China online bookings soar

CTRIP.COM, China's largest online travel agent, recently announced net profits of RMB398 million (US$55 million) in 2007, up 66 per cent over the previous year, leading many analysts to question the future of traditional travel agents in the country.

According to the World Travel & Tourism Council, China's travel and tourism industry is expected to grow by close to 10 per cent per annum over the next 10 years.

MasterCard Worldwide expects outbound tourists from China to top 21.6 million in the first half of 2008. And a growing share of these tourists are turning to the Internet for travel information.

A recent survey by The Nielsen Company in partnership with PATA found that nearly seven in 10 Chinese leisure travellers used the Internet to secure information before making travel bookings. The study also found that the Internet was now more popular as a source of travel information than traditional travel agents in China. And representatives from eLong, China's second largest online travel site, say Chinese travellers are using the Internet to make hotel and flight bookings and payments.

In 2006, more than 2.75 million Chinese booked hotel rooms, air tickets and other travel services on the Internet, up 72 per cent from the previous year. And analysts are optimistic the number of users will more than double to 5.7 million this year, and hit nine million by 2010. The online sector is expected to be worth RMB6.5 billion by 2010.

Chinese Internet Travel Site Receives Funding Round

Chinese Internet travel search engine Qunar has reportedly received a round of financing worth US$10 million.

According to published media reports, Lehman Brothers Private Equity Partners led the financing for the oddly named search engine that means "where are you going" in the Beijing dialect. With previous funding from funds like GSR Ventures and Mayfield, now the company will use the money to capture more users from around the country.

The company operates as a meta-search engine that aggregates and provides Chinese-language search results of travel deals around China. As many Chinese airline deals and prices are still rather standardized, this search service should become more valuable as the Chinese airline sector becomes more fragmented and less regulated, giving users the ability to truly leverage a travel search online.