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Etao Hotel Booking Service to Share Profits with Users

China Business News, 7/11/13

Taobao's e-commerce search engine Etao has announced that the company will reward users of the site's newly launched hotel booking feature with "shares" of Etao's profits for 2013. For every successful booking, users will receive a stake commensurate with the actual value of the transaction, with the profit sharing plan to be completed by February 2014.

In response, Chinese Internet firm Baidu's (Nasdaq: BIDU) online travel services subsidiary Qunar announced a RMB 100 mln subsidy for the company's summer sales event.

Zhang Qin, GM of Etao, has stated that Etao and rival Qunar have different business models, and while Qunar receives revenue based on user traffic (clicks), Etao charges a percentage based on completed bookings. Zhang also stated that parent company Alibaba Group has not exerted much pressure on Etao to generate profits, prioritizing the expansion of services instead.

Editor's Note: For more information on this topic, please see "Etao Adds Hotel Booking Features," MD 7/10/13 issue.

Keywords: Zhang Qin online travel Etao e-commerce search revenue share vertical search

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