Specialist
Executive at online travel platform
Agenda
- OTA (online travel agency) outbound travel business development over the past three years, plus China’s relevant international travel policy changes across stages and impacts on OTA industry
- China’s border reopening on 8 January 2023 – short-, mid- and long-term stimulus and impacts on cross-border travel and vacation demand, OTA platforms’ supply recovery progress, plus major overseas travel destinations’ border-entry policies’ impacts
- Major domestic OTA platforms and outbound travel agencies – outbound travel business sizes, take rates, plus air ticketing, hotel and vacation travel business recovery trends and main growth drivers in 2023
- Major OTA platforms’ outbound travel destination planning, supply chain establishment, plus core advantages and disadvantages
Questions
1.
Could you briefly introduce yourself and your work experience in online travel agencies (OTAs) and outbound travel-related industries?
2.
Could you review the development history of domestic OTAs’ and OTPs’ outbound travel business over the past three years amid the pandemic under the infection prevention and control policies? I am not sure if their outbound travel business was completely suspended or not. Could you talk about China’s entry and exit policies, visa policies and COVID-19 isolation and quarantine policies at different stages amid the pandemic? What were the short-term and long-term impacts on OTAs’ outbound travel business?
3.
The Chinese government announced on 8 January 2023 that it would adjust the entry and exit policies for Chinese and foreign travellers and re-open borders for international travellers. As a result, some countries started to impose restrictions on people entering their borders embarking from China because a lot of people in China started to get infected at the time. On 20 January, the Ministry of Culture and Tourism issued a notice, announcing that Chinese travel agencies and OTAs will resume pilot outbound group tours and air ticket and hotel booking to a total of 20 countries starting from 6 February. What do you think of the supporting measures, such as the re-issuance of passports, after China’s re-opening? How have flights been resumed?
4.
Visa-free entry hasn’t fully resumed in Japan and South Korea, where quarantine policies are issued for Chinese travellers. According to your observations, is there a trend toward easing border-entry measures in major overseas destinations? What is the impact of such policies on the Chinese outbound travel industry in Q1?
5.
Many platforms’ news headlines mentioned explosive growth of search volume of outbound travel, air ticket or destination. However, you shared with us that the flight reservation this January only recovered to 10% of that in 2019. Could you please furtherly comment on the cross-border travel demand recovery? It seems supply falls short of demand. Is that caused by airline capacity? Or has the demand seen a limited boost because people are reluctant to book flights temporarily?
6.
According to Trip.com’s Blackboard (携程黑板报), one of the company’s Weixin official accounts, nearly 700 outbound group travel products have been launched, which can cover 15 destinations, countries and regions. Meanwhile, pageviews of outbound group travel products dedicated to the 7-day holidays of the Chinese New Year tripled. Thailand, Maldives and Egypt are priority destinations among travellers in Shanghai, Beijing and Hangzhou. Before the pandemic, middle-aged and elderly people tended to choose group travel products, while during this Chinese New Year, the post-80s and post-90s generations play a major role in affording early bird tickets. How do you view the product supply resumption among OTPs? After all, limited travel products were rolled out or operated over the past three years due to the pandemic. Could you explain it?
7.
You just mentioned that the market size of outbound travel in 2019 was about RMB 800bn. What is your estimate of the GMV proportion of Trip.com, Tongcheng Travel Holdings (Tongcheng Travel) and other platforms such as Meituan and Tuniu in the outbound travel market?
8.
Could you elaborate on the monetisation models of Trip.com, Tongcheng Travel and Tuniu in the outbound travel market? As far as I know, some of them make profits by developing self-operated businesses or collecting commissions for air tickets. What have been the changes in the overall monetisation rate?
9.
Considering Trip.com’s limited overseas hotel resources, could you compare the platform’s commission for overseas and domestic hotels? What is the platform’s commission level in the industry?
10.
For customers who want to book overseas hotels, will the prices on Booking.com be less than that on Trip.com?
11.
Domestic OTAs are not profitable in the air ticket booking business with almost no commission for air tickets, so they mainly conduct this business to attract traffic. Is the outbound travel air ticket booking business profitable?
12.
In 2019, what were the proportions of outbound travel revenue to Trip.com’s and Tongcheng Travel’s total revenue respectively? What were their profits from the outbound travel business?
13.
You mentioned that Trip.com’s OTA platforms achieved a GMV of about RMB 500bn in the outbound travel business in 2019. I’m a little confused about that because as I remember, the figure was less than RMB 600bn in 2020-21 with all Trip.com’s core sub-platforms considered. Is that right?
14.
What is Douyin’s planning for the outbound travel business?
15.
Did the three-year pandemic bring the outbound travel business of previous leading outbound travel agencies, such as Caissa Tosun, China CYTS Tours Holding and U-tour, to a complete halt? Will their outbound travel business recover as China now has lifted restrictions on outbound travel?
16.
What are your opinions on the recovery of China’s domestic and outbound travel business? Will people downgrade their spending on travel or engage in revenge travel spending?
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