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text丨fan dongcheng

the tourism industry is currently very popular.

leading domestic online travel players have recently disclosed the latest developments based on their respective achievements: ctrip released the "2024 national day travel forecast report", with inbound travel orders on the platform increasing by 60% year-on-year; tongcheng released the "2024 national day holiday travel trend report" ", residents of third-tier and below cities account for more than 40% of the platform's long-term outbound tourists, and the popularity of platform-related product bookings has more than doubled year-on-year; fliggy released the "2024 national day holiday travel vane", and the unit price of the platform during the national day holiday increased by 6% year-on-year. the number of outbound air tickets and hotel bookings has significantly exceeded the same period in 2023.

during the mid-autumn festival holiday that just passed, the industry's performance was also quite impressive. according to data from the ministry of culture and tourism, during the mid-autumn festival holiday in 2024, domestic tourists will reach 107 million, an increase of 6.3% year-on-year in 2019; tourism revenue is 51.047 billion yuan, an increase of 8% year-on-year.

the peak travel season is a key period for otas, or online travel platforms, to compete in depth. in order to gain more users and orders during these periods, and then strengthen the methodology and spread it throughout the year, all parties are actively preparing to face market demand and obtain show the utmost sincerity. this is a competition of comprehensive strength between platforms.

fliggy’s card position is worthy of attention.

judging from the current industry competition landscape, fliggy’s challenges are not insignificant.

according to data from essence international, china galaxy securities, fastdata and other institutions, since 2020, in the domestic online travel industry, fliggy has ranked behind ctrip, meituan, after tongcheng and qunar; qunar has long been subsumed by ctrip. ctrip is the largest shareholder of tongcheng. the three ctrip-related companies, ctrip, tongcheng and qunar, have currently captured more than 60% of the domestic online travel market. the u.s. tuan’s share is about 20%, while fliggy’s is around 7%.

although fliggy is small, there is a big man ali standing behind it. this is a key factor that has made all parties in the industry fear or have expectations for fliggy over the years. however, in recent years, due to well-known reasons, alibaba has continued to undergo internal changes and adjustments, and its strategy has become more focused. fliggy's presence in the alibaba system has become increasingly weakened, and its future direction is even more elusive.

it can be seen that ali's financial report has included fliggy, hema, sun art retail, ali health, etc. into the "all other" section; the latest two financial reports are the annual report as of march 31, 2024 and the the quarterly report ending on june 30, 2024, did not separately mention the specific situation of fliggy.

hiding in ali is by no means what feizhu and ali are pursuing. highlights flying are the proper meaning of the title. however, the highlight relies on its own energy to fly, which is extremely powerful and can even overwhelm leading competitors. the current fliggy is undoubtedly still far away from this step.

01

the difference is difficult to perceive

fliggy uses differentiation as a way to deal with competition, emphasizing the platform ecological model.

after changing its name from "alibaba travel", fliggy has used a platform ecological model to attract suppliers. fliggy does not want to call itself an ota, and instead emphasizes otp and otm in its promotions, that is, it is not an agency that does online travel, but a platform and market place, and calls otm an online travel ecosystem.

this logic is similar to taobao, which is based on alibaba's technology, traffic, data and resources. the platform provides marketing tools and allows merchants to use their capabilities freely. in the words of zhuang zhuoran, the current ceo of fliggy, compared to ios, fliggy hopes to develop android and involve different partners to jointly promote the development of the industry.

according to multiple media reports, the service fee charged by fliggy is generally 2%-8%, while the commissions of other ota platforms are more than 10%. with relatively low commissions and the traffic brought by alibaba’s ecosystem, fliggy can easily attract suppliers.

taking overseas supply as an example, in june 2024, fliggy disclosed at its overseas local entertainment partner conference that more than 1,000 new merchants operating overseas local entertainment and scenic spot ticketing have settled in fliggy within one year. the platform has overseas destination entertainment, nearly 30,000 new products such as tickets have been added.

but for users, such a differentiated route cannot directly constitute a strong brand mentality.

in communication, ota generally refers to online travel platforms. in most contexts, users do not deliberately distinguish between otas and otps, but instead include ctrip, tongcheng, fliggy, etc. as otas. more importantly, they all have self-operated products and third-party suppliers. they are essentially platforms. according to heike finance's observation, the content layout of these platforms is not much different. the first screen is for bookings of air tickets, train tickets, hotels, travel itineraries and other items. fliggy, a self-positioning otp, also has fliggy international, fliggy vacation and other self-catering otps. business brand.

even if specific services are provided by third-party providers, service quality will still affect users' evaluation of the platform. this is a key reason why fliggy’s reputation has been affected. as of september 29, 2024, on the national 12315 consumer complaint information disclosure platform under the state administration for market regulation, there were nearly 30,000 complaints involving fliggy, less than 2,000 for ctrip and qunar, and 4.3 for tongcheng. ten thousand. it should be noted that in this set of data, it seems that tongcheng is involved in more complaints, but according to the total number of deduplicated users calculated by questmobile, fliggy’s scale is only about 12% of tongcheng’s. it can be seen that fliggy has a high complaint rate much more.

the experience of xiaohongshu user “rayna fairy” is very representative. the user placed an order for a one-day trip to australia's great barrier reef on may 1 from a fliggy merchant in march 2024. no one greeted him after he went at the agreed time. after learning from others, the user believed that the ordering merchant did not give her australian phone number to the local receptionist, resulting in the receptionist being unable to contact her. she complained to fliggy, who said that the receptionist had received other people from the same hotel. it was the user's own problem and the merchant was not at fault, so no refund would be required. the user stated in the note that he would sue fliggy platform and related suppliers. as of the publication of this article by haike finance, the user has not updated the relevant progress.

a similar problem exists with flight bookings. many users reported that fliggy merchants purchased connecting tickets in violation of regulations when booking tickets, forcing users to "drift", that is, not taking the later part of the flight.

a user purchased air tickets from seoul to xiamen on fliggy in september 2024, but found that there were extra air tickets from xiamen to nanjing. when users complained to fliggy, the platform stated that this was the supplier's behavior and suggested not to take the later part of the flight. the user learned that many airlines clearly oppose the behavior of "drifting" and may blacklist relevant passengers. after the user complained, fliggy gave the option of either refunding the 300 yuan price difference or refunding the ticket in full without compensation. the user immediately complained on 12315 and civil aviation service supervision 12326, but the relevant progress has not been updated yet.

for the tourism industry, the importance of channels needs no elaboration. in this regard, ctrip and tongcheng have first-mover advantages, and fliggy hopes to expand its channel power by exploring third-party suppliers through a platform strategy. however, the service chain of the tourism industry is long and complex, covering multiple performing parties. it is not easy to ensure stable service quality. a little carelessness will affect the user experience and platform reputation.

02

marginal status

fliggy has been in operation for 14 years. during this period, there has been no major change in strategy, but its position within the alibaba group has undergone considerable changes.

in addition to platformization, another focus of fliggy is globalization.

the predecessor of fliggy was taobao travel launched by ali in 2010. in 2014, it was renamed "alibaba travel·quaa" and became a business group under ali. in 2016, it was officially renamed fliggy. fliggy’s first ceo was li shaohua, who had many years of experience in the aviation business. at that time, jack ma proposed the globalization strategy of “buy globally, sell globally, pay globally, ship globally, and travel globally”. fliggy focused on outbound travel. direction. in march 2018, li shaohua was transferred from fliggy, and his replacement was zhao ying, the former leader of alibaba’s globalization leadership group.

alibaba's emphasis on globalization has enabled fliggy to form a comparative advantage in the industry and has accumulated its advantages to this day.

according to the "2024 china outbound travel industry development trend report" released by the research organization fastdata, based on the number of people served, fliggy ranked first in the outbound independent travel market share of domestic travel platforms in july 2024, accounting for 44.3%; ctrip, tongcheng and meituan ranked second, third and fourth with shares of 31.2%, 9.5% and 5.9% respectively.

current ceo zhuang zhuoran is still advancing in the existing direction after taking over fliggy in 2020. during the epidemic, fliggy also created a "package package" business model, which enabled suppliers to take advantage of the abundant supply during the off-season to package cost-effective products, breaking the strict time constraints of traditional travel products. this can greatly reduce the decision-making costs of users with short-term travel restrictions. fliggy’s 2022 double 11 battle report stated that the platform event commodity transaction volume has maintained double-digit growth for three consecutive years compared with the pre-epidemic period, that is, the 2019 double 11.

despite this, compared to the growing overall scale of platforms such as ctrip and meituan, fliggy is not dazzling enough.

take meituan, which joined the wine and travel business in 2014, as an example. relying on its potential in the local life field, meituan has grown rapidly in the wine and travel industry in recent years. reports from multiple research institutions show that meituan’s hotel room nights accounted for more than 50% of the market in 2019, surpassing ota platforms such as ctrip. according to the financial report, in the second quarter of 2024, meituan’s core local business revenue, including in-house hotel and travel business, was 60.682 billion yuan, a year-on-year increase of 18.5%. among them, the order volume of in-house hotel and travel business increased by more than 60% year-on-year. annual transaction users both the number and annual number of active merchants hit record highs.

the matthew effect of the strong being always strong may continue to exacerbate the gap between fliggy and ctrip, tongcheng and meituan.

the changes in fliggy’s weight within alibaba can also be seen clearly.

in july 2021, alibaba classified its location-based service business into the local life service segment, including autonavi, fliggy and ele.me. this was collectively called "flying high" by the media. the financial report shows that in fiscal year 2023, that is, the 12 months ending on march 31, 2023, alibaba’s local life service order volume increased year-on-year. among them, the “to-destination” business order volume increased rapidly year-on-year, and the revenue mainly came from high-end services. virtue and flying pigs.

with the adjustment of alibaba's "1+6+n" organizational structure in 2023, fliggy has been classified under "n" and is not among the six core groups. later, alibaba’s financial report occasionally mentioned fliggy. for example, according to the quarterly financial report ending september 30, 2023, thanks to the strong recovery of domestic and international tourism demand, fliggy’s gmv grew rapidly year-on-year. however, alibaba did not announce the specific performance and profit and loss of fliggy. alibaba’s financial report for fiscal year 2024, that is, the 12 months ending march 31, 2024, did not separately mention fliggy’s business situation.

this is very different from the emphasis that li shaohua took on "global travel", which refers to fliggy, at the group level.

for comparison, hema is also native to alibaba and belongs to the "n" category. alibaba has given out plans for hema to go public, and hema has also reported profits in the off-season. but where the flying pig has flown and where it is going, ali has not made it clear. tsai chongxin, who took over as chairman of alibaba's board of directors in september 2023, and wu yongming, who took over as alibaba's ceo, have not publicly mentioned fliggy's business so far.

in an all-member letter sent in march 2022, zhuang zhuoran mentioned that fliggy will face the market independently in the future, return to an entrepreneurial mentality, "speak human words and do practical things", and "tighten its pants" belt". in the blink of an eye, more than two years have passed, and fliggy's business still has not made a significant breakthrough, its user base is still not dominant, and it is facing a rapid decline.

according to data from the research organization questmobile, in the ranking of online travel applications not included in meituan, based on the total number of deduplicated users in june 2024, the first place is tongcheng with 207 million, a year-on-year decrease of 7%; the second place is 1.35 ctrip with 50.75 million, a year-on-year increase of 4.9%; third place is qunar with 50.75 million, a year-on-year increase of 9.1%; fliggy ranks fourth with 29.94 million, a year-on-year decrease of 15%.

03

too much traffic and anxiety

in order to increase traffic, fliggy’s actions show a sense of urgency.

the popular "mao-flavored double bed room" is a typical example.

in september 2023, moutai and luckin jointly launched the "sauce sauce latte", which became popular as soon as it was launched. that month, fliggy officially announced on weibo that it would launch the maotai hotel's "maotai-flavored double bed room". the promotional materials included "staying in maotai and drinking maotai are all real maotai" and "when maotai is drunk, sleep in maotai hotel ” and other advertising slogans. according to heike finance, the relevant packages include on-site tasting of feitian moutai.

moutai quickly stated that it had not cooperated with fliggy. fliggy stated that this product was supplied to the platform by a supplier that cooperated with sanya haitang bay moutai resort. on this basis, the platform provided subsidies and designed it as a package style for promotion. fliggy said that it will guarantee that users who purchase packages will have corresponding check-in and experience rights when making reservations. as a result of this back and forth, related topics have been trending on multiple platforms.

the moutai incident is not an isolated case. in march 2024, fliggy officially released on the public account "accept price comparison, buy more and get refund!" the westin kyoto "siege price" is here! ", announced the launch of "siege price", which is regarded as the precursor of the price war in the ota industry. however, on march 11, the westin kyoto hotel issued a statement that it had never authorized products with relevant prices to be sold on fliggy and had stopped fliggy from writing off related orders.

as the group reduces costs and increases efficiency and becomes increasingly marginalized, one can imagine the marketing resources fliggy can use to attract new customers.

according to the "2024 cultural tourism marketing insight report" released by questmobile, comparing the marketing expenses of ctrip, tongcheng, qunar and fliggy from january to april 2024, the marketing expenses of the three ctrip companies are all in the 100 million yuan level, with the highest the same journey amounted to 365 million yuan, while that of fliggy was only 31.53 million yuan.

if the flow is under pressure, the action will be easily deformed.

this is the case with the train ticket refund incident. in july 2024, fliggy’s service account released the content of “fliggy’s summer air and train tickets are free of refund handling fees” and launched the “free refund” and “exclusive worry-free refund” activities for train tickets across the entire network. new users who purchase train tickets on fliggy travel and synchronize the ticket information of 12306 can apply for the first refund fee to be issued to the card in the form of a red envelope. but soon china railway 12306 officially issued a statement, saying that "certain platforms" attract new members to engage in marketing hype and mislead consumers into thinking that refunds for train tickets are exempt from refund fees.

marketing is clearly not enough to solve all problems. no amount of hot searches will change fliggy’s brand mental problems at the user perception level in the short term. who users think of first before traveling is crucial.

china merchants securities made a judgment in a research report released on april 17 that ctrip has tied up with business travelers in high-tier cities and absorbed travel users from lower-tier markets at the same time, while meituan has grasped the minds of users who consume wine and travel related to local life. it has been formed, and it is expected that the market share of ctrip and tongcheng will continue to increase in 2024.

as for fliggy, many users said that they chose fliggy because they are members of taobao’s 88vip, and 88vip can directly receive the “fliggy money saving card”.

according to a research report released by china galaxy securities on august 23, the domestic online tourism market revenue will be 4.91 trillion yuan in 2023, will reach 6.27 trillion yuan in 2024, and is expected to increase to 7.37 trillion yuan in 2026; from 2023 by 2026, the online travel market’s share of domestic tourism market revenue may increase from 33% to 39%.

the tourism market is showing clear growth momentum, and more and more players are entering the market. new players such as douyin have achieved rapid expansion in this field and are still making efforts. according to media reports such as 36kr, the gmv of douyin’s lifestyle services, including wine, tourism and catering, has reached 320 billion yuan from january to august 2024. xiaohongshu, which has become popular for “planting grass”, has also set foot here, and its penetration and possibility cannot be underestimated.

old rivals ctrip, tongcheng and meituan have accelerated the pace of exploring broader and more subtle territories while consolidating their territory.

take meituan as an example. in september 2024, meituan once again adjusted its organizational structure, including the establishment of a new department "core local business/hotel travel", which will integrate and increase the accommodation, ticket vacation, transportation, b&b and other sectors. the purpose the aim is to achieve better collaboration in the wine and tourism business. the impact of this move on the future structure of the industry is difficult to predict, but meituan’s ambitions have already been highlighted.

in the past, traditional ota players such as ctrip and tongcheng were blocking and besieging the company. in the middle, the local lifestyle leader meituan has shown a bigger plan. later, emerging forces such as douyin and xiaohongshu continued to attack with traffic, and the variables increased sharply. looking at it now, no matter from the perspective of time or space, there is not much left for feizhu to hesitate and wander.