Reporter Tao Li Intern Qin Yuanshun, Shanghai
Booking Holdings, the world's largest online travel group, sees China as the next strategic height.
Booking Holdings Group is the largest online travel company in the world. It owns Booking.com, agoda.com, Kayak, Priceline.com, Rentalcars.com and OpenTable brands, providing services to customers in more than 220 countries and regions around the world. In the past two years, Booking's App has developed rapidly in China. Take Android application market as an example, Booking.com has now downloaded 75 million people.
Glenn D.Fogel told 21st Century Economics:
But increasing market share quickly is not easy even for giants like Booking Holdings. In the China online Travel Market report, Analysys Qianfan said:
The pace of Booking group's efforts to start the Chinese market begins with investment. In October last year, Booking invested $450 million in American Mission reviews, and the cooperation between the two sides focused on stock house swaps. Subsequently, in July 2018, Booking again invested $500 million in strategic investment. Booking app acquired the drip call service interface, but also further drained users through the drip entrance.
In fact, these two investments are just the tip of the iceberg in the Booking layout. As early as 2012, Priceline, the predecessor of Booking Group, cooperated with Ctrip, the largest hotel booking company in China. Priceline became one of Ctrip's investors. Priceline added two additional investments to Ctrip in 2015 and 2016. On June 11, 2018, Gillian Tans, CEO of Booking Group, served as an observer for Ctrip's board of directors, deepening the strategic alliance between the two sides.
It is understood that at present, Booking group's main partners in China include Didi, USA group, Ctrip, HUAWEI, China Merchants Bank, Hornets nest, flying pig and other enterprises in various fields. In addition to working with Chinese companies, Booking group also focuses on customer service construction. Up to now, Booking group has nearly one thousand employees and 12 offices in China. Booking also has a customer service centre in Shanghai, a total of 450 people.
According to Glenn D.Fogel,
Targeting market segmentation
Interestingly, Booking's biggest competitor in broadening China's market boundaries is not someone else, but Ctrip, which it invests in. According to the data of Yiguan Qianfan, the transaction scale of China's online tourism market reached 89.23 billion yuan in 2017, and the growth rate slowed down significantly. Ctrip's Ctrip Travel Network and Qunar Network account for 54.6% of the total market share, exceeding half of the industry.
In November 8th, Ctrip announced its third quarter financial report. According to financial data, Ctrip's net operating income in the third quarter of 2018 was 9.4 billion yuan, up 15% from the same period last year. Among them, the business income of tourism holiday business was 1 billion 400 million yuan, up 28% over the same period. The steady growth of revenue mainly comes from the sink channel. As of June, there were 7000 stores under the line, and 8000 were expected to open at the end of the year. These stores are mainly distributed in three or four line cities.
Free travel abroad may be the core market segment that Booking group wants to grasp in China. According to data released recently by the Ministry of Culture and Tourism, in the first half of this year, 71.31 million Chinese citizens traveled abroad, an increase of 15.0% over the same period last year. China's outbound arrivals reached a historical peak of 135 million in 2016, and by 2020, it is expected that the number of outbound tourists will reach 160 million. This is clearly a huge opportunity for Booking, who owns The Globe Hotel and travel resources.
In the China online Travel Market report, Analysys Qianfan analysts pointed out that for different segments of the market, Ctrip, where to go and other domestic major online tourism platforms still have unoccupied territory, aiming at the characteristics of different groups of people.