China's travel agencies struggle despite 300 million daily holiday trips
In short
Traditional Chinese travel agencies are losing business even though more than 300 million people travelled each day during the National Day holiday, according to Transport Ministry data cited by Jiemian and TMTPost. About 2,400 agencies closed in the first half of this year, the reports said, as independent travel, online platforms and younger travellers' demand for experiences and custom trips change the market.
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Traditional travel agencies in China are losing ground even as tourism demand stays high, according to a feature carried by Jiemian and TMTPost and summarised by Huxiu. During the National Day holiday more than 300 million people travelled each day, the reports said, citing Transport Ministry data, and top domestic scenic sites were hard to get tickets for. Yet 2,400 agencies closed in the first half of this year. [ 1 , 2 , 3 ]
In the livestream of Li Jiaqi (李佳琦), tour packages are discounted by half, more than big-brand cosmetics, the reports said. Industry veteran Sun Rui (孙瑞) said a seven-day Qinghai-Gansu loop tour fell from a usual 5,000 yuan to as little as 1,980 yuan. He argued those agencies may be the smartest, using the 'Li Jiaqi recommended' label to advertise elsewhere and fill hotels and coaches. [ 2 , 3 ]
Sun said the first turning point came around 2018, when platforms such as Xiecheng (携程), Qunar (去哪儿) and Tuniu (途牛) made flight, hotel and ticket prices standard and public. The second is happening now: tourism founder An Pang (安胖) said younger travellers want experience and service rather than routes. Xiaotan Balang (小谭巴郎) named his route Kuangye Xinjiang (狂野新疆, 'Wild Xinjiang') after surveying white-collar workers in 100 cities; it has run nearly 800 trips, and he profiles each customer before assigning a tour leader. [ 1 , 2 , 3 ]
Many traditional agencies have not changed. Hongdou (红豆), who has worked in the trade for over a decade, said owners are mostly older, near retirement and with little drive to change. Trip planner Sisi (思思) said her boss moved into seniors', wellness, family and study tours, but these were coach sightseeing tours under a new name, and low-price shopping tours sold as wellness trips were eroding tourists' trust. Falling income has pushed some operators to raise margins or cut service, the reports said. [ 1 , 2 , 3 ]
Huxiu added that customer acquisition costs on Xiaohongshu and Douyin rose 289% in two years, that fewer than 10% of traditional agencies succeed with their own social media, and that online platforms rank by lowest price while surcharges and payment terms squeeze profits. It said agencies can survive by moving close to resources such as scenic sites and hotels, or close to customers. Huaixiong (坏熊), who started a high-end custom travel business in 2016, said tourism workers most want world peace, since extreme weather and war can break their cash flow. [ 1 , 2 , 3 ]
Why it matters
The reports describe a shake-out in which agencies built on packaged group tours and information gaps are closing while firms offering custom and themed trips grow, despite strong holiday demand. Business outlets present price cuts, rising marketing costs and platform terms as pressures on agencies' cash flow.
Key facts
- More than 300 million people travelled each day during the National Day holiday, according to Transport Ministry data cited in the reports. [ 2 , 3 ]
- 2,400 travel agencies closed in the first half of this year. [ 1 , 2 , 3 ]
- Industry veteran Sun Rui (孙瑞) said a seven-day Qinghai-Gansu loop tour was cut from a usual 5,000 yuan to as low as 1,980 yuan in the livestream of Li Jiaqi (李佳琦). [ 2 , 3 ]
- Around 2018, online platforms including Xiecheng (携程) and Qunar (去哪儿) made flight, hotel and ticket prices standard and public, and young people moved to independent travel. [ 1 , 2 , 3 ]
- Customer acquisition costs for tourism on Xiaohongshu and Douyin rose 289% over two years, Huxiu reported. [ 1 ]
- The custom route Kuangye Xinjiang (狂野新疆) has run nearly 800 trips. [ 2 , 3 ]
- A trip planner said seniors' and wellness tours offered by traditional agencies are often low-price shopping or coach tours under a new name. [ 1 , 2 , 3 ]
Confirmed by several sources
- More than 300 million people travelled each day during the National Day holiday, citing Transport Ministry data. [ 2 , 3 ]
- 2,400 travel agencies closed in the first half of the year. [ 1 , 2 , 3 ]
- Online platforms made travel prices standard and public around 2018, pushing young people towards independent travel. [ 1 , 2 , 3 ]
- Younger travellers want experience and service rather than set routes, which has given rise to themed and custom tours. [ 1 , 2 , 3 ]
Still unclear
- The 289% rise in acquisition costs and the under-10% success rate of traditional agencies on social media. Reported only by Huxiu, which does not give the source of the figures.
- The source of the figure of 2,400 agency closures. None of the reports says where the figure comes from.
- The currency of Huaixiong's first-year turnover of 30 million. The reports give the figure without a unit.
- The rest of Huaixiong's account of why agencies are closing. The Jiemian and TMTPost texts available are cut off mid-account.