Qunar CEO speaks about automation, new features, Chinese challenges and moreNews / TechnologyBy Karthick Prabu | April 9, 2014Share This article was originally published on A big rumor doing the rounds in recent days is a possible merger of the China's top two travel sites - Qunar and Ctrip.Such a deal with between the pair - a metasearch service and online travel agency respectively - would be one of the biggest deals in the sector since the acquisition of Kayak by Priceline in November 2012.Both parties are inevitably remaining tight-lipped at present, letting the rumour run its course in the media and boardrooms around the sector.Nevertheless, it's been quite a few years for Qunar, the country's most visited travel website which recently went public and is currently trading at $29.69 per share.For the fiscal year 2013, Qunar reported revenue of $140.6 million, an increase of 69.6% year-on-year (YOY), albeit with net loss of $30.9 million.Recently, the company reported an all-time-high flight booking number of 250,000 tickets in a single day. This was achieved during the Chinese new year (CNY) holiday and it is an 85% increase compared to the 135,000 tickets that it sold in a single day during CNY 2013.Also, 50% of the total flight bookings on the peak day were via Qunar’s mobile channel.In the recent quarterly earning calls, Qunar has been reporting significant growth in its mobile channel.Tnooz spoke to Qunar's CEO Zhuang Chenchao to understand the company's relationship with Baidu and Ctrip, its investment interests, importance of automation, growing mobile interest, and many more.Interview with Chenchao below:How is your frenemy relationship with Ctrip shaping up?We are happy to partner with Ctrip in any area in which they can provide our users with more product coverage. We view all our travel service providers in this light - as long as they can provide reliable service and value for our users, we want them on our platform.With Baidu (that gives 26% traffic to your frenemy Ctrip) offering $300 million credit to Qunar, how do you see the relationship between Qunar and Baidu for the next 12 months?The new deal is a sign of Baidu’s commitment to supporting us as we go forward in the online travel industry. For us, it’s a boost in confidence that should the opportunity or necessity arise, we’ll have cash ready to go.What are the various possible integration points between Qunar and Baidu?We have already been working with Baidu extensively on projects such as building voice recognition software for mobile air and hotel search. As a matter of fact, we have a team sitting at the Baidu office looking for various product integration opportunities with Baidu.How different or same is Qunar compared to Kayak? In the recent quarterly report call, you said Qunar is way advanced than Kayak...Qunar began as a metasearch site in 2005, which is most similar to what Kayak did. We believe we have a very large stage given how fragmented the distribution system for travel related products is in China.As a search based platform, we eliminate inefficiencies in the distribution system, make pricing and availability more transparent, and offer consumers with broad selection of travel products, all through bringing China’s large number of travel service providers to face China’s travelers directly.While other leading online travel players like Ctrip are investing in multiple travel brands, why isn't Qunar investing?Our current focus is on investing in enhancing product coverage and improving our user experience. However, we are also open to investments in other companies if we come across companies with unique resources. We’re keeping our eyes open for that.How is your Total Solutions (TTS) platform scaling up? Can you give an update about this platform?As of Q4 2013, we have almost 2,000 OTAs, over 84,000 hotels, 13 airlines enrolled in our SaaS system (TTS). As a percent of qualified clicks, 86% of our flight clicks and 59% of our hotel clicks come from TTS.Do you see a future where technology/software-robot does more than 90% of Qunar's day to day operations/tasks?I definitely believe that in the future, technology will eventually be able to offer better service quality than human beings. We are moving in the direction of eventually providing completely automated service for our consumers.In recent three consecutive quarters (Q4, Q3, Q2), Qunar has reported significant mobile numbers. When do you think mobile will overtake desktop in terms of all parameters - users, traffic, booking?During peak days of the Q4 2013, mobile flight search queries and mobile hotel search queries had already reached 36% and 76% of total flight search queries and total hotel search queries respectively.Mobile is definitely growing fast, and it is particularly well-suited for travel, since so much of the travel process happens on-the-road where mobile devices are more convenient.We are further developing our mobile offerings by focusing on adding more destination services so that travelers will find it easier to look up local services, such as attraction tickets, when they reach their destinations.What are the key features Qunar will be rolling out in near future?We are focusing on a few things:1. Technology-driven service enhancement: As of 2013, over 50% of flight cancellation and refund were done automatically. We offer consumers the best data protection. Our goal is to achieve high service quality with well-equipped technology.2. Value-add travel services: We have already rolled out services such as taxi-booking services and airport pick-ups. We will continue expanding our coverage of hotels, local destinations, tickets, restaurants, and entertainment so that users will be able to find solutions to all their travel needs via our one-stop platform. We have just established a new Destination Services business unit to specifically handle this task.Can you elaborate about the "priority listing" feature that Qunar is working on?We are giving users the option to choose travel products with premium service.Users of these marked listings will be guaranteed confirmation within three minutes. These priority listing vendors will be pre-screened and they will offer a certain caliber of service.This is an initiative to be more business-traveler friendly, for which we have also rolled out first class and business options in our flight search.What are the top three challenges you see in China online travel industry?1. Finding and hiring enough quality talent to keep up with our business growth is an ongoing challenge. We have plans to continue heavy expansion this year.2. The online travel space remains competitive. We are confident that our model and technology will be able to best serve users in the long-run, but for now, the Chinese Internet companies are in an aggressive land grab, so we do have to contend with that.3. Finally, maintaining strong leadership in mobile is an incredibly important task. As users shift more to mobile and since mobile technology continues to penetrate all levels of life, we need to act fast to create the best and most convenient one-stop-platform for all on-the-go traveler needs. This means, bringing a lot of largely offline local information online onto our platform.Any plans of launching an English-version website and international (non-China market) expansion?Our focus is still on solidifying our position in China and making the best products possible for Chinese users.We are planning to follow Chinese users’ footprint to expand overseas, with a top priority of Southeast Asia.