Baidu Launches A New Product for Hotel Ads

The economic growth in China has fueled outbound tourism with the Chinese GDP representing 16% of the global GDP in 2019 and will grow to an estimated 20% by 2029. More importantly, the Chinese GDP per capita is rising and empowering millions to travel.

Currently, China represents about 166 million (13%) departures globally with a forecasted growth to 231 million (15%) in 2024 and 286 million (16%) in 2029. In comparison, the US outbound travel is estimated at 91 million departures in 2019, which shines a light on both the current and potential massive growth for outbound Chinese travelers. 

This growth in outbound travel for China also brings an increase in purchasing power for these Chinese travelers. The gross number of bookings for hotels online is estimated to be around 22 billion bookings in 2019 with expectations to grow to 29 billion bookings in 2022, and these numbers are not solely outbound travel bookings. China is at the center of development plans for global hotel chains as both a destination and source of market.

The marketing mix for China currently looks like:

  • Metasearch With Players Like Qunar and Mafengwo
  • SEM With Baidu
  • Social Platforms With WeChat

However, this marketing mix proves difficult with China travel.

Historically, e-commerce for China travel has gone through OTAs more than any other region in the world, with Ctrip leading the pack. Qunar and Mafengwo offer small volumes, especially after Ctrip acquired Qunar. SEM proves to be difficult for most partners especially regarding making ROAS high enough to sustain always-on-campaigns. WeChat Mini-Programs was the last channel added for China e-commerce and was designed to help hotels leverage the fast growth in travel all within the WeChat ecosystem. 

All of these challenges and avenues for booking have not stopped hotels from looking at new channels to penetrate China more and developed direct bookings from there. Hotels have not stopped looking for new channels to penetrate China and grow direct bookings from there. 

Enter Baidu, China’s top search engine, which just released a metasearch platform offering a new powerhouse for hotels looking to grow within China.

Introduction to Aladdin

Baidu works very similar to Google and Bing and offers multiple tools within its platform such as a Chinese search engine and maps. Similar to other search engines, Baidu has recently launched a metasearch tool, Aladdin, to leverage its advertising hotels’ relevant placements.

The features and functionalities of Aladdin include:

Baidu Search: The largest Chinese search engine in China has more than 75% of the Chinese search market share. In Q4 of 2018, daily active users grew to 161 million users which represented a 24% year-over-year growth.

Baidu Map: The leading map in China has more than 300 million active users monthly.

Baidu Nuomi: The location-based lifestyle app where over 70 million active users have access to services tailored to each user’s specific needs, often at special or discount prices. This app covers transportation and entertainment as well as travel, hospitality and much more.

Aladdin for Users and Advertisers

Aladdin is still in the early stages, and DerbySoft expects both the UX and the system to change before Baidu scales-up the hotel metasearch offerings. However, the current release has an interesting design. Referencing the below image, the hotel listings are displayed when the user has selected both the hotel and the room type, which makes the click out even more qualified.

Comparison

The below chart breaks down the offerings of Baidu’s metasearch program compared to Google Ads.

What’s Next 

Baidu’s first step into metasearch has been relatively positive from the hotel chains, and DerbySoft is working closely with Baidu and digital marketing clients. As a company, DerbySoft expects Baidu to expand their current available business models and bidding strategies as well as increase their the speed at which they are building their infrastructure so they can get closer to the offerings of the big four (4) metasearch engines.

OTAs are currently the highest spenders in the market, and Baidu, as a company, has invested in partners such as Qunar and partnered with Ctrip and Yilong in the past. DerbySoft expects more Chinese OTAs and global players to start working with the platform in the near future. 

Conclusion

DerbySoft’s team of expert Digital Marketing Managers fully expect Baidu to grow their hotel metasearch access points beyond the Search, Maps and Naomi and is working with Baidu to fully integrate connectivity and bidding automation tools for the platform.

Learn more about how DerbySoft and our expert team of Digital Marketing Managers can help you by reading past articles on our website. DerbySoft.com

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