More fallout from Marriott’s email gaffe: Marriott temporarily delisted by major Chinese travel site

After Marriott engendered a national controversy in China in January, its digital strategy was forced to change. We’ve already covered how the incident led to Marriott’s Chinese-language website being shut down for two months, and how the site returned without a direct-booking feature.

One effect of the incident, unreported by Western media, was that Marriott hotels were temporarily delisted in January by Meituan-Dianping, a major Chinese travel site. Our independent verification, done on May 24th, 2018, indicates that Marriott properties are now searchable on Meituan.com and Dianping.com.[1] [2]

Meituan-Dianping is part of an emerging alliance of Chinese travel sites that captured 94% of the online market – a superior position to Marriott’s partner, Fliggy, which held less than 2.5%.

Marriott Delisted by Meituan-Dianping

On January 12th, 2018, Thepaper.cn reported that following the January incident, not only were Marriott hotels boycotted by customers and convention organizers, Marriott-branded properties were also delisted from booking sites operated by Meituan-Dianping.[3] Journalists for Thepaper.cn searched the sites for 万豪 (Marriott) and several Marriott brands such as 万怡 (Courtyard by Marriott) or 万丽(Renaissance) but came back with no results on January 12th.[4] The delisting of Marriott properties on Meituan.com and the Meituan app was reported by Xinhua News on the same day.[5]

We discussed Meituan-Dianping in a previous post. Since its 2015 launch from the merger of other sites, Meituan-Dianping has become a major player in the Chinese online lodging booking industry, occupying more than 16% of the market in 2016. For comparison, Fliggy, Marriott’s OTA partner, occupied less than 2.5%.[6]

Marriott’s delisting, however temporary, deprived the company of access to a substantial portion of the online travel market.

2016 Chinese Online Lodging Market Share (by Trade Volume). Source: iResearch

Putting it in context: online travel consolidation could put pressure on Marriott

We explored in a previous post how OTA companies backed by Baidu and Tencent have begun to form an alliance that captures more than 94% of the total trade volume of online lodging bookings in China.[7] Meituan-Dianping is part of the alliance: it is both backed by the Priceline group, partner of Ctrip since 2012, and Tencent. Marriott’s OTA partner, Fliggy, is on the outside of this alliance.

Marriott already saw its relationship with its former partner, the major OTA site Ctrip, unravel; the latter downranked all of Marriott properties on its websites in 2017. The conflict seems to have had long term impact. In early April 2018, nearly one year after Ctrip first downranked Marriott hotels, a search for hotels in Shanghai on Ctrip returned no Marriott hotels on the first page.[8] Marriott hotels were similarly absent from the Shanghai hotel listing of the Ctrip affiliated travel websites Qunar and eLong.[9] [10]

Marriott is at a disadvantage against an alliance that maintains a superior market position.

 

[1] Meituan, retrieved May 24th, 2018, http://bj.meituan.com

[2] Dianping, retrieved May 24th, 2018, https://www.dianping.com

[3] Sina (2018, January 12th), 知名企业退订万豪更换年会地点,大众点评、美团等集体屏蔽, retrieved May 8th, 2018, http://news.sina.com.cn/o/2018-01-12/doc-ifyqptqv8449294.shtml

[4] Sina (2018, January 12th), 知名企业退订万豪更换年会地点,大众点评、美团等集体屏蔽, retrieved May 8th, 2018, http://news.sina.com.cn/o/2018-01-12/doc-ifyqptqv8449294.shtml

[5] Xinhua News (2018, January 12th), 国内在线旅游运营商开始下架万豪酒店产品, retrieved May 30th, 2018, http://www.xinhuanet.com/travel/2018-01/12/c_1122250663.htm

[6] iResearch, 2017年中国在线旅游度假行业研究报告, p. 20, retrieved April 25th, 2018, http://report.iresearch.cn/report_pdf.aspx?id=3025

[7] iResearch, 2017年中国在线旅游度假行业研究报告, p. 20, retrieved April 25th, 2018, http://report.iresearch.cn/report_pdf.aspx?id=3025

[8] Ctrip, retrieved April 2nd, 2018, http://www.ctrip.com/

[9] Qunar, retrieved April 2nd, 2018, https://www.qunar.com/

[10] eLong, retrieved April 2nd, 2018, http://www.elong.com/