Keeping it exclusive is a balancing act

Travel company finds a way to broaden luxury horizons

Most companies and analysts in the customized travel market say the service cannot be done on a large scale because it is designed to cater for individual clients' demands.

However, Guo Ming, chief operating officer of HH Travel, says his company believes the only way to survive in the new emerging market is to apply specialized products to a larger range of customers.

Guo says he is confident that the company will be the top customized travel service provider for Chinese people around the world within five years.

"HH Travel will target the medium- and high-end segments of China's tourist market, and spare no effort to build a reliable tourism service brand," Guo says.

The company has provided more than 1,500 themed travel packages, the most popular being its round-the-world tour.

Last year its 60-day global tour, which cost 500,000 yuan ($78,000, 64,000 euros), was fully booked in nine minutes, it says. This year's global tour package, costing 660,000 yuan, sold out in 30 seconds, and it took only 17 seconds before places on the 1.01 million yuan 80-day package for 2013 were snapped up.

The round-the-world packages include sightseeing opportunities in all seven continents while living in luxury accommodation and enjoying first-class service. Customers stay at top hotels such as Burj-Al-Arab in Dubai, and Four Seasons and Westin Palace hotels in major capital cities.

"China's rich people have passed the phase of thinking only about doing business and making money. They are more willing than ever to relax and enjoy their lives," says Wang Tingting, an analyst with iResearch Consulting Group in Shanghai.

Unlike other companies in the market, HH Travel's service focuses more on luxury experiences during a trip than on customized travel routes and adventure pursuits.

At first, Guo says, the company also focused on providing services tailored to an individual client's demand. However, it discovered it was better to gather together clients with similar demands and organize packages on a larger scale.

"Costs are too high if we concentrate too much on designing travel packages for every single client, so why don't we create certain demand for our clients and advise them on choosing what we have designed?" he says.

Guo says China's customized travel market is still in its infancy, and most travel companies, as well as customers, are still unsure about it.

"For any market of any industry, products that only apply to one or two individuals are destined to have short lives. The theory can also be applied in this market," Guo says. "Although the target range of clients for this market is a very small number of people, we still need to sort out products that can be provided on larger scales. Otherwise, the costs of the operation can beat the whole company down."

The company's merger in April with Ctrip, China's largest online travel service provider in terms of market share, was a big step toward increasing its customer base.

"When Guo told me Ctrip had more than 50 million clients, I thought I saw a gold mine," said Hu Shihui, CEO of Life TM Group, when the merger was announced. "We only need to pick several of the tens of thousands who travel in first class and stay in high-end hotels to become our target clients."

Both Guo and Hu are confident that HH Travel will soon lead China's high-end travel market.

"We have the natural advantage of a large web of clients, and our goal is to take 50 percent of this market," Guo says.

The "large web" is that of the Life TM Group. Established by Hu in 2007, the group gathered 19 of the most influential Chinese entrepreneurs, including Hina Group CEO Chen Hong and Alibaba President Ma Yun, to its board.

Hu's initial idea was for these entrepreneurs to arrange their travel together through Life TM, as the company was designed to provide services to financially successful people.

Its Trippes Club is only available to 500 members from the Chinese mainland and 500 others from Hong Kong, Macao, Taiwan and elsewhere.

As well as being company clients, these people are bridges to building up Life TM Group's social network. Hu says this club serves more as a channel for developing broader social relationships than as a profitable department.

Before its cooperation with Ctrip, Life TM Group's travel branch accounted for a third of its total profits. After the merger, Hu says, HH Travel is expected to have 300,000 target customers.

yanyiqi@chinadaily.com.cn

(China Daily 07/27/2012 page13)