Huazhu ranked 4th globally, Meituan files for IPO, and more in ChinaTravelNews Briefing
AccorHotels’ shareholder Huazhu surpassed IHG in market capitalization as the world’s fourth highest valued hospitality group. Tencent-invested e-commerce and travel firms Meituan and Tongcheng Elong filed for Hong Kong listings.
Huazhu, BTG Homeinns and Wyndham
Huazhu Group (formerly China Lodging Group), a Chinese hospitality giant that has cross-ownership with French hotel group AccorHotels, announced on June 26 that it has surpassed InterContinental Hotels Group as the world’s fourth highest valued hospitality group with a market capitalization of USD 12.8 billion as of May 31 this year. Chinese state-owned hotel group BTG Homeinns Hotels Group, valued at USD 4.25 billion, was ranked 12th.
Both Huazhu and BTG Homeinns shared their ideas at the 2018 China Hotel Marketing Conference held by TravelDaily in Hangzhou on June 27-28. "We have been re-designing in order to revitalize our brands," said Jenny Zhang, CEO of Huazhu Group. David Sun, General Manager of BTG, revealed that the group was looking at opening up around 400 properties annually in the next 3-4 years. More than half of the properties would be in the mid-scale segment.
Another speaker at the conference, Leo Liu, President of Greater China, Wyndham Hotels & Resorts, mentioned that maintaining standards doesn't mean sticking to fixed ideas. "Flexibility and standardization aren't necessarily contradictory... Standards refer to the implementation of certain processes to ensure quality, but being local and being a part of a certain culture is a way to make a stay enjoyable."
Meituan, Ctrip and other OTAs
Meituan Dianping, backed by Booking Holdings and Tencent, filed for a Hong Kong listing on June 22. As of December 31, 2017, the group-buying, restaurant-review and lifestyle service company had secured room supply from approximately 339,200 hotels in China. Revenues from the company’s in-store, hotel & travel segment increased by 54.6% to RMB 10.9 billion, accounting for 32% of the company's total revenues in 2017. Kevin Guo, VP of Meituan, acknowledged that over 80% of new hotel bookers were converted from the food delivery and in-store dining businesses last year.
To compete with Meituan Dianping and Michelin, Ctrip Gourmet has issued its own restaurant evaluation list on June 22 in Bangkok, Thailand. This is the first Chinese eatery list published in a foreign country.
For its overseas travel-related services, Ctrip has also opened its first batch of foreign currency withdrawal service outlets in Shanghai with close to 30 different currencies on offer. Customers can make an appointment online or head directly to the outlets to pick up their currencies. The company will gradually expand the network to 30 locations nationwide covering 10 key cities by the end of the year.
Tongcheng Elong, a Chinese online travel company backed by Tencent and Ctrip, applied on June 21 for listing on the Stock Exchange of Hong Kong. The average monthly active users of Tongcheng and eLong combined increased from 88.7 million in 2015 to 121.2 million in 2017, representing a compound annual growth rate of 16.9%.
Shanghai-based online travel operator Lvmama.com has been announced as the official Chinese travel partner of Inter Milan. The two sides will design and develop soccer itineraries for Chinese tourists and sports fans, including trips to San Siro to watch games of the club and visits to the stadium and training base of Inter Milan.
To differentiate itself from OTAs, Alibaba’s travel unit Fliggy is redefining its role as an Online Travel Marketplace (OTM). "Our platform isn't just about sales for travel brands, but also has a role to play in marketing and service," said Wells Zheng, Vice President, Strategic Development for Transportation Business of Fliggy. "For this, brands can leverage brand account management and marketing services. These are integral parts of the Online Travel Marketplace, which marks the latest phase in the evolution of the tourism business model."
WeChat now allows for real-time tax rebates at 77 airports in Europe and Asia. The service, dubbed We Tax Refund, enables travelers to quickly apply for tax refunds in the app while abroad or once they have returned home. WeChat also claims that it will not impose any fees on the transactions.
On Chinese tourists
In the first four months of this year, Chinese arrivals to Europe were up 9.3% on the same period last year and forward bookings for May to August are currently 7.9% ahead.
The top destinations for Chinese tourists were Germany (up 7.9%) and France (up 11.4%). The fastest growing destinations were Turkey (up 74.1%), Ukraine (up 27.6%) and Hungary (up 15.2%).
Chinese tourists are expected to make 5.7 million cruise trips this year, up 15% from last year. The annual passenger throughput of China's ocean liners will reach about 30 million by 2030, according to projections issued by the country's authorities in 2015.
China’s railway network is expected to transport 647 million passengers during this year’s summer travel rush, an increase of 7.6% year on year, according to the China Railway Corporation. During the period, passengers in the country will make a total of more than 10 million train journeys every day.
Startup funding updates
Travel tech service provider Travel-X has completed its A-round financing. By applying a high-performing airfare query engine built with search technology, it is able to process thousands of pieces of regular data and inventory data per second, so as to update prices and other key indicators concerning travel products in real time.
B2B insurtech platform P6air has received USD 1.56 million in an angel round funding. The company claims that it is able to achieve a 95% accuracy rate in predicting flight delays within 30 minutes, 5 percentage points higher than the industry average.
Kuaibangxing, a platform for turnkey travel services across North America, has reaped millions of dollars in an angel round of financing. With the latest funding, it will speed up to expand its own distribution channels and explore segmented or niche channels like overseas travel communities and parent-child education institutions.
MICE venue and service brand L-SPACE has closed a seed funding round backed by individual investors. The funds will be used to launch its first store slated for this September. The store will serve small meetings for 100-300 people, and the costs of such events will be lower than four- and five-star hotels.
Travel platform My Daydream has reaped USD 7.7 million in the A+ financing round. It was established in 2014 for independent travel designers to present tourists with immersive and personal getaways.
Yacht service operator HiTime has secured multi-million yuan in an angel round of financing. The company is planning to claim 70%-100% of the yachting market in Hainan, the Yangtze River Delta and the Pearl River Delta regions.
Hotel cloud-computing service provider Titan has pocketed USD 15 million in its C round funding. The company will use the proceeds to double down on technological innovation and business expansion to further develop its services to the hotel supply chain.
Homestay chain brand Youjia received an investment backed by investors including Ctrip and Tujia. The company operates as a Virtual Store & Service Center – each group of 100 guestrooms within a radius of three kilometers is clustered into a virtual store, supported by a service center that provides concierge, housekeeping, laundry and luggage valet services.
Residential hotel operator InnJoy has closed a USD 1.5-million angel round of financing. InnJoy is testing new retailing in its properties similar to that of the Yanxuan Hotel jointly launched by Chinese Internet portal NetEase and lifestyle hotel brand Atour. Users can try the products during their stay and place orders by scanning the QR codes in the hotel rooms.