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Key takeaways

Key takeaways

What is the scope of this industry report?

The European travel trade market comprises businesses that provide booking services, (packaged) travel arrangements and business travel support, covering the full customer journey from transportation and accommodation to car rentals and excursions. We segmented the European market in terms of offering and clientele into: (i) tour operators, (ii) travel agencies, (iii) booking platforms and (iv) travel management services.

What is the scope of this industry report?

The European travel trade market comprises businesses that provide booking services, (packaged) travel arrangements and business travel support, covering the full customer journey from transportation and accommodation to car rentals and excursions. We segmented the European market in terms of offering and clientele into: (i) tour operators, (ii) travel agencies, (iii) booking platforms and (iv) travel management services.

What is the scope of this industry report?

The European travel trade market comprises businesses that provide booking services, (packaged) travel arrangements and business travel support, covering the full customer journey from transportation and accommodation to car rentals and excursions. We segmented the European market in terms of offering and clientele into: (i) tour operators, (ii) travel agencies, (iii) booking platforms and (iv) travel management services.

What does the travel trade market landscape look like in Europe?

European travel trade businesses are increasingly transforming their offerings, with all segments pursuing digitalisation, personalisation and ancillary upselling to enhance their margins. While tour operators and agencies shift towards asset-light business models and tech-enabled services, booking platforms differentiate by focusing on dynamic pricing and content-based engagement across social channels. To compete in this environment, incumbents pursue offering specialisation and focus on experience-based travelling. In addition, M&A activity is set to thrive, mainly driven by players seeking to broaden their offerings, expand internationally and accelerate digitalisation (interviews by Gain.pro).

What is the level of investor activity in Europe travel trade industry?

Sponsor-led interest has been significant, with ~52% of identified assets being investor-backed (June 2025). Investors are primarily attracted by the (i) favourable consumer preferences leading to higher time and budget allocation, (ii) continued digitalisation offering greater engagement and scalability potential and (iii) growing share of millennial and Gen Z travellers with higher travel frequencies. On the other hand, (i) stagnating incomes and rising living costs, (ii) overtourism backlash and (iii) the rising share of independent travellers bypassing intermediaries act as detractors for investors.

What are the key ESG considerations in Europe travel trade industry?

The ESG agenda revolves around environmental, social and governance topics. Environmentally, travel accounts for a significant share of global emissions, prompting operators to reduce their carbon footprint through fuel alternatives, emissions offsetting and eco-certification schemes. Social concerns relate to managing overtourism and the impact on local communities, with rising traveller interest in supporting local economies driving initiatives related to community engagement, skills development and responsible destination management. Governance priorities focus on safeguarding consumer data, with players increasingly implementing cybersecurity frameworks to protect sensitive personal information.

Company benchmarking

Company benchmarking

Market growth

Market growth

Industry experts forecast the European travel agencies market to grow at a ~5-7% CAGR in 2025-2030 (interview by Gain.pro)

Statista (July 2024) estimates that the European travel and tourism market will grow from ~€278.8bn in 2025 to ~€311.2bn by 2029 (+2.8% CAGR 2025-2029)

The European business travel market is expected to grow from €360.4bn in 2024 to ~€476.6bn by 2028 (+7.3% CAGR 2024-2028; Global Business Travel Association, November 2024)

The European business travel market is expected to grow from €360.4bn in 2024 to ~€476.6bn by 2028 (+7.3% CAGR 2024-2028; Global Business Travel Association, November 2024)

Positive drivers

Positive drivers

Favourable shifts in consumer preferences increase the demand for European travel incumbents. Consumers are increasingly prioritising travel within their personal budgets, while also allocating ~1 extra day on vacation on average compared to pre-COVID data (Mastercard, May 2024; Thrillist, May 2024)

The continued digitalisation of the European travel market enhances customer engagement and improves scalability. By adopting innovative technologies and leveraging digital channels, European incumbents can enhance customer lifetime value and deliver more personalised offerings, thereby unlocking greater sales potential (interview by Gain.pro; Forbes, May 2025)

The growing share of millennial and Generation Z travellers, who do an average of ~5 trips per person annually, versus fewer than 4 trips for Gen X and Baby Boomers. This reflects a growing preference for immersive travel experiences over traditional holidays, offering higher margin potential for industry incumbents (interview by Gain.pro; McKinsey & Company, September 2024)

Negative drivers

Negative drivers

Escalating overtourism across Europe has led to multiple key destinations (e.g. Amsterdam, Venice) implementing measures aimed at controlling visitor numbers (e.g. visitor caps, cruise ship restrictions). These actions, coupled with widespread local protests against mass tourism, limit the growth prospects for the European travel industry (The European Business Review, May 2025; Euronews, September 2024; Forbes, May 2025)

The ongoing surge in Free Independent Travellers (FITs) is expected to further diminish sales volumes and profitability for traditional travel agencies and tour operators. With more travellers preferring to plan and book their trips independently, there is a decreasing interest in all-inclusive packages that offer the highest margins for travel businesses (interview by Gain.pro)

Stagnating middle-class incomes and rising living costs are curbing discretionary travel spend, especially among price-sensitive consumers. At the same time, airline capacity constraints, supply chain disruptions and volatile energy prices have inflated the underlying travel costs, thus putting pressure on travel volumes and profitability (MarketWatch, February 2025; Reuters, February 2025; MarketWatch, June 2025)

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