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Dai Bin: How to cultivate world-class tourism enterprises?

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2024-12-12


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Editor-in-Chief | Yang Ming

Editor | Liu Kaiye

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China Tourism Academy



The 2024 China Tourism Group Development Forum was successfully held at the Beijing Gehua Kaiyuan Hotel from December 9-11, 2024. Dean Dai Bin delivered a closing speech entitled "How to Cultivate World-Class Tourism Enterprises," the full text of which is shared below:


With the strong support of the Party group of the Ministry of Culture and Tourism, and the joint efforts of the tourism industry, the 16th China Tourism Group Development Forum has successfully completed its entire schedule, achieved its objectives, and is about to conclude victoriously. Over the past two days, we have released the 2024 Top 20 China Tourism Groups, the Top 10 Tourism Pioneers, and case studies on tourism investment and entrepreneurship, the application of new productive forces, and the integrated development of culture and tourism. We have listened to insightful speeches from key leaders of the Ministry of Culture and Tourism, leaders of relevant tourism city Party committees and governments, heads of major tourism groups, and entrepreneurs and innovators. The forum's achievements have generated widespread repercussions in the culture and tourism industry, forming a consensus on accelerating the construction of a strong tourism nation and building the spiritual momentum for cultivating world-class tourism enterprises.



Restructuring the Tourism Industry

New Thinking on High-Quality Development



The development and innovation of any undertaking requires the guidance of thought and the support of theory. Cultivating world-class tourism enterprises should be guided by the construction of a strong tourism nation, meeting the new needs of the people for a better life with high-quality supply, and leading the new development of tourism enterprises through excellence and innovation.


To be a company with values, meeting the new needs of a better life with high-quality tourism products. Tourism is a long-lasting way of life for humanity. Protecting the tourism rights of the people is inseparable from market system construction and enterprise development, "one can benefit the world without doing anything, that is the merchant." The prosperity of commerce and industry and the growth of enterprises must also be subordinate to and serve the strong tourism nation and the happiness of the people, the so-called "the profits of merchants are what the world relies on." Throughout history, both domestic and foreign, the view of righteousness and profit has always been the core of business thought in all sectors of the national economy. From Konosuke Matsushita's business philosophy of "making national wealth like tap water," to Ford's "making cars affordable for more people"; from Thomas Cook's travel services for the public, to the Ritz-Carlton's "ladies and gentlemen serving ladies and gentlemen"; from Mr. Chen Guangfu's founding of China Travel Service "serving the national travel, obeying national needs," to Ruijia Hotel's "smile power" and 7 Days Inn's "sleep well every day," all possess business ideas that transcend competition and are linked to national strategy. Today, tourism is not only a business, a transaction, an industry, but also a magnificent undertaking for all tourism professionals to strive for the better life of the people. Enterprises without ideas and entrepreneurs without passion will not go far. Today's tourism enterprises must, with a high degree of cultural confidence and cultural awareness, proceed from the people's better life and tourism rights, consciously practice the global civilization initiative, and reconstruct the guiding ideology and discourse system of the modern tourism industry.


To be a company with ideas, serving the new strategy of a strong tourism nation with excellent business capabilities. Since the reform and opening up, the guiding ideology and development strategy of China's tourism industry have been dynamically evolving. In the 1980s, in order to earn foreign exchange, the development strategy of inbound tourism emphasized "government leadership and moderate preemption." In the mid-to-late 1990s, in order to stimulate consumption and cultivate new growth points for the national economy, a market-led new pattern of domestic tourism development was formed. In 2009, the State Council issued a document "to cultivate the tourism industry into a strategic pillar industry of the national economy and a modern service industry that is more satisfactory to the people." In 2018, a new round of national institutional reforms pushed the integrated development of culture and tourism into a new stage. In May 2024, the Central Committee held a national tourism development conference in Beijing, and General Secretary Xi Jinping made important instructions on tourism work, focusing on improving the modern tourism industry system, accelerating the construction of a strong tourism nation, and promoting the steady and far-reaching high-quality development of the tourism industry. Various travel service providers, tourism accommodation providers, tourism retailers, tourism scenic spots and resorts, tourism groups and listed companies are the basic framework support of the modern tourism industry system. World-class tourism enterprises are an important manifestation of a strong tourism nation, and they are also the main force that the construction of a strong tourism nation can trust, rely on, and should support.


To be a company with a sense of the future, leading the new development of tourism formats with outstanding creative capabilities. The tourism industry has passed the stage of "fencing mountains and waters to collect tickets, and enjoying the benefits of large crowds," and also the era of "using the name of tourism to engage in real estate" or turning the tourism industry into the financial industry. The tourism industry is shifting from a natural growth model based on resource dependence and factor input to a high-quality development model driven by product research and development and innovation. With the mass tourism entering a new era of comprehensive development, the consumption stratification and demand upgrading highlighted by diversity, personalization, and quality, the supply-side structural reforms caused by cultural creation, technological innovation, and strategic investment, coupled with the increasingly prominent strategic positioning of tourism in the national governance system, fully demonstrate that the time and conditions are ripe for the tourism industry to transition from traditional to modern. Faced with changing demands, ubiquitous resources, and cross-border competitors, tourism groups must cultivate modern industrial systems with greater wisdom and patience, using new productive forces such as culture, technology, education, and talent.


In the strategic process of improving the modern tourism industry system and building a strong tourism nation, tourism groups must have a strong historical consciousness and confidence in their abilities, as well as a clear awareness of crises and innovative ideas. Following the path of tourism development with Chinese characteristics, China has formed the world's largest domestic tourism market and has become the world's largest source of international tourists and a major destination. Benefiting from the growth in demand and policy promotion, China has formed a tourism industry system supported by travel service providers represented by travel agencies and tourism platforms, tourism accommodation providers mainly composed of star-rated hotels and branded hotels, tourism reception providers supported by tourism scenic spots and resorts, and new formats such as sea cruises and inland river cruises, tourist trains, tourist charter flights, car rentals, and tourism performances. It has also formed a national tourism industry's first echelon represented by the Top 20 tourism groups. At the same time, problems such as aggregation without unity and largeness without strength that have plagued the industry for many years have not yet been systematically resolved. In the process of building a strong tourism nation and cultivating world-class tourism enterprises, we still need to respond to the following challenges from both theoretical and practical aspects: Are there globally influential IPs and their continuously iterated product series? Is there strong marketing and promotion, channel management, technical support, and quality control capabilities? Are there stable and high-quality R&D cooperation institutions, professional suppliers, and channel distributors? Are there globally renowned legal and financial advisory institutions and long-term cooperative relationships established? In particular, is there global market influence, brand appeal, and topic-setting ability? In the long run, we also need to pay attention to the overseas investment and revenue share of tourism groups, as well as the global ranking of specialized business segments in the globally recognized hotel, travel agency, theme park, and resort industries.



Expanding the Tourism Market

New Space for Sustainable Growth



Cultivating traditional tourism needs such as inbound tourism, teams, tour guides, sightseeing, and routes, leading Chinese services, and fostering classic business models. Modern tourism began with Thomas Cook's train tours, while modern Chinese tourism is marked by inbound groups to Beijing, Xi'an, Shanghai, Guilin, Guangxi, and the Yangtze River Three Gorges. Today, although the proportion of group tourists continues to decline, the absolute number is still growing. For travel agencies, tourist attractions, tourism retail, and other business models, as well as tourism trains and tourism performances, tour groups organized and received by travel agencies remain the most important market. Whether it's China Travel's "East of the Forbidden City" during the epidemic, Ctrip's "Urban Micro-Travel, Architecture is Readable," or Ctrip Group's free half-day inbound tour to Shanghai, GZLY's Baiyun Mountain Mingchun Valley Scenic Area during the recovery and prosperity phase, or innovative projects such as UTour and "Only This Zhouzhuang," they all provide valuable reference cases for the classic reconstruction of traditional travel agencies and tourist attractions. With more young people from small towns, new senior citizens, and students entering the ranks of first-time tourists, and the growth of "new group" needs such as MICE tourism, business tourism, and family tourism, outbound group agencies, local agencies, and tourist attractions may usher in a new round of development opportunities. The rebirth of demand is not a simple return to the traditional market, nor will it provide any legitimate space for gray business models such as low-price customer acquisition, high-price group sales, inducing consumption, and frequent shopping. While expanding in scale, the market share of traditional industries will further concentrate on leading companies with high brand reputation, high quality assurance, and high emotional connection. By reducing costs through economies of scale and improving efficiency through digital transformation, traditional enterprises have greatly increased the possibility of classic reconstruction. It is worth noting that the national tour guide qualification examination, which started half a month ago, attracted 310,000 applicants, a record high. An industry that cannot attract young people has no future. The involvement of new forces will bring infinite vitality and energy to tourism entrepreneurship and innovation.


Targeting the sinking tourism market, including low-tier cities, county-level central towns, and rural residents, serving national leisure, and guiding demand upgrades. Tourism has become the most potential consumption growth area after urban and rural residents have solved the "two worries and three guarantees." In the stage of comprehensive development of mass tourism, tourism consumption has formed a strategic trend of gradient transfer from high-tier cities to low-tier cities, and from central towns to rural markets. According to the data center of the Ministry of Culture and Tourism's 2024 holiday tourism market monitoring, during the National Day holiday, the travel rate of rural residents was 18.4%, and the number of tourists accounted for 11.5% of the total number of domestic tourists during the holiday. Emerging market groups have a natural dependence on travel agencies, budget hotels, and natural and cultural heritage tourist attractions, playing a role in supporting and expanding tourism consumption. For tourism groups, listed companies, and entrepreneurial and innovative enterprises, this is an indispensable market opportunity to develop new markets such as rural tourism, mountain tourism, and ethnic tourism, and develop new business models such as travel agencies, tourism homestays, and rural resorts. Since the "National Day Golden Week" in 1999, along with the market expansion and consumption upgrades of mass tourism, budget hotels such as Home Inn, 7 Days Inn, Hanting Inn, and Dongcheng Hotel, travel agents such as Spring Airlines, UTour, and Caesar, online travel platforms such as Ctrip, Tongcheng, Qunar, and Mafengwo, theme parks such as Haichang Ocean Park, Changlong Wildlife World, and Qingming Shanghe Garden, and tourism performance projects such as Impression, Again, and Millennium Love have grown. Although central and local state-owned enterprises such as China Travel, OCT, Shoujiao, Jinjiang, and Shaanxi Tourism have also launched innovative brands with higher growth potential such as Happy Valley, Jinjiang Star, and Chang'henge, there are not many original brands with market influence. With the new round of market sinking and consumption upgrades in the comprehensive development of mass tourism, as well as the construction of world-class tourist destinations in the process of urban renewal and rural revitalization, it will bring more small, exquisite, beautiful, and warm project construction and brand growth opportunities for investment institutions and market entities, which cannot be ignored.


Attaching importance to emerging tourism markets such as self-driving, travel, vacation, and study tours, promoting the coupled growth of industrial capital and transportation infrastructure enterprises, and accelerating the layout of new tourism business models. Whether it's weekends, holidays, summer vacations, or ice and snow seasons, whether it's national roads, expressways, grasslands, or borders, the trend of fewer tourist buses and more private cars is obvious. Self-driving tourists during the Spring Festival, Labor Day, and National Day holidays have already accounted for more than half. The self-driving tourism market is expanding the "automotive after-sales" chain while also nurturing new tourism business models and talent needs, such as car rentals, motels, RV and self-driving campsites, and off-road exploration route planning and guide navigation personnel. In the past year, self-operated platforms such as Yihai, Hello, and Ghz, and third-party platforms such as Didi, Ctrip, and Fliggy have all focused on the layout of national car rental networks. With the increase in users and member activity, it is entirely possible for leading car rental companies to replace traditional tourism enterprises as the new chain masters of the tourism industry chain. In the modern tourism system, it has always been tourists who define the tourism industry, not the tourism industry that defines tourists. According to the United Nations World Tourism Organization's 25% standard line for the tourism industry, that is, no less than 25% of the products are generated by tourist consumption, which is the tourism industry or an industry with a strong tourism-related nature. In the annual selection of the top 20 Chinese tourism groups, the China Tourism Academy uses the sample enterprise's tourism revenue accounting for 50% of the total revenue as the criterion for judging tourism groups. Throughout the development of China's tourism industry from small to large, from weak to strong, especially since the 18th National Congress of the Communist Party of China, there has never been a natural direct lineage or permanent main force in the tourism industry. Whoever can provide tourists with high-quality products and services, and whoever can effectively use new productive forces to reduce costs and increase efficiency, is the direct lineage and main force of the tourism industry, and the emerging markets facing new demands are the natural fertile ground for tourism entrepreneurship and innovation.


Tourism groups and listed companies should also pay close attention to railway, aviation, shipping companies, and expressway construction and operators, as their entry strategies into the tourism industry are shifting from product innovation and market cooperation to a new stage of strategic layout. China Yangtze River Shipping Group, Chengdu and Lanzhou Railway Bureau Groups, as well as Hainan Airlines, Shanghai Airlines, Qingdao Airport, and China Transportation are no longer traditional tourism suppliers, but important components of the tourism market. In due course, the operating income and profit contribution of transportation enterprises in the infrastructure sector will increasingly come from tourist consumption, or the contribution rate of tourist expenditure to the enterprise will become higher and higher, and they will become the reserve army of world-class tourism enterprises.


Guiding outbound tourism to shift from basic demands like sightseeing and shopping towards a pursuit of good life and cultural experiences, and accelerating the layout of overseas markets. Globally competitive and influential tourism enterprises and service brands are invariably closely linked to the economic and social development level, industrial and commercial sophistication, cultural influence, and outbound tourism market size of their respective countries. This holds true for Japan Travel Bureau, Germany's TUI, France's Accor, and the USA's Disney and Universal. Coordinating both international and domestic markets, utilizing both international and domestic resources, and leveraging cross-cultural communication capabilities to seize the high ground in the global tourism competitiveness landscape and discourse system, is an objective law independent of human will, and also the only path for our country to cultivate world-class tourism enterprises. In the past two decades, we have also attempted to acquire hotels in the UK and third-party hotel management companies in the US, and establish travel agency branches, visa centers, and airline ticketing agencies overseas through commercial presence. From a strategic evaluation perspective, due to a lack of commercial competitiveness and cultural influence, these efforts did not achieve the desired results. With enhanced national strength, improved living standards, and enriched international travel experience, more and more people are traveling abroad, exploring this blue planet freely. Compared to twenty years ago, outbound tourists are now looking at overseas destinations' scenery and scenes with an equal gaze, and strengthening cultural exchanges with overseas destinations with confidence, equality, and inclusiveness. In this process, they will also look back and examine the innovative achievements in domestic hotels, catering, shopping, cultural entertainment, and smart tourism, and bring the consumption preferences and brand trust cultivated over these years overseas, thereby creating an increasingly expanding market space for us to cultivate world-class tourism enterprises. In this sense, outbound tourism is a natural extension of domestic tourism, and overseas destinations are the strategic space for tourism groups to become world-class tourism destinations, and also the decisive ground for international tourism industry competition.



Cultivating modern tourism

Integrating and developing new business models



Cultivating world-class tourism enterprises needs to be integrated with national strategies such as building world-class tourism destinations, world-class scenic areas and resorts, and world-class tourism routes. Enterprise development requires mass production of standardized products, long-term adherence to quality services, and even more, strategic guidance from project investment, product research and development, and expanded reproduction. In the process of accelerating the construction of a strong tourism nation, we have noticed unprecedented attention given to tourism leisure cities and districts, tourism villages, tourism scenic areas and resorts, national parks, national cultural parks, tourism transportation infrastructure, tourism public services, and tourism routes. Judging from the tourism development conferences held and policy documents released by various provinces and cities within the year, whether it's tourism image promotion, tourism market cultivation, or tourism project construction, the role of tourism groups and listed companies is highly valued, and institutional innovation, market innovation, and technological innovation have been carried out in cooperation models. The cooperation between Zhongwei City and tourism enterprises like CYTS in projects such as Shapotou Scenic Area and Yellow River Shuji, the cooperation between Shaoguan City and Ya'an City with Xiangyuan Cultural Tourism in scenic area investment and construction, and the deep involvement of tourism enterprises such as Nanjing Tourism Group, Hangzhou Business Travel, Guangzhou Lingnan Business Travel, Shanghai Shendi, and Beijing Shouhuan in urban tourism destination construction, have directly promoted the deep integration and high-quality development of culture and tourism. In the process of project construction, through the general contracting by leading enterprises and sub-contracting by related enterprises in the industry chain, it can not only expand the market share and scale of tourism groups but also contribute to the extension of the tourism industry chain and the cultivation of a modern tourism industry ecosystem.


In the long run, world-class tourism enterprises emerge from global market competition, rather than being protected by industrial policies, or cultivated simply by providing funds, projects, or branding. Great companies are invariably consumer-oriented, growing by providing consumers with high-quality, selectable products and services. For enterprises to go far and entrepreneurs to stand tall, they must allocate more resources and energy to market tracking and analysis, technological innovation, and product iteration, rather than government lobbying and commercial public relations. We also need to pay attention to the monopolistic tendencies of platform enterprises and be wary of the "dragon-slaying youth" growing into the very dragon they once despised. In the process of building a strong tourism nation, the government will not allow any enterprise to abuse its market scale advantage, technological advantage, and data advantage to suppress market competition, nor will it tolerate any enterprise seeking power it should not seek. In the near future, promoting the joint establishment of an anti-monopoly analysis mechanism by commerce, pricing, market regulation, and tourism departments will be highly necessary and entirely feasible.


Continuously promoting the deep integration of cultural creation and tourism innovation, and accelerating the formation of a new development pattern where art descends and tourism ascends. Tourists who have moved past the era of merely "seeing mountains, rivers, and scenery" hope to encounter more humanities, and see more excellent artistic works and cultural and museum exhibitions during their journeys. This requires cultural relic institutions and art groups to focus on people-centered creative performances, exhibition planning, and market promotion. This requires cultural confidence from entrepreneurs and cultural awareness from tourism practitioners, to genuinely recognize and practice the integrated philosophy of "shaping tourism with culture and showcasing culture through tourism." The Top 10 Chinese Tourism Pioneer Forces released at this forum are typical examples of tourism innovation driving cultural creation, and also a concentrated display of people-centered artistic creation in the tourism field. Taowenlv Group, which champions "World Handicraft," has long insisted on holding cultural activities such as Taoranji, Spring and Autumn Grand Market, and Taoyang Temple Fair, bringing in artists from all over the world for co-creation, and attracting tens of millions of visitors. Aranya Group, which has become a creator of contemporary artistic life, not only has the lonely library by the sea and projects in Beidaihe, Sanya, Jinshanling, etc., but also organized poetry festivals, drama festivals, and the Waves Film Week, and invested in films such as "My People, My Country," "My People, My Parents," and "Return to Dust," helping niche art reach mainstream life. Xiangwai Cultural Tourism, the creator of the "Shili Fangfei" resort complex, further positions itself as an exponent of village aesthetics and a inheritor of local culture. Since 2018, from a series of tourism performing arts projects like "Impression," "Encounter," and "Drama Fantasy City" created by literary and art workers for the tourism market, to cultural projects like "Silk Road Dream," "Happy Coast," and "Anren Ancient Town" by tourism groups paying tribute to culture, culture and tourism are integrating and developing at deeper levels, broader scopes, and higher standards."


Actively develop new productive forces such as artificial intelligence, high-end equipment, and green energy, to effectively improve the quality and reasonably increase the quantity of modern tourism economic development. In traditional perception, tourism is a resource-driven and labor-intensive industry. With the growth of the tourism market, changes in tourism consumption, and the pervasive transformation of production and life by modern technology, the tourism industry is beginning to shift from traditional to modern. This requires top-level design and development planning at the national level, strengthening the principal position of enterprises in technological innovation, and even more, leveraging the leading role of the national tourism industry's first echelon, represented by the Top 20 tourism groups and Top 10 tourism pioneers. This includes collaborating with leading enterprises in technology research and development, equipment manufacturing, and energy development to jointly establish laboratories, jointly develop new products, and jointly enjoy new tourism opportunities. Drawing on the paradigms and experiences of the Top 40 tourism entrepreneurship and innovation examples, and relying on the advantages of the tourism economy's super-large market, more scientific and technological achievements should move from laboratories to the market. Emphasis should be placed on leveraging the advantages of small, medium, and micro enterprises and startup teams in being close to the market, making quick decisions, and forming flexible teams. Relying on urban renewal and rural revitalization, cultivate a batch of small but exquisite, small but beautiful, and small but warm cultural tourism projects with strong cultural atmosphere and high technological content.


Practically advance the strategy of strengthening the enterprise with talents, building the human resource support and sustainable development guarantee for a world-class tourism enterprise. Improving the modern tourism system and accelerating the construction of a strong tourism country depend on high-level entrepreneurs, managers, professional and technical personnel, and a group of highly skilled workers. With market penetration, upgrading of demand, and industrial transformation, competition for high-level talent has become unprecedentedly fierce. The tourism industry is strongly economic and highly marketized. Talent is mostly cultivated through market competition rather than traditional training paths, and it is not something that traditional hierarchical systems can accommodate. Different types of talent, at different stages of development, have different requirements for benefit protection, development orientation, and career ideals. Tourism groups should implement talent classification and cultivation plans. The experience of tourism startups and development in various countries shows that small and micro entrepreneurial teams are often business schools for entrepreneurs and managers, and also a reserve army of high-end talent. No matter how large or strong a tourism group is, it must pay close attention to the R&D, production, and marketing teams on the market front line and discover and cultivate the strategic talent needed to build a world-class enterprise. For tourism group leaders, they should not only have the wisdom and ability of collective leadership and teamwork, but also the mind and demeanor of "gaining the world by gaining one person."


This is an era that needs world-class tourism enterprises, and an era that will surely produce world-class tourism enterprises; this is an era that needs tourism entrepreneurs, and an era that will surely produce tourism entrepreneurs. This is an era where all types of tourism talents will have great opportunities and will make great achievements. Tourism professionals across the country should unite to cultivate world-class enterprises and work hard to improve the modern tourism system and build a strong tourism country!


Special Survey on Investment in the Tourism and Culture Industry


To gain a deeper understanding of the investment and development of the tourism and culture industry, the China Tourism Academy, in conjunction with the China Amusement Machine and Amusement Park Association and other organizations, is conducting a special survey on investment in the tourism and culture industry. We sincerely invite all member units and tourism and culture enterprises to participate in the survey.

▲Scan the QR code to fill out the questionnaire



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