Ctrip is making some big bets on the travel market in China, but not only by expanding their existing business – they are exploring the future of the travel industry and trying to predict which travel innovation will really be making a difference in future.
The company was only started in 1999, with a 2003 IPO, but they now have annual revenue of over $3bn and over 30,000 employees. In fact the analyst predictions for the next three years suggest a Gross Merchandise Volume (GMV) of $158bn. If you don’t have many interactions with China then you might not even know this company, but they are all set to be the global leader in the Online Travel Agency (OTA) market.
China’s travel market, both outbound and domestic, is growing extremely quickly. For the past few years the outbound market has doubled each year. In addition, China is the 4th most visited country in the world so inbound tourism is also significant. Analysts estimate that the outbound tourism market will be worth $163bn by 2024.
Other interesting facts about the outbound tourism market include:
– Visa requirements for Chinese travelers visiting Japan were eased from 2017
– China is the largest source market for Taiwan tourism
– China ranks top in terms of number of visitor arrivals to Hong Kong
– Chinese visitors spend more in the US than visitors from any other nation
In terms of volume, the Chinese travel market leads the world and companies like Ctrip are at the forefront of all these statistics, but the Chinese travel market is also focused on innovation. It is estimated that in the next few years up to 80% of all hotels in China will feature Artificial Intelligence (AI) functions.
Hotels will start learning about a customer from the moment they make a booking. AI systems will analyse customer behaviour and personalise their room experience, even down to the type of art hanging on the wall and the temperature the customer prefers. This kind of innovation is world-leading. I really believe that if you want to watch how travel will develop in the US or European markets over the next decade then just look at how China develops over the next two years.
Let me know what you think about Ctrip and the rapid expansion and innovation in the Chinese travel market by leaving a comment here or get in touch directly via my LinkedIn.