The past several years have been turbulent for the travel industry. From pandemic-era shutdowns and restrictions to the post-pandemic travel boom and now global conflict and wavering economies, there has been a lot of change for sites like Booking.com.
As the leading travel company in terms of market share, there was significant pressure for Booking Holdings to maintain market dominance during and after the pandemic shakedown.
Here are the key statistics on Booking.com’s losses from the pandemic, and its subsequent recovery.
Booking.com Pandemic Losses
Like the rest of the travel industry, Booking.com saw huge drops in reservations and revenue in 2020.
From 2019 to 2020, the number of room nights reserved through Booking.com dropped by 68% due to the pandemic.
The effect of the pandemic is also striking when looking at the revenue of Booking.com’s gross travel bookings, which dropped 63% from 2019 to 2020.
Impressively, even with the dramatic drop in gross travel bookings in 2020, Booking Holdings still managed to do better (barely) than break even with a net profit of $59 million. That was a 99% decrease from the previous year’s net profit of $4.8 billion.
Still, that is far better performance than most companies and other websites in the tourism industry fared during the pandemic. For example, based on data from Macro Trends, Booking Holding’s top competitor, Expedia, operated at a net loss of $2.7 billion in 2020.
Booking.com Pandemic Recovery
Global tourism hasn’t recovered to pre-pandemic levels based on 2022 data from the UN World Tourism Organization. In 2022, 900 million people traveled internationally. That’s a major improvement from 2020 and 2021, but it is still 37% lower than pre-pandemic levels.
Most experts don’t expect global tourism to recover to 2019 levels until the end of 2024.
On the other hand, Booking.com and its parent company Booking Holdings experienced a much quicker rebound from the pandemic.
By 2022, Booking.com’s total number of room nights sold was 6% above 2019 levels, and revenue from gross travel bookings was up 25%.
Explaining Booking.com’s Accelerated Recovery
There’s no one obvious explanation for why Booking.com has outperformed other online travel agents in recovering from the pandemic. Rather, it is a combination of several complex factors.
One contributing factor is that, while Expedia focuses heavily on North America, Booking.com has the largest travel market share in Europe by far.
That makes a difference because the hotel industry is vastly different between Europe and North America.
In North America, most hotels are operated by major chains (Wyndham, Marriott, etc.). These larger chain companies have much more bargaining power when negotiating with online travel agencies, meaning lower margins for those agencies.
On the other hand, according to HospitalityNet, in Europe, only 20-25% of hotels are part of a large chain brand. Independent hotels have less bargaining power, so Booking.com can negotiate higher booking fees. UN World Tourism Organization research also shows that Europe has seen the greatest recovery in travel and tourism.
This only partially explains Booking.com’s impressive recovery though, especially in the current global financial situation.