Nicolas Chu

While making the HotelClub Chinese website more relevant to Chinese consumers, the brand is also repositioning itself – recognising its roots as a travel club.

So far HotelClub has been tapping the enormous China outbound market mainly through its offline travel agent network. Through HotelClub for Travel Agents, the company offers its inventory as well as membership benefits to 120 affiliate Chinese travel agents booking through its website.

Meanwhile, the company is lining up the outstanding pieces of its China strategy including building new offers tailored for China, offering payment options relevant and familiar to the Chinese market, refining its simplified Chinese site, and also offering hotel rates and payments in RMB. The aim is to offer a site which is fully functional for direct consumers in China, according to HotelClub’s president, Nicolas Chu.

In June, HotelClub became the first online global travel agency to sign an agreement directly with Alipay for online payment solutions. In order to cater for Chinese customers, it has also developed dedicated customer support manned by Putonghua-speaking staff in its call center.

The China market is seen as one with promising growth potential. “Mainland Chinese have more money to spend on travel, and (they travel to) more destinations. We’re seeing an emerging trend that Chinese travellers are very much after added value and extras when booking their trips,” said Chu.

HotelClub targets China’s independent travellers.  “The needs of Mainland Chinese travellers are similar to Australian and US travellers. Our consumers are looking for deals as well as added value and extras,” he added.

The emphasis on Club Benefits echoes the brand’s positioning shift in the past six months, tracing back to its DNA as a travel club. The strategy is already delivering accelerated growth, Chu said without divulging numbers.

The repositioning strategy is intended to drive growth. “It is our strategy to go back to our roots. At the end of the day, there are hundreds of sites selling more or less the same products and same hotels at the same rates. We are not the biggest. It was important for us to define our value proposition around what consumers actually want and need,” he said.

In less mature markets where consumers are in the “bro-bo” stage (browse online but book offline), HotelClub deploys its offline affiliate travel agent programme. The HotelClub for Travel Agents program has been growing significantly especially in China and has been launched in the Middle East as well.

Chu maintained that HotelClub’s strategy of dealing directly with consumers is not in conflict with its affiliate travel agent programme. “We still offer our inventory to travel agents with some extra benefits. For example, rewards are linked to an agent’s personal account. Effectively we don’t give rewards to our travel agent partners’ customers who are not booking with us directly, but we do give the rewards to the travel agents themselves.”

He also added that the company and travel agents are in fact going after different segments, as there are still quite a lot of people in China who prefer to book through travel agents for various individual needs – such as visas, for example.

Meanwhile, the company is also investing in mobile devices in order to catch the next big wave in online travel.

Chu anticipates that interactions based on a traveller’s location while using on-the-go devices (including mobiles and tablets) could be the next big trend for online travel development.

“While online travel began with travellers using the internet simply to hunt for bargains and make last minute bookings, it has since progressed to travellers sharing their recommendations online. Now we are seeing the dynamic exchange of information and recommendations as travellers begin to have conversations online – both between themselves and also directly with providers themselves.

“In the future it won’t be just about checking what people are saying on the web. Because you are in a specific location and you are linked to a specific group of people you will be able to view specific content which has been adapted to your needs. There will be interaction between people, combined with both the social and location dimensions. That’s what I believe will be the future and the logical next step for online travel,” he said.

“We are already starting to see this happen. It’s really the early stages at the moment.”

HotelClub will gear up for such trends in markets where mobile penetration is healthy. “It’s definitely something we are investing in. As a group, Orbitz is leading the way in terms of mobile. We already have a lot of data and analytics from our current mobile offering, which will be used to further optimise the way we use mobile in the future,” he said.

Nicolas Chu will be speaking at the 2013 China Travel Distribution Summit, September 11-12 in Guangzhou. Click here for more information on the Summit.