Ctrip Analysis: Competitive Advantages and Porter's Strategy

Running head: CTRIP ANALYSIS
CTRIP ANALYSIS
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1CTRIP ANALYSIS
The respective paper is an analysis of the competitive advantages of the company “Ctrip”
according to Porter’s strategy as choice perspective from the article “Ctrip: Scientifically
managing travel services” (Hua Dai, G. (2019). Competitive advantage is a particular
circumstance that puts the company in a better market position from that of the other companies
(Mantere 2013, pg 1438). Porter’s strategy of competitive advantage is a generic strategy that
comprehends, analyses and interprets the competitive advantages of a company (DaSilva and
Trkman 2014, pg 379). The respective paper introspects on every aspects of the company Ctrip
in order to find out the circumstance that keeps the company in a better position from its
competitors.
Ctrip is a Chinese tours and travel services which was formed in the year 1999 that
provides premium services such as accommodation reservation, ticket booking for transportation,
corporate travel management and packaged tour. Ctrip has become one of the largest travel
agencies of China (Hua and Dai, 2019).
According to Porter, a value proposition is an intellectual insight and exercise about the
strategic choices a company can take in terms of customers, needs and price (Dong-sung and
Hwy-Chang, 2013). Uniqueness and differentiation are the two factors on which Porter’s value
proposition is based. In the arena of value proposition, Porter had classified the respective
strategy into three divisions, namely, What customers? Which needs? And What relative price?
(Bosch-Badia, Montllor-Serrats and Tarrazon, 2013, pg 11). Therefore, in order to analyze Ctrip,
if Porter’s value proposition is taken into account, it is analyzed hereafter.
What customers section deals with what users and channels need to be taken in order to
provide a commendable strategy for the company. Ctrip has always catered to the needs and

2CTRIP ANALYSIS
desires of two types of customers: Budgeted and Premium. For the budget customers, Ctrip
revisited their operations by focusing on hotel reservations, shrunk the air ticketing services and
others, and changed the reservation media from call centers to online, thereby, minimizing the
chances of having loss. In case of Ctrip, the medium that it chose to publicize themselves was the
internet. The initial website that was developed for Ctrip was also a success. The website had
unusually premium and quality content, extensive online communities and the user-friendly
design and operative modes of the website, the respective company became famous all through
the internet as well, apart from its offline popularity. The website of Ctrip was considered to be
the top travel website of China among the 300 travel websites that were available.
Under the section “Which needs?” the firm focuses on what kind of products, services
and features they can best provide to keep them superior and apart from the rest of its
competitors (Edvardsson, 2014). In the case of Ctrip, the company utilized the internet to handle
the operations such as tickets and hotel reservation unlike the existing competitors who called the
hotels and tickets to negotiate with them on telephone that wasted time and resource. Ctrip’s
services were fast and accurate. Ctrip consisted of databases about the customers and their
preferences and provided the services accordingly, which was highly unlikely among the
competitors in the time of 1990s and 200s. with facilities such as e-booking networks and own
ticket delivery teams in the cities, Ctrip gained competitive advantage in China.
Under the section “What relative Price?” the firm focuses on premium, parity and
discount strategies to gain competitive advantage. In the case of Ctrip, the company provided
different packages to different customers (budget and premium). The company had different
kinds of packages according to the affordability of the customers. In case of premium customers,
the company experimented with sales and discount by offering a 60 day world tour of 24 luxury