As a result of smartphone penetration, the online hotel market will grow to $4 billion at a Compound Annual Growth Rate (CAGR) of 25 per cent, while off-line hotels will grow at 13 per cent to $13 billion by 2020.
In addition, the report showed that only 12 per cent of the consumers prefer to use off-line sources for research on travel.
Conversely, 57 per cent believed that online channels give them better deals while 41 per cent find it more convenient for them to book online.
"India's domestic travel market is on an acceleration path. One of the key findings of the report is that by 2020, one in three hotel rooms will be booked online -- a clear indicator of the growing importance of digital in travel research, planning and booking," added Vikas Agnihotri, Industry Director, Google India.
While air travel -- the biggest contributor in the growth of the domestic travel market -- will grow at 15 per cent to reach $30 billion, railways will remain largely stagnant at $5 billion, the report said.
The report is based on data tracked from 256 travellers between November 2016 - January 2017, who were 18-45 year old Android users spread across Delhi, Hyderabad and Ahmedabad.
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