With Trip in hand, set off just now!

A critical analysis of how Trip uses the Internet to transform and innovate the tourism industry

"airplane in sky" by Sean MacEntee is licensed under CC BY 2.0

Introduction

Trip.com Group Limited (formerly known as Ctrip.com International) is currently the largest online travel agency in China and one of the largest travel service providers in the world. In this essay, a critical analysis of Trip’s revolutionary internet transformations will be made.

In this essay, a brief introduction of the operations of Trip and its historical development will be produced in section one and section two. The third section will focus on analyzing the business model of Trip while section four will focus on its industry ecology. Finally, this essay will critically study the innovative impacts of Trip’s integration of the Internet and the traditional tourism industry on society.

Here is a short video about Trip.com 7.0.

What is Trip

Ctrip, established in 1999, was officially renamed Trip in 2019. It is a large Chinese travel website headquartered in Shanghai which went public in 2003. As a leading representative of online travel agencies (OTA), Trip offers services including accommodation booking, attractions and transportation ticket reservations, packaged tours, corporate travel management and so on (Mi, Chen, Cheng, Uwanyirigira & Lin, 2019). As China’s largest travel e-commerce company, Trip sells travel products through the internet. Simultaneously, Trip is also a kind of comprehensive agent, and it sometimes provides organic proportioning combinations of certain products to meet the comprehensive needs of customers (Xiao & Liu 2010). With the help of Internet information technology to change travel-related information distribution channels, Trip successfully contacted suppliers and consumers directly. Trip’s efficient operation system and open platform are increasingly recognized by the public (Zhang, 2014).

File:Ctrip Headquarter in Shanghai, China.jpg“File:Ctrip Headquarter in Shanghai, China.jpg” by ctrip.com is licensed under CC BY-SA 4.0

The historical development of Trip

Under the background that the Chinese government was vigorously promoting the technical field in the late 1990s, Liang Jianzhang, together with Fan Min, Ji Qi, and Shen Nanpeng founded Trip, headquartered in Shanghai (Sorrells, 2019). Initially, Trip relied mainly on employees to distribute advertisements for hotels at Shanghai airports and railway stations (Schaal, 2016). At the time when the internet was still in its infancy, this way of distributing advertisements did help many customers find a suitable hotel. However, due to credit cards not being widely used in China at that time, payment became a hinder. The original Trip was just a comment community similar to TripAdvisor, a community with no profit (Schaal, 2016).

Before being listed on The Nasdaq Stock Market (NASDAQ) in America in 2003, Trip successfully acquired Beijing Modern Express, which was then known as one of China’s largest hotel reservation centers, in October 2000. After this acquisition, Ctrip became China’s largest online travel and hotel reservation provider (Huang & Law, 2003). In the following nearly two decades of development, Ctrip received a total of US$750 million in investment from Priceline.com (later renamed Booking Holdings). At the same time, Trip’s investment and acquisitions of other companies have also been proceeding. After acquiring Wing On Travel in Hong Kong, Trip also invested in ToursForFun, which mainly targets the North American market (Zhang, Denizci Guillet & Kucukusta, 2015). Compared with other travel sites of the same type, such as eLong, Trip has been profitable for many years (Wang, 2012). Trip currently has many subsidiaries including Skyscanner, MakeMyTrip, Qunar, TrainPal and so on.

First Minister - China Visit“First Minister – China Visit” by Scottish Government images is licensed under CC BY-NC 2.0

By expanding the comprehensive coverage of services before, during and after travel, Trip has further improved its service methods for value groups in the allocation of internal resources of the companies. In terms of external resource allocation, Trip realized effective control and cooperation on upstream and downstream tourism by strengthening cooperation with hotels, tourist attractions and airlines. In terms of products and services, Trip pays more attention to providing tourists with targeted online travel services and other functions, including various comprehensive information related to travel as well as providing booking and reservation services (Li & Zhu, 2016).

Discussion on Trip’s business model

Trip is a good example of the O2O business model, a new e-commerce business model that combines online transactions and offline experience. In recent years, the O2O business model has become an important strategy for corporate development. (Lu & Liu, 2016, cited in Long & Shi, 2017).

The formation and development of the O2O business model benefited from the cooperative development of tour operator (TO) and online travel agency (OTA). As Long & Shi (2017) mentioned, in the travel supply chain, TO lacks sufficient online marketing foundation, technology, labour and other resources, while OTA has difficulty in providing supporting store services for packages. However, the cooperation of these two services can enable both to give full play to their resource advantages and better adapt to the transformation of the tourism industry in the context of the rapid development of the internet and information technology.

Trip integrates online and offline travel resources through the internet, providing users with services including accommodation reservations, transportation ticket bookings, attraction ticket sales, travel agencies’ recommendations and others. Sometimes it can even recommend some combinations of popular attraction tickets and high-quality hotels based on the number of tourists. For example, users can check the price of air tickets for various time periods on Trip where air tickets provided by many airlines are usually included. Users can also filter hotels based on the scope of activities by adding restrictions such as price ranges and star ratings.

Ctrip“Ctrip” by donuzz is licensed under CC BY-NC-SA 2.0

Trip seized the opportunity for the development of the e-tourism business model. In order to achieve a better adaptation to the market, Trip has been keeping to innovate in content and management. In addition to the integration of travel resources, Trip also has a huge advantage in service awareness. It has clear liability clauses regarding ticket issuance time, return policy, and delivery clauses, which are not well protected on many other travel websites (Wang, 2012).

Trip’s internet ecology

Trip has been committed to building a comprehensive online travel ecosystem. In the beginning, Ctrip focused its target consumer group on a group of relatively wealthy business guests, which is one of the reasons why it can handle star-rated hotel reservations, air ticket reservations and other services well. However, with the development of the public’s enthusiasm for self-help travel and major netizens group tending to be younger generations, those users who have limited financial capacity and hope that the website can provide comfortable and cheap hotels have gradually become potential customers for Trip. Trip has begun to pay more attention to meeting the needs of individual travelers.

Since its establishment, Trip has received investment support from some online travel websites including Priceline.com and investment and shares support from multinational consumer companies such as Naspers. In 2010, Trip invested in Taiwanese company Ez Travel and Hong Kong Wing On Travel. Additionally, Trip has also actively acquired online travel agencies such as Skyscanner and Toursforfun (Liu & Lu, 2015).

In order to provide excellent hotel and air ticket booking services for customers around the world, Trip has established good long-term cooperative relations with hotels in major tourist destination cities in the world and major global airlines. To protect the rights and interests of customers, Trip has cooperated with many insurance companies and online payment companies (Liu & Lu, 2015). Although currently being one of China’s largest online travel services, Trip still faces fierce market competition. Its competitors range from domestic online travel websites such as Tuniu Corporation and Fliggy to foreign ones such as Booking and Expedia.

The rapid growth of the tourism industry has created a strong demand for quality tourism services (Au, Buhalis & Law, 2014). Having a positive feedback mechanism can often lead to more sales (Zhang & Zhang, 2008). Trip has created a virtual online community for consumers to sharing travel information with each other. Consumers can suggest and criticize travel services in the virtual community. It makes Trip being under the supervision of more and more users. At the same time, in order to prevent the emergence of monopoly, government agencies are also strengthening the supervision of Trip (Zou & He, 2017).

Here is an ecosystem map of Trip (Figure 1).

Figure 1: Ecosystem map of Ctrip. Created by Antong Chen (the Author).

Trip’s innovation in the internet

In the context of the rapid development of the internet in the 1990s, the tourism industry ushered in tremendous changes and unprecedented opportunities (Buhalis, 1998; Gretzel & Fesenmaier, 2009, cited in Amaro & Duarte, 2015). The emergence of online travel services represented by Trip has greatly changed the behavior of the tourism industry and travelers. It also reflects that a new type of e-commerce model is becoming more and more popular in today’s electronic market.

Firstly, in terms of reforming the tourism industry, the internet with strong communication and distribution channels has successfully filled the gap between tourists and suppliers (Buhalis, 1998, cited in Amaro & Duarte, 2015). Trip uses the internet to integrate online and offline travel resources, succeed in providing more sufficient tourist resources for offline traditional travel agencies and allowing offline travel resources to be fully utilized. By displaying integrated travel resources on its page, Ctrip allows consumers to screen suitable products according to their special needs. As Heung (2003, cited in Amaro & Duarte, 2015) mentioned, the emergence of the electronic market has brought lower prices to consumers and saved consumers’ time. Trip has changed the way public travel purchases.

Casa Monica Hotel, St. Augustine - Reflections of 2011“Casa Monica Hotel, St. Augustine – Reflections of 2011” by Krazy Diamnd is licensed under CC BY-NC-ND 2.0

Secondly, as Chen, Leu & Su (2016) argues, O2O is an e-commerce model with great development prospects. It emphasizes online purchases, which in turn drives offline sales. Trip is a good example of the O2O business model. As Trip and other travel websites that include multiple services become more popular, more and more similar travel websites have appeared. Fierce market competition has promoted the continuous development of the O2O model in the internet market (Long & Shi, 2017).

Thirdly, compared with many other travel sites, Trip has also created a special online virtual community. In this virtual community, consumers are allowed to conduct some online communication activities, such as sharing travel experiences, evaluating travel services, or sharing travel experiences (Huang & Law, 2003). This brings convenience to users to a certain extent. By browsing the communication on the virtual community, users can get a preliminary understanding of an unfamiliar place they are going to in a short time. In addition to sharing travel experiences, consumers can also submit service complaints or suggestions in virtual communities. Trip’s rapid development is subject to strict supervision and supervision by users and government institutions.

A final note

In conclusion, Trip represents a new e-commerce business model that is becoming more and more popular in the current online market. Trip can effectively integrate online and offline tourism resources through the internet, leading to changing the traditional tourism industry and the way consumers purchase tourism products. In addition, by establishing an online virtual discussion community, Trip has allowed more users to participate in development supervision. However, it still has problems in handling consumer complaints, such as slow response and not enough complaint channels for consumers (Xiao & Liu, 2010). To stay ahead of the fierce online travel service market competition for a long time, Trip still needs to continue improving in many aspects.

References

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from: https://doi.org/10.1016/j.tourman.2014.06.006

 

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from: https://doi.org/10.1080/15256480.2014.925722

 

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from: http://search.proquest.com/docview/1783658343/

 

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from: https://doi.org/10.1300/J073v13n04_07

 

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from: https://doi.org/10.1109/LISS.2015.7369783

 

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from: https://doi.org/10.3390/su11092613

 

Schaal, D. (2016). Oral History of Online Travel: Ctrip’s Different Path to China’s Consumers. Retrieved

from: https://skift.com/2016/06/06/oral-history-of-online-travel-ctrips-different-path-to-chinas-consumers/

 

Sorrells, M. (2019). China, part 2: A conversation with Ctrip founder James Liang | PhocusWire. Retrieved

from:https://www.phocuswire.com/China-series-part-2-Ctrip-James-Liang

 

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Multimedia Reference List

Ctrip.com (2017). Ctrip Headquarter in Shanghai, China. Wikimedia Commons. Retrieved

from: https://commons.wikimedia.org/w/index.php?curid=78789336

 

Donuzz (2012). Ctrip. Flickr. Retrieved

from: https://www.flickr.com/photos/donuzz/8100441705/

 

First Minister of Scotland (2018). First Minister – China Visit. Retrieved

from: https://www.flickr.com/photos/129188510@N06/41429729021

 

Krazy Diamnd (2011). Casa Monica Hotel, St. Augustine – Reflections of 2011. Flickr. Retrieved

from: https://www.flickr.com/photos/50484250@N08/6587705901

 

Sean MacEntee (2011). Airplane in sky. Flickr. Retrieved

from: https://www.flickr.com/photos/18090920@N07/4820389847

 

Trip.com (Publisher). 2019. The new Trip.com 7.0! [Video]. YouTube. Retrieved

from: https://www.youtube.com/watch?v=WMNkMZtaPsY

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About Antong Chen 2 Articles
I am Antonia, a university student major in Digital Cultures.