Online travel services bank on sharing information for outbound market

Chinese online travel services are set to grow amid increasing interest in overseas destinations, with many businesses catering to the lucrative budget sector alone.

Economic Travel Net (go2eu.com), one of the country's top travel information websites, offers tips, itineraries and traveler feedback as a platform for savvy backpackers.

Figures from the portal show that its daily page view number about 400,000, with users aged from 18 to 35 forming more than 90 percent of the viewers.

By March 1, the number of registered users hit 900,000, compared with 1,500 in 2004 and 150,000 in 2008. About 1,100 newcomers register with the website every day and up to 5,000 posts are recorded on the website's bulletin board.

Xiao Yi, 32, and Zhou Tong, 33, the founders of go2eu.com, set up the Chinese-language website in 2004 to share their travel tips and reviews with friends and classmates as they became fascinated with traveling in Europe during their studies in Germany.

"Ninety-percent of the page views come from unregistered users," Zhou says. "We set up the site out of interest and felt it was more convenient for us to post our experiences rather than talk to people one by one."

More people joined their site to provide more information about traveling in Europe and its number of visitors grew.

The two decided to register go2eu.com in Germany in 2004. But in two to three months' time, they recorded a growing number of people registering on the website and received their first commission from hostelworld.com, an online accommodation booking website which targets students.

Zhou and Xiao moved their headquarters to Beijing in 2008. Their site also shifted its focus as a tourism-themed online bulletin board for overseas students in Europe to one offering consulting and booking services including route planning, transportation, accommodation and insurance.

"The fast growth of overseas travel in China attracted us," Zhou says.

"Providing services for Chinese travelers was our original intention as travel information was in short supply in China."

The website has grown in line with increasing outbound travel by Chinese people.

Chinese tourists made a total of 57.39 million outbound trips in 2010, up 20.4 percent on the previous year, according to the National Tourism Administration. More than 1.53 million tourists went to Europe in 2010, according to cntour2.com, a leading news website focusing on the tourism sector.

Other successful websites similar to go2eu.com's business model include yododo.com and mafengwo.cn.

Many other players have also jumped on the travel information bandwagon. Expedia's TripAdvisor, a free travel guide and research website, launched Daodao.com, a travel hotel and destination review website, in April 2009. It also acquired Kuxun.cn, a Chinese flight and hotel search engine at the end of 2009. Ctrip.com, a major Chinese online travel booking website, established its travel comment site lvping.com.

Zhang Yanan, a media analyst with Chinese investment research group Zero2IPO Research, says there is potential in the country's online traveling services market but "sophisticated guidance" for overseas tours is in short supply.

The sector's offline services market can also no longer meet customers' needs. Go2eu.com's shift to China also saw changes in the breakdown of registered users. Before 2008, 46 percent of its users were from overseas. Since its move, 71 percent of its users now come from China, says Zhou Tong.

Most of these are high-end users and 75 percent are in the high-income group. Forty-six percent of these have a monthly income of more than 8,000 yuan (863 euros).

"We have started making profits, with income far surpassing our costs," Zhou says.

The site was initially an outlet for people to share and obtain travel information, and excessive commercialization will lead to an "uncomfortable customer experience", Zhou says.

Rui Huanhuan, a go2eu.com user from Beijing with an annual income of 150,000 yuan, says she registered with the site in 2007 during a search for travel diaries.

The 28-year-old, who works in a Fortune 500 company, spends 10,000 to 20,000 yuan on an overseas trip every year. Before setting off, she goes through go2eu.com to collect tips and itineraries. She later began posting diaries and information about her own trips.

"I tend to stick to pre-determined routes and the site can help me solve problems with air tickets, exit visas, hotel booking and route planning," Rui says. "Many of the online users have become my friends in real life. We share information on the site, help each other and are optimistic about life."

There are also no pop-up advertisements on the site, Zhou says.

"Commission from hotel bookings and insurance advertisements are important profit sources for us, accounting for more than 80 percent of our total income," Zhou says. But it does not mean they do not have advertisements.

"All the advertisements on go2eu.com are related to travel. The users' experience is what we value most. Go2eu was built by a group of backpackers so we know what our users want," he says.

As an online media, the website will also speed up cooperation with advertisers and fight for investment from venture capital for further development.

Li Xinjian, dean of tourism management at Beijing International Studies University, which is one of the first Chinese universities to offer courses in tourism management, says economic development has allowed significantly more people to travel.

It is a far cry from about 10 years ago, when most outbound Chinese tourists had to arrange group business tours through travel agencies, Li says.

Chen Yingying contributed to this story.