"Qunar" operation strategy: 10 times user growth skills

Based on his own professional experience, the author of this article has sorted out and analyzed Qunar 's operational strategy from both macro and micro aspects, exploring how Qunar's products achieved a 10-fold growth? I hope you can gain some thoughts from it.

Prologue

Qunar is China's leading travel search engine. Qunar is the world's largest Chinese online travel website. It was founded in February 2005 and is headquartered in Beijing. Qunar.com provides consumers with real-time search for air tickets, hotels, tickets, and vacation products, as well as group purchasing of travel products and other travel information services, and provides online technology and mobile technology solutions for tourism industry partners.

schedule:

It took this company five years to achieve the number one market share. It took 9 years to be listed on NASDAQ. After experiencing a price war, important partners fled, the company was overtaken by latecomers and eventually was acquired and delisted. The series of events that occurred in the process have strong reference value and practical significance for every business owner and manager. I have classified the timetable into the following categories, from which I can abstract several valuable topics:

1. How to catch up through products
2. Cooperation and competition
3. Qunar’s Organizational Construction (Speaking Out Loud)
4. Why did we lose in the competition?

Definition of terms

Before starting the explanation, it is necessary to synchronize some definitions of terms to facilitate better understanding.

• Ctrip: An important supplier in China's online travel industry, which was more focused on business travel at that time
• OTA: online travel agency, online agent for air tickets and hotels, positioned similarly to a channel, conducting online booking business through the website
• User: Guests who need air tickets and hotels are collectively referred to as users.

How to catch up through products

Ctrip was founded in 1999 and was the number one in China's online travel market at the time. How did Qunar achieve success as a latecomer by leveraging its products?

1. Macro decision-making

If I were to lay out the evolution of the Qunar product, combined with the training my predecessors have given me, I would roughly divide it into four stages: "information aggregation, experience upgrade, scenario coverage, and value upgrade."

(1) Information aggregation

Qunar was founded in 2005, and its initial business was vertical search for air tickets.

In 2005, Ctrip was the dominant player in Internet air ticket booking, accounting for 30% of the market share. But on the other hand, 70% of users still do not use Ctrip. What are they using? There are official websites of airlines, smaller OTAs, that is, online travel websites like Ctrip, and rough websites made by various ticketing agents.

In this market context, Qunar rose rapidly and at its peak captured 70% of the online air ticket market share.

Back then, Qunar was just a pure website that included all web page information just like Baidu. After searching, the user finds the flight he wants and clicks on it to go to the website that provides this flight. Then the user completes the registration and purchases the ticket by himself.

At that time, compared with Baidu, Qunar was better at searching for air ticket information and was more efficient than Baidu.

In this way, the value is clearly precipitated.

This initial version provides a connector service and is essentially a tool . For example, Baidu, how many people have never registered on Baidu. The stability of the connector is so weak

(2) Experience upgrade

We all know that repeatedly filling in one's identity information is very cumbersome. The second version of Qunar has a small plug-in to help users fill out forms. As long as you have submitted your name, ID number and other booking information on Qunar, you do not need to fill it out again when you are imported to other websites by Qunar. Qunar will record this information and automatically complete it for you.

Automatically recording repetitive actions provides convenience and creates convenient value for users. This point is enough to encourage users to register for your product.

Qunar takes advantage of people’s nature of “losing aversion” and ensures delivery.

The core service provided by Qunar is to allow users to compare air ticket prices across the entire network. Grab the real-time data of all air tickets, merge them and sort them.

The process most people use is:

• Enter your own travel information
• Browse search results
• Weighing time and price
• More than 80% of people directly buy the cheapest ticket on the corresponding flight

Sometimes, the so-called cheapest price is actually only 5 dollars cheaper. However, in order to earn the 5 yuan, users will go to a new website to register and resubmit their ID information.

Why? Because you have already seen cheaper ones, you will feel bad even if you spend 5 dollars more. This is human nature. Therefore, the return rate of users who have used Qunar once is very high. Because users are afraid that they have paid too much.

What this means to Qunar is that, originally it was just a connector for distributing traffic. This step of optimization gives Qunar enough value to attract users to complete registration.

At this point, he can occupy the user's mind, he becomes a complete product, and he has his own users.

(3) Scenario coverage

When users buy air tickets, they are likely to travel across cities. Since it is a medium to long distance trip, accommodation will naturally become a necessary need. In 2007, Qunar began to prepare for its hotel business. The keyword of the Internet in 2010 was group buying, and Qunar also launched the group buying business. In the following period, vacation business, ticket business, travel business, travel notes, and Q&A. Business in the travel sector has been surging. Qunar has become the world's largest Chinese online travel website.

At this point, the user's mind has changed from "a convenient ticket booking tool" to "a community that you must visit before traveling." It was also at that time that the slogan "Smarten your travel" became popular.

(4) Value upgrade

During this period, Qunar did two very, very, very important things:

• Provide booking business solutions for all flight/hotel partners
• Provide customers with customer service that is responsible for the results

Let me explain " booking business solutions " and " customer service responsible for results " respectively.

Back to the scene, I am now going to book a hotel in Beijing. After checking, I found that this hotel included quotes from multiple suppliers.

There are direct sales prices (now no longer available), quotes provided by various small and medium-sized travel agencies, and prices from large OTAs.

So when the user clicks on any quote, he or she will leave Qunar's product system. At that time, the business focus of small and medium-sized travel agencies was not online, and large hotel groups were not good at user experience of Internet products. A website with poor user experience will most likely make a user who already has a need to buy tickets cautious and afraid to place an order. Directly affect users' orders.

Secondly, since the search started from Qunar, it is worth striving for the order to be completed on Qunar as well. Use the same color scheme and design elements. The user will not realize that he has been redirected from Qunar to another website. Only very professional users will find that the URL has changed from the website address. This will make the entire experience more complete, which is what the Internet industry always calls a "closed loop."

At that time, the name of this product line was TTS, which stands for Total Solution. Now called QTA. It is equivalent to Qunar developing a set of booking software services that are suitable for all suppliers.

By doing this, from visual to purchasing experience, users will feel that their order was placed on Qunar. There is only one link that still has loopholes, and that is after-sales service.

Back to the same scene, I booked xx hotel on Qunar.com and paid the prepayment, but there were no rooms available when I arrived. what to do?

As a platform, Qunar provides users with travel-related air/hotel services. Due to practical reasons, various problems are inevitable. Airlines and branded hotels are fully capable of providing good customer service when problems arise, but the service capabilities of small merchants, which make up a large proportion of suppliers, are often problematic. The user enthusiastically registered for your product, paid the fee, but when he arrived at the store, there were no rooms available. What a bad experience (refer to Taobao)

Therefore, Qunar began to build its own customer service team in 2010. The service standard is "as long as users place an order on Qunar, all after-sales issues arising will be directly resolved by the Qunar team."

In the past, an agent needed to find clients and provide customer service on his own. It may also want to get traffic from search engines and provide good after-sales service, but it is just a small agency consisting of a couple and their brother-in-law. The size limits its capabilities and there is an obvious ceiling.

Qunar uses orders and users as strategic leverage, integrates ticket agents, and squeezes them here to sell at low prices through quotation sorting, thus forming its own product value. When users develop path dependence, it further strengthens its control over medium and large air ticket suppliers.

In this way, these small ticket agents are completely covered by Qunar, and their only value left is to manage their own upstream resources and get discounted tickets. If it can't even secure the supply of goods, then it will have no room for survival at all.

This is the main process by which Qunar captured 70% of the online air ticket market.

People can buy air tickets anywhere, but Qunar has become a relatively more reliable choice and has formed its own scale. In this way, the user's mindset is upgraded again, and "connector" becomes "reliable integration service provider" .

2. Micro-process

The previous part is a bit macro. Next, I will talk about some projects I have actually participated in to put the previous concepts into practice. The time when I was working in this company happened to be at the stage of "scenario coverage" and "value upgrade". Let's take a look at the company's approach from macro decision-making to micro processes through real-life work stories.

(1) The platform doesn’t look like a platform?

I joined the company in 2011, and the first department I worked for was the housing control department. The full name of room control is room sale status control, which is similar to inventory management in the retail industry. This department works in a similar way to a call center. Its daily routine is to confirm the day's orders with the hotel's reservation department and reserve information such as the number of rooms. The department has a total of 17 people, who have to maintain the room status of tens of thousands of online hotels at the same time.

At this time, many people were puzzled as to why an Internet company's normal approach was to build a system and let hotel-related personnel complete the operations themselves. Why was it so heavy and brought about a series of cost increases?

Why was it originally a platform, but now there is no difference between it and OTA?

Why was it originally a platform, but now there is no difference between it and OTA?

Why was it originally a platform, but now there is no difference between it and OTA?

At the monthly open meetings, many colleagues expressed their confusion. At that time, the VP said this:

"As a user, he doesn't care whether our costs are high or whether we are a platform. He only cares whether he can book a room, how long it will take to confirm the reservation, and whether there will be no rooms when he arrives at the hotel."

Admittedly, the working logic of the entire Internet population was relatively naive at that time. They think that as long as there is a function, the problem can be solved, but this ignores many real problems. for example:

• The system has a function to confirm orders, but the hotel has to deal with more than 20 systems every day.
• Branded hotels have a complete workflow and detailed division of labor, but managers of independent hotels and small inns have to handle all services related to guests, which is too much for them.
• Some hotel front desks do not allow computers to access the Internet due to confidentiality policies.

These objective conditions determine that the user experience cannot be guaranteed by using a "light" approach. I remember that I left a sentence at that time. In order to ensure user experience, we must " use OTA ideas to solve problems that OTA cannot solve."

At the same time, the hotel's room control department will not only contact the hotel, but also contact the guests. What is the purpose? Confirm the guest's itinerary.

Essentially, this is what the hotel's reservation department does, and they will start confirming the day's itinerary every afternoon. However, Qunar's room control department will take the initiative to carry out this part of the work that originally belongs to the hotel. So this is essentially improving the hotel's work efficiency. If you do this, the hotel will trust you more, cooperate with your work better, and provide you with more available rooms.

• A platform connects both ends of the supply and demand relationship. You have to grasp it with both hands, only then can both hands be strong.
• A latecomer can only bring limited guests to the hotel. Only by serving guests well and improving the efficiency of the hotel can it be valuable to the hotel.

This story is very good. It illustrates in a very practical way that when doing business, you cannot just think about doing the easy work, but you must also do the dirty and hard work and be truly responsible for the results. At the same time, as a latecomer, you can only exchange value for value by doing more.

(2) Referee? athlete?

Anyone familiar with Internet industry news has heard this complaint about Qunar: "Being both a referee and an athlete." At an internal strategy meeting, I heard the company’s management respond to this question, which was a direct answer from the strategic level.

Qunar is a price comparison search engine. We provide quotes from multiple suppliers for a hotel or a flight. If our quotes came only from third parties, it would be difficult for us to consistently negotiate lower prices for consumers. If we also do direct sales ourselves, then this quotation will act like a catfish, constantly stirring up changes in the price system. No matter how the competitive landscape ultimately changes, consumers will always get value here.

Catfish, this metaphor is very clever. Many times, we talk about standing with users. However, there is a high probability that something will go wrong during the execution (there is no way, this is a high-risk area in the business process). I think the story above is about practicing the strategy of "standing with users" from the top-level business design.

Second, as a platform, what are you most worried about? Loss of saleable resources.

I once made an analogy that the relationship between a product manager and a business owner is like that between a restaurant waiter and his boss. A waiter cannot be a waiter for his entire life. Sooner or later, he will open his own restaurant.

This is especially true for highly liquid business resources.

The external environment is changing all the time. We were your loyal partners just a second ago. If you have hotel/air tickets, I will help you sell them. In the next second, they will build their own platform and perform on the stage.

As we mentioned earlier, the value of a travel search engine lies in the price comparison between multiple quotes, so "multiple quotes" is a prerequisite . If the same events as happened in 2015 when brand hotel chains were collectively removed from shelves and in 2016 when airline flagship stores were collectively removed from shelves, Qunar’s products would be destroyed in an instant. When users with needs come to the website and see that there is no quotation for their favorite hotel, they will leave without mercy. You know, users never give us two chances when using Internet products.

The air ticket and hotel industry is a typical battlefield with a high market concentration, which means that with complete resources, the entry efficiency is very high. This is true for you and your competitors.

If you don’t have your own direct sales business, a very “heavy” direct sales team, and only do business with hotels and airlines through middlemen, the risks are really huge. If the architectural design is not done well in the top-level design, there will be unavoidable systemic risks.

Therefore, wherever you go, you must be both a referee and an athlete.

Now you won’t find a single direct sales offer on the page anymore. Because of the previous merger with Ctrip, the booming hotel direct sales business finally came to an end. We'll discuss this part of the story separately when we have the chance.

(3) Reduce available inventory?

Before we begin, some background information:

A user makes a reservation on a website for x room type at x hotel for x nights on x month x day. After that, the website's call center will call the hotel and the user to confirm in order to ensure that the hotel has rooms available and that the user has confirmed his/her arrival at the hotel.

Once both parties have confirmed, the reservation is successful.

What’s important is that this time window is between 5 minutes and 40 minutes, and may be extended to 2 to 3 working days before public holidays.

So, if the hotel can give some reserved rooms to OTA, then when the user makes a reservation on the website, the number of reserved rooms (inventory) will be automatically deducted to facilitate instant confirmation.

This logic is similar to the concept of e-commerce inventory.

As mentioned before, if an OTA can get as many reserved rooms as possible, it will greatly improve the booking experience of its channel users. So does that mean the more reserved rooms, the better?

In terms of local interests, this is correct. If a hotel gives me 9 reserved rooms, then I will have 9 available inventory online, but the hotel will also have the opportunity cost of selling the 9 reserved rooms in advance.

• If OTA's marketing ability is good enough, everyone will be happy if all the products are sold.
• If the OTA’s marketing ability is poor and only 3 rooms are sold, the hotel will lose 6 room nights of revenue.

This will cause hotels to question the sales capabilities of OTAs, and they will begin to reduce the amount of reserved rooms, or even offer these room nights to other OTAs that are also competitors of Qunar.

Colleagues who worked in the hotel business department in 2011 still remember our marketing strategy of only reserving “ one ” room.

The reasons for choosing this strategy at the time were as follows:

• At that time, Qunar was a latecomer in the hotel industry and had relatively little say in the hotel industry.
• Qunar’s strategy for deploying hotel management backend requires a hook to attract hotel operators to log in to the backend and develop path dependence.

For the former, it is essentially feasibility. It’s better to have one than to have nothing. Only if you have one can you have 10.

For the latter, asking for 1 house and completing the sale is far better than asking for 10 houses and only completing 1. At the same time, after a reserved room is sold, it can be used as a lever to guide hotel operators to use the system to confirm orders, respond to reviews, and even actively increase the number of reserved rooms.

So at that stage, we worked together to establish cooperation with thousands of hotels, and let the hotels use the software on their own to complete the cold start of their business flow.

The business I was responsible for at the time was using this strategy. It was also part of the business matrix of that era and will be discussed in a separate article later.

3. Core conclusions

Earlier, we discussed Qunar’s business design process from both the macro and micro levels. Now let's make a brief summary.

What the Qunar case tells me is that as a latecomer, as long as you find the gap in the industry, provide solid service, and improve products from the user's perspective, you can gain the recognition and trust of users.

Looking back, the difference is that Qunar has indeed done a lot of dirty and tiring work that no one is willing to do. For newcomers, this attitude of rolling up their trouser legs and working in the fields is the most realistic and essential choice.

Judging from the results, Qunar, a latecomer, was able to carve out a niche in a fiercely competitive industry. It did the following things right:

• The first thing is to take advantage of people’s “loss aversion” nature and do a good job of delivery.
• The second thing is to stand at both ends of supply and demand and continuously innovate business
• The third thing is to integrate resources. From tools, to products, to service providers

These three things also correspond to several principles in the business design process and establish core barriers.

Without effective entry, it is difficult to catch up with strong competitors

Without continuous innovation at both ends of the business, even the best designs will not be implemented.

If we don’t do it heavy, the thin and light connector model will be broken by larger platforms like Baidu in a minute.

This concludes my story of how the product achieved 10x growth. In the next article, let’s talk about Qunar’s cooperation and competition. It includes two topics: "cooperation with Baidu" and "price war". See you next time.

Author: Ma Xiwen

Source: maxiwenfine