Ctrip

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Ctrip
Type Public (NASDAQCTRP)
Industry Travel agency
Founded 1999 (IPO December 9, 2003)
Headquarters Shanghai, China
Key people James Liang, CEO and Co-Founder
Website www.ctrip.com

Ctrip (Chinese: 携程; pinyin: Xié chéng) is a mainland China-focused travel agency, which runs the eponymous Ctrip.com travel website.

History[edit]

Shanghai-based Ctrip was founded by James Liang, Neil Shen, Min Fan, and Ji Qi in 1999.[1][2] It listed on NASDAQ in 2003 in a Merrill Lynch-led offering, raising US$75 million (4.2 million ADRs at $18 each) and then further appreciated by 86% to close at $33.94 in its first day of trading. Ctrip traded at a peak of $37.35, making it the first company since the November 2000 IPO of Transmeta to double its price in the first day of trading.[2]

In 2006, about 70% of Ctrip's sales came from just four cities in China: Beijing, Guangzhou, Shanghai, and Shenzhen.[3]

Associated companies[edit]

In 2006, Liang spoke to Bloomberg about the possibility of Ctrip buying travel companies in other Asian markets such as Hong Kong and South Korea. Ctrip already had an agreement with Taiwan-based ezTravel to cooperate in offering air tickets and hotel rooms to mainland Chinese tourists in Taiwan once tourists from the mainland became able to travel to Taiwan.[3] As of November 2011, Ctrip holds an 8.4% stake in NASDAQ-listed Home Inns as well as a minority stake in the privately held BTC-Jianguo Hotels and Resorts. Ctrip also holds a 1.3% stake in the NASDAQ-listed China Lodging (owner of the Hanting brand).[1]

Payment methods[edit]

Ctrip accepts foreign credit cards and PayPal, as well as domestic credit cards (issued in mainland China, not Macau or Hong Kong) of certain banks (see footnote for full list). Non-credit card payment methods include Alipay, Tenpay (Tencent Holdings Ltd.), China UnionPay Mobile Payment, and cash on delivery in selected cities in mainland China as well as cash payment by showing up in person at a Ctrip office.[4] Most hotels in large cities accept foreign credit cards but some domestic hotels and domestic chain hotels do not. Payment is on check out unless guaranteed booking is required for very late check-ins.

Scientific management[edit]

Ctrip is well known as a proponent of scientific management in using rigorous data analysis in managerial decision making. [5] One example of this is the randomized control trial Ctrip ran on telecommuting. Given the uncertainty over the impact of telecommuting on company profits they decided to rigorously evaluate its impact before making any management decisions. So Ctrip conducted an experiment on 242 employees involving professors at Stanford and Beijing University. The experiment found that employees randomly assigned to work at home for 9 months increased their output by 13.5% versus the office-based control group, and their quit rates fell by almost 50%. Adding in the savings from cutting office space telecommuting was found to have substantially reduced costs, leading Ctrip to roll this practice out across the firm.[6]

References[edit]

  1. ^ a b Flannery, Russell (2010-03-29). "Ctrip's Remarkable Journey: China travel boom fuels hotel chain IPO". Forbes. Retrieved 2011-01-02. 
  2. ^ a b Beltran, Luisa (2003-12-09). "Ctrip.com IPO soars in first day". MarketWatch. Retrieved 2011-01-02. 
  3. ^ a b Liu, John; Damien Ryan (2006-05-29). "Ctrip May Buy Asian Companies as More Chinese Travel". Bloomberg. Retrieved 2011-01-02. 
  4. ^ Ctrip.com: 常见问题 (信用卡支付与担保). As of December 2010, the list of domestic credit cards accepted includes Industrial and Commercial Bank of China, Bank of China, China Construction Bank, Agricultural Bank of China, Guangdong Development Bank, China CITIC Bank, Shanghai Pudong Development Bank, Bank of Communications, China Merchants Bank, Everbright, Minsheng Banking Corp., Bank of Shanghai, Industrial Bank), Ping An Bank, Shenzhen Development Bank, Hua Xia Bank, Bank of Ningbo, and Bank of East Asia.
  5. ^ Garvin, David (2012-01-01). "Ctrip: Scientifically Managing Travel Services". Harvard Business School. Retrieved 2014-06-16. .
  6. ^ Bloom, Nicholas, Liang, James, Roberts, John and Ying, Jenny "Does working from home work? Evidence from a Chinese experiment" Stanford Research Paper, February 2013.

External links[edit]