China has long been a lucrative hotel market, and has recently been heating up further as more hotel brands make the leap into mainland investment.
Insight specialist L2 has released a new report (paywall download here) looking at the performance of hotel apps in mainland China. With a domestic travel market set to eclipse the US by 2030, there's a lot on the table for global hotel brands.
From the report:
Prestige hotels, such as Hilton Worldwide and Hyatt Hotels, are tailoring programs to attract Chines tourist as they travel abroad. The increase in domestic travel has also powered a wave of investment and consolidation in the hotel industry. International chains, which dominate the prestige sector in China are investing in new locations.
By the end of 2015, Starwood Hotels will have doubled its luxury portfolio in China. Domestic chains are also undergoing tremendous growth, consolidating their hold on the budget category and competing with international chains for mid-range properties.
As far brands looking to build share in the hyper-competitive Chinese market, the think tank recommends building equity and driving booking through online and mobile channels. As internet familiarity rises with broadband penetration, offline travel agencies are losing share to online bookings - a solid opportunity to educate new travelers about travel brands while capturing nascent loyalties.
The report points to a recent finding by Research Consulting Group that projects a 73% expansion in the online travel market through 2018. With a gaggle of first-time travelers typing online to book travel, brands must deploy an educated, China-specific strategy to capitalize on the new loyalties being formed every day around travel.
On mobile, within the L2 index, 60% of the brands have some sort of mobile presence. The majority have chosen a mobile site, and 33 brands have their English language apps on China's app store. Overall, 90 million people are reached each month via Chinese mobile travel apps, showing a significant audience ready and willing to use these apps.
Yet, as the analysts point out, the quality of these apps are lower than the in-market OTAs. This is an opportunity for hotels to win over some share from OTAs, and encourage more direct bookings in the growing Chinese market.
L2 concludes that deploying a savvy search strategy alongside a metasearch approach to address the Chinese traveler across platforms, including mobile.
NB: Beijing Hilton image courtesy Shutterstock.