Industry Insight

Online Travel Landscape Between India & China

Release Date: Sept 8, 2017

In China, online travel is an old topic, you would have assumed the market is already saturated, but the truth is the penetration of online travel is only 15.8%, with a volume of 739 billion RMB(~ 108 billion USD) until 2016.

If you further break down the market size, you will find the market is mostly occupied by online transportation segment, which holds 72.8% of the total market. Online accommodation and online vacation hold 16.9% and 10.3% respectively.

There are three clear trends in China’s online travel market:

Trend #1: Magnates in Domestic Market

Except for Alibaba, both Baidu and Tencent seem to lose much of their interest in this market as they are neither actively participated in the investments, nor their own initiatives. Ctrip is the only pure online giant right now through multiple major M&A(merger and acquisitions) as well as investments. Meanwhile, big offline companies which originally from air aviation or accommodations are trying to integrate offline assets with online services to take the market. The following picture shows the top 4 emerging travel groups in domestic market:

  • Ctrip Portfolio: Ctrip owns relatively comprehensive investment portfolios among the others. Its strategy is from online to offline, which means they occupy the online traffics as much as they can, and then fully leverage their offline resources to make it bigger than bigger.
  • Alibaba Portfolio: Alibaba inherits its thinking to build a marketplace, e.g. Fliggy, in order to aggregate all the agencies and customers.
  • Jinjiang Portfolio: Starting from domestic hotel accommodation business, Jinjiang heavily invests in related business assets in recent years.
  • HNA Portfolio: Famous of its Hainan Airlines, HNA tries to attach the advantage of mobile Internet trend in China. It has more and unique online portfolios than the other traditional travel companies.

Trend #2: UGC Platform Expands Quickly

Driven by the trend of more and more travellers want to travel by themselves instead of tour groups, UGC platform has been growing very fast in the past 5 years. For example, Mafengwo, the most leading travel UGC platform owns more than 6 million active users every quarter, and each active user will open its App 22+ times for 2.5+ hours averagely per quarter. Combining with 1 million hotels and accommodations resources, 380,000 tickets SKUs as well as 5,000+ travel partners, Mafengwo is able to use its big data to enable a smarter recommendation system.

Trend #3: Huge Outbound Travel Market

According to a report from China Tourism Academy, there are more than 62 million Chinese people travel overseas in the first half of 2017, which means there are 100+ million outbound Chinese tourists around the world every year! That is a huge market, but a different market as well. So we can see there are some new, smaller and innovative startups focusing on this area.

Chinese Peers Brief Information

Company Logo Company Name Category(ies) Financial Status* One Sentence Description
Ctrip OTA, Fare Aggregator / Search, TMC NASDAQ: CTRP Ctrip is the biggest provider of accommodation reservation, transportation ticketing, package tour and TMC(Travel Management Company) and other travel-related services in China. Recently Ctrip actively builds its overseas blueprint, including invested MakeMyTrip in India, acquired Skyscanner, and established a 200 million RMB fund to invest oversea hotels.
Tuniu OTA NASDAQ: TOUR Tuniu is a leading OTA provider in China, which strength is at leisure travel segment, holding 25% of leisure travel market share in 2016 according to Analysys report.
Qunar Fare Aggregator / Search NASDAQ:QUNR (Delisted) Starting from search and bidding, Qunar is the leading OTA provider in China, firstly was backed by Baidu, and then acquired by Ctrip in 2015. Currently is the #2 biggest OTA company in China with a market share of 18.2% in 2016.
TongCheng OTA Strategic Investment: 1 billion RMB, Oct 9, 2016; E Round: 6 billion RMB, Jul 3, 2015 Backed by Ctrip, Tencent, and Wanda, TongCheng served nearly 300 million travellers in 2016.
Lvmama OTA NEEQ: 835188 (Delisted) As a leading OTA company, Lvmama has 50K+ partners and more than 700 million App downloads.
uzai.com OTA C Round: Undisclosed Amount, Dec 4, 2014 Acquired by Zhongxin Tourism, uzai is focus on outbound tourism market more.
Aoyou OTA SHSE: 600138 Subsidiary of CYS, one of the largest travel agency in China.
Baicheng OTA NEEQ: 836925 Dedicated focus on outbound travel OTA business.
manGO OTA HKSE: 00308 Another OTA backed by CTSH, one of the largest travel agencies.
eLong OTA NASDAQ: Long(Delisted) eLong is one of Chinese leading mobile and online travel agencies. After its delisting, eLong right now is a portfolio company of Ctrip.
Agoda OTA, Fare Aggregator / Search NASDAQ: PCLN As a subsidiary of Priceline Group, Agoda is one of the leading player in China targeting to Chinese outbound travellers.
TripAdvisor OTA NASDAQ:TRIP TripAdvisor enters China in 2009.
Booking Fare Aggregator / Search NASDAQ: PCLN As one of the most successful online travel player in China, Booking.com operates in 7 offices in China.
Alitrip / Fliggy Fare Aggregator / Search NYSE: BABA Backed by Alibaba, Alitrip holds a market share of 14.8% of online travel market in China in 2016.
Kuxun / Meituan Fare Aggregator / Search M&A: Undisclosed Amount, Jul 16, 2015 Firstly acquired by TripAdvisor on 2009, then acquired by Meituan on 2015.
Airbnb B&B F Round: 1 billion USD, Mar 10, 2017 Global most leading B&B(Bed and Breakfast) platform operates in China.
tujia B&B E Round: Undisclosed Amount, Jun 22, 2016 Meaning of “home during the travel”, tujia is the leading local B&B platform in China, covers 335 destinations in mainland China and 1,018 oversea destinations, and exceeded 56,000 room nights per day. In Oct 2016, tujia acquired B&B sectors from both Ctrip and Qunar.
Xiaozhu B&B D Round: 65 million USD, Nov 2, 2016 Meaning of “little pig”, Xiaozhu is the Chinese version of Airbnb.
Belvedor B&B, Outbound Travel NEEQ: 837077 B&B booking platform dedicated focus on Chinese outbound tourists.
Muniao B&B B Round: Undisclosed Amount, Feb 29, 2016 Leading B&B booking platform focus on domestic accommodations.
FishTrip B&B, Outbound Travel A Round: Undisclosed Amount, Dec 1, 2013 Not only provide B&B booking services, FishTrip also recommends interesting destinations for tourists. FishTrip is target outbound tourism only.
Mayi B&B M&A: Undisclosed Amount, Jun 22, 2016 Meaning of “ant B&B”, Mayi was acquired by tujia, but still operates as a separate entity.
Mafengwo UGC Round C: Undisclosed Amount, Mar 25, 2015 The most leading travel UGC platform owns more than 6 million active users every quarter, and each active user will open its App 22+ times for 2.5+ hours averagely per quarter.
Yododo UGC Round A: 25 million RMB, Nov 12, 2013 Leading UGC platform in China, also provides services like find buddies to travel together.
Qyer UGC D Round: 60 million USD, Jan 5, 2016 A leading UGC platform which can also assist for travel planning. Qyer was backed by Alibaba in both B & C rounds, and Zhongxin Tourism in D round.
BreadTrip UGC C Round: 50 million USD, Dec 21, 2014 BreadTrip is an innovative UGC platform only focus on travel photos taken by tourists.
cncn B2B N.A Travel products wholesale platform, including package tour, ticketing, accommodation, etc. They also enable travel agencies to build website and mobile apps easily.
Lixing Network B2B A Round: 10 million RMB, Jul 16, 2015 Established in 2014, Lixing Network aims to build a GDS(Global Distribution System) for destinations around the globe. Instead of transportation and accommodation, Lixing focuses more on oversea destinations’ ticketing service, which the big companies haven’t well covered yet.
Tripb2b B2B SZSE: 002356 Owned by Shenzhen Hemei, Tripb2b is a newly established domestic travel B2B platform.
HI GUIDES Outbound Travel B Round: 210 million RMB, Jan 19, 2017 HI GUIDES offers Chinese drivers in various oversea destinations to provide transportation service toward Chinese outbound tourists.
Zuzuche Outbound Travel B+ Round: Undisclosed Amount, Aug 12, 2016; B Round: 700 million RMB, May 26, 2016 Zuzuche connects to over 200 global car renting companies to provide services to Chinese outbound tourists.
Alipay Outbound Travel NYSE: BABA Alipay is providing currency exchange and abroad on-site payment to outbound tourists.
TenPay Outbound Travel SEHK: 700 Alongside with local partners, TenPay enables WeChat Payment in various places abroad.
133 / Flight Manager Travel Tool C Round: 933 million RMB, Mar 23, 2016 One of the major tools in China which enables tourists to check flight information, as well as online check in.
VariFlight Travel Tool N.A Similar to Flight Manager, VariFlight is the leading air aviation service platform.
UME Trip Travel Tool N.A Provide similar service of Flight Manager.
Tencent Map Travel Tool SEHK: 700 Map from Tencent.
amap Travel Tool NYSE: BABA Map from Alibaba.
Baidu Map Travel Tool NASDAQ: BIDU Map from Baidu.
Travel Translator Travel Tool Round C: Undisclosed Amount, Mar 25, 2015 Travel Translator is a well-known App from Mafengwo.
AliBi TMC NYSE: BABA AliBi(AliBiztravel) focus on business trip management in China. Taking the advantage of Alibaba’s B2B pioneer DingDing, AliBi tries to facilitate all the services from booking to payment to expense reimbursement.
TempusWorld TMC SZSE: 300178 Leading TMC vendor in China.
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*: As of Sep 5, 2017.

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