China online accommodation market totaled 39.38 billion yuan (US$5.97 billion) with an increase of 27.1% YoY according to data from Analysis.

Ctrip leads China’s online accommodation market in Q2 2017 with 46.7% market share, followed by Qunar, Meituan and Alitrip.

While China’s more affluent consumers increasingly favor independent travel, the online holiday and group tour booking market is still showing rapid growth, likely driven by continued expansion of the middle class in China. China online holiday booking market overview Q2 2017 »

China online tourism market analysis 2017

China’s air ticket online booking market is upcoming and on the rise, with seen increases in market share and dominance of certain air divisions, coupled with increased direct sales channels to enhance the pace of growth.

According to Analysys’s released report in Q1 of 2017 on China’s air ticket online booking market, its market size reached 132 billion yuan (US$19 billion), with a year on year growth rate of 31.8%, as seen in the chart below.

Following the July 2016 revised ticket sales policy for the pay-per-month segment vote, each air division is aimed at improving corporate profits, exerting market dominance and directing marketing channels to accelerate the pace, all working with OTA to rectify the ticket agent industry.

This year, the airline continued to strengthen its platform and held sales of the tickets, hotels, tour package through direct channels in order to increase market share.

With each air divisions playing individual strategies with increased intensities, OTA’s profit margins are gradually decreasing. This quarter, while OTA is continuing to enhance product experience and operational efficiency, at the same time, it is also focussing on the layout of higher prices of the international air ticket market.

From engaging in depths of integration, and aspects of upgrading, manufacturers provide more competitive online aviation service products. On the other hand, manufacturers further strengthen the international ticket product and service side of supply through online international voyage and flagship stores.

China online travel market overview Q1 2017

China online travel market exceeded 210 billion yuan in Q1 2017 with an increase of 51.5% YoY, led by Ctrip, Qunar, and Alitrip.

It consists of online transportation booking (71.9%), online accommodation booking, and online holiday booking.

Ctrip has 35.19% market share in China’s online travel market, followed by Qunar (17.28%), and Alitrip (13.57%).

In Q1 2017, the market concentration has increased, with the market share of Qunar, Ctrip and Alitrip summing up to a whooping 73.6%. Amongst these three, online ticketing transaction size is 50.2 billion yuan, 27.69 billion yuan, and 19.22 billion yuan respectively.

Analysys analysts believe that since the overall market space for online tickets is still huge, coupled with a positive outlook on the tourism industry, the demand for air travel is still on the rise. At present, despite the increase in online air ticket sales, OTA is still the main channel for the booking of air tickets. The main direction of future development of this industry would be to actively possess creative business models, improve online service experiences, and increase consumer reliance.

China online accommodation market overview Q1 2017

The transactions of China online accommodation market totaled 37.202 billion yuan in Q1 2017 with an increase of 43.24% YoY according to data from Analysis.

Ctrip leads the market with 46.6% market share, followed by Qunar, Meituan, eLong, and Alitrip.

China’s domestic tourism insights in 2017

Alibaba announced an upgrade to its OTA platform Alitrip and renamed it to Fliggy (or “Fei Zhu”, flying pig) positioned as a leisure travel brand targeting the young travelers.

Fliggy focuses on outbound tourism market; it cooperates with European countries in a deep level building offline service stations and offering Chinese tourists local services in Chinese.

Fliggy has over 200 million members with more than 10 million daily visitors according to Shaohua Li, CEO of Fliggy.

Alibaba also launched a new product targeting business tourism market on its team collaboration platform Dingtalk (or Dingding) last month. GMV of China’s business tourism market is estimated to reach RMB 600 billion in 2016.

China online travel market reached 155.71 billion yuan in the first quarter of 2016, up 58.9% YoY or 14.7% QoQ, according the research company Analysis.

Ctrip and Qunar led the online travel market with 35.6% and 30.2% market share in Q1 2016 respectively, followed by Alitrip (14.8%).

Offline merchants hoped to get more consumers and profits by accessing to the O2O platforms in China in 2015. Tier-3 and tier-4 cities have been a new expanding regions for the O2O platforms. Meituan maintained a prominent position in the less developed cities.

China O2O companies were busy expanding to tier-3 and tier-4 cities in 2015 as more consumers accessed to the service according to Tencent. For example, 36.8% of total transaction values of Meituan came from tier-3 and tier-4 cities in early 2015 and over 80% once came from tier-1 cities in 2010.

China O2O market entered a white-hot competition period in 2015 and companies tried hard to win consumers. The number of merchants on Meituan was only 780,000 in 2014 and the number increased to 1,600,000 in 2015.

Major catering O2O apps were Meituan, Dianping, and Nuomi in China in 2015. Penetration of Meituan in tier-3 and tier-4 cities was far higher than that of other catering O2O apps.

About 50% users would use catering apps less than five times per month according to Tencent and the usage frequency of tier-1 and tier-2 city users was higher than that of tier-3 and below city users in 2015.

About half users spent 100 yuan to 300 yuan each time. 35.4% tier-3 and below city users spent less than 100 yuan and 28.7% tier-1 and tier-2 city users spent less than 100 yuan when catering with O2O apps. However, 10.4% tier-3 and tier-4 city users spent 300 yuan to 500 yuan higher than 8.7% of tier-1 and tier-2 city users.

Competition among food-delivery O2O market also was fierce in 2015. Meituan played a more prominent role in tier-3 and tier-4 cities and the penetration rate surpassed others with a large gap. Penetration rate of food-delivery O2O apps didn’t have much gap in tier-1 and tier-2 cities.

The monthly usage of food-delivery apps came more frequently in advanced cities than less developed cities in China in 2015. The overall usage frequency of food-delivery O2O apps was fewer than the catering O2O apps.

Ctrip was more active in tier-1 and tier-2 cities and Meituan was more active in tier-3 and tier-4 cities when booking hotels online.

36.0% couples in tier-3 and tier-4 cities would reserve hotels online for dating and 38.2% users in tier-1 and tier-2 cities would book hotels for neighboring travel.

Low price, rich hotel resource, and perfect function of hotel O2O apps was the major reasons for users to reserve hotels online in China in 2015.

The increasing travel needs boosted the intense competition of hotel O2O apps. The top seven travel apps were Ctrip, Qunar, Meituan, Alitrip, Tuniu, CY, and eLong.

Rich resource was more important towards tier-1 and tier-2 city users than the less developed city users. Tier-3 and above city users concerned more on low price than other city users.

Catering O2O market developed into a mature stage in 2015. 72.0% merchants surveyed engaged in the catering industry in China in 2015.

The recent two year had witnessed the fast development of the O2O market. 63.0% merchants accessed to the O2O market in 2015 and 21.0% accessed in 2014.

42.0% of offline merchants surveyed accessed to the O2O platforms because of the large orders online and 13.0% because of the quick payback speed. Promotion of salesman was also an important reason for the merchants to access to the O2O platforms.

By accessing to the O2O platforms, offline merchants hoped to get an increase in turnover, profit, and brand public praise.

About 50% of merchants surveyed believed their turnover increased by 10% to 30% after accessing to the O2O platforms and 32.0% believed their turnover increased by 30% to 50%.

Some merchants terminated their cooperation with the O2O platforms. 50.0% terminated because of the loss of consumers and 33.0% because of the decrease of turnover.

The current cooperation mode of merchants and O2O platforms is subsidy plus discount which is expected to upgrade to maintain and draw more merchants and users. The O2O platforms could bring in more traffic and consumers for merchants while how to manage the merchants is still a severe challenge for O2O platforms.

Also read: China B2B Market Insights 2016

China’s online accommodation booking market reached 24.983 billion yuan (US$3.89 billion) representing a QoQ growth of 27.98% and YoY growth of 82.16% in the third quarter of 2015 according to Analysys.

China’s online travel market reached 122.23 billion yuan (US$19.07 billion) with an increase of 18.0% QoQ and 45.9% YoY in the third quarter of 2015 according to iResearch. The OTA market in China reached 5.96 billion yuan (US$0.93 billion) in Q3 2015 with an increase of 48.8% compared to the same period last year, led by Ctrip and eLong.

The online accommodation market maintained a rapid growth in the third quarter of 2015 under the constant promotions of China’s online accommodation and online travel agencies. Overall transactions of online travel market totaled US$19.07 billion in the third quarter and the OTA market in China gained US$0.93 billion.

Ctrip reached revenues of 10.762 billion yuan (US$1.68 billion) with 43.08% market share. Transaction values of Qunar were 5.63 billion yuan (US$0.88 billion) accounting for 22.54% online accommodation booking market. Ctrip, Qunar, eLong and Alitrip combined account for almost 85% total market share, 4.14 percentage points higher compared to the previous quarter.

Continue reading on China online travel booking users in Q3 2015 here.

China’s online accommodation booking companies have attempted in exploring more effective cooperation modes and integration methods between the online and offline. By an increasing number of China’s tourists and promotion of industrial chains, the online accommodation booking market in China will continue to grow in the future.

Also read: China Short-term Accommodation Market Overview 2015

China online travel market reached 44.88 billion yuan (US$7.00 billion) an increase of 48.1% YoY in 2014. And, China’s online travel market is expected to total 63.06 billion yuan (US$9.84 billion) in 2015, an increase of 40.5% compared to the previous year estimated by iResearch.

China’s online travel market is expected to total 63.06 billion yuan (US$9.84 billion) in 2015 with an increase of 40.5% compared to the previous year. 12.5% internet users will buy travel products online. China’s online travel will maintain a steady growth rate in the next several years with an annual growth rate over 30%.

Outbound travel by cruise in China has become fashionable in large and developed cities in recent years. Compared to other outbound travel means, cruise travel could offer more activities for entertainment and relaxation, and travelers won’t need to get on and off trains or planes during trips which can save a lot of money for travelers.

China’s outbound cruise travelers increased to 1.48 million person-trips in 2014 and the number is predicted to reach 1.9 million person-trips in 2015, gaining 4.5 billion yuan (US$0.70 billion) for China’s online travel market. More outbound travelers will travel by cruise in the future.

Online travel websites are the main channel for travelers to receive cruise travel information. Promotion activities of cruise travel and information on comprehensive portal websites can attract more travelers. A large number of cruise travelers will order on online travel websites mainly owing to the convenient payment, good public reputation and more promotion activities.

The online travel agencies and online travel websites have made a large contribution to China’s online travel market. Ctrip, Tuniu, LY, Lvmama, Alitrip and Qunar are major online cruise travel webites in China.

Most of China’s outbound cruise travelers are citizens in large and developed regions such as Beijing, Shanghai and Guangdong. 42.7% gain the monthly income between 3,000 (US$467.94) to 6,000 yuan (US$935.88). The majority of cruise travelers are bachelors who can soon get aware of this new travel method and willing to try it. Travelers with stable income resources account for the bulk.

Generally speaking, outbound cruise travelers won’t travel alone which is distinct from free and easy travelers. 76.9% cruise travelers will travel with lovers, 67.5% will travel with children, 57.6% with parents, and 51.9% with friends.

Outbound cruise travelers usually spend much time in preparing for the trips. 35.3% will prepare for travel half to one month in advance.

About 57.8% cruise travelers don’t spend more than one week on the cruise. 32.0% tend to spend 8 to 14 days on trips and 10.2% spend over 14 days.

China’s outbound cruise travelers prefer short-distance journeys compared to long-distance trips. Neighboring destinations such as Japan and Korea, Southeastern countries, Aegean, Hong Kong, Taiwan and Macao have a heavy passenger flow volume.

62.8% travelers like outside staterooms where they can see the sea view. The majority don’t want to spend all time on the cruise. Nearly half cruise travelers are inclined to visit on land in daylight and relax on the cruise at night.

Over 80% outbound cruise travelers plan to spend less than 10,000 yuan (US$1,559.79) on the trips while about 84% are prepared to spend less than 10,000 yuan on chargeable entertainment activities during the travel.

Apart from enjoying the beautiful sea sceneries, outbound cruise travelers also would like to shop at duty-free shops, enjoy delicious foods, and land to watch local sceneries.

China’s online travel market reached 122.23 billion yuan (US$19.07 billion) with a QoQ growth of 18.0% and YoY growth of 45.9% in the third quarter of 2015, among which the online travel agencies gained 5.96 billion yuan (US$0.93 billion) according to iResearch.

A total of 109 million Chinese person-trips visited foreign countries in 2014 according to the World Urban Tourism Federation (WTCF). With the outbound travel and outbound cruise travel penetrated into more China’s users by government’s support and online travel agencies’ favor, the market in China will be further broadened.

Also read: China Outbound Travelers Shopping Overview 2015

Online family tours market in China has been in the rapid development on both mobile and PC end. Transaction value of China’s online family tourism was 6.51 billion yuan (US$1.02 billion) in 2014 and it is expected to achieve 76.2% growth to 11.47 billion yuan (US$1.8 billion) in 2015 according to iResearch.

Travel tours in China are usually categorized by travel distance as getaway trips at nearby attractions, mid- to long-distance trips, and outbound trips. By sales volume, getaway trips are the most popular. Family trips refer to travel trips by parents and children together.

Among potential family tour travelers who haven’t yet made the bookings, 55.8% prefer free and easy trips in which they don’t have to be in a group following a tour guide. 52.5% would choose long-distance domestic trips. Among those experienced family tour travelers, the ratio of following a group is higher and they prefer getaway trips.

China’s major online family tourism companies can be divided into three groups according to their themes and products:

• Separate family trips section, represented by Lvmama and Tuniu.
• Mixed family tourism section, represented by Ctrip and Alitrip where users can get the section by filtering website search results.
• Related family trips products, represented by Qunar and Utour which only have related tourism products.

The top ten cities parents and children like most are Beijing, Zhuhai, Suzhou, Shanghai, Chengdu, Hong Kong, Dongguan, Foshan, Hefei and Hohhot. Apart from family tourism, business tourism, award tourism and mass tourism are also full of bright market prospect.

Also read: China Tourists Travel Intention Study 2015

Alitrip has cooperated with Sina to launch a tourism product Qingtingke during this year’s Double 11. This product provides resources and support to Weibo WeMedia owners and influencers in travel industry to enrich tourism product categories and improve destination tourism resources.

Qingtingke is a product for WeMedia users and tourism lovers on Weibo who have rich travel experiences to provide one-to-one personalized travel experience to travelers.

As one of the leading online travel platform in China launched a year ago, Alitrip has served over 100 million users. Sina Weibo has gathered more than 25,000 users who love traveling with more than 2.67 million daily published travel related posts. This strategic cooperation between Alitrip and Weibo could well integrate the big travel platform data with the powerful travel content.

Also read: More Chinese Travelers Active on Mobile Than PC

Since January 2015, the number of active users on mobile apps has surpassed that of the PC side, and the gap is gradually increasing. Online travel websites are increasing efforts to transform to mobile end to compete for more users.

Ctrip leads the online tourism market while Qunar attracts more consumers on mobile end, followed by LY, Alitrip and Tuniu.

Also read: China Mobile Internet Trend 2015

In Q2 2015, China’s online accommodations booking market reached 19.52 billion yuan (US$3.09 billion), with an increase of 15.9% QoQ and 63.5% YoY.

Also read: China Online Vacation Market in Q1 2015

The total transactions of China online travel market reached 94.76 billion yuan (USD 15.28 billion) in Q1 2015, an increase of 51.3% YoY or 9.4% QoQ.

Offers from China online travel providers such as Ctrip and Qunar have extended to provide more on “things to do” in travel destinations. China online trave providers have also expanded to provide lifestyle offers such as food delivery, movie ticketing and car renting.

Ctrip and Qunar in total accounted for over half of China’s online travel market by total transaction values. Alitrip, Alibaba’s ambition in China online travel market only launched in October 2014, already grabbed over 10% of China’s online travel market.

71.3% of China online travel market transactions came from transportation online booking.

Also read: China Outbound Travelers Spent Close to $500B Overseas in 2014

Alibaba Group upgraded Taobao Travel and launched an independent travel brand “Qu A” at Alitrip.com today and a corresponding mobile app is also released.

The domain name Alitrip is different from the pinyin or pronunciation of its Chinese brand “Qu A” (去啊) and it’s in English, hard for many Chinese to remember and type; not a very wise choice.

Alitrip.com operates as a platform offering air tickets and accommodation bookings, tickets of attractions, and tour packages, just like Taobao Travel, a travel section of Taobao.com

Alibaba wants to gain more in China’s booming travel market, where 57% Chinese made travel bookings online, by setting up a separate brand for travel. With the established user base on Taobao Travel and its rich resources, it’s promising to see Alitrip very competitive in China online travel market.

Taobao Travel’s half day transaction value reached RMB 157 million on Double 11 (Single’s Day) in 2013. Taobao Travel mobile app is also among the top six mobile app by total number of monthly active users, after Qunar, Ctrip, LY, eLong and Daodao.

Taobao agreed to invest RMB2.81 billion in Beijing Shiji Information Technology Co. Ltd (Shiji Information) who is listed on Shenzhen Stock Exchange (code: 002153), a China-based hotel information technology provider, in return for a 15% stake, who has been appointed as the preferred vendor for many International Hotel Groups like Grand Hyatt, Sheraton, Hilton, Shangri-la, Marriott, Peninsula and Accor etc.

Read more: China National Day Travelers’ Insights