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©️shen xiang original author｜lv yue

since the recovery of the cultural tourism market, both local tours and outbound tours have been gaining popularity. as a low-frequency niche consumer product, tourism has also transformed into a popular mass consumer product. according to statistics from the ministry of culture and tourism, the number of domestic tourists in the first half of 2024 was 2.725 billion, a year-on-year increase of 14.3%; the total expenditure of domestic tourists on travel was 2.73 trillion yuan, a year-on-year increase of 19.0%.

it’s nice to be under a big tree. the performance of several ota platforms in the first half of this year was as good as expected.

ctrip's revenue in the first half of this year was 24.709 billion yuan, a year-on-year increase of 20.69%; net profit attributable to the parent company was 8.145 billion yuan, a year-on-year increase of 103.32%. looking closely at the second quarter, not only did net income increase by 13.55% year-on-year to 12.788 billion yuan,the net profit attributable to the parent company increased by 507.45% year-on-year to 3.833 billion yuan.

in the first half of this year, tongcheng travel's revenue was 8.11 billion yuan, with a year-on-year growth rate of 48.8%; its adjusted net profit was 1.22 billion yuan, a year-on-year increase of 10.9%.total revenue in the second quarter was 4.25 billion yuan, a year-on-year increase of 48.1%, setting a new record for single-quarter revenue.the adjusted net profit was rmb 660 million, and the adjusted net profit margin was 15.5%.

tuniu's net income in the first quarter of this year increased by 70.9% year-on-year to 108 million yuan, and its net profit was 27.7 million yuan; in the second quarter, its net profit reached 43 million yuan, compared with a net profit of only 220,000 yuan in the same period of 2023, a year-on-year increase of 194%.

behind the good data, there are more details worth paying attention to. the ota industry has bid farewell to the drastic fluctuations during the special period and has also passed the initial stage of recovery. now, under the general trend of rational consumption, how will the industry's status quo, growth momentum and challenges evolve?

01 ctrip leads by a huge margin,tongcheng competes with others in different fields, while tuniu is busy with live streaming

if divided by total revenue, the three listed companies in the ota field - ctrip, tongcheng travel and tuniu - are at three levels respectively.

ctrip occupies the leading position in the industry, with its quarterly revenue reaching tens of billions.

among ctrip's five businesses, accommodation booking and transportation ticketing are the basic ones, and their combined revenue accounts for nearly 80% of the total revenue.

accommodation reservations are driven by market demand. with the public's willingness to travel on the rise, hotel reservations will naturally maintain their growth momentum. therefore, we can see that in the first half of this year, the revenue of this business reached 9.632 billion yuan, a year-on-year increase of 24.04%.

however, when comparing the two quarters, the revenue in the second quarter exceeded 5.1 billion yuan, but the year-on-year growth rate of 19.86% was lower than that in the first quarter. in this regard, ctrip group cfo wang xiaofan made an in-depth analysis in the earnings conference call:although the growth rate of hotel bookings in the second quarter remained consistent with that in the first quarter, hotel adr(average room rate for rooms sold)however, there was a year-on-year decline.this change has somewhat weakened the positive effect of strong growth in bookings.

there are two main reasons for the decline in adr: first, the supply of hotels on the ctrip platform has increased significantly, intensifying market competition and leading to more intense price competition; second, outbound tourism is booming, which to some extent diverted mid- to high-end customers from the domestic hotel market, thus affecting the performance of hotel adr.

another major pillar business, transportation ticketing, had revenue of 9.871 billion yuan in the first half of this year, slightly higher than accommodation reservations. however, its growth rate fell faster, with a year-on-year growth rate of 20.31% in the first quarter, but slowed to 1.2% in the second quarter, almost flat.

in fact, this business is more affected by the fluctuation of air ticket prices. this year, the increase in aviation market supply, the decline in air ticket prices, and the increase in consumer price sensitivity have played a role. at the same time, ctrip has also taken the initiative to reduce insurance bundling sales, which will definitely affect the revenue growth rate in the short term, but in the long run, it will still have positive value in improving user experience.

in contrast, among all ctrip's businesses, the one with the highest growth rate is actually the tourism and vacation business, which is mainly group tours, semi-group tours, and customized travel. this is also a market demand-driven business, with a growth rate of 115.80% in the first quarter and a decline in the second quarter, but still reaching 41.97%. if we put business revenue in the total revenue, the tourism and vacation business currently accounts for a relatively small proportion, not exceeding 10%. with demand still high, there is still a lot of room for growth.

in addition, ctrip's business travel management business also achieved steady growth, with a year-on-year growth of 8.39% in the second quarter and a significant increase of 24% from the previous quarter. other businesses, including online advertising and financial services, also showed a good growth trend, with a year-on-year growth of more than 30% in the second quarter, which also provided strong support for ctrip to maintain its leading position.

although ctrip's revenue far exceeds that of other platforms, the ota industry is not a one-size-fits-all situation.

in recent years, tongcheng travel has demonstrated a remarkable growth momentum - its total revenue in the first half of this year reached 8.111 billion yuan, a year-on-year increase of 48.77%, the highest growth rate among the three companies.

specifically, accommodation business and transportation ticketing are also the core pillars of tongcheng travel, accounting for nearly 70% of the total revenue. in the second quarter, the year-on-year growth rates of the two revenues were 25.6% and 15.6% respectively, both of which exceeded ctrip's growth rates.

ctrip has already formed a fairly high barrier in the air and hotel supply chain, so why can tongcheng travel still achieve a high growth rate?the key is that the two have formed a misaligned competition pattern. ctrip emphasizes serving high-net-worth individuals with high income and high education, forming a barrier in the supply of high-end hotels. tongcheng, on the other hand, has been deeply involved in the market outside the fifth ring road, firmly grasping the sinking market, and has rich mid- and low-end hotel and travel resources.this year, there has been a reverse tourism boom, with niche towns and low-tier cities becoming popular tourist destinations for internet celebrities, which has also brought growth to tongcheng travel.

in particular, tongcheng travel's other businesses (including advertising, membership programs and hotel management) are the fastest growing, with a year-on-year growth rate of 87% in the second quarter. this is due to the outstanding growth of advertising and black whale membership businesses, as well as the expansion of hotel management business under the asset-light model. as of the end of june, the number of hotels in operation under tongcheng travel's hotel management division has further increased to approximately 1,900, and more than 1,000 hotels are under preparation.

in addition, vacation is a business that tongcheng travel has only started to engage in since the end of 2023. it mainly refers to the revenue obtained through offline travel agency stores after the acquisition and integration of tongcheng travel. in the second quarter, the revenue of this business reached 719 million yuan, an increase of 8.44% month-on-month, which also contributed to the growth of revenue.

tuniu’s total revenue for a single quarter just exceeded 100 million yuan this year.

previously, tuniu's business structure was relatively simple, and packaged travel products were its lifeline, contributing as much as 70% of its total revenue. this model of relying on a single business has caused tuniu to suffer a great impact during the special period, and it once suffered losses to the point of facing the crisis of delisting.

to save yourself,tuniu has taken a different approach and embarked on a new path of live streaming mcn.since april 2020, tuniu has chosen to broadcast on the douyin platform, incubating a series of accounts such as "east china little players" and "jiangsu, zhejiang and shanghai surrounding tours" to form a matrix.the scope of its live broadcast business is not limited to the cultural and tourism fields, but also involves a wide range of local life services.zhu zhanzhao, vice president of tuniu travel network, said in an interview that although outsiders may think this is a transformation, for internally it is the opening of a new business line. live streaming is not to attract traffic to the main site, but to operate as an independent new business.

supported by the live broadcast business, tuniu finally waited for the turning point of recovery. its net income in the first half of this year was 225 million yuan, a year-on-year increase of 37.86%; the net income in the first quarter alone was 108 million yuan, a year-on-year growth rate of 70.87%; the net income in the second quarter was 117 million yuan, and the growth rate fell back to 16.99%, which is also in line with the overall trend of the industry. among them, the package travel business quickly resumed growth, with revenue of 82.951 million yuan in the first quarter of this year, a year-on-year increase of 106.71%; the year-on-year growth rate in the second quarter fell back to 28.64%, but the revenue of 89.782 million yuan also reached a new high.

tuniu has not yet disclosed the revenue from live streaming sales separately, but it mentioned that in the second quarter of this year, its live streaming transaction amount and write-off amount increased by more than 200% year-on-year. as of the end of may, both indicators have exceeded the total amount for the whole year of 2023. the continuous investment in the live streaming field has also brought significant growth.

02 domestic slowdown to find growth,overseas supports the second curve

in fact, a summary of the net income of the above three ota platforms in the second quarter shows thatafter a year of recovery, the growth of domestic business in the tourism industry has slowed down. how to find growth will be a long-term theme for the industry.

first,all major platforms start with marketing.invest aggressively to reach as many users as possible.

this year, fliggy's marketing activities are very frequent. "jiangxiang king bed room", "attack price" and various promotional activities launched at various nodes have aroused widespread attention from the market. from the data level, ctrip's marketing expenses in the second quarter of this year were 2.84 billion, a year-on-year increase of 20.38%, which is significantly higher than the revenue growth rate, which is enough to prove its investment strength. in addition, ctrip stated in the earnings call that the proportion of marketing expenses may rise slightly in the next few quarters.

tongcheng travel has also been increasing its marketing efforts, with marketing expenses in the second quarter reaching 1.502 billion yuan, up 35.56% year-on-year. tongcheng travel also made it clear in its earnings call that it will continue to invest in brand promotion and marketing activities to increase brand awareness and cultivate user loyalty.

what is special is that tongcheng travel has always worked closely with tencent. not only has the tencent ecosystem become the main source of traffic for the platform, but the cooperation between the two parties in e-sports events, popular dramas and variety shows has also brought tongcheng travel more brand exposure opportunities. in july this year, tongcheng and tencent continued their cooperation, and tencent's huge traffic will continue to bring more support to tongcheng travel.

secondly, in the context of stock competition, the platform is also working hard to improve the experience of existing users and deeply tap into user value.

membership operation is a typical example of this strategy. since launching the black diamond membership program in 2020, ctrip has continuously expanded membership benefits to meet the diverse needs of users. tongcheng travel also emphasized in its financial report that by optimizing operations and holding social events, it has enhanced the interactivity of members and significantly increased the number of black whale members.these member operation efforts not only strengthen the connection between the platform and users and improve user stickiness, but also to a certain extent reduce the possibility of the platform being replaced due to its overly strong tool attributes.

in addition, platforms are also keeping up with new cultural and tourism trends and hot spots, and innovating products and services.

for example, ctrip has launched a number of special packages or targeted activities for the citywalk that has emerged in recent years, the reverse niche popular internet celebrity cities, and the olympic games that just ended a while ago. tongcheng has launched a one-stop travel service around e-sports, allowing users to buy tickets for events on the site, as well as air and train tickets for travel and book e-sports hotel accommodation. after watching the game, users can also buy tickets to scenic spots around the stadium to play.

of course, with the domestic market growth slowing down, ota platforms naturally turn their attention to overseas markets.the expansion of the international market has become the second curve for these platforms.

according to the research report data released by huachuang securities, compared with overseas countries, my country's outbound tourism penetration rate is still relatively low, and there is still much room for improvement in the future. in recent years, thanks to the active adjustment of international entry and exit policies, the popularity of outbound and inbound tourism has increased significantly. the china tourism academy predicts that the recovery process of the inbound and outbound tourism market will be further accelerated in 2024, and the number of inbound and outbound tourists and international tourism revenue will exceed 264 million and us$107 billion respectively.

this has already been reflected in the platform's financial report. after the release of its first quarter financial report this year, tuniu stated that packaged travel, or group travel, has always been the core of tuniu's business, among which outbound travel contributes the most.

ctrip also clearly mentioned in its second quarter financial report thatthis year, inbound and outbound travel and pure overseas travel are the key points of rapid growth.reservations for outbound accommodation and air tickets have recovered to more than 100% of the same period in 2019; the revenue from pure outbound travel business increased by 70% year-on-year, and the number of inbound tourists in the first half of the year also increased by 150% year-on-year.

ctrip started its outbound travel business very early, dating back to the launch of its english website in 2007. the accumulation of users and overseas resources in the early years also laid a solid foundation for ctrip to maintain its advantages in the future. currently, in the overseas market, ctrip has formed a dual-platform structure similar to that in china with skyscanner and trip.com, the former focusing on air ticket price comparison and the latter providing one-stop travel services.

image source: trip.com official website

at the same time, ctrip also mentioned in the earnings call that asia pacific is still the fastest growing region in the world. the online penetration rate in the region is low, and the rapid layout of online and mobile platforms will continue to benefit the platform.

in contrast,tongcheng travel started late in outbound travel and international business, so its main task at present is to speed up the layout and quickly make up for the business services.

in the first half of this year, tongcheng travel launched the international travel booking platform hopegoo. its business currently covers air tickets, hotels, train tickets, tickets, boat tickets, local entertainment and other fields, and supports payment in 16 global currencies and multiple operating languages.

tongcheng travel is also confident about the growth of its international business. in the earnings call, the company said that as the international business matures, its profit margin will be better than that of the domestic business, and it is expected that the proportion of international business will grow rapidly in the next two to three years. tongcheng travel will give priority to the development of international business and believes that it will become an important growth driver for the company in the next few years.

image source: hopegoo official website

in fact, whether in the domestic or overseas markets, consumers are becoming more rational and more sensitive to prices, which will undoubtedly continue to affect the performance of ota platforms.

the wave of change that ota is facing continues, as does competition within the industry. after a sharp rise in the recovery phase, ota is now standing at the starting point of a new stage.