Ctrip Chairman: globalization is about supply chain, brand and innovative R&D

Ctrip’s globalization should focus on its supply chain, brand and innovative research and development, chairman James Jianzhang Liang said.

In a discussion about what count as a globalized company at a recent conference in Shanghai, Ctrip co-founder and executive chairman Mr. James Jianzhang Liang said that a company must have its supply chain, brand, innovation, research and development globalized to be considered globalized.

“What is a globalized company? First of all, its  supply chain must be global in nature, which means its product range should be worldwide and the production of its product uses the supply chains worldwide. Secondly, its brand must be global, and brand awareness must extend beyond China to the rest of the world. Thirdly, its entire process of innovation and product R&D involves global talent.”  Mr. Liang said.

Mr. Liang named Huawei as the most successful globalized Chinese company in the manufacturing sector, as nearly half of its revenues are generated from overseas markets, whereas e-commerce giant Alibaba in the service sector has only 2% of its income from abroad, a far cry from its American peers. 

He believes that Ctrip is more likely to fare better in globalization. As China’s largest platform for international travel and hotel bookings, Ctrip claims that incomes from international hotel booking comprise 20% of total revenues while international air ticketing contributes around 30%. Some 60% of Ctrip’s group tour operation is for outbound travel.

Mr. Liang also admitted that Ctrip lacks brand power in the global market. The company plans to improve that on its own or through acquisitions and partnerships with other companies worldwide.

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