Public enemy Ctrip danger approaching: profit driven capital defense.

category:Internet
 Public enemy Ctrip danger approaching: profit driven capital defense.


The distance between Ctrip and the most dangerous moment is unknown. It is certain that the danger is approaching step by step. / Interview with Guo Zhaofei, Chinese entrepreneur, Jiao Lisha Guo Zhaofei editor Zhai Wenting After Liang Jianzhang used capital to kill his opponent, he did not have a clean change. Ctrip fell into a continuous whirlpool of public opinion, and was even labeled as a public enemy. It has been criticized for its bundled sales, high price refund, and big data, such as the common user, also writer Jiang Fangzhou, actor Han Xue, micro-blog V Wang Zhian and other celebrities. One of the questions, Liang Jianzhangs rare response, as the chairman of the board of Ctrip, he is more of a population economist, almost export must talk about demography, talk less or not talk about Ctrip. It seems that this is not the most dangerous moment for Ctrip. Before Liang Jianzhang returned in 2013, Ctrip suffered a fierce attack by his opponents, including where and Yilong. Once the stock price and market value fell to the bottom, he was rejected by the cashiers 100 index. At present, Ctrip has a market value of more than $20 billion. If the Ctrip was an aircraft carrier at that time, it was already full of holes. Many executive executives got the option price which was more expensive than the market price, not as white as paper. In the view of Ctrip executives, the current situation is not as critical as it was then. A person close to Ctrip familiar with Liang Jian Zhang told Chinese entrepreneurs. In fact, apart from reputation and brand, Ctrips income and share price are also facing challenges. In March 15th, Ctrip announced the performance of the whole year of 2017. Earnings report shows that in 2017 Ctrips net operating income was 26 billion 800 million yuan, an increase of 39% over the same period last year. Compared with the growth rate of 76% in 2016, the slowdown was nearly half. In 2017, Ctrips share price was more than $60, which is currently hovering at $40. Liang Jianzhang may not have expected that where he went, eLong, and Cheng Cheng were put into Ctrip, his new rivals would grow so fast. Us and Alibaba pigs are the two most threatening rivals. In other vertical subdivision areas, new players are also trying to get a slice of the game. A lot of new entrepreneurs to subversion Ctrip as a goal or mission, too big, short term can not shake, but the change will appear in inadvertently, maybe two or three years later. Dai Zheng, the founder and founder of the global pleasure brigade, said. profit-motivated The change has to begin with the beginning of the merger. Liang Jianzhang, chairman of Ctrip board. Source: an interviewee In the morning of October 26, 2015, Liang Jianzhang walked out of the China World Trade Center central building in Beijing with a sigh of relief. Just now, after 48 hours of intense negotiations, he finally talked about it. That night, Ctrip and where to merge the news spread throughout the network. This is a merger that changed the pattern. According to the industry data at that time, Ctrip took 70% of the online tourism market. Before that, Liang Jianzhang worked hard. In November 2015, he accepted an exclusive interview with Chinese entrepreneurs. Sometimes, he did not understand the competitors and why he burned so much money that it caused a lot of pressure on Ctrip, especially in the price war. Ctrip develops much faster than before, and it burns money very fiercely. But it is a listed company and has profit pressure. These two aspects are more difficult to balance. The merger makes the problem seem simple. After the elimination of competition, Ctrip launched a profit centered management approach. The previous people familiar with Liang Jianzhang close to Ctrip recalled, and where to compete, to grab market share, Ctrip rarely make harm to the user experience. After the merger, Ctrips dominance and bundled sales began to appear at a high frequency. Users are limited to the frequency of usage and the process of perceived needs. This is also the reason for the frequent explosion in the past one or two years. At present, Ctrip has been widely questioned the impact of user experience behavior evil mainly includes bundling sales, high price back to change, big data and so on. In October 2017, actor Han Xue exposed himself in micro-blog. Her total mileage of more than 99% travellers had repeatedly found and manually cancelled the pre selected safety box under the booking information, but it was still not spared. In addition to the normal ticket price and airport construction fee, it was forced to join the 38 yuan hotel coupon. Under the drive of profit first, it is also very common to refund or change the price at a high price, or it will not be refunded, or the refund fee will be more expensive than buying a ticket. Dai Zheng reminded. In February this year, a subscriber in Shenzhen subscribed a two yuan private line worth 48422 yuan to Tunisia on 8 days. Because the situation has changed, the order less than 20 minutes to call the user to call the wish to cancel, Ctrip is not refundable on the grounds that the ticket has already been out of the ticket, if the cancellation of the ticket, the need to charge a total loss of 18524 yuan. The airlines feedback is that the unit price of the ticket is about 6415 yuan, and no refund is required. The customer complained about Ctrip to the Shenzhen Consumer Council. Ctrip was interviewed, and CEO Sun Jie, the company, apologized. In the view of Hu Chenjie, vice president of the Alibaba group, the transformation of business model into tying, bundling or cross selling is in some sense to fight with the user. For example, the general airport lounge will sell to more than 100 yuan, and the bundled sales may only sell more than 30 pieces, because many people buy it and do not go to rest. This is actually a probability fight between the platform and the users. In fact, Ctrip is not only a problem of bundling sales, high price refund, and other issues, but other online travel platforms are more or less involved. Recent Jiangsu Provincial Security Commission launched a survey of high price ticket refund, remarking, involving 8 airlines, internet ticket sales platform, including 7, including Ctrip, where, the mother donkey, the way cattle and so on. But this is not a reason for Ctrip. In 2013, after the return of Liang Jianzhang, in order to save Ctrip, Liang Jianzhang began to carry out the system of business, divided the company into BU (business unit), no longer eat the big pot, each BU had great autonomy. Income, bonus and so on were directly related to the profitability of BU. According to 36 krypton, each BUs CEO is fully responsible for the cost and income, and Ctrips BU is a strict valuation formula: four times revenue (revenue) +20 times net profit (profit), and then divided by two. This formula is equivalent to Ctrip playing the stock exchange, pricing for each BU, and the price level is directly linked to the staff bonus. This is a strong heart stimulator to reactivate the entrepreneurial cells of the company. But with profit oriented, business departments are more focused on their own interests, making it easier to break through the bottom line. The foregoing people familiar with the beam construction are close to Ctrip. Many airlines and hotels have revenue management departments to determine the best sales or service prices by establishing real time prediction models and analyzing demand behavior based on market segmentation. According to Dai Zheng, there is also a revenue management department in Ctrip. The first is to do two things. First, research on how to do bundled sales to the general users, second, through large data analysis, the users do subdivision management, generally through the assistant booking, the price of the hotel may be higher than 30%, Ctrip to judge these orders may be possible Reimbursement, if I reserve the price will be lower. In addition, the price of a mobile phone for the same person may be very different. Bundling sales, high price refund sign is not bad to say, may need to play double quotes, large data analysis is done through big data evil, is true evil. Dai Zheng said. At present, in the public view, Liang Jianzhang is a population economist who seems to be at a distance from the company. The industry has a consistent evaluation of him, basically using the words of wisdom and shrewdness, but he also believes that he maintains control of Ctrip, just more like the man behind the curtain, and CEO Sun Jie standing in front of the platform. Sun financial origin, to rely on the CEO world, the world relies on CFO, her task is to maintain the share price, keep the dishes good. Liang Jianzhang basically looks at the big but not the small. He occasionally looks at small things. He looks at numbers and sees the results. He is a little goal oriented. The former people familiar with Ctrip Liang Jianzhangs proximity stressed that Liang did not stay away from the company and returned to the company for five years, as long as it was in Shanghai, almost half past six every morning to the company, from seven to half past seven with the teams. Because of the diligence of Liang Jian Zhang, the other CXO of the company may arrive at the company from five to half past five and prepare all kinds of materials. In the case of Ctrip executives, these waves are not a very serious problem at present, and they will soon pass, but the biggest problem is that they are not a problem. The person said. Capital line Liang Jianzhang will go to where, Yilong, the same journey into the flag, investment cattle, East Airlines and other important players in the tourism industry, but also with capital links to the tourism industry, the downstream of a number of entrepreneurial companies, to build a Ctrip. But this system is not strong and strong in imagination. Earlier, Liang Jianzhang told the Chinese entrepreneur that the risk of investing in M & A is mainly integrated. After Ctrip investment and M & A and Yilong, several are also independent companies, which will not be fully integrated into a team. The integration focus is resource sharing and the reduction of business duplication. According to the forefamiliar with Liang Jianzhang, close to the Ctrip people, after the merger, the Ctrip is not much business synergy, the most important is to get through the data and transaction scale, to realize the growth of market share and the monopoly of resources. For example, in the high star hotel, Ctrip unify inventory, carry Cheng, where, Yilong supply chain integration, into Ctrip companys company HCH unified management. In the industry, there is a statement that hitsu provides inventory to Ctrip, where, and Yilong, but these platforms must guarantee more than 15% of the profits, otherwise it may be rejected, which has not been confirmed by Ctrip. In the view of Chen Liang, the chief executive of the online tourism industry, the president of the United States group platform and the business group, there are several different types of mergers and acquisitions, one of which is to eliminate competition, and the whole contract is a qualitative opponent. At this time, 1+1 is less than 2. In the past two years, he obviously felt that after the merger, eLong and where the teams combat effectiveness was dropping rapidly. The relationship between Ctrips investment and Ctrip is more subtle. A former senior executive who asked for anonymity recalls the change from where Yang Changle, the former senior vice president and deputy general manager of the Department of major accommodation, started COO. In October 31, 2016, Luo Jun announced the appointment through an internal letter. As other Ctrip executives drop off, the original products, R & D and operation teams of the way home have been replaced. What is intriguing is that one day in April 2017, the road family wrote a press release, preparing for second days to announce that Yang Changle replaced Luo Juns CEO. The second day early in the morning, Luo Jun urgently stopped, because Yang Changle did not agree. In 2017, the frequency of Liang Jianzhangs visits to home increased significantly. In mid August, Liang Jianzhang held the annual meeting of the first half of the company with the management of the way home, during which every executive would be interrupted by him, and then throw out two questions. First, why do you spend the money? Second, what is the result of the money? Liang Jianzhang belongs to someone who doesnt speak, if he opens his mouth, he points to the key. The former chief executive said that the way home is more and more like Ctrip, which is entirely result oriented and icy KPI drive. At present, the former senior executive team is almost all resigned, Luo Jun is the nominal CEO, the real power is Yang Changle and other Ctrip airborne executives, behind the decision is Liang Jianzhang. The journey through the entire Ctrip system of non - standard accommodation and flow, including the home, Ctrip, where the house, ant short rent, big fish self-service, which will supplement the Ctrip room. Road home is the Chinese version of Airbnb, just like Airbnb will one day challenge Booking, Ctrip will worry. Luo Juns team has done a good job, but Ctrip must have its own control, and Luo Jun is out. The foregoing is familiar with Liang Jianzhang, who is close to Ctrip. Entrepreneurs who have accepted Ctrips investment tell Chinese entrepreneurs that this is in line with Ctrips investment style. To accept Ctrips investment, either to be bought or sold, or to be suppressed, a financial or strategic investment company will always be an outsider to Ctrip and will be treated as a competitor. To some extent, Ctrips upstream and downstream investment in tourism industry itself is a competitive strategy. In general, Ctrip will set up an internal observer in the company being invested. As long as the company is in business, it may threaten Ctrip. Ctrip will turn around and copy one. Therefore, when some companies have new financing, they will try their best to let Ctrip exit. The Three Kingdoms war From the outside, where the merger of Ctrip went to clean up the battlefield, a new war was brewing. The two merge month, Ctrip suddenly off the shelf Ctrip Department (Ctrip, where to go, eLong, city, etc.) in the public comment on hotel resources. A month ago, the US group and the public comment just merged. I dont know if there is a causal relationship between this merger and our merger. It is said that this is the direct command of the highest level of Ctrip, and the setting time is all offline. Chen Liang told the Chinese entrepreneur. It is said that this is the direct command of the highest level of Ctrip, and the setting time is all offline, which is obviously inseparable from the merger case a month ago. The former online travel industry veteran told Chinese entrepreneurs. It has to be said that this is the sensitivity and determination of Liang Jian Zhang. The merger of the US delegation has brought challenges to Ctrip. Before and after 2012, the group began to dabble in the hotel group purchase. In the early days, it was mainly on the standard art dragon, then set up a team to make a hotel reservation, and where to compete in the low end market. After Liang Jianzhangs return, he launched a counter attack on where and Yilong. A classic case was that in 2014, a strategic cooperation between the same journey and Yilong was lifted through the same journey in 2014. Art dragon and where to be suppressed, but gave the US group a breathing space, slowed down the pressure of competition, and grew rapidly in the low-end hotel market. Chen Liang admitted that there was no way for the US group at that time. Ctrip basically monopolized the supply of the high star hotel market. After analysis, Chen Liang believes that after the merger of the US group, some users have strong demand for Gao Xing Hotel. In addition, Ctrips dominance is very strong, high star hotels overall profitability and level of room for improvement. After analysis, Chen Liang, President of the US group platform and wine brigade group, thinks that some users have strong demand for Gao Xing Hotel after the merger of the US group. At the beginning of 2016, the US group formed a high star hotel team and started the high-end layout. Price war is a common means of war in the tourism industry. According to media reports, with the cooperation of Gao Xing Hotel, the commission ratio of the US group is about 8%-10%, and the proportion of Ctrip is 15%-20%. Chen Liang said that the US Commissions commission would be lower and the maximum amount would be twenty percent off. This is achieved by the US group through the cost structure advantage, rather than the price war. The US group is still understanding the industry and expanding its team capability, not to compete with anyone or to lose its share. But Ctrip has a strong response and returns to customers, requiring him to be excluded at the hotel side. For some high-end hotels, the Ctrip family can not meet the needs, but also afraid to offend the journey, they will package their own inventory, such as packaging into a travel agency in the United States. Ctrip employees may test the list under the US mission, and find out who provided the inventory resources to the hotel, if they are familiar partners, they will punish. In addition to the test list, the staff of Ctrip workers have been brushed wool in the United States. Some individuals have made a profit of more than 5000 yuan, suspected of fraud and police intervention. Flying pigs pose a threat to Ctrip in the area of air tickets. In May and June 2017, Hu Jinjie gave lectures to Hongkong airlines to popularize some Internet concepts and tactics. In the meantime, he joined the chairman of Hongkong airlines to form a cooperation center, which set up marketing center in Hangzhou headquarters of flying pig. As a direct channel for Hong Kong Airlines, the flying pig platform is the same as the Hong Kong Airlines official network. It is not only the ticket price synchronization, but also the rights and interests of the refund and reform, the promotion and so on to the flying pig platform. Hu Chenjie described the cooperation as one. It is not who persuaded anyone, but we are all right. Hu Chenjie said. Before joining Ali, Hu was the head of China Southern Airlines electronic business department. He had extensive contacts in the airline company and was familiar with the pain points and ideas of shipping company. Over the years, the airline has been working hard to make direct sales, from the first to send tickets, to the ticket office, business department, and to the website, APP and WeChat public number, spent a lot of effort and cost, but did not master the flow. Even if the official website sold some tickets, many times it was taken away by agents, not C end users. With Ctrips dominance, it has acquired more chips in the game, which has brought a sense of crisis to the shipping division. We urgently hope to establish direct contact with users, transform to the Internet, and realize digital marketing. The airlines set up the marketing center in Ali, and the flying pigs provide services for the airlines, such as users, marketing, data and technology, which actually follows the Taobao platform model. However, before Ali flew pig and its predecessor Ali to go, he was learning to imitate Ctrips OTA mode. Flying pig is transforming from OTA to platform, and more than ten airlines at home and abroad have set up marketing centers in Ali. Hu Chenjie is confident that he will give him a year and a half to two years, and the number of flying pigs will exceed that of Ctrip. Ctrip has four major businesses, including accommodation reservations, traffic ticketing, tourist holidays and business travel management. Accommodation reservations and traffic ticketing accounts for 80% of the total income. The growth rate has slowed down under the invasion and competition of the United States and the flying pigs. According to Ctrips earnings report, the income of accommodation bookings in 2017 accounted for 35% of total revenue, an increase of 30% over the same period. In 2015~2016, the two figures were 40%, 44%, 37% and 58% respectively. In terms of traffic ticketing, 2017 accounted for 45% of the annual revenue, up 38% from the same period last year. The figures in 2016 were 45% and 98%, and 39% and 51% respectively in 2015. According to the accounting standards, Ctrip has merged the financial performance of the report since December 31, 2015, so the income of accommodation, booking and traffic ticketing increased substantially in 2016, but the growth rate in 2017 was lower than that in 2015. Over the past two years, the proportion of Ctrip traffic ticketing has exceeded that of residential booking, which is related to policy changes to some extent. In 2014, the State Councils SASAC asked the shipping Secretary to bring down the direct descending (increase the proportion of direct selling and reduce the proportion of the Commission), which raised the concentration of the airline agent industry, and made the share of the Ctrip market bigger, but the air ticket business profit space narrowed. People in the tourism industry say that the gross interest rate of accommodation reservations is much higher than that of traffic ticketing, and the profit structure of Ctrip is changing. In the face of the pressure of competition, the business model is more easily converted into bundling sales, high price refund and reform. Danger approximation Internal and external difficulties, internationalization is Liang Jianzhangs important move. Over the past two years, Ctrip has mainly distributed overseas through capital means. In 2016, Ctrip became a shareholder of the largest OTA platform in India, MakeMyTrip, a strategic investment in North Americas two earth contact seagull holiday and gull group, with a total of about 1 billion 400 million pounds (including 1 billion 200 million pounds of cash and 200 million pounds of ordinary shares) to buy the worlds leading tourist search engine (Skyscanner). In 2017, the US social tourism website Trip.com was acquired. In March of this year, Liang Jianzhang said at the Ctrip telephone conference that Ctrip began to enter the overseas market a few years ago, but had already felt the benefits of the growth of overseas sales. Tian Juns help in promoting the natural growth of Ctrip, the two sides synergy began to appear. Trip.coms air ticket bookings grew by three digits in the five quarter. Therefore, we have confidence in the future of overseas tourism market and believe that overseas business will be the main driving force for Ctrips future growth. In the medium and long term, international air tickets have become the main driving force for the growth of our airline ticket revenue. Ctrip CFO, Wang Xiao, said. In order to cooperate with internationalization, Sun Jie promoted staff to learn English in Ctrip. According to the Tencent technology report, Sun Jie encouraged internal English to write mail, speech, and PPT, the staff organized English card, one day did not learn, forget how many words, to fines. The former with Liang Jianzhang familiar with Ctrip evaluation, the internationalization must be right, but if the use of domestic play, that is, the strategic investment, acquisition of the elimination of competitors, may encounter a relatively large obstacles. The flying pigs and the US regiment are still the rivals that can not be ignored by Ctrip. Outbound travel is the focus of flying pigs, the strategy is to face young users, create a holiday IP, its product price advantage is very obvious, such as the launch of the northern lights holiday IP products only 9999 yuan, 49999 yuan in the Antarctic Tour. In March this year, Li Shaohua was no longer the president of the flying pig. Zhao Ying, the leader of the Alibabas global leadership group, took over directly, flying pigs or getting more resources and strategic support from the Ali system. Interestingly, in 2017, Priceline, an important shareholder of Ctrip, invested in the US group with an investment of US $450 million. Todd, senior vice president of Priceline group, said the two sides have many potential for cooperation and will jointly develop China and the worlds huge entry and exit tourism market in the future. Priceline how to choose and balance between Ctrip and the US group will directly affect the industry structure. Internationalization is still in time, the recent fire burned to the field of travel, the United States Group is energetically layout network about cars, Gao de launched a car business, Ctrip announced to get Tianjin network license plate. Flying pig and Gode set up the goft project group, hoping to provide users with a solution to solve the problem of door to door travel. For example, a user from Beijing to a hotel in Shanghai, according to the road congestion, help users to push down a few points from Beijing, a few points of high speed rail or aircraft, to Shanghai how to reach the destination. In fact, Ctrip entered the field earlier, and built a special vehicle platform inside. Those who were close to Liang Jianzhang and those who were close to Ctrip believed that if they had made any big mistakes in the past few years, they would have missed the draught. In those days, Tencent had not invested in dripping. Liang Jianzhang had seen that investment was recommended by others. Liang believed no value. Later, Ctrip voted for easy access, but as easy to equity changes were constantly diluted. In 2017, when Yi was in a crisis, Liang Jianzhang and Sun Jie flew to Beijing to meet Jia Yueting and seek investment. The result was disparate. Maybe everything is right, but its old. The personage exclaimed. In many peoples eyes, Ctrip is a traditional company, lacking innovation. Hu Chenjie thinks, carry Cheng to use Internet technology to run OTA, DNA or Agent (agent) mode. Transformation needs to endure the pain of a long time of declining profits. As a listed company, Ctrip can not give up the core profit point really change. According to Dai Zheng observation, Ctrip is in the solution of the profit problem, there are innovative departments, and also support the internal business, but the general carrier is a large shareholder, basically is done around the Ctrip system, so far has not hatched a very successful project. If we analyze it from the perspective of users alone, we can see the clue. At present, both the flying pig and the United States and the United States are fighting for young users. Ctrip is still the main business user, and is older than the age. In 2017, most of the GMV is still contributed by the old users. The distance between Ctrip and the most dangerous moment is unknown. It is certain that the danger is approaching step by step. Source: Chinese entrepreneur editor: Bai Xin _NT4464 In many peoples eyes, Ctrip is a traditional company, lacking innovation. Hu Chenjie thinks, carry Cheng to use Internet technology to run OTA, DNA or Agent (agent) mode. Transformation needs to endure the pain of a long time of declining profits. As a listed company, Ctrip can not give up the core profit point really change. According to Dai Zheng observation, Ctrip is in the solution of the profit problem, there are innovative departments, and also support the internal business, but the general carrier is a large shareholder, basically is done around the Ctrip system, so far has not hatched a very successful project. If we analyze it from the perspective of users alone, we can see the clue. At present, both the flying pig and the United States and the United States are fighting for young users. Ctrip is still the main business user, and is older than the age. In 2017, most of the GMV is still contributed by the old users. The distance between Ctrip and the most dangerous moment is unknown. It is certain that the danger is approaching step by step.