Source of Article: NTU EMBA Alumni Club Website

Courtesy of CEO Xie Ming-hui, keynote speaker of Alumni’s Lecture Series No. 2 on Nov. 26: Transition of Ctrip. Before the Lecture began the participating EMBA alumni members were mingling with some long lost friends, followed by seating themselves to work on the reading of the case material. With full attention among the alumni members, the Alumni’s Lecture Series No. 2 then began to study and dissect a Chinese company: Ctrip Ctrip.com International Ltd.)

Established in 1999, Ctrip went public in December 2003 at NASDAQ, US. Today it is the leader in Chinese general tour operator market. The management concepts behind its outstanding performance is the primary topic for today.

. As Professor Tang had mentioned in the previous Alumni’s Lecture Series, all traditional business patterns must change to adapt to the rise of internet; Ctrip will be an example of tour industry changing people’s ways of travel planning as internet evolves. Tracing back to Ctrip’s history of development, it did not directly offer traditional tourism products; instead, it first locked onto hotel booking service. In the times when information comes less handy, booking hotel rooms could be a daunting task for business travelers touring state-to-state in the vast terrain of China, and Ctrip emerged to fill in the blank. While the similar service was never short of competitors, Ctrip’s team prevailed in technology and financial management.

Winning the travelers who demand efficiency and trust was Ctrip’s priority objective. For example, both its Rooms Availability Real-time Control System that offered the availabilities of all hotels in real-time, and the E-booking that offers real-time booking status had adopted the strategies of information completeness and speed. Ctrip took a second step and developed flight ticketing business with innovative Flight Ticket Booking Platform using its IT advantage, offering an even more convenient option for domestic travel consumers. In 2004 Ctrip further introduced the International Flight Ticket Online Booking System that aimed to overcome the problem of flight fare accounting caused by complex foreign currency exchange rates. The Ticket Delivery Team started in 2006 further reduced travelers’ doubt about “lost ticket”, and made certain that the ticket supply side will receive payments. All these efforts committed by Ctrip had been aligned coherently to offering reliable and convenient services for travelers.

”Have you ever thought about why using Ctrip as our subject of case study? What makes it so special?” Back to the very beginning of the Lecture, Professor Xie Ming-hui, the speaker, challenged the audience. With Xie’s moderation, discussion for the class then started thereafter to analyze step-by-step the hidden recipe of success. Why the need of rapid economy of scale to attract clientele in volume? How service perishability and consumer stickiness become the focal points for achieving economy of scale in the market? Having acquired Charming International Travel, Ctrip expanded into vacation business, of which customizable services demand for higher cost that ultimately drive up selling price; what did Ctrip do to retain customers? Ctrip, where service is mission critical, had been dedicating to standardization, customization, and personalization throughout all stages in its development; what are the differences about these three factors and how they each functioned to be influential in their respective aspects? The Q&As among the professor and the Alumni Members then consolidated into a solid conclusion about Ctrip’s efforts and visualized Ctrip’s architect of visions.

After an enthusiastic discussion, Professor Xie presented Sun Jie, the current COO of Ctrip, to the audience over instant messaging software for real-time dialogue. As the screen in front of the audience lowered, COO Sun Jie appeared and briefly greeted the audience and jumped right into Q&A about Ctrip’s operation. A discussion in a case study can be fruitful and exciting, but being able to communicate directly with an executive member of the subject company proved to be even better. COO Sun first-handedly shared precious information about the company’s history and future prospects with the audience.

Ctrip in the recent years is on something even bigger; acquisitions and joint-venturing along the chain both up- and down-stream are suggesting that Ctrip is positioning itself toward an ambitious global presence. The speaker and the Alumni Members in this special afternoon had profiled, in block-building fashion, Ctrip’s early development and transition process. In a Cross-Strait dialogue, they had also envisioned a journey to the other side of Taiwan Strait that is yet to set sail. This Lecture had been a trip of enlightenment. 

NTU EMBA Alumni Club Webiste: http://www.ntuemba.org/