CHINESE ONLINE GIANT TO INVEST IN TOURISM IN EUROPE?

Laura Maudlin - Jun 1, 2020
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The Chinese online travel and tourism giant, Trip.com Group, continues to shop around after having bought Trip.com from the United States and Skyscanner from the United Kingdom. Now they are going after the Netherlands. Why China’s largest travel company acquired a tiny Dutch travel group?

Founded in 1999, Ctrip has been one of the largest online travel service providers in China and Asia with over 400 million users. The company has been listed on the Nasdaq since 2003.

Skyscanner was acquired in 2016 for €1.7 billion! Ctrip became Trip.com in 2019 to be more easily remembered by customers worldwide.

Trip.com's CEO, Jane Sun, indicated that sales outside of China could generate 40% to 50% of the company's total revenues over the next three to five years.

The business travel group, BCD Travel, sold its online agencies grouped in the company Travix to Trip.com in December. This sale was carried out on a highly confidential basis and the price was not disclosed.

The deal gave the Chinese travel titan a set of brands, based in Amsterdam, including Vayama, Vliegwinkel and CheapTickets.nl.

Today, Expedia or Booking.com spend billions of dollars to be present on Google. Trip.com prefers to buy local online agencies that can compete by developing a loyal customer base in a market.

In this case, Trip.com enters the Netherlands market for leisure flight bookings without having to spend unreasonable amounts of money to acquire customers.

Some local online agencies are preferred by customers especially if the customer service speaks their language. In addition, these small online agencies may offer locally known payment methods.

In France, for example, Misterfly accepts holiday cheques for the booking of holidays. Finally, the values of several agencies have fallen sharply due to coronavirus.

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