Hotels in China ought to pay more attention to their online hotel bookings as China’s online hotel reservation industry maintains speedy growth with monthly active users (MAU) reaching 91.09 million in Q2 2018, which is 20.1% increase compared to the first quarter.
The research from Trustdata’s Mobile Big Data Monitoring service added that online booking platforms such as Ctrip, Meituan Hotels, Qunar, Tongcheng-eLong and Fliggy were the popular and fast-growing platforms for the quarter. These players accounted for 96.4% of the online hotel bookings in the second quarter.
The competitive landscape of online hotel booking becomes clear-cut, with traditional OTAs like Ctrip and super platforms like Meituan Hotels carving up the market. Meituan Hotels ranks first by both order volume and room night in Q2. It exceeded the combined room nights registered on Ctrip, Qunar and Tongcheng-eLong again, seizing 46.2% of the market share in Q2 2018.
Fliggy ranks first in terms of customer stickiness. Super platforms like Meituan Hotels and Fliggy are gaining popularity, thanks to the user bases of Meituan-Dianping and Taobao accumulated via such high-frequency services as food delivery and online shopping, respectively.
Lastly, Ctrip is a pioneer of OTA that is offering all travel-related services. It has the edges in high-starred hotels but is challenged by Meituan Hotels and Fliggy. While the main users of Ctrip are middle-aged with strong consumption capacity, users of Meituan Hotels and Fliggy are younger and have massive buying power in the future.
The Chinese millennials or the Post-80s and Post-90s consumers are the critical driving forces on this rapid growth of accommodation bookings. Millennials are adept in using the technology and to share their information online unlike the older generations.
Millennials are thirsty for unique experiences. More often than not, they search for one-of-a-kind destinations and activities and makes sure to take a photo as proof and to post on their social media. Therefore, it is important to meet their demands and to curate experiences around their wants.
The third and lower-tier cities or the less populated and less industrialised cities become a major growth driver, contributing 50% to the total online hotel bookings in June. Among the 20 million new users in Q2 2018, the post-80s and post-90s are the main force, while the demand from the post-00s or Gen Z also begins to grow.
Foreign tourists are not alone in exploring the less popular places in China. Locals are also on their foot discovering the beauty of their country. The proportion of hotel reservations made by locals exceeds 30% in Q2 2018, indicating that online hotel booking is gaining popularity among travellers as well as locals.