The Impact of Online Travel Agencies on Airlines’ Own Online Platform: Evidence from a Quasi-experiment

Usually, many airlines sell their tickets through their own 0nline platform and Online Travel Agency (OTA) platforms. Although selling tickets through the OTA platforms offers airlines exposure to a broader consumer base. It is unclear whether this effect applies to airlines’ own online platform. In this paper, we analyzed the impact of the OTA’s introduction on the self-owned platform to explain this problem. X Airlines determined to sell their tickets of some routes in Ctrip on May 21, 2012. Relying on this special quasi-experiment in combination with DID and PSM method, we empirically verify our conjecture. The results reveal that the introduction of OTA has caused a significant decline in the competitiveness (e.g. passenger load factor (PLF)) of their own online platform, while it has a positive effect on the auxiliary service sales (e.g. baggage revenue). Our findings have important implications for both airlines and platforms