From selling goods on WeChat to entering beauty, how difficult is it for travel companies to save themselves in a hundred days?
Source: Global Travel News 2020-05-29 20:20:16 “It is expected that the overall business will return to 60-70% last year in May, and the most important thing at the moment is open source.”
[Global Travel News] Affected by the epidemic, the tourism industry has been almost shut down since January 27 when all the team travel business and the machine + wine service were suspended.
As the epidemic prevention and control situation improved, in recent months, 31 provinces across the country have successively lowered the level of public health emergency response to second, third, and fourth levels; many provinces have opened intra-provincial and peripheral tours, plus With the arrival of the May Day Holiday – Golden Week, the China tourism industry can be described as “a long drought meets a sweet spot”.
However, the recovery situation of tourism enterprises is still not clear.
According to Zhang Yanhong, marketing director of Shenzhen JLG, the overall business of Shenzhen JLG returned to about 60% in the same period last year, and it is expected that the overall business will return to 60% to 70% in May.
The tension of the CEO of Ctrip’s Travel Channel Business Division bluntly stated that the data for “May Day” is worse than expected. The cross-provincial tourism has not yet been restored, and there is no news when the outbound tourism will be unsealed. At present, less than half of Ctrip’s 7,500 offline stores are open for business. Tension is expected to wait at least for the recovery of cross-provincial tourism before business conditions can improve.
The 6-person tour CEO Jia Jianqiang said that the biggest impact of the epidemic on the company is that the number of refunds is relatively large. There have been few orders in the past few months. “However, when the market demand is low, I did not do marketing. This year I saved 10 million yuan Marketing expenses.”
After the China travel business pressed the pause button, they all began to explore the “open source” approach: Shenzhen Jielv and Ctrip travel stores began to “sell” on WeChat, and the 6-person tour chose to join the beauty makeup track.
For them, the most important thing at the moment is to walk on two legs. On the one hand, they should grasp production recovery, resume work as soon as possible, and prepare for the full recovery of the tourism industry; on the other hand, they must overcome the current difficulties through “self-help”.
Operating sideline business, moving low and high frequencies
At a critical moment, only you are the ferryman of fate. This sentence also applies to tourism companies. After the tourism industry is hit by the epidemic, perhaps only active self-help can change the status quo.
It is worth noting that many travel companies have chosen cross-border self-help. Whether it is “selling goods” on WeChat or launching a beauty brand, it uses high-band dynamic and low-frequency play to enhance user stickiness.
According to Zhang Yanhong, Shenzhen Jielv launched the C-side small program “Hui Departure” launched in July 2019. Due to the high-star hotel supply chain capabilities of Shenzhen Jielv, the initial direction of Hui Departure was to sell hotels + scenic spots , Hotel + catering and other products. At that time, the total number of members of Hui departure was about 20,000, and the number of distributors was more than 8,000. After selling non-tourism products in February this year, the total number of members has increased significantly. At present, the number of members of Hui departure is 110,000, and The number of distributors reached more than 30,000.
At present, non-tourism products from Huihui include epidemic prevention articles, daily necessities and fruits, and local specialties. Zhang Yanhong said that in order to protect the quality of the goods, more than 90% of the fruits and local products of Huiqi are directly harvested, and the repurchase rate has reached more than 20%. Most of these fruits and local products are personally contacted by local supply and marketing cooperatives and shipped directly from the place of origin.
Under the epidemic situation, the days of hotels are not easy, and the market recovery needs a longer period, so many hotels have implemented different self-help solutions, and hotel pre-sale is one of them. Hotel groups such as Mangrove, Shilili and Gaoyuan Cultural Tourism have all launched hotel pre-sale products to attract consumers at far lower prices than usual.
By pre-selling products in hotels, on the one hand, it can boost consumption and increase income; on the other hand, it can also regain travel labels and re-establish contact with potential consumers. On February 19, Huizhe also started to try hotel pre-sales, and reached cooperation with many hotel brands including Yanyang Holiday, Huazhu, China Travel Group, Junlan Group, Shilifangfei Resort, etc., a total of 130 online SKU. As of the end of March, the sales of hotel products from Huihui reached more than 10,000 sets. In terms of the amount of nights between hotels, there are hundreds of nights in February and 10,000 nights in March.
However, at present, Hui’s orders are still mainly based on non-tourism products. Zhang Yanhong said that the current ratio of hotel pre-sales and non-tourism products to order sales is 2:3, but as the epidemic situation improves, it is expected that the proportion of hotel pre-sales will increase.
Compared with Hui departure, the Dolphin Life Museum in Ctrip store can be said to be too late. In April of this year, the Ctrip store launched a small program for the C-end-Dolphin Life Museum. However, Zhang Li said that the Dolphin Factory Life Pavilion was a project that Ctrip store was laid out last year. At that time, the small program was created because the store has a natural social attribute, and it needs to maintain a considerable frequency of contact with the customer group. It is difficult to meet this attribute with the frequency of travel product consumption. , “So we want to make a small program that sells pan-tourism products, allowing store members to distribute and increase the stickiness of customers, and move low and high frequencies in high frequency bands.”
Currently, there are more than 200 items on the Dolphin Factory Life Pavilion, mainly for daily necessities, food, and beauty. Distributors on this platform can only be applied by employees of their stores. At present, more than 4,000 UIDs (user accounts) have applied to become distributors. As a distributor, after the distribution of fresh products is successful, you can get a commission of 4%-5% of the gross profit of the commodity, and other products can get a commission of 10%-15%.
In April, when tourism companies broadcast live goods, the 6-person tour also launched a live broadcast. It is not their customized tour that is recommended, but a mask called “Xueyu”. Jia Jianqiang personally played live, obviously, the effect is not as good as Li Jiaqi, but also sincere enough.
Jia Jianqiang mentioned in the interview that the consumption frequency of tourism products is low and the decision-making cycle is long. Female users of 6-person travel account for about 70%. Due to the need for differentiated development with the industry, they launched a comparison of consumption frequency for female consumers. High skin care products to increase customer stickiness.
This idea is not caused by the epidemic. As early as 2018, 6-person tour acquired the skin care brand Xueyu and invited Guangzhou University of Traditional Chinese Medicine Research Institute as technical support. The products were produced by Guangzhou’s beauty factory. At present, the product is in the stage of upgrading and polishing, but the epidemic has accelerated the launch of the product.
Crossovers have many difficulties
Although it is the right choice to actively seek a way out in adversity, in a complex and ever-changing environment, it is not easy to enter a strange field. It is understood that whether it is Hui Departure, Ctrip store, or 6-person tour, after the cross-bank layout, it can only achieve basic coverage costs or not yet cover costs, and there is still a way to go before profitability.
According to Zhang Yanhong, the water flow of all products on the Hui departure platform was 2.6 million yuan in February and 3.5 million yuan in March, with a gross profit of about 10%-15%. At present, there are six or seven employees responsible for the projects initiated by Hui, which can basically cover all costs without vigorously expanding recruitment.
Jia Jianqiang said that since its launch, Xueyu Mask has achieved sales of 1 million yuan on various e-commerce platforms. He said that although the current marketing amount can not feed the team of 6 people to 200 people, this is a project from 0 to 1. It is very gratifying to successfully establish a project and have a positive development.
Tension said that since the small program was just launched, it is still in the groping stage. Compared with the mature e-commerce platform, Zhang Li described the living hall of the Dolphin Factory as a “newborn”. He said that the advantage of the living hall is not the product itself, but more of it depends on the acquaintance effect.
Choosing products and operating e-commerce are not the strengths of Ctrip stores. Therefore, Ctrip stores choose to cut in from the establishment of a platform and invite merchants to settle in the Dolphin Life Museum. Merchants need to pay a certain deposit to enter the platform. The person in charge said that the payment of the deposit is to protect the quality of the goods.
Compared with the self-operated model, the platform model is relatively light, does not require a large amount of capital investment, and avoids the risk of unsalable goods caused by unfamiliar product selection.
Dolphin Factory Life Pavilion merchants need to pay a certain deposit.
For the C-side platform, whether it can continue to acquire customers is a crucial issue.
At the end of October last year, Hui launched a two-level distribution model and used 50% of the product gross profit as a commission for two-level distributors. For example, when A was promoted to B, B was then promoted to C, and after C successfully purchased, B was used as the first-level distribution. Distributors can get 80% of the commission, A as a secondary distributor can get 20% of the commission. In addition, the threshold for becoming a distributor of Hui departure is relatively low, and you can become a distributor only by registering on the Hui departure applet without paying any other fees.
Relying on a relatively perfect distribution system, the number of distributors in Huiqi rose from 8,000 to 30,000 today, and relied on distributors to increase traffic, but to a certain stage, the continued expansion of traffic is still difficult.
In this regard, Zhang Yanhong said that on the one hand, 30,000 distributors should be systematically managed to improve the promotion and growth mechanism; on the other hand, it will also try to increase traffic through live broadcasts and other methods. “The core is product-driven and social fission gameplay, on the one hand to ensure product quality, on the other hand, continuous innovation technology, in order to attract users for a long time.” According to Zhang Yanhong, Hui Qi recently launched the “demolition red envelope” function, and then will On-line product grouping and other functions. These functions are all attempts to pull new users.
Jia Jianqiang live broadcasts once a week recently, which is Xueyu’s main marketing method. Jia Jianqiang said that social marketing will not be carried out at this stage, and their promotion this year is only aimed at the 2 million direct customers who traveled for 6 people. He believes that the current cost-effectiveness of social promotion is not high, and it is more suitable for tapping demand from existing customers and reducing market costs. “Now consumer demand is not so strong, consumers still have concerns about travel, and the conversion rate is low; all travel companies are doing promotion, competing with Ctrip and other OTAs for traffic, not necessarily making money.”
It is true that many travel companies including Ctrip have tried to bring live broadcasts this year, but live broadcasts are not a panacea. For the above-mentioned companies, although the big-name KOL has a high conversion rate, it is expensive. When the main business has not been fully restored, how much money to invest in the side business needs to be carefully considered. In addition, Global Travel News has reported that even if it is a live broadcast of the pre-sale of travel, it is necessary to consider the issue of write-off rate. If the write-off rate is too low, it is unknown whether actual revenue can cover costs.
The Dolphin Life Museum has also tried to do live broadcasts, but Zhang Li said that the current marketing tools are very rich, and they still need to constantly try more new methods.
In addition to live broadcasting, Ctrip stores are also trying to increase consumer awareness of new brands by renaming small programs to increase traffic. It is reported that in February this year, the Ctrip store had a trial operation project under the name “CBQ Life Pavilion” (C refers to Ctrip, B refers to PepsiCo, and Q refers to where to go), but later it was officially named “Dolphin Life Pavilion” On the line, LOGO has also added a dolphin pattern, and changed the background color to blue, which has the genes of Ctrip as a whole.
Sideline will always exist in the future
Guotai Junan Securities once released a research report called “Deep Review 2003 SARS”. The report shows that after the tourism market fully returned to normal in early July 2003, a major rebound (passenger growth rate, The total tourism revenue growth was 11.5% and 13.07% respectively. It was not until the Spring Festival in 2004 that the market ushered in retaliatory growth. Similarly, under the influence of this epidemic, it will take a long time for the tourism industry to fully restore normalcy. During this period, enterprises with low risk resistance will be out, and industry reshuffle will accelerate. Therefore, tourism companies must increase The ability to resist risks.
For tourism companies, in addition to working hard on the main business, the side business is also inseparable. On the one hand, the operating sideline can drive high and low frequency bands to drive the sales of tourism products; on the other hand, although the current sideline is relatively small and cannot compete with the mature e-commerce platform, the operating sideline is a precautionary measure at a critical moment In addition, the sideline business can also subsidize the main industry to a certain extent to enhance the ability to resist risks.
The above interviewees also said in an interview that the current sideline business is not only a special measure during the epidemic. In the future, Huiqi, Dolphin Life Pavilion and Xueyu brand will run as regular projects.
As a routine project, it is necessary to constantly polish and improve products. Zhang Yanhong said that on the technical level, the functions and user experience of small programs still need to be strengthened; the supply chain of direct-purchased products also needs to be strengthened; more diversified methods should be tried in marketing. She also said that although Hui will start to become a regular project in the future, there will be no expansion of personnel in the short term.
According to Zhang Li, the Dolphin Life Museum will list tourism products in the future. He expressed his hope that the Dolphin Factory Life Museum will be built into a pan-tourism + lifestyle platform.
Jia Jianqiang’s and Zhang Li’s ideas coincide, except that the Xueyu brand will exist for a long time and continue to promote new products. The original hotel mini program of the package is combined into one, and the data on the original hotel mini program is gradually transferred to the 6-person tour strict selection applet. Users can purchase daily and beauty products from it, and can also book hotel packages.
According to him, most of the non-tourism products selected by the 6-person tour are non-direct mining products, and some are direct mining, such as lipstick and cultural and creative products in the Forbidden City series. The sales of non-tourism products are about 1 million yuan per month, but the cost has not yet been covered; hotel products are all from direct mining. According to Jia Jianqiang, the company has established cooperation with 100 hotels, and its turnover has tripled compared with last year.
However, compared with other platforms, 6-player Yanxuan did not launch a distribution model. Jia Jianqiang revealed that they may design a distribution model and carry out social marketing in the future, so that tourism operators can become distributors and earn profits through distribution, and the commission can reach 15%-20% of the gross profit of the entire commodity.
Since the outbreak of the epidemic, the tourism industry has gone from a wave of withdrawals to business zero, to industry recovery, and fancy self-help; the industry has experienced too much from shock, pressure, confusion, and positive optimism. Although the tourism industry’s sideline business is still in the preliminary exploration stage, as Zhang Yanhong said, “As long as there is hope, dare to innovate and make breakthroughs, the future will definitely be better.” Learn more about China Tours.