Still seen as an ‘emergent’ travel market, it is one of the fastest growing markets in the world, yet it has managed that growth without turning to the low cost airline market to support such development.
NB: This is an analysis by John Grant, executive vice president of OAG.
It is fragmented in terms of locally based airlines but these can nearly all be traced back to three or four state-owned enterprises.
Airports and supporting infrastructures are well developed and capable of handling millions of passengers; add to this a growing middle class and a population that is becoming the biggest market for mobile technology and apps and you can see why Chinese aviation has exploded in the last decade.
OAG entered the Chinese market ten years ago and so we have witnessed these changes – and how the wider Asian market now reacts to the sophisticated technologies available in the aviation market.
Our database feeds a platform that allows flight schedule updates on a dynamic basis.
Until recently, many internal systems did not have the capability to handle sophisticated dynamic feeds, but we are starting to see interest now as businesses wise up to the benefits of dynamic information – as our growing interest and customer base in China confirms.
Emergent it may be, but peek behind the curtain and China represents a market where dramatic change is likely in the next five years.
Reality
There is an old Chinese proverb “laí rì fāng cháng” that translates into “all good things come to those that wait” and, from a travel perspective, it looks like that wait is coming to an end in China.
Today’s Chinese market is based on rock solid foundations of distribution, airlines, airports and traditional relationships across the market. Tomorrow’s market will see revolutionary change in its structure, creating new business opportunities for everyone as travel increasingly becomes a commodity rather than a perceived luxury.
Changes in technology will also fuel this growth. Expectations are that within three years the Asia-Pacific region will account for nearly half (47%) of the 4.4 billion app users and China will be the biggest market for that demand.
In absolute terms that means some 360 million app users today will have grown to 2.1 billion app users; that is huge growth!
Today there are over 216 million travel apps downloaded in China, suggesting that there could be anything up to a six fold increase in travel apps downloaded in China by the end of 2017.
Creating those leading edge, pioneering “must have” apps will require great imaginations, massive creativity and the best available data and intelligence to compete.
That change will challenge the aviation industry’s conventional ways of doing things, not least the pace at which we work and create new products.
What to do
Great user experiences will become crucial to the success of any product – clunky interfaces and lengthy transaction processes will become a thing of the past – and real-time data refreshes will drive that creativity.
OAG’s Dynamic Schedules updates are leading the industry in this area with our pioneering technology allowing us to push schedule updates to clients dynamically, reflecting the vibrancy and opportunities presented by China.
As our customers in the Chinese travel industry experience the power and potential of our analytic tools, OAG are increasingly gaining resonance and traction in this market and our partnership-based customer base is growing.
Expectations are for more passenger demand to consistently grow by double digits in China for the next decade; that means bigger airports, more flights, more supplies and even more data.
Successful companies will need to move faster and further in their product developments to support the rapid changes that we are seeing.
We pioneered, along with global brands, the early phases of distribution and now actively support all of the major established and developing players in all areas of travel, tourism and aviation development.
As we approach our tenth year working in China we have learnt that it’s fast paced, fraught and challenging but never dull! The Chinese philosopher Laozi (604-531 BC) is credited with the famous proverb: “a journey of a thousand miles begins with a single step”.
We have made some single steps and are now ready to make more as China fulfills its position as a market of opportunity. We look forward to seeing you on that journey!
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