Recently, the 'Plan for Promoting Consumption Special Action' has been issued, once again clarifying the goal of boosting consumption and expanding domestic demand.

From this point, looking back at the CSI Consumer 360 index in 2024, the tourism Industry shows explosive growth, making it a leader and gradually establishing an important strategic position for the tourism Industry in the national economy.

Against this backdrop, unleashing the potential of travel consumption has also become a social consensus and a trend in development. OTA platforms are emerging with new momentum and roles in this wave, writing a new narrative for China's tourism market. The core Earnings Reports data of Ctrip and TONGCHENGTRAVEL also confirms this.

1. Tourism is moving toward a new prosperous cycle, and OTAs are more needed.

During this year's Two Sessions, tourism consumption has once again become a focal point. The 'Government Work Report' mentions cultural and tourism content multiple times, clearly stating that it is necessary to 'release the consumption potential of culture, tourism, and sports'; the Minister of Culture and Tourism, Sun Yeli, also stated, 'Cultural and tourism consumption has great potential for expanding consumption and should be cultivated into a pillar industry...'

In 2024, the public's desire to travel remains strong, showcasing unprecedented resilience and vitality in the Chinese tourism market, achieving significant year-on-year increases in several key Indicators.

Among them, in 2024, the number of domestic tourism trips in China will reach 5.615 billion, a year-on-year increase of 14.8%, nearing the level of the same period in 2019; the total expenditure of domestic tourists on trips in 2024 will reach 5.75 trillion yuan, a year-on-year increase of 17.1%, surpassing the same period in 2019 and setting a new historical high.

These reveal the leap that has taken place in the Chinese tourism market, from recovery to prosperity, and there is hope for sustained prosperity.

According to the global tourism industry report released by the World Travel and Tourism Council, the output value of China's tourism industry is expected to grow from 938 billion USD in 2024 to 4 trillion USD by 2033, with a compound annual growth rate of about 18%.

At the same time, one trend is becoming more apparent: OTA platforms are playing an increasingly important role in the leap of China's tourism market.

Visually, according to the "2024 China Tourism Industry Annual Report" released by Fastdata, the online transaction rate of China's tourism has been rapidly increasing, reaching 51.5% in 2024, setting a new historical high. OTA platforms play an important role in enhancing the online rate of tourism consumption.

Source: Fastdata.

More importantly, tourism has become a form of mass consumption. With diverse demands and the rise of experiential tourism, the supply side of tourism needs to be fully developed, utilized, and mobilized to keep pace with the development of the times to achieve precise matching of supply and demand. OTA platforms, with their strong resource integration and digital intelligence capabilities, can naturally meet the new development needs and play a significant role.

Standing in the present, OTA platforms are also more capable of shouldering the banner of releasing the potential of tourism consumption, and are more likely to drive the underlying logic of China's tourism market from short-term demand release to supply and demand collaborative upgrading, helping China's tourism market achieve sustained prosperity in the new cycle.

In this sense, OTA platforms have never been needed more than now.

2. The positioning and strategic differentiation of the two leaders: "Elite" and "Mass".

Focusing on the OTA platform sector, it has long been dominated by the two giants, Ctrip Group and TONGCHENGTRAVEL. The positioning and strategic differentiation of these two platforms can be simply summarized as "Ctrip for the elite" and "TONGCHENGTRAVEL for the masses."

The differences among them also reveal the diverse development of the OTA and even the tourism industry, as well as the different development opportunities in the future.

Specifically:

1) Ctrip: Accumulating high-end users, bringing Chinese-style service into overseas competition.

Ctrip focuses on high-quality travel and has taken the lead in laying out overseas ahead of other domestic OTA platforms, achieving a distinct positioning for high-end users, whose profile primarily consists of high-spending urban populations.

Internationalization is also one of the biggest highlights of Ctrip currently.

From a strategic layout perspective, TONGCHENGTRAVEL firmly bets on the overseas market and inbound tourism, including investing more aggressively in marketing in 2024 to promote its overseas platform, Trip.com, to accelerate customer acquisition and upgrade the entire inbound tourism chain. During the earnings call for Q4 2024 and the whole year, TONGCHENGTRAVEL's management also clearly stated that in the short term, the priority will continue to be overseas business expansion, which is crucial for unlocking major long-term growth opportunities.

A thorough study of Trip.com reveals that TONGCHENGTRAVEL's internationalization essentially introduces Chinese-style services into overseas market competition.

Compared to international platforms such as Booking.com and Agoda, Trip.com's advantages mainly lie in: Trip.com offers a one-stop travel solution that includes flights, hotels, activities, and car rentals, greatly enhancing the convenience and experience of travel; Trip.com's user base is skewed towards the upper end, primarily international travelers and middle to high-income groups that focus on quality. Moreover, in terms of AI technology application, Trip has launched the TripGenie large model to improve the efficiency and accuracy of personalized recommendations, continuing to enhance the overall user experience.

The characteristics exhibited by Trip.com align closely with TONGCHENGTRAVEL.

From a performance perspective, TONGCHENGTRAVEL naturally becomes one of the biggest beneficiaries of the recovery in inbound and outbound tourism in 2024, and inbound tourism drives TONGCHENGTRAVEL's international business to become an important growth engine. In Q4 2024, TONGCHENGTRAVEL's outbound hotel and flight bookings increased by over 20% compared to the same period in 2019; international OTA platform hotel and flight bookings increased by over 70% year-on-year; for Q4 2024 and the entire year, TONGCHENGTRAVEL's inbound tourism bookings each increased by over 100% year-on-year.

The development of inbound and outbound tourism and the deepening of international layout are also expected to support TONGCHENGTRAVEL's long-term growth.

Looking solely from the perspective of inbound tourism, referencing a report released by Morgan Stanley in 2024, the revenues from inbound tourism are expected to accumulate to 1.7-4.5 trillion USD over the next decade, with the contribution rate of inbound tourism to China's GDP expected to rise to 2-4% after ten years. At the same time, in the inbound tourism business, TONGCHENGTRAVEL can leverage its rich domestic hotel resources and extensive destination expansion to construct supply chain advantages, making it more competitive compared to overseas rivals like Booking and Expedia, indicating a promising development outlook.

2) TONGCHENGTRAVEL: Rooted in the general public, serving the national tourism demand with cost-effective services.

Looking at TONGCHENGTRAVEL, which is taking the lead in the mass tourism market, providing more cost-effective travel services to cover a larger group of the mass tourism population in China, continuously maintaining its position as the largest OTA in terms of users in China.

Nowadays, the explosion of the mass tourism market is also the foundational aspect and new engine of the entire travel market in China. TONGCHENGTRAVEL is continuously delving deep into this with its first-mover advantage.

For example, in mass travel, TONGCHENGTRAVEL is promoting a new travel method - transfer transport. For users, transfer options are often more economical than direct flights, catering to a wider range of travel destinations. At the same time, it helps improve the capacity of airports and airlines, which is urgently needed by domestic small and medium-sized airports. Conversely, these domestic small and medium-sized airports can also collaborate to develop more routes and products, enhancing the accessibility of local comprehensive transportation networks, achieving multiple wins. During the Golden Week of National Day in 2024, the cross-segment volume of train tickets and flight tickets at TONGCHENGTRAVEL increased by 18% year-on-year.

At the same time, TONGCHENGTRAVEL is expanding its offline service scenarios, with 19 member service centers established at various stations by March 2025, and extending its service radius to airports in non-first-tier cities, such as Haikou Meilan Airport and Lanzhou Zhongchuan Airport.

TONGCHENGTRAVEL officially launched the "First Ride Worry-Free" program to activate the potential of a large first-time flyer population, including young people primarily consisting of students, elderly travelers flying for leisure, and some foreign tourists in inbound travel. Since its testing began in January 2025, it has served over 0.02 million users.

It is worth noting that TONGCHENGTRAVEL is also continuously expanding its AI application scenarios. As the era of mass tourism and experiential tourism arrives, AI-driven digital-first travel methods become the key to meeting users' needs. TONGCHENGTRAVEL's first dedicated generative AI for travel, "Chengxin," has successively passed the filing of deep synthesis algorithms and large model filings, and is currently the first OTA connected to DeepSeek.

These business lines construct a unique formula of inclusive value: high-quality service pricing and sunk-down scenarios × further activation of demand from the mass tourism group × technology-driven efficiency and cost restructuring. This points towards creating "consumer inclusion" in the era of mass tourism, consistently highlighting and deepening the underlying logic of TONGCHENGTRAVEL: providing more cost-effective travel services to cover a larger group of the mass tourism population in China.

The performance of TONGCHENGTRAVEL unveils an optimistic picture.

It can be seen that TONGCHENGTRAVEL's performance in the fourth quarter of 2024 and for the whole year maintains a high growth rate, with users continuing to break through and grow comprehensively, consolidating its advantages among the mass tourism crowd.

As of 2024, TONGCHENGTRAVEL's annual cumulative number of service users reached 1.93 billion, a year-on-year increase of 9.3%; the number of annual paying users reached 0.24 billion, a year-on-year increase of 1.5%.

At the same time, the potential of individual users on TONGCHENGTRAVEL is continuously being released. By the end of the fourth quarter of 2024, the average consumption frequency per user on TONGCHENGTRAVEL increased from 5.5 times in 2019 to 8.1 times in 2024, with the average revenue per user (ARPU) on the platform growing by 44% year-on-year.

We conclude that the demand from more users in non-first tier cities is gradually extending, with increased travel frequency from domestic to leisure outbound travel. TONGCHENGTRAVEL is continuously solidifying a dual growth pattern of expanding mass tourism and enhancing value. Data shows that TONGCHENGTRAVEL's international business Sector performed well in 2024, with international flight and hotel business volume both doubling year-on-year.

According to McKinsey's predictions, by 2030, over 66% of personal consumption growth in China will come from non-first tier markets, and the enormous consumer potential contained in non-first tier markets is also expected to drive this logic to continue unfolding.

3. Conclusion

From a broader perspective, the future of China's tourism market and even the domestic Consumer Industry holds immense potential, but faces two choices: to go down (popularization) or to go out (internationalization). This is not only an inevitable choice for industrial upgrading but also a necessary path for the transition of China's consumer market from scale expansion to quality leap.

Trip.com and TONGCHENGTRAVEL serve as observational samples of going down and going out in China's tourism market. Trip.com will benefit from the booming inbound and outbound market, while TONGCHENGTRAVEL can also Share in the expanding cake of the mass tourism market.

These two different path choices also jointly promote the leap of the China tourism market at a higher dimension, providing a unique 'Chinese sample' to the Global tourism Industry and outlining the complete picture of its new narrative.

Of course, as with all Industry changes, with the arrival of new waves, explorers and disruptors often will not be let down by the times.