Tujia, China’s equivalent of Airbnb, announced on August 5 it had registered the largest volume of orders on a single day on August 4. The number of orders exceeding 56,000 room nights is a record high in the house-sharing field in China. Analysts in this sector hold that Tujia’s new record signifies that house-sharing is being favored by an increasing number of Chinese users, and the market is likely to see a new round of explosive growth in the coming 6 to 12 months.
The transaction volume also included orders received by Mayi.com, another leading enterprise in China’s house sharing sector that Tujia announced it would acquire on June 22, 2016. Mayi.com has enjoyed substantial increase in orders in the past two months since the announcement of the merger, with daily orders averaging 10,000 room nights, five times more than before the M&A announcement. The merger with Mayi.com is deemed to be an important strategy of Tujia for consolidating its leading position in the China market.
Figures also indicate that Tujia’s core users are increasingly active. During the summer travel season, more than 70% of the users were families and groups and more than 60% of the bookings were for stays of three days or longer. Tujia users tend to be groups of multiple persons staying together or staying for multiple days.
Market analysts believe Tujia’s record transaction volume signifies that house-sharing is increasingly popular and this market may see a new round of explosive growth in the coming 6 to 12 months. In just over five years since the concept was introduced, at least tens of millions of Chinese consumers have become familiarized and adopted the house-sharing model.
Launched on December 1, 2011, Tujia maintains an annual transaction growth of 300% YoY. In August 2015, Tujia raised USD 300 million of financing at an estimated valuation surpassing USD 1 billion. Tujia hosts an inventory of 430,000 online properties covering 312 destinations in mainland China, and over 1,000 of those are in overseas.
Since 2013, Tujia has gone international by handling outbound travel for Chinese customers. The company’s current focus is on the top vacation destinations for Chinese customers: Southeast Asia, Japan and South Korea. Tujia’s overseas transaction volume also maintains rapid growth.
China recorded 4 billion man/trips for domestic travel and 120 million man/trips for overseas travel in 2015. The potential market size for house-sharing in China is still relatively untapped. Meanwhile, major platforms like Tujia that assure customers with quality management on a long-term basis have built users’ trust in this new form of travel accommodation and developed a solid base for rapid market growth in the future.
