticity and experiences are important to millennials and Gen Z, incorporating social media, influencer collaborations, and engaging content appeals to them.

Collaborations with local service providers, hotels, and other travel-related businesses open opportunities for special offers and improved services. Partnerships increase agencies' accessibility and provide clients with more options. Some travel companies concentrate on particular areas or niche markets, such as luxury travel, family trips, or health retreats. They offer in-depth knowledge and specialized advice that is suited to the demands of certain customers according to their areas of expertise. Thus, traditional travel agency market demand is creating traditional travel agency market opportunities during the forecast period. 

The traditional travel agency market is analyzed on the basis of service type, age group, and region. By service type, the market is divided into transportation, travel accommodation, and vacation packages. Among these, the transportation segment occupied the major traditional travel agency market share in 2022 and is projected to maintain its dominance during the traditional travel agency market forecast period. In order to negotiate special rates and offer distinctive packages to their consumers, several travel agents are establishing direct partnerships with transportation companies like airlines and railroads. The COVID-19 pandemic highlighted the value of flexible cancellation and booking rules and regulations. To provide consumers peace of mind, travel agencies are modifying their conditions to make allowances for last-minute modifications to vacation itineraries. To offer integrated travel experiences and reward programs, traditional travel agents are collaborating with businesses from various industries, like hospitality, entertainment, and even technology. All these traditional travel agency market trends are driving the traditional travel agency market growth. 

By age group, the traditional travel agency market is segmented into 22-31 years, 32-43 years, 44-56 years, and >56 years. The 22-31 years segment is anticipated to grow at a moderate rate during the forecast period. Younger travelers are traveling solo more frequently due to their desire for independence and self-discovery. The emphasis on flexible booking choices is being placed by travel firms as they develop packages and itineraries specifically for single travelers. Budget-consciousness is a common trait among Gen Z and millennial travelers. Traditional travel firms offer solutions for budget-friendly travel, including offers, discounts, and packages that are specific to this market. Younger tourists typically favor experiences over material possessions. Traditional travel companies are adjusting to this need by providing curated and customized itineraries in response to their client's need for distinctive and engaging travel experiences.

The region that dominated the global traditional travel agency market in 2022 was Europe, and its dominance is anticipated to continue throughout the forecast period. Travelers are still attracted to Europe due to its extensive history and cultural richness. The development of itineraries that let travelers fully experience the culture, history, and traditions of a place is a focus for travel agencies. Some travel businesses in Europe are focusing on particular areas, such as culinary experiences, wellness retreats, and adventure travel. They now target particular travel groups and offer their specialist knowledge. The cruise and river cruise industries are quite popular in Europe. Traditional travel agencies are taking advantage of this by providing a variety of cruise alternatives, such as luxury cruises and river cruises with a specific theme.

The major players analyzed for the global traditional travel agency industry are Expedia Group Inc., Booking Holdings, Mahindra Holidays, STA Travel, Carlson Wagonlit Travel (CWT), AAA Travel, Kuoni Group, Thomas Cook, TUI AG, and Flight Center Travel Group Limited.

KEY FINDINGS OF STUDY

• By service type, transportation was the largest segment in 2022. 
• Vacation packages is the fastest-growing segment during the forecast period. 
• As per age group, 32-43 Years is the fastest growing segment during the forecast period.
• Region wise, Europe region was the highest revenue contributor in 2022.
• LAMEA is the fastest growing region during the forecast period (2023-2032).