By Martin Kelly
CHINA’S largest accommodation group, Jin Jiang Hotels, will more than double in size over the next four years, Michael Meade, Senior Vice President – Sales and Marketing, told Wired Travel Asia delegates.
Meade said Jin Jiang, which aims to grow from 220 hotels and inns to 500 by 2010, will also expand beyond China and plans to list on the Hong Kong Stock Exchange by the end of this year.
The company’s aggressive growth plans reflect the dynamic nature of the Chinese hotel market, where just 3.3% of hotels are managed by international brands, and the strong support of its ultimate owner, the Chinese National Government.
Right now, Jin Jiang is in the midst of transition – just like the Chinese accommodation market, which Meade said is currently characterised by:
– Dominance of the online duopoly – Ctrip and Elong
– Relationship selling and reservations process
– Reliance on phone and fax
– Very late booking profile
– Low credit card penetration (but this is changing)
– GDS growth, particularly in Shanghai and Beijing, although slow elsewhere
He said Jin Jiang is methodically driving change as the company moves to take advantage of its market-leading position without upsetting its delicate internal balance.
Rushing technology such as Revenue Management Systems does not work, Meade said, nor does GDS (so far), online rate parity and outdated reliance on facsimile machines.
“We are taking it step by step, and are doing training, training and more training,” he said.
Many of the changes focus on technology, distribution and Customer Relationship Management (CRM).
Jin Jiang has already developed its own Central Reservations System – JREZ – with the Thayer Group, which is going to become increasingly important to the group as it attempts to convert hotel-direct bookings to the CRS.
Jin Jiang will also introduce customer loyalty programs next year as part of an integrated CRM platform incorporating its Property Management Systems.
Meanwhile, it is well into a website rejuvenation program that started with jingjianghotels.com earlier this year.
This revamp is now moving through into the individual sites as part of an overall strategy to increase online sales, either direct or through intermediaries.
The design focus with the new websites is on cleaning up the traditionally busy, glitzy Chinese look into a more international information-based format with stronger, cleaner images, and online booking engines.
“Online is just going to go off,” Meade said, adding that over time Jin Jiang would like to become “a one-stop online shop” offering travel, accommodation, tours and transport.
Chinese consumers are gradually getting the hang of booking over the web with Ctrip reporting that 35% of its bookings are now taken online, a major improvement.
In future, Meade sees major opportunities for online competitors to Ctrip and Elong, dynamic packaging, mobile reservation technology, and “Last Minute” products.
November 8, 2006