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ZUJI: Finding a Winning Strategy

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It was October 2015, Charlie Wong, CEO of Zuji Hong Kong told the media at the launch of Zuji's new brand campaign “Search, Discover and Share” that he would like to see Zuji “become the Google for travel” in Hong Kong. Indeed, a deemed pioneer and leading online travel agent (“OTA”) in Hong Kong, the aspiration did not seem far-fetched. Yet, the ambition was not without challenge.

Since Zuji went online in 2002, the brand had been twice sold and its geographic coverage shrunk from six to three markets: Hong Kong, Singapore and Australia.  Online travel booking had been slow picking up in Hong Kong.  After more than 10 years, online sales remained at under 10% of the total market in Hong Kong, compared to the regional average of 25% in Asia Pacific.  As momentum built up, Wong predicted the online travel agent (“OTA”) market to quadruple, from 10% in 2014 to 40% in 2016.  Meantime, competition from multiple fronts was flooding the market.  Global leader Expedia had launched in 2013, and was investing heavily in marketing to capture share.  Traditional offline agents were busy expanding their online presence, building a hybrid model as competitive advantage.  At the consumer end, mobile phones have become an indispensable travel companion and its implication went beyond the migration from one platform to another.  Around the world, the industry was seeing the rise of the millennia travellers with new needs and expectations while on the road, and they were changing the rules of the game. Zuji is facing the biggest opportunity of its time to ride this wave of change and reinforced its market leadership.

Learning Objective:

1.To understand how to use the Five-Force Model to analyse industry attractiveness.
2.To explore the opportunities and challenges associated with the online travel industry.
3.To learn how to apply the VRIO framework to analyse a firm’s internal strengths and weaknesses and identify the sources of sustainable competitive advantage.
4.To learn how to use Ansoff’s Product/Market Grid to devise strategies for future growth.

Year of Publication: 2016
Ref. No.: 16/577C
Discipline: Strategy & General Management, Marketing
Industry: Transportation
Country: Hong Kong SAR
Company: ZUJI Limited
Languages: English
Pages of Text: 15