ChinaTravelNews, Ritesh Gupta - James Liang, Executive Chairman, Trip.com Group has stated that the group is focused on working out a uniform artificial intelligence (AI) adoption strategy across all markets.
Speaking during the group’s third quarter (Q3) results last week, Liang mentioned that AI is being relied upon to augment performance in several disciplines including marketing, engineering and customer services.
“Our goal is to offer users a smart AI assistant that can simplify and enhance their trip planning and research experiences. Through natural language interfaces and actionable recommendations, we aim to help users plan their trips more effectively. Successful practices from each market will be shared and promoted across others, ultimately becoming a global standard within our organization,” said Liang.
This year Trip.com Group has continuously come up with initiatives backed by AI. These include the work being done on its AI travel assistant. As part of its plans to become a top-notch OTA, significant upgrades have been released to reduce a travel shopper’s booking path, backed by enhanced UX in serving tailored itineraries and coming up with richer responses to travel-related needs. AI technology is also being blended with driving a travel booker to a booking page. A couple of months ago Trip.com Group stated that those users who have been served by their AI assistant have featured in better conversion results - an order conversion rate twice that of the average user and a retention rate 30-40% higher than the average user.
Jane Sun, Chief Executive Officer of the group stated that AI is also behind superb self-service rates. According to the team, AI chatbots manage inquiries via text and voice “with over 85% semantic recognition accuracy”. This streamlined approach results in impressive self-service resolution rates of 78% for airline tickets and 68% for hotels.
As part of its overall focus on CX, the group has ensured its product and tech innovation is being combined with its content strategy. For this, teams have added AI-powered content marketing tools to its app to boost other features such as live streams and community-focused user-generated content.
This is also resulting in positive results.
Jane said, “Notably, in Q3, 60% of our global booking came directly through our global mobile app. Our APAC market, we have seen 70% of the orders are booked through our mobile app, which is even higher than the global booking. To further capitalize on this opportunity, we have developed a comprehensive road map that leverages our strengths and resources to drive continuous growth.”
Growth plans, relying on synergy
The group acknowledged that it did start with a “comparatively small market share”, but now the team at trip.com is poised to enlarge its presence through its all-in-one mobile app.
Commenting on growth plans over the next 3-5 years, Xiaofan Wang, Trip.com Group’s CFO, shared, “…we expect that Trip.com will maintain a robust mid-double-digit growth rate, becoming one of the primary growth drivers for the whole group. In terms of different markets in Asia, Trip.com is targeting to become the leading OTA. The combined size of its top market in the Asia Pacific region exceeds that of Mainland China in terms of total gross booking. And Trip.com has already established a pretty solid foothold in this region with comprehensive local operations.”
Wang acknowledged that Trip.com has “strong brand awareness and market share in the China market for both the China domestic as well as China outbound”.
“…we have a very healthy margin to serving the China market. And in the international market,
We (are) growing very fast. We are still in the investment cycle (in foreign markets). But at the same time, we will balance the investment versus improving and towards a more healthy margin for the international market,” said Wang.
Total bookings on Trip.com Group’s global OTA platform have increased by over 100% year over year in Q3.
Jane also mentioned that the inventory the group has developed for Chinese outbound customers can also be used by global customers as well.
“…we will be able to empower the customers from overseas to travel abroad. So different segments, we look at different opportunities. But for each segment, we feel there is a lot of upside for us to drive to. And we will make sure we make investment to address our customers' needs,” she said.
Wang said for the European market, the near-term focus is more on the air travel.
“The air market in Europe is about twice the size of China's in terms of gross booking. This represents a significant opportunity for the group to capitalize through synergies among different brands within the group. Furthermore, we are strategically expanding our service offering into other markets while upholding our ROI return standards,” said Wang. Air ticket booking on the company’s global OTA platform has nearly doubled year-over-year and 80% above 2019 level.
“Our overall hotel bookings on the global platform also hit a new record high and more than doubled 2019 level. Following the country's goal to promote inbound tourism and roll out of favorable policies, we have also seen triple-digit growth in inbound travel through our global platform,” said Jane.
Moving into the year 2024, Wang felt that outbound travel as a percentage of the total revenue contribution to the whole group is expected to go up. “And outbound, traditionally is a more healthy or higher-margin business for us,” said Wang. “We have the full confidence to continuously to maintain a healthy margin level moving forward.”
Adjusted EBITDA margin was 34%, compared to 21% for the same period in 2022 and 33% for the previous quarter.
