There are a few key words that people don’t want to touch in 2015 that are about to pass: economic slowdown、Capital Winter、Venture Capital Bubble。

According to Goldman Sachs data，China’s economic growth dropped to an average of 6 for the first time in the past decade.9%，The next five to ten years，The growth rate will remain at 5%-6%。Sudden deceleration，The Chinese economy, which is accustomed to running at an average speed of 10%, feels a strong sense of discomfort: the secondary market is in shock，Stock market crash swept across，From May to September this year，1.8 trillion evaporated；Venture investment bubble is rising，"Double Entrepreneurship" Advocacy，Capital Fever，Like beer，Toppled too hard，The drunken entrepreneurs and investors were shocked，Thought they were cheating on each other，The wine shop broke up on bad terms。

Many death lists in the O2O field are flying like big-character posters，Under the bustling surface, there are corpses everywhere、The ground is full of hunger and death，It makes people suspicious，This is the best era after all，It’s still the worst time，Or both？Therefore, rational analysis after chaos and noise will be more valuable，Facing the problem，Return to the essence of business，This is the beginning of solving the problem。

Is tourism still a good industry?？Is the outlet for outbound travel closed?，What other opportunities and pain points exist？Want to be the "pig" in the spotlight，What efforts are needed to really fly？What is supply-side reform？Is it related to outbound travel？These questions，Let’s discuss each one。

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Opportunity 1: Consumption upgrades, large tourism consumption has become a necessity

Thirty years of reform and opening up，China’s economy is developing rapidly，China’s total GDP will reach 19 trillion US dollars in 2016 (U.S. 18.8 trillion US dollars)，Accounting for about 18% of the global economy；Per capita GDP has reached US$7,800 by 2015，To be over $9000 in 2016，According to statistics from the International Tourism Organization，Per capita GDP exceeds 5,000 US dollars，Tourism consumption demand reaches the standard of experience tourism。As an important form of national consumption，Travel has gradually become a necessity for consumption。

Opportunity 2: Outbound tourism is growing rapidly，There is a huge gap with developed countries，Favorable policies

The number of outbound tourists from mainland China in 1998 was only 8.43 million，Breaking 100 million for the first time in 2014，The number of outbound tourists in 2015 will reach 1.3.5 billion，In 2015 alone, there was a year-on-year increase of 17% compared with 2014。Merrill-Lynch research prediction also shows，China’s outbound tourism will reach 1 by 2019.7.4 billion people，Growth 10.8 times，China’s outbound tourism is developing rapidly。

According to Phocuswright report，China’s tourism share of the Asia-Pacific tourism market has increased to 32% in 2015，But compared to the United States，There is still a huge gap。In the past 20 years (2004-2014)，The per capita GDP of the United States has increased from US$40,000 to US$55,000，China’s per capita GDP increased from US$1,000 in 2004 to US$6,770 in 2014；The frequency of flights per capita in the United States has been higher than twice/year over the past 20 years，And China has never exceeded 0.5 times/year；The average annual travel frequency of Chinese families is 2.7 times，Equivalent to the level of the United States in 1972，The United States has now reached 6.7 times。

In addition，The proportion of people in mainland China who have passports is less than 10%，224 countries and regions in the world，As of now (December 2015), there are only less than 30 countries or regions that have achieved true visa-free or visa-on-arrival status with China，As mainstream Western countries such as the United States, Britain and Canada gradually relax their visa policies for China，Outbound travel will continue to benefit。

Per capita GDP and number of air passengers in China and the United States in the past 20 years (data source: World Bank)

Opportunity three: Millennials are becoming the mainstream consumer group，Free travel abroad is the first choice

The British Financial Times website published an article entitled "China's Millennials on February 4 this year.，If you have money, you love to travel" article: China's Millennials make up a large portion of the richest population，And the proportion is still rising。Estimated，There are approximately 300 million young consumers born in 1984-1995，They are a population that grew up in a relatively prosperous and stable social background，Also a beneficiary of an approximately 4-fold increase in national education spending over the past 10 years，About 1/4 of them have attended college or received other forms of higher education。

A prominent trend is: Chinese Millennials are willing to spend a lot of money on outbound travel。They usually go abroad four times a year，Twice as many as peers in other Asian countries，Also much higher than the average frequency of family travel。Although Asian countries remain the top destinations for Millennials，For example, nearly half of the tourists aged 20-40 who visited South Korea last year were from China，But Millennials are increasingly willing to go to further countries when traveling abroad。

The great industry opportunities brought about by the upgrading of national consumption are obvious to all，The trend of outbound travel has also inspired tourism venture investors，But opportunities are not without pitfalls，Behind the swarm is a blind entry、188bet app Painful struggle and unbearable winter。

2. Four major pain points of outbound travel

Pain point one: low penetration rate and slow improvement

From the perspective of online tourism penetration rate，The current penetration rate of online tourism in China is about 10%，And Asia Pacific reached 19%，USA 45%，European average 47%，Promoted by the national “Internet + Tourism” policy，China’s outbound tourism market has huge potential。According to iResearch monitoring data，The transaction size of China’s online travel market reached 3077 in 2014.900 million yuan，Online penetration rate reaches 9.2%，But the penetration rate only increased by 1 compared to the previous year.7 percentage points。The online air ticket market accounted for 62% in 2014.7%，The penetration rate increased by 1 percentage point compared with 2013；Online vacations accounted for 14% in 2014.6%，Proportion continues to rise，But the Internet penetration rate is only 2 higher than in 2013.4 percentage points。As of the end of 2014，The number of Internet users in China has reached 800 million，Among them, mobile Internet users reached 500 million，Accounting for 80% of the total Internet users，The average annual growth rate of Internet penetration exceeds 20%，The overall Internet penetration rate has reached 57.1%，But the Internet penetration rate of online travel is growing，Far lower than the average growth rate of Internet users。The segment that lowers the overall penetration rate is products other than air tickets and hotels in the leisure and vacation field，Tickets、Activity、Catering、Entertainment is seriously fragmented、Low online level、High integration costs、Very difficult，Difficult to solve in the short term。

Pain Point 2: High user acquisition cost and low input-output ratio

The homogeneity of travel apps is serious，User acquisition is expensive，Download from user、Activate to scheduled conversion，The cost of acquiring customers can be as high as hundreds of yuan，Although tourism consumption has gradually become a necessity for family and personal consumption，But the frequency is still too low，Especially when traveling abroad，High user retention cost，And the user uninstallation cost is almost zero。Currently, there are more than 4 million apps in major Chinese app stores only，But about 80% of “zombie applications” are facing elimination，The average life cycle of an App is only 10 months，85% of users delete apps they downloaded from their phones within a month，And after 5 months，These apps have only a 5% retention rate。Report from application analyst Adjust (The Undead AppStore The course for discovery in 2015) pair still exists、But there are statistics on applications that consumers can no longer see，And call it "Zombie Apps)". The report shows that App Zombified apps in the Store increased from 74% in January last year to 83%，The zombie rate of travel apps is as high as 80%。According to CNNIC report，The top channels for obtaining user information for online travel and vacation product bookings are still search engines with low cost performance，Ad conversion rate is less than 2%。Take Ctrip as an example，Its sales and marketing expenses in the third quarter of 2015 were 8.3.8 billion 188bet sports betting app download yuan。If stock-based compensation expenses are not included，Sales and marketing expenses in the third quarter of 2015 accounted for 26% of net revenue，High marketing expenses are unbearable for many outbound travel providers。

Pain Point 3: Outbound travel independent travel products are seriously homogenized

As of the end of 2014，Chinese citizens’ outbound travel exceeded 100 million，But more than half of them are tourists from Hong Kong, Macao and Taiwan。According to the latest China aviation market report (China released by the British aviation data analysis agency OAG to the World），Except Hong Kong, Macao and Taiwan，Southeast Asian countries (Thailand、Japan、Vietnam、Philippines) still accounts for more than half of China’s outbound tourism market，Southeast Asia、The homogeneity of tourism products in Hong Kong, Macao and Taiwan is very serious，Between each product channel, whether online or offline，Intense price war，This is one of the reasons。More personalized destinations，Rich and diverse experiential tourism products need to be developed，China’s outbound tourism product routines have remained unchanged for 30 years and need to be improved urgently。

Pain point four: It is difficult and costly to integrate fragmented resources

Talk about travel，We usually use “food, accommodation, travel, shopping and entertainment” to describe needs，China’s online tourism has developed for 26 years，Air tickets and hotels have always been the representatives of standard products，In 2008, Lvmama realized the electronicization of scenic spot tickets，Pushing leisure vacation travel one step forward，The emergence of Tuniu，occupies a place in outbound group tours。With Ctrip、Elong、Qunar’s business merger and integration，Online travel, with flights + wine as the main representative form, has formed a relatively monopolized market pattern。But the leisure vacation market has just begun，The market structure of each OTA is fragmented，Among many OTAs，No one has occupied more than 33% of the market share。The integration of fragmented resources for overseas food, drink and entertainment products that meet consumer experience needs is a thorny issue that many outbound travel product and service providers urgently need to solve，Meituan Dianping provides a better model in China with its local promotion team model，But it is currently not possible to copy this model overseas，The current overseas fragmented resource integration methods generally include: local negotiation、Cooperation with local agencies and accumulation of resources from former wholesalers, etc.，There is an urgent need for complete solutions that can help industry concentration and scale procurement reduce costs。

3. Focus and solutions for the supply-side reform of outbound tourism

November 10, 2015，Xi Jinping proposed for the first time when presiding over the 11th meeting of the Central Financial and Economic Leading Group: “We must strengthen the ‘supply side’ structural reform，Strive to improve the effectiveness and production efficiency of the supply system，Enhance the driving force for sustained economic growth，Promote the overall improvement of my country’s social productivity level”。

Tourism is a comprehensive industry，As many as 109 related surrounding subdivisions，The industrial chain is complex，Involving online and offline，Long supply and demand chain、Many links、Poor standardization。December 11，At the "2016 Internet + Tourism Summit Forum" held in Xiamen，I spoke on the topic of "Logical Thinking on Supply-side Reform and Customized Tours"；On the same day, Hong Qinghua, chairman of Jingyu Group, the parent company of Lvmama, also mentioned that "supply-side reform has brought huge dividends to the tourism industry" at its sixth annual global partners meeting。The supply side of tourism is not a new topic，The key point that needs to be focused on in its reform and improvement is: increasing industry concentration、Improved supply chain efficiency、Integration of fragmented resources、Improvement and improvement of products and service systems。

I mentioned in my speech the problem of mismatch between supply and demand in China’s tourism industry chain: domestic consumption growth is declining，But Chinese residents are frantically shopping overseas，Domestic air passenger traffic growth rate is slowing down，However, cross-border travel continues to grow at a high rate，China has maintained a high trade surplus for many years，Tourism trade deficit reached US$100 billion in 2014。This means，Problems currently facing China’s tourism，Not in short-term demand，And effective in the medium and long term、Can meet the demand and supply of mainstream consumer groups，Outbound travel is no exception。So what are the focuses of the supply-side reform of outbound tourism and attempts to solve problems that are worthy of attention？

1. An attempt to integrate resources into PMS+GDS

The extreme dispersion of overseas resources，High labor costs and management difficulties have deterred domestic outbound travel product suppliers，The independent travel product platform with machine + wine as the entry point faces the challenge of large OTA，Not only is user acquisition cost high，And it cannot meet the comprehensive consumption of tourists for food, drink and entertainment，Narrow profit margin，Difficult survival。Systematic solution to resource procurement is the right way，The resource integration platform that provides PMS+GDS for destination resource procurement currently has Dao Travel in the field of direct connection to international hotels，Spider Travel in the Domestic Hotel B2B Field、Please refer to the case of Huanyuyou in the field of GDS integrating Titan Cloud and overseas fragmented resources。

2. Enter the charter flight + destination resource mode

There are three entrances to the outbound travel client，Including a travel itinerary booking platform that uses content as a starting point to engage users before traveling，Car and guide service platform for overseas Chinese chartered cars arriving at the destination，But the largest entrance platform for large transportation booking of international air tickets，Among them, the charter + destination resource integration model is the most practical，Especially the approach of entering high-quality island vertical destinations，In line with tourists’ pursuit of high cost performance，Demand for novel and in-depth experience，There is room for development in both free travel and group tour modes。Today, when the demand for leisure vacations is strong，With the opening of direct flights to more high-quality 188bet sports betting app download destinations and the joining of more outbound travel agencies，The supply-side reform that cuts through the resource layer will have strong vitality。The operation model of mature charter operators such as Anke Yunda、Have good experience in resource control and risk management，can be an example。

3. Cooperation with overseas resource suppliers

Many overseas resource parties currently have insufficient understanding of the Chinese market，Not enough penetration，Supply side to be integrated。ITBAsia held by me in Singapore in October、and the Phocuswright Conference held in Florida, USA in November focused on understanding the situation of foreign resource suppliers，They have insufficient connections with Chinese outbound travel product and service providers，And most domestic companies still lack the ability to go global and integrate resources，Insufficient supply side，Product richness and service network construction have been greatly affected。

4. Supply chain model innovation

The most important thing in the supply-side reform of outbound tourism is the effectiveness and efficiency of the supply system。Low gross profit in tourism industry，But cash flow is good，The model innovation of supply chain finance is to improve the supply side deficiencies、Inefficiency、An effective attempt at low production capacity，Domestic mainstream tourism companies and OTAs，Including Tempus International、Zhongxin、Ctrip、Tuniu、Mother Donkey、Tongcheng and others are testing the waters of tourism finance which is a good attempt，Foreign benchmarking American Express model is worth reference。

5. Product quality and service improvement

The efficiency of supply-side reform in outbound tourism is certainly important，But returning to the essence is to ensure product quality and improve services，Higher efficiency and supply effectiveness，If there is no excellent product quality and excellent service experience，The essence of deviating from consumer needs，It’s still a lose-lose outcome，Supply-side reform cannot only be provided to，Also look at the demand side，After all, from the perspective of the industrial chain，Efficient、High quality、Matching supply must coincide with changing consumer demand。

[Extra number！】The second stop of the Zhihui Private Exhibition will be held in Shenzhen on the afternoon of December 19th (Saturday)，This event invited the founders of many representative Shenzhen tourism O2O companies、Executive，Let’s discuss the topic of “How to make gold in ‘Internet + Tourism’ in 2016”。Some of the companies mentioned in this article are such as Dao Travel、Spider Travel and others will be guests at the private event to share useful information，Zhihui Travel will also draw lucky visitors on site to give away Seychelles provided by Anke Yunda、Bali round-trip air ticket！Welcome to register。Please click ☞ to register“I want to sign up”。