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China’s Online Tourism Market in 2017Q1
According to the data in 2017 Q1 Quarterly Monitoring Report on China’s Market of Online Travel Booking issued by Analysys, the transaction scale of China's online travel booking reached RMB 210.002 billion, representing a year-on-year growth of 51.5%. China’s online travel booking market has started its rapid growth, and the year-on-year growth has shown an upward trend this quarter.
  • 19 Jul, 2017
  • Travel
  • 643
According to the data in 2017 Q1 Quarterly Monitoring Report on China’s Market of Online Travel Booking issued by Analysys, the transaction scale of China's online travel booking reached RMB 210.002 billion, representing a year-on-year growth of 51.5%. China’s online travel booking market has started its rapid growth, and the year-on-year growth has shown an upward trend this quarter.
According to Analysys, the online travel booking market has continued to expand in the first quarter of 2017 thanks to the travel boom in New Year's Day, winter vacation, Spring Festival, the Lantern Festival, etc. The companies in the industry have focused on the expansion of outbound tourism market while further integrating online and offline resources. They have further strengthened the sustainable and stable supply of overseas market products and services and constantly improved product experience and operating efficiency by upgrading overseas hotels, establishing overseas branches, building overseas teams, etc.  

1.    Online transport booking market is the segment of the largest transaction scale
In terms of online flight booking, Ctrip, Qunar, and other platforms remain leading in the market. This quarter, Qunar has taken advantage of its vertical search and declared to re-launch a price comparison platform so as to make the optimal offer for the customers.
With respect to online train ticket booking, the State Council has issued the 13th five-year transportation plan, which explains the expectation that high-speed rail will cover more than 80% of cities with a population of more than one million, high-speed rail service will extend to other areas, and the space for market supply will further expand. Therefore, online train ticket booking will be an important part of online tourism transport booking market. Driven by the booking boom in Spring Festival, key companies have launched their own railway ticket booking businesses for the further growth.
2.    Urgent demand of the online hotel booking market for high-quality products
Online hotel booking market has witnessed a dramatic growth. On one hand, major companies have reduced the cutthroat competition in the saturated market, contributing to a healthier development; on the other hand, with the upgrading of consumption demand, the suppliers of hotel products have input more for the product quality and development, hotels of mid-to-high end have realized larger market scale by an increase in the average price per customer and the improvement of customer satisfaction. Resort hotels and shared private houses, which mainly meet personalized demand, attach great importance to scene style and have strong awareness of IP marketing, have developed and flourished.
3.    Further integration of online vacation tour market and fusion of online and offline resources
With the increase in national income and the rise of the enthusiasm for tourism, OTA has accelerated the pace of online vacation tour layout and reorganized the booking system. Under the influence of mobile Internet, sharing economy, smart hotels, resort lifestyle, etc. have won the great favor from users thanks to innovative services. As for outbound travel, several online travel agents have established the vertical layout in the back-end market of users by the cooperation and communication with the authorities of overseas tourism destinations. For instance, Meituan Diping and Fliggy have concluded official cooperation with Denmark. With respect to inbound tourism, it has become one effective section to boost the overall market growth by virtue of the open attitudes towards transformation promoted by the Belt and Road and the 13th five-year plan and the market resources accumulated in the export of capitals, products, technologies, etc. Accordingly, the overall market has shown an upward trend and increasingly clear preferential allocation of market resources.

Ctrip has been leading the market in competitiveness, and platform companies have constituted main market players
With respect to market structure, the shares of China’s online tourism market have been further concentrated. More specifically, the Ctrip-related platforms led by Ctrip and Qunar have occupied 52.5% market shares in total. The top 3 platforms, Ctrip, Qunar, and Fliggy, have totally held 65.9% markets shares. At the end of 2016, Ctrip, Qunar, and Travelling Bestone had completed the integration of product and marketing system and basically restructured air ticket, hotel, and standard product segments, contributing to higher market efficiency.
In addition to traditional travel agents, Meituan Dianping has extensively promoted hotel and travel businesses in reliance upon its enormous user resources and the advantages in local services for life. It aims to move to the scene of nonlocal services for life from the scene of local services for life and build the hotel and travel business into one segment only second to take-out and movie.
According to Analysys, the online tourism market is characterized by low profit percentage and high cost of user development. The companies in the industry can efficiently reduce the average cost of user development, improve channel efficiency, and realize economies of scale through the attraction of voluminous suppliers by platforms, mutual promotion between businesses, and one-stop shopping.
For more information about the online tourism market, please keep an eye on Analysys's official WeChat account or call at 4006-515-715 for customer services.
 
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