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Online travel platforms build membership programs for independent hotels

06/04/2020| 11:06:50 AM| ChinaTravelNews 中文

Smaller hotels are particularly vulnerable to the coronavirus impact and that may present an opportunity for the online giants to help while growing their own influence.

Chinese online travel service platforms including Fliggy, Meituan and Trip.com Group have been developing membership programs for independent hotels in the country for the past year, attracting more guests to these small hotels while strengthening their own influence on the hospitality industry. 

Alibaba subsidiary Fliggy teamed up with 15,000 hotels in 2019 to establish a membership club known as Feizhu Hotel Alliance. The alliance seeks to generate traffic to hotels and provide technical support and intelligent hardware in the future, according to the Hangzhou-based e-commerce giant. 

As of April 24 this year, the alliance has signed 23,000 hotels, according to Hai Zhuang, CEO of Alibaba's Future Hotel and director of Feizhu Hotel Alliance. 

Last year, Meituan launched its own membership card DaMeiKa, and in March this year, Trip.com Group inaugurated its YOYO membership program, both targeting to help independent hotels in China attract more guests through the online platforms.

Mr. Zhuang said the Feizhu Hotel Alliance aims at scaling up the program to have  10 million paid members in 2020, at which point the company will have a strong influence on their partner hotels and gain better control and management of the membership club. 

On the consumer side, the Feizhu Hotel Alliance charges RMB 39 (USD 5.5) for a two-year membership with an 8%-off hotel booking discount, while the programs of Meituan and Trip.com requires no membership fees and offers little or even no incentive to consumer sign-ups.  

On the supply side, the hotels joining Fliggy's program will have to offer 15%-off rates to the platform, but there will be no charge on commission when a hotel's own acquired customers make reservations at the same hotel. But both the programs of Meituan and Trip.com Group require no discount rates from hotels on the bookings. Under Meituan's DaMeiKa program, a hotel will pay 3% commission when its own acquired customer makes a second reservation.  

China has around one million independent hotels, accounting for more than 85% of the country's total number, according to data from Fliggy. But these lodging providers usually have less than 80 rooms and lack strong branding and user retention.

The hospitality industry has seen great devastation under COVID-19 impacts. Independent hotels are more vulnerable than big chains to the lockdown and travel restrictions worldwide. That may present an opportunity for the online platforms to help while growing their own influence in the long term.

TAGS: independent hotels | Fliggy | Meituan | membership
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