Electric dealer price war upgrade Ctrip Invest 500 million USD low price promotion

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Ctrip invest 500 million USD low price promotion, mango NET 80 million cash subsidy

New Express comprehensive report on the price war of electricity dealers to the online travel booking business (OTA). Ctrip finally can't restrain, increase horsepower to advance the price war in full swing now. July 5, Ctrip (NASDAQ:CTRP) announced that it would invest 500 million U.S. dollars (about 3.2 billion yuan), starting in July, for a one-year low price promotion. According to the introduction, 500 million of dollars in the budget than Ctrip in previous years of annual marketing funds jumped nearly 10 times times, this is ctrip since the establishment of the first large-scale promotional in 12.

Now the market pattern of online tourism has changed, before there is a long network of art, to where, mango nets, and other "old friends" more intense competition, after the Jingdong Mall, Taobao and other Internet and tonight, such as special hotel discounts on the right Zobon, airlines and hotels to build their own sales platform ... Ctrip can no longer be indifferent.

Can you get this one?

Ctrip Travel Network Marketing Vice President Mr. Predicted that the price war will be "6 months later, not more than a year to see, after the chaos must have Zhi, will find the entry threshold for online tourism higher."

"(other companies) to do the two years of group buying, in fact, has an impact on Ctrip." A lot of small companies take a bit of hot money to venture in, and E-commerce, the industry as a whole very impetuous. "Mr. said.

This kind of influence to concrete present, can the art Dragon Net buys business "Rose" as an example. According to the Art of Dragon Net previously released data, December 2011, art Dragon Group purchase hotel breakthrough 100,000 night, ranked first in China, this is the number of Ctrip hotel Group Purchase Volume 4 times times.

Compared with Ctrip, the first quarter of this year, Yi Long net revenue of 153 million yuan, of which hotel booking revenue of 122.9 million yuan, an increase of 36%, accounting for the main 75%. However, because of the great devotion of the art Dragon to the hotel group buying, it diluted the commission of every night in its hotel. But Art Dragon CEO Trihun frankly optimistic about the hotel group buying market, and stressed that the low price is the embodiment of the user value. He also said that the Art Dragon Daily Online hotel Group purchase products reached 2,500, is the hotel group buying business absolute name.

Can you make it back? In December 2011, Ctrip suddenly launched a return to the art of the fight against the price of the dragon. In this way to transform different projects to promote, until June this year, has been not very advocating for group buy Ctrip simply to "Low-cost hotel Group buy" for the theme of the event, for a one-month promotional, stepping into the main battlefield of the Yi Long network.

Yi Long Network was offended, two companies at once in the media and micro-blog on the "empty propaganda."

Summer campaign is vital.

Mango Network also recently announced the investment of 80 million yuan for cash subsidies, so far, online travel price war summer stalls. Reporter Login Mango network found that June 28-September 30, all through the Mango net Book hotel can get cash return. From thousands of yuan/day star hotel, to hundred Yuan/day of the budget hotel, the rebate ratio is 30%-50%. Even popular hotels in the summer tourist season have cash returns.

Prior to this, the industry boss Ctrip and the competition for the Arts Dragon are mostly limited in the "Group Purchase Hotel", "budget hotels" and other low-cost hotel areas. This time, the mango net will fire to the high-end market. Reporter found that daily participation in Mango net "hotel Carnival" in more than 800 hotels, there are a large number of four-star, five-stars hotels, the return is also in the proportion of 30%-50%. It is understood that online travel booking business mainly through the collection of Hotel commission to obtain income, the proportion of 15%-20%. Mango network admits, Mango Network Hotel Department general manager Gaogo in an interview, said Mango net target is impulse, not afraid of loss.

"The traditional marketing model relies on hotel and ticket bookings and discounts on restaurants to support OTA development," he said. "Marketing planners Wang Xinyi that the price war is not the way out, mode innovation, service-oriented and other" internal strength "of the cultivation in the increasingly fierce competition will be more prominent role.

Wang Xinyi predicts that the future of domestic internet giants will be more competitive in the market, and now their share of the cake is only a beginning. Therefore, "the future who will be more transparent, more flexible and more dynamic service to meet the demands of consumers, who will be able to seize this market opportunity." "#p # subtitle #e#

Industry competition appears white-hot

Last year, China's online travel booking market was 45.2% and the size of the airline ticket market was 40.8%, according to the survey. It is expected that in the next 2-3 years, the hotel revenue will remain at about 40% levels, the ticket revenue share will be further reduced.

In the air ticket reservation market increasingly transparent background, hotel booking became OTA's fragrant pastry, so the industry giants scramble to exert force. The industry believes that the online travel booking business through the price war, will bring consumers more affordable prices, thus changing the overall profitability of the hotel industry.

Competition in the industry is white-hot, especially in the staggered competition of internet companies. May 2011, Tencent invested 84.4 million U.S. dollars in investment in Art Dragon Net, become its second largest shareholder, a year later Tencent and tens of millions of dollars to invest in the same process network, to help its listing, the two online travel site from the Tencent strong entrance support; Baidu also lonely, a stake in Ctrip one of the biggest competitors to where the net, The latter immediately jumped on the network traffic, while the Jingdong Mall, Taobao Travel, suning and other Internet platforms also strongly involved in online tourism. Ctrip seems a little isolated. Mr. Denied this view, "In fact, Ctrip has been working closely with many sites, the future will be more open, increase online partners." ”

All along, Ctrip has been criticized as a "offline, online, strange" on-line travel company, which is located in Jiangsu Suqian Call center operator has exceeded 20,000 people. The situation may change. Reporter learned that the current from the network ticket purchase order has accounted for the total order of Ctrip nearly 55%.

Observation

Where is the end of the "price war" for electric dealers?

This year the Internet shopping market is a bit "strange"-the electric dealers seem to spare no effort to carry out the "price war" to the end. In the past, "price war" also around the festival, such as time node, but since the cat for several years held "double 11" big promotion (refers to November 11 each year to hold a substantial preferential activities), the net shopping festival has become the norm. If the "double 11" or to seize the year-end market opportunities for consideration, then the electricity dealers from June 18 this year a new round of "price war" is a bit confusing: this is not a holiday or consumption hot season, why should a substantial price reduction?

With the Sando Mamang of the "price war" among the electric merchants, many consumers have already produced aesthetic fatigue to the competitive way. Where is the end of the vigorous "price war"?

Did you reduce the price?

This round of electric dealers "close-fitting hand-to-hand combat", are not defeated the other side of the posture. Suning easy to purchase proposed "Super 0 yuan Purchase, the whole number of goods to buy back how much", Gome's Bowser network announced an Orange storm, the summer to promote activities; The cat is the delivery value of 40 million yuan in cash red envelopes, for buyers in general ... Tencent, Beijing-east, Xun and other well-known electric business website promotion policy is also very attractive. Reporter according to the description of the home appliance business estimates, starting from the end of May, this so-called "history of the strongest electric dealer price war" has been involved in the value of 7 billion yuan concessions and marketing resources, and before and after June 18 ushered in a climax.

Does 7 billion yuan profit margin and marketing resources really bring low price? Can consumers really buy a bargain? The answer seems to be not that simple. From the specific price range, consumers to find the most appropriate timing is not easy, because the rules of the game are more complex.

Although the direct result of the price reduction is a big increase in sales, but also caused by ordering, distribution and other issues, affecting the consumer's shopping experience. Suning easy to purchase, because of "0 yuan purchase" Feedback strength unprecedented, make "0 yuan buy" an opening, created a single second snapped orders more than million pen rare record. This surge in traffic greatly exceeded the limit of the site load, so that the Web page in the peak period of slow opening speed and other overloading phenomenon. According to the data disclosed by the cat, the number of buyers participating in "6 18 online Carnival" was more than 55 million, and many brands launched the special selling all over the red, apparel home textiles sales than the previous day growth of more than 200%, some of the official flagship stores in the daily traffic more than 150,000 people. But this result leads directly to the reduction of brand delivery speed, consumer slaughter miss the Order of goods, although cheaper than usual 10%, but on the road "ran" a full 5 days, and the usual every other day can be sent, coupled with a damaged product packaging, products slightly flawed, which made her a little disappointed.

How long can "burn money" burn?

According to people familiar with the situation, "price war" behind the supplier and the electric platform for the synchronization of the benefits, "burning money" brought about by the pressure of operating costs are very large, and even suppliers due to the power of the platform of "burning money", choose to exit the platform. So why do electric dealers still like to "Burn money"?

Suning easy to buy the relevant person in charge frankly, domestic consumers for E-commerce enterprises have not formed a good stickiness and loyalty, consumer sensitivity to commodity prices is still the highest, in the short term this situation will not change immediately. Therefore, the "price war" has become the most effective way for the electric dealers to compete for the market at the front.

But "burning money" is not a long-term solution. Many electric dealers are also in preparation for the "price war" after the development. Among them, supply chain, logistics system, service system, backstage construction become important support point.