The message is loud and clear – Trip.com Group wants to have the leading international travel brand in Asia in three years and to be the leading international travel brand in the world by 2025.
Those ambitions were declared by chairman James Liang at its 20th anniversary celebrations and the day before, its key expansion vehicle, Trip.com, shared its strategy and plans at its first-ever English-speaking Airline Partners event in Shanghai.
There’s a lot riding on the group’s internalisation – its latest financial results for the third quarter of 2019 showed a 50% year-over-year growth rate in its international hotel business (excluding Greater China). It was also the 12th consecutive quarter of triple-digit growth for international air ticketing volume.
Overall, Trip.com Group posted a 52%
year-over-year increase in income from operations to $314 million. Operating
margin reached 21% for the quarter, topping the 16% mark for the same period in
2018.
Announcing the results, CEO Jane Sun: “We are encouraged by the performance of
our international business.”
The Trip.com event, attended by close to 200 partners and suppliers from all over the world, was both about declaring Trip.com’s global ambitions as well as showing to its partners its desire to take a lead in distribution, branding, and customer service, as well as thought leadership.
The agenda was a mix of both internal presentations as well as talks by external parties on trends and issues pertinent to its airline partners – from data to airline retailing and virtual interlining and of course, not to forget, how NDC will change airline distribution.
The reasons for Trip.com’s existence are …
Trip.com’s CEO Xing Xiong (above) kicked off the day by sounding a realistic note. Although airlines have never been as profitable as today (he cited the fact that Warren Buffet today holds US$15b in four US airlines), and there were favourable factors fueling growth, from drops in fuel and distribution costs, as well as more demand, airlines no longer view OTAs with the same importance as they did a few years ago.
Citing a survey done by IATA on airline distribution, he said OTAs were being displaced in importance by airline website and mobile app. As such, he said it was critical to keep asking, why do OTAs exist, a question Trip.com takes seriously as it focuses its activities around the answers.
And the answers? “We exist because we add value to consumers and airlines – value creation; we want to be the most reliable channel – reliability, and we want to offer the best customer experience – best tech company.”
He said Trip.com was taking its “superapp – one-stop shop” concept globally, and it stands ready to fight in a world of declining commissions and enhanced loyalty programmes by airlines by offering the best data and tech to airline partners and taking care of customers at extremely low cost.
He called Google’s announcement of quantum computing “a big deal’ and Trip.com would be keeping a close eye on that. Saying it wants to be the best tech and data company in travel, he said, “Our team is the one who fully uses machine learning to solve problems such as traveller profiling, personalized recommendation, precision marketing, abnormal detection, revenue management and network planning.”
Trip.com has grown to 19 languages and has seen triple-digit growth in the past three years. Traffic has grown 130% and tickets over 100% year on year. Hotel bookings have also shown continuous growth year-on-year with more than 690,000 verified user reviews – a number it is clearly looking to expand with its latest partnership with TripAdvisor.
“Flights is where the traffic is, hotels are where the money is,” he said.
He said the accolades the brand had won recently was evidence of its acceptance in the market – 2019 Brand of the Year in Korea from the Korean Consumer Council and 2019 Material Design Award from Google Design.
Branding around relevance and customer service
Trip.com’s brand promise is built on three pillars – 24/7 service, mobile-first approach and wide range of products – and Leslie Hsu, corporate 
director of branding (pictured right), said that the brand wants to be relevant and useful at all stages of travel – pre-, on-trip and post. “We want to go beyond a booking service to being a companion.”
However, there is no running away from the fact that it will have to learn to compete in a Google world where even brands like Expedia and TripAdvisor are struggling against what they call Google SEO headwinds, reflected in both their latest financial results. It explains Trip.com’s heavy investment in aggressive branding exercises offline in a clear attempt to drive direct business.
Being a companion means excelling at customer service and Peter Mileham, general manager, IBU Customer Support Center Edinburgh, who was hired from BskyB service and worked with companies such as Barclays and Amazon, spoke of how surprised he was when he was told that his mission was “building an award-winning service operations and environment”.
“This is a rare thing because I usually work in warehouses and where call centres are considered the bottom of the value chain.”
He currently operates eight service centres across five countries employing a total of 1,000 employees. The newest centre is in Penang, with 20 employees. The team comprises 18 nationalities and an older demographic “because they are better at speaking to customers”.
Lessons he’s learnt include “understanding the known unknowns such as weather, airport closures” and “how to build a flexible model around crisis”.
With the number of contacts per booking decreasing, Mileham said they had seen a satisfaction score of 92% over 1.3m completed surveys.
“It’s about reducing the total effort involved while improving customer experience through automation and self-service options,” he said. “Putting customers first means investing in customer service recovery.”
Hammering home the customer service message, Ooi Chee Teong, senior director, International Flight Business, Ctrip and Trip.com, said that up to 95% of customer enquiries were answered within 20 seconds and the post-transaction self-service rate was 75%. And between 2015-2018, the number of customer service staff required to service flight enquiries was halved, “managed by tech and automation”.
It is clear though that while customer service best practices are common to both China and global markets, Trip.com will have to find a middle path between leveraging Ctrip’s strengths and localising enough to make it relevant to markets outside China. In building for a non-Chinese consumer, Ooi said the product and user experience have to be different. “Ctrip has 60 products, the Chinese consumer love options, but not foreign travellers. We will design differently but will bring all products into a mobile-first approach. Having Ctrip’s own search engine allows us to do our own creative things, for example, virtual interlining.”
Trip.com now offers six main products – flights, hotels, trains, cars, tours and tickets and the latest addition, bundle & save. Other innovations it is working on include “open inspiration search on map, predicted best price on calendar and push price alerts”.
When it comes to tech in a mobile world, Trip.com may have the competitive edge but the critical element is talent and if Xiong’s vision of building a “glocal” company is to be delivered, then it has to build a “global mindset” workforce at its Shanghai headquarters as well as abroad.
If conversations with airline executives who attended the event – from brands such as Singapore Airlines, Oman Air, Kenya Airways, Virgin Atlantic to AirAsia – are anything to go by, it is clear Trip.com has taken a good first step towards delivering on its global ambitions.
Most said they were pleasantly surprised by how open Trip.com was about sharing their strategy and plans, as well as sparking debate, about the future of the airline-OTA relationship. “We need another OTA to balance out the power,” said one Asia-based executive.