This Segment Might Be The Biggest Driver Toward Ctrip’s Outbound Traveler Revenues

January 3rd, 2017 by Trefis Team

CTRP

Ctrip

By now we already know one of the most important categories that Ctrip focuses upon for growth is Chinese outbound travel. Among its outbound travelers in 2016, the most rapidly growing and biggest segment had been medical tourists. A latest report by Ctrip suggests that in 2016, the Chinese medical tourism market grew by 500% to reach around 500,000 outbound medical trips. On an average, the Chinese medical tourist spends around 26,000 yuan ($3,741) in their Europe trips and around 18,000 yuan ($2,590) in their travels within Asia. Along with the rise in China’s HNIs, urban, and aged population the demand for outbound medical tourism can only be expected to grow even more in 2017, and further. By 2020, China’s population of the above 60 age range is expected to reach 240 million.

Regular health checkups occupied over a 50% share in Chinese medical tourism, in 2016. Other popular services in the high-revenue generating categories were plastic surgery and gene tests (especially in the United States). These services were especially popular with China’s high net worth individuals (HNIs). In fact, healthcare related discussions are one of the most interesting topics for conversation among China’s HNIs. Among the preferred destinations for Ctrip’s outbound medical tourists, Japan was the most popular destination, followed by South Korea, the United States, Taiwan, Germany, Singapore, Malaysia, Switzerland, Thailand, and India. Japan’s medical tourism is dominated by Chinese travelers. Also, the three biggest markets for the outbound medical tourists for Ctrip were Beijing, Shanghai, and Shenzhen.

If medical tourism continues growing at this rapid pace, we can expect Ctrip’s global share of hotel bookings to increase significantly in the future.

What Is Ctrip Doing To Help Boost The Growth Of Its Outbound Travelers?

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In 2016, Ctrip made investments in various global entities in order to expand the products and services to be enjoyed by its outbound travelers. In October, the company made strategic investments in three tour operators based in the US, namely, Universal Vision, a bus tour operator and travel agency in New York, Ctour, a Los Angeles-based wholesaler and China group-tour operator, and Tours for Fun, a Los Angeles-headquartered online travel agency. The four companies will work together in receiving customers, in supply and distribution of inventories, and in helping each other with their expertise.

In November, Ctrip acquired one of the largest global metasearch companies, UK-based Skyscanner for $1.74 billion. Ctrip also has a majority stake in Travelfusion, a U.K. based travel distribution system that operates from London and Shanghai. The Skyscanner and Travelfusion teams will be working on increasing synergy and Ctrip’s global reach in the airline booking market might significantly increase due to this synergy.

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Have more questions about Ctrip? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com

2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Ctrip

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