Alibaba Group's online travel arm Fliggy recently announced the launch of an RMB 10 billion (USD 1.48 billion) subsidy program, covering 100,000 hotels nationwide at the initial stage. The program will be extended to transportation and tourist sites before the National Day holiday in October.
This year’s China National Day holiday lasting eight days is the first long vacation since the outbreak of the pandemic. Vacation bookings have soared since last week, by 190% for hotel bookings and 160% for flight tickets on a week-on-week basis, according to Fliggy.
The average room rate for the National Day holiday has increased 65% compared to August, but is still 30% lower than that of the same period of last year. With domestic and short-haul tours becoming increasingly popular, hotels are a key component in the localization of travel activities.
Fliggy’s RMB 10 billion subsidy program will cover hotels, shared homes and apartments of various types and levels, to meet different consumer needs.
Fliggy users can search for hotels participating the subsidy program according to arrival date and destinations. Many five-star hotels in CBDs even provide 50% extra discount on top of the reduced room rate subsidized by Fliggy subsidy program. Fliggy said that the subsidy ratios varied among hotels and are subject to changes.
Fliggy’s subsidy program would also be extended to attractions before the National Day holiday. With the subsidy, Disneyland ticket price will be reduced to as low as RMB 199 (USD 29.5), and tourists will get a 50% discount for tickets of many other attractions including the Forbidden City and Chimelong.
Fliggy expected that more than 60% of Chinese tourists would increase their travel budget by at least RMB 2,000 (USD 296). At the same time, they would be more concerned with safety and more interested in customized and small group tours.
The RMB 10 billion subsidy program is not a short-term marketing activity, but a long-term consumer-centric initiative for promoting merchants’ values, according to Zhuoran Zhuang, vice president of Alibaba Group and president of Fliggy, adding that Fliggy brings travel merchants not just transactions but also active users.
For the past two years, Fliggy has been helping its merchant partners shift their operational focus from “traffic-centric” to “user-centric” with its digital tools, which has created significant returns for the partners. Fliggy has brought 35 million targeted fans and members to the hotels. Over 50% of all hotel bookings were made by loyalty members. With the support of Fliggy’s hotel alliance, independent hotels generate more than 40% of their business from repeat bookings.
Fliggy said it would further revitalize Alibaba’s ecosystem, upgrade products and improve services for travelers in the next step.