Tourist sites just the ticket for Tongcheng

The headquarters of Tongcheng Network Technology Share Co Ltd is seen in Suzhou, East China's Jiangsu province, May 19, 2014. [Photo/IC]

Company expands 1-yuan program for attractions with 5b yuan injection

Tongcheng Network Technology Share Co Ltd said on Tuesday it will invest a further 5 billion yuan ($813 million) in its program that offers tickets to tourist attractions at 1 yuan each.

The Jiangsu-based online travel agency, which focuses on bookings for popular tourist sites, received a credit line of 5 billion yuan from China Merchants Bank Co for the program, said Tongcheng Chief Executive Officer Wu Zhixiang.

The current program "is just a beginning", Wu said. "Our ultimate goal is to make the country's tourism attractions affordable."

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Half of the tickets are sold directly to Tongcheng's clients. The other half are offered to consumers of its partners, including JD.com, Dianping.com and CMB, Wu said.

Online travel agencies' price war expanded from air and hotel bookings to scenic spot tickets late last year. Since then, all major online travel agencies, including Ctrip.com International Inc and eLong Inc, have offered discounted admissions to tourist attractions.

But the battle has become less intense since May when Ctrip, the largest online travel agency in China, became Tongcheng's second-largest shareholder with an investment of more than $200 million.

The investment provided the cash for Tongcheng to continue the price war with other agencies, said Wei Changren, general manager of Ctcnn.com Inc, which provides analysis of the online tourism sector.

Tongcheng launched its 1-yuan offer in March. As of Sunday, the agency was offering tickets in 120 cities. So far, more than 6 million travelers have saved about 500 million yuan, said Wu.

The travel agency, which is the largest online vendor of scenic spot tickets, has a well-developed business model to support the 1-yuan ticket program, Wu said. All parties involved - Tongcheng, the tourism sites, travelers and other business partners - benefit from the program, he said.

The program is supporting visits to tourism attractions, some experts said.

The discounted tickets "encourage more travelers to see scenic spots ... and the higher visitor flow provides more income from other items they consume at these spots", said Dai Bin, director of the China Tourism Academy, a research institute that is affiliated with the China National Tourism Administration.

Other partners, such as banks, can share consumer data with Tongcheng and offer the tickets as rewards to consumers.

CMB has launched co-branded cards with Tongcheng, and users of the cards can get free scenic spot tickets every year, said Chen Fang, assistant general manager of the bank's consumer department.

Wu said Tongcheng is seeking additional strategic partners.