The hotel booking market remained relatively stable for many years. OTA (Online Travel Agency) platforms built global booking ecosystems, while search engines mainly served as traffic acquisition channels directing users to those platforms.
The biggest example of such a platform is Booking.com, which for years has dominated online accommodation distribution. At the same time, Google has gradually been developing its own travel tools, such as Google Hotels.
In recent years, however, a new factor has emerged that is beginning to reshape the market structure: Google AI Overview.
This technology changes not only how users search for hotel information, but also how they make decisions. As a result, people are increasingly talking about a new model of the travel market, in which the search engine is no longer just a tool for finding websites, but is becoming a recommendation and trip-planning system.
How the hotel booking market worked over the last 20 years
To understand the scale of these changes, it is worth first looking at how the hotel booking market has operated over the last two decades.
The model was relatively simple.
A user typed a query into a search engine, for example:
hotel in central Barcelona
accommodation in central Zakopane
hotel in Rome with a pool
The search results displayed hotel websites, travel portals, and OTA platforms. The user would then move to a booking service and complete the reservation.
The process could be simplified into the following scheme:
search engine → OTA / portal → booking
Platforms such as Booking.com built their position thanks to several key elements:
- a huge accommodation database
- a user review system
- payment processing
- customer support
- integrations with hotel reservation systems
As a result, OTAs became the main sales channel for many hotels around the world.
The scale of the OTA market
According to travel market analyses, Booking.com is one of the biggest players in the global online accommodation booking market. The platform handles hundreds of millions of visits each month and lists millions of accommodation properties worldwide.
Industry reports indicate that in Europe, Booking.com is responsible for a significant share of reservations made through OTA platforms, and its market share exceeds competing platforms such as Expedia or Agoda.
This dominance was possible thanks to the network effect:
- more hotels mean greater attractiveness for users
- more users mean greater attractiveness for hotels
As a result, a global booking ecosystem was created.
Google’s entry into the travel market
Google has been developing travel-related products for years, but the real breakthrough came with the launch of Google Hotels.
Google Hotels is not a traditional booking platform. It works more like a metasearch engine, meaning a system that compares accommodation prices from different sources:
- OTAs
- hotel websites
- booking systems
The user sees a list of hotels in the search results together with prices, ratings, and availability. After clicking, they are redirected to the place where the booking is completed.
The operating model therefore looks like this:
Google Hotels → offer selection → redirect → booking
Google earns revenue from this model mainly through Google Hotel Ads, an advertising system that allows hotels and OTA platforms to display their offers in search results.
The paradox of the relationship between Google and OTAs
The relationship between Google and OTA platforms is complex.
On the one hand, Google generates enormous traffic for platforms such as Booking.com. OTAs invest large advertising budgets in search to acquire users. On the other hand, Google is developing its own travel tools, which are starting to compete with OTAs in the accommodation comparison space.
This has created a situation in which Google is simultaneously:
- a partner of OTAs
- a marketing channel for OTAs
- a potential competitor of OTAs
The arrival of AI Overview
The next stage in the evolution of search is the introduction of AI Overview.
AI Overview generates automatic answer summaries directly in search results. Instead of the traditional list of links, the user receives a synthetic answer prepared by an AI system.
If a user types in a query such as:
- where to stay in Venice
- best hotels in central Paris
- hotel in Zakopane with a view of the Tatra Mountains
Google may generate a summary containing:
- hotel recommendations
- location analysis
- review summaries
- suggestions for the best accommodation options
As a result, the user gets a ready-made shortlist of hotels before even visiting any website.
Zero-click search in the travel industry
One of the most important effects of AI Overview is the phenomenon known as zero-click search.
This means a situation in which the user gets an answer without having to visit other websites.
In the travel industry, this may look as follows:
- the user enters a hotel-related query
- AI Overview generates recommendations
- the user selects one of the suggested options
In such a situation, some websites may receive no traffic from search at all, even though their content was used to create the answer.
Why AI Overview changes the market more than Google Hotels
Google Hotels changed the way accommodation offers are compared. AI Overview, however, changes the very way the user makes a decision. The difference is fundamental. Google Hotels answers the question:
where can I book a hotel
AI Overview answers the question:
which hotel should I choose
This means a shift in Google’s influence from the search layer to the recommendation and trip-planning layer.
A new model of the travel market
More and more often, the accommodation selection process now looks like this:
AI Overview
↓
↓
↓
Google Hotels
↓
OTA / hotel website
↓
booking
Google is therefore beginning to control the first two stages:
- discovery
- recommendation
Meanwhile, OTAs still handle the final transaction.
Why OTAs still have a strong position
Despite Google’s growing role, platforms such as Booking.com still retain important competitive advantages.
The most important of these are:
- scale of inventory
- OTAs have vast accommodation databases covering millions of properties
- review systems
User reviews are one of the key factors influencing purchasing decisions.
booking infrastructure
OTA platforms offer:
- payment processing
- reservation management
- customer support
These are elements that Google has not yet taken over at scale.
What may happen in the coming years
Travel industry experts point to several possible market development scenarios.
-
Google will remain the discovery layer
In this scenario, Google controls search and offer comparison, while OTAs handle bookings. -
Google will become a fully fledged travel agent
If Google starts allowing users to book directly within search, this could significantly change the balance of power in the market. -
the development of AI concierge
AI may play the role of a personal travel advisor, recommending specific hotels and planning entire trips.
Conclusions
The hotel booking market is not changing through simple competition between Google and OTA platforms.
It is changing through a shift in control over the user’s decision-making process.
This can be summarized as follows:
- Google controls search and recommendations
- OTAs control the final transaction
- AI is beginning to influence the hotel selection process itself
Therefore, in the coming years, the key question will not be whether Google will replace Booking.com, but who will control the moment when the user makes the decision.
Sources
Google – Introducing AI Overviews in Search
Google Travel & Hotel Ads documentation
Hospitality Net – Google Hotel Ads market share
Travolution – Google direct booking market share analysis