How to understand the OTA situation in China
This article will explain how to understand the OTA situation in China. At least there are several factors that must be considered by anyone who wants to get a real picture of the OTA situation in China. Here are the two most important factors.
The first factor is the digital booming. Today, China has no less than 630 million Internet users and of course this fact cannot be ignored by anyone who wants to sell online. The majority of the Chinese population are increasingly depending on the Internet and they have formed a large proportion of the global market of E-marketing. They are the most active gadget users of in the world and they are supported by a variety of native Chinese technology companies that provide Chinese social media-based services.
The second factor is closely linked with the first factor that is the tendency of which owned by the Chinese to find any information online. They are now more likely to use the Internet to book airplane tickets, hotel booking, travel packages, and so forth.
Chinese tourism has been increasing year by year and in 2014, more than 107 million Chinese traveled abroad. That amount was almost 10% of the total population of China. In 2014 they spent no less than 146 billion Euros.
Boston Consulting Group has even predicted that by 2030, Chinese tourists will spend 1.7 billion trips per year and that number will be three times bigger than what achieved in 2012.
The main OTA in China
The main players among all OTAs are CTrip, Qunar, Feiren, etc. Ctrip was introduced in 1999 and began its service in booking airplane tickets and hotels. Qunar at the second position faced various problems, but two years ago, the company was able to achieve 42% market share of online ticket booking.
We must realize that the battle is not actually involving fellow OTAs but the giants; Tencent, Baidu, and Alibaba. They fight for the first position in the service of tourism. We should not forget that Qunar owned by Baidu and the company has decided not to work with Ctrip. However Ctrip has earned a joint bid from Alibaba.
Tencent has eLong but the company wanted more control of eLong so they purchased all the shares. The company wants to become a leading company in the field of online travel services. Alibaba, on the other hand, has Taobao Trip, launched in 2010. The site offers a variety of travel services, including not less than 2 million products and 800 airlines! Based on some calculations, Taobao Trip has sold in 500 million times.
The difference with the Western OTA trend
Most Chinese still rely on the website that they are familiar with. While Westerners tend to try new things so that the OTA situation in China is quite difficult to some new challengers.
OTA trend in China
OTA trend in China is that 40% of the market held by organized travelers and 60% of the market held by independent travelers. This provoked various international airlines to promote their services through social media, instead of selling tickets through cooperation with conventional travel agents. However the trend will resemble the Western OTA trend where people are accustomed to travel independently. I hope this article can help you in understanding the OTA situation in China.