China's Baidu-backed travel company Qunar has become one of the country's leading online travel search providers, boasting about 75 million monthly visits.
As of March 2013, Qunar’s search scope covers over 900 travel agencies, 160,000 hotels, 71,000 flight routes, 186,000 vacation routes, 8500 daily group-buying deals.
Furthermore, the company's move into mobile has resonated users with more than 34 million downloads of its app so far. But the company has evolved over the years, not least with the launch of its "TTS - Total Solution" service in recent years.
Tnooz spoke to Jenna Qian (head of comms at Qunar) about the TTS platform and other trends affecting the marketplace.
Can you give us some background on TTS platform? Why did you launch it?
In December 2009, Qunar became the number one travel site in China (in terms of volume). Using this volume as a key, we wanted to connect consumers with various travel suppliers, OTAs, hotels, airlines. But, we faced lot of challenges and issues while doing this.
In China, travel industry is still not a hi-tech industry that is very well equiped with technology.
While doing business with travel suppliers, we found that there are increasing complaints by travel consumers.
Traffic to travel portals spiked during chinese new year and other national holidays. And, travel portals couldn't handle such massive traffic.
Qunar is a technology oriented company, and thats our strength. That's why rolled out "TTS - Total Solution" in July 2010. TTS is a SaaS based platform and TTS is an internal name for the platform.
What is the use of TTS?
TTS is a back-end system provided for free to all our travel partners.
Before TTS implementation, when consumers search in Qunar, they will be directed to respective travel service provider website. While doing so, they are confused about the various user interfaces across websites.
After TTS rollout, consumers will be able to reserve a travel product in Qunar site itself. Consumers enjoy consistent user experience across site, also it helps our travel partners to manage their inventory better, and improve operational efficiency.
What's your revenue model?
We dont charge commissions for bookings made in Qunar site. We are a travel search company, and that has not been changed from the first day we started.
Quanr makes money by CPC ads (similar to Google). By the TTS platform, we can evaluate our conversion rates with lot of clarity, we learn how much value we bring to our partners.
Who uses TTS?
We rolled out Hotel TTS in June 2011, OTA TTS in March 2012. Since then, a lot of independent hotels and many OTAs are using TTS system.
Customers of TTS are OTAs, offline travel agencies, airlines, hotels.
If a service provider doesn't have an online presence or doesn't have a strong IT team to manage their services/products, they can hop on to our TTS system for free.
eLong, one of the leading Chinese OTAs, pulled their inventory out of Qunar. Why do you think this happened?
Not sure why they aren't happy, we didn't force them to participate either. There were lot of rumors in Chinese media about this incident, but a lot of these are not fact.
The root cause of the elong event is this: We increased the CPC cost in April 2012, that's a very normal business practice that we do every year. I'm not very sure why they are not very happy with that.
But, our CPC to our partners is definitely the most highest ROI/marketing channel in the market, and its much lower than OTA commission rate.
eLong is one of our major partner. Its upto them to decide whether to join Qunar's TTS system or not.
Will you be becoming an OTA in future?
Definitely it's not our intention to become an OTA. We are a search platform and we want to be in that space.
Before TTS, you were a meta search company. Now, you facilitate bookings as well. Can Qunar be compared to Kayak in terms of business?
We have some similarity with Kayak, but we aren't same.
With Qunar's TTS system, we are like OpenTable in travel industry. Our TTS adopters can be small, medium, or big businesses.
We also have an element of TripAdvisor business in Qunar, we are the largest hotel review generator in China, we are aggregating group of review writers to write review for us.
We are "Kayak + OpenTable + TripAdvisor".
Plans going forward?
Our aim is to become a technology enabler for travel industry, we want to maximize what we are good at. We're trying to implement technology into whatever area we can.
NB: Qunar would not on recent speculation about a funding round nor any plans for an IPO later this year.
NB2: In case you didn't know, Qunar means "where to go" in Mandarin Chinese.