In the second half of the year, facing a more open and diversified competitive landscape, how will established OTAs reshape themselves to regain attention while strengthening their core barriers? Can content-based platforms maintain their strong growth momentum and convert traffic into "retained traffic"?

Content/Lan Yu 

Editor/TV  

Proofreader/Mang Fu 

In the first half of 2024, the trend of "one drama igniting one city" continued to thrive.

"Springtime Sentiment," starring Li Xian and Zhou Yutong, and "My Altay," adapted from the eponymous essay collection by renowned writer Li Juan, respectively ignited interest in Quanzhou, Fujian, and Altay, Xinjiang.

The succession of "Internet celebrity cities" once again proves the power of content-based platforms. Especially with the rise of fragmented reading, the role of content-based platforms as online traffic anchors in the tourism industry continues to amplify.

After a period of recovery, the domestic tourism market has shown a strong growth trend this year. Recent statistics released by the Ministry of Commerce show that from January to April, consumption of key monitored online services grew by 25.1%, with online tourism growing by 77.6%.

In the current tourism market, the competition between established OTAs (Online Travel Agencies) and platforms like Douyin and Xiaohongshu has intensified, with each striving to capture users' minds and market share. Established OTAs have joined the live streaming trend, while platforms like Douyin and Xiaohongshu quickly transform users' interests from content browsing into actual transactions through their content ecosystems.

In the second half of the year, facing a more open and diversified competitive landscape, how will established OTAs reshape themselves to regain attention while strengthening their core barriers? Can content-based platforms maintain their strong growth momentum and convert traffic into "retained traffic"?

Part.1

Competitive Barriers of Ctrip and Tongcheng

As veterans in the online tourism industry, the financial reports of Ctrip and Tongcheng provide important reference points for observing the development trends of the entire OTA sector.

The financial reports show that in the first quarter of 2024, Ctrip Group's revenue was 11.92 billion yuan, up 29% year-on-year, with a net profit of 4.31 billion yuan, up 27.51% year-on-year. Meanwhile, Tongcheng Travel's revenue was 3.866 billion yuan, up 49.5% year-on-year, with an adjusted net profit of 558 million yuan, up 10.9% year-on-year.

Despite the strong onslaught from disruptors like Meituan, Douyin, and Xiaohongshu, Ctrip and Tongcheng's revenues continued to grow, with their positions remaining unshaken. The core reason lies in their absolute bargaining power formed through shareholding, acquisitions, or focusing on main businesses such as accommodation bookings, transportation ticketing, travel and vacation packages, and business travel management, which led to performance growth.

Starting in 2008, Ctrip began to invest heavily in leading domestic hotel enterprises such as BTG Hotels, Huazhu Hotels, Kaiyuan Hotels, and Atour Hotel Group. From 2013 to 2017, Ctrip continuously invested and acquired over 20 companies, including Tunefeng.com, Tongcheng.com, Tuniu.com, Qunar.com, Indian OTA giant MakeMyTrip, and Skyscanner, achieving market share growth and scale expansion.

In 2023, Tongcheng Travel successively acquired Beijing Tongcheng Tourism Investment Group Co., Ltd. and Hainan Yanoda Harmony Tourism Co., Ltd. The former is composed of multiple regional travel agencies, while the latter, located in Hainan, is primarily engaged in the operation of tropical forest parks. The positive impact of these acquisitions on performance growth is also an important reason for Tongcheng Travel's performance growth.

Against the backdrop of a globally sluggish economy, consumers in the tourism market have increasingly stringent requirements for product cost-effectiveness. The discourse power held by Ctrip and Tongcheng in resources and channels is sufficient for them to calmly respond to price wars from competitors. In contrast, user groups on platforms like Douyin and Xiaohongshu are mainly young people who may focus more on sharing travel experiences and acquiring travel tips rather than directly purchasing travel products on the platforms.

Part.2

Douyin, Kuaishou, and Xiaohongshu Grasping the Traffic Password

During the cultural tourism recovery process, content-based platforms like Douyin, Kuaishou, and Xiaohongshu have played a significant role. The three companies provide a huge traffic pool for the dissemination of cultural tourism content, and their "content + traffic" strategy has become a powerful weapon that distinguishes them from traditional OTA platforms.

From the explosion of popularity of "entering Zibo for exams" to the new-style marketing of Harbin's Central Street, and the Tianshui spicy hot pot driving tourism in Gansu, Douyin has successfully promoted local cultural tourism features to the entire country through short videos and live streaming. Compared with traditional OTA platforms, Douyin's biggest advantage remains its content and traffic.

According to the "2023 Douyin Tourism Industry White Paper," in the first quarter of 2023, the number of people posting "travel"-related content on the Douyin platform ranked second in the entire industry, with over 400 million interested users in tourism on Douyin. Additionally, supplier resources have also begun to gather on the Douyin platform.

The "2023 Douyin Travel Ecosystem Report" shows that various cultural tourism enterprises have successively entered the Douyin platform, including foreign tourism bureaus, airlines, hotels, scenic spots, OTAs, etc., covering almost all cultural tourism scenarios. The number of these accounts has shown exponential growth.

Kuaishou has long had a presence in the cultural tourism market, displaying a clear and gradually deepening trend, with content remaining the core driver. In 2021 and 2023, Kuaishou respectively launched the "virtual tourism" program "Travel Adventures" and the "Every City Has a Trick" hundred-city collaborative cultural tourism project, supporting regional cultural tourism content with tens of billions of traffic.

Xiaohongshu's decentralized content distribution logic is a unique advantage. From seeding destinations, online exploration, to offline experiences and online sharing, users' travel experiences form a closed loop on Xiaohongshu.

In 2023, the number of travel influencers on Xiaohongshu increased by 672% year-on-year, and the number of travel-related professional accounts increased by 1221%. The number of travel-related notes reached 28.65 million. Topics such as temple economics, special forces tourism, and CityWalk sparked round after round of heated discussions.

Part.3

Addressing Shortcomings and Returning to User Experience

In essence, cultural tourism products, due to their "non-standard" nature, require a high degree of coordination and cooperation among hotels, scenic spots, local travel agencies, and other links. If these "post-link" services cannot be effectively controlled, it will directly impair consumers' actual travel experience.

For example, during offline fulfillment, unreasonable additional transportation and hotel fees may be charged. Meanwhile, in live streaming and short videos, merchants offer discounted prices by including itineraries, providing large transportation, subsidies, and cashback, indirectly promoting "unreasonably low-priced" group tours. Merely grasping traffic is far from sufficient to enhance user satisfaction and loyalty.

To address these issues, platforms need to work on multiple fronts, continuously strengthening cooperation and communication with suppliers, improving the professionalism and service awareness of customer service teams, establishing a sound after-sales service system, and participating in deeper fulfillment services within the industry. Facing the rise of content-based platforms like Douyin and Xiaohongshu, OTA platforms also need to quickly address their content shortcomings.

Amid the upsurge in the tourism sector, not only are new players emerging with fierce momentum, but industry leaders are also constantly adjusting their strategies. All platforms are going all out to layout this hotly contested field.

With the end of the first half of 2024, summer tourism has kicked off, with long-distance tours, wilderness tours, and family tours gaining popularity. Policy dividends such as accelerated supply chain recovery, visa optimization, overseas payment facilitation, and accommodation optimization will also bring new opportunities to the market. Competition in the tourism sector in the second half of the year will become even more intense.