Interface News Reporter | Li Rujia
On October 24th, Ctrip Group held a Global Partner Summit on Sentosa Island, Singapore. At the summit, Ctrip and the tourism industry in Singapore, including the Sentosa Development Authority, Sentosa World, and Singapore Changi Airport, signed strategic cooperation agreements.
In 2020, the Singapore Tourism Authority signed a three-year strategic partnership with Ctrip Group. This time, the two sides signed a second three-year strategic cooperation and launched a global market cooperation upgrade plan: the two sides will carry out cooperation within China around Singapore's hot festivals, art and culture, etc; Further implement cooperation between Trip.com's multiple overseas sites and the Singapore Tourism Authority in the international market; At the same time, we will assist in upgrading Singapore's tourism products and digital marketing, expanding domestic tourist sources and expanding international tourism promotion for Singapore.
The cooperation with the Singapore Tourism Authority is also one of the measures taken by Ctrip to increase its efforts to implement its globalization strategy this year.
In 2019, Ctrip announced its "G2 strategy" - Great Quality and Globalization - at its 20th anniversary celebration. But the accompanying epidemic caused the domestic inbound and outbound tourism market to press the pause button, and the international tourism market laid out by Ctrip also suffered a significant blow.
With the relaxation of outbound tourism policies this year, there has been an increase in outbound tourism for domestic tourists, and the inbound and outbound tourism business of tourism enterprises is gradually recovering. Taking Singapore as an example, according to Ctrip data, China has returned to Singapore as the top source of inbound tourists this summer.
In 2022, the overseas tourism market began to recover, and at that time, the growth of the overseas market had already played a repairing role in Ctrip's performance. From the perspective of overseas air ticket business, in the fourth quarter of 2022, the overall air ticket booking on Ctrip Group's international platform increased by over 80% year-on-year; According to the fixed exchange rate standard, the ticket revenue of Ctrip Group's international platform has returned to the pre epidemic level.
With the recovery of international flight capacity, China's outbound tourism performance has gradually rebounded in the second quarter of 2023. Ctrip has reached cooperation with multiple tourism bureaus, with BOSS live streaming going overseas and landing in multiple countries for destination promotion. From a data perspective, compared to the same period in 2019, Ctrip's overseas ticket revenue doubled in 2023, global ticket business orders increased by 100%, and the number of overseas car rental stores doubled.
However, currently outbound travel still faces the challenge of insufficient flight capacity. At the meeting, Tan Yudong, CEO of Ctrip's air ticket business unit, shared that in the second quarter, domestic air tickets in China had already exceeded the level of 2019, especially in the peak season of July and August, with an increase of over 10% compared to 2019, and the average ticket price was 20% higher than 2019. However, the number of inbound and outbound flights in Chinese Mainland only recovered to 50% to 60% of that in 2019, especially the flights from China to North America, even after the increase of flights in September and October, it only recovered to about 10% of that in 2019.
Tan Yudong believes that although China's inbound and outbound flights are still recovering, it also indicates that there is a large backlog of demand that has not been released, and there is still great room for growth in the future. In addition to domestic entry and exit business, another segment of international air ticket business is the overseas market, which is characterized by the company being relatively dispersed and having no monopolistic competitors, especially in the European and Southeast Asian markets, where there is still ample competition space.
So we still have great hope for the growth of international air ticket business. Of course, there are challenges in this process, "Tan Yudong said. This includes understanding local needs, deep cooperation with global airlines, as well as continuing innovation and compliance, which are all areas that enterprises need to learn in their global journey. He believes that the supply chain and users are the cornerstone of competitiveness and the key to success or failure. Trip.com is currently playing a role as a bridge and platform, providing support for domestic suppliers to go overseas and connecting with more international suppliers to serve Chinese customers.
In addition to flight capacity, outbound travel also faces factors such as the convenience of visas and the general increase in prices for overseas destination consumption. However, Chen Guan, Vice President of Ctrip Group, mentioned in a media interview that there are also opportunities and potential for outbound travel. For example, after the epidemic, tourists have changed their preference from large group tours to small group tours, and customized products are constantly increasing; Tourists' spending on tourism has also increased, and the age group has started to become younger, with the 80s and 90s becoming the main travel age groups; The factors that stimulate tourism are also more diverse, and the younger generation will also visit their destinations due to a concert, music festival, competition, and other activities.
He believes that this requires practitioners to customize new tourism products for different age groups and users. If there is no preparation or adjustment in the supply chain and platform strategy, it will not be able to meet the current needs of tourists.
Cross border business travel is also an important component of Ctrip's cross-border business. Ctrip Business Travel's overseas hotel order demand has increased by 365% year-on-year this year, overseas air tickets have increased by 587%, overseas ground transportation has increased by more than 15 times, and the number of monthly active overseas users for business travel has increased by 118%.
In terms of cross-border business travel, Ctrip Business Travel has released a global influence plan to strengthen overseas travel. In the future, Ctrip Business Travel will improve multiple payment and settlement methods such as overseas credit cards, BTA (travel allowance), VCC (virtual credit card), and cover multiple international service sites in Southeast Asia and Europe. At the same time, we will strengthen the supply of overseas hotels, airlines, and car resources, and improve the global business and tourism supply chain resources.
In addition to outbound travel, Ctrip has also launched an inbound travel project. Sun Jie, CEO of Ctrip Group, mentioned that data shows that in 2019, the income of inbound tourists accounted for only 0.5% of China's GDP. If it were to increase to 1.5% of the international median, it would bring at least 1.3 trillion yuan of growth space, and the potential for inbound tourism is enormous.
Sun Jie analyzed that the slow development of inbound tourism is hindered by various factors, including visa, payment, lack of foreign language services, and insufficient supply of foreign-related hotels. At present, relevant departments are gradually introducing policies to optimize visas, promoting the resolution of related pain points and difficulties.
In September, the General Office of the State Council issued the "Several Measures on Releasing the Potential of Tourism Consumption to Promote the High Quality Development of the Tourism Industry", which specifically mentioned the need to strengthen inbound tourism work, including implementing inbound tourism promotion plans, optimizing visa and customs clearance policies, restoring and increasing international flights, and improving inbound tourism services.
Ctrip has launched a series of "Hello China" content for inbound travel, which will be disseminated on multiple destinations and social media worldwide. Ctrip stated that in the future, it will spread destinations to overseas friends through a "1+N" approach. "1" is Ctrip's platform, and "N" is industry partners who work together to enrich product formats and introduce Chinese culture to the world. During the summit, cultural and tourism bureaus in Hunan, Tianjin, Chengdu and other regions carried out tourism promotion to attract overseas tourists to China.
We can also mobilize potential users' interest in China through customized tours and differentiated products. We will also invite overseas KOLs to visit and experience Chinese attractions and products, and promote them from the perspective of overseas tourists, "said Sun Jie.