Break Through the Intense Competition from Both Inside and Outside: The Way Out for Chinese Hotels Amidst the Vicious Competition
Only enterprises that face up to business cycles can truly navigate through them.
For enterprises with a long - term vision, business cycles are not merely challenges thrown by the external environment but also opportunities for self - evolution and "accelerators" for development.
Looking across different industries, leading enterprises show greater strategic composure that transcends short - term anxiety when facing cyclical fluctuations. They are never trapped in the current market turmoil and act blindly. Instead, they choose to bide their time, strengthen their internal capabilities, and reshape themselves proactively. This is not only a solid barrier against cyclical shocks but also the core advantage to seize the initiative in the recovery.
The Chinese hotel industry, regarded as the "barometer" of the macro - economy, has entered a cyclical adjustment after the "explosive recovery" three years ago. In 2023, driven by "revenge tourism," the Chinese hotel market soared. However, with a rush of investment, the hidden dangers of irrational supply began to surface. By 2025, as the market cleared and rationality returned, closing inefficient stores, reducing ineffective supply, and restructuring products have undoubtedly become the key issues in the current reform.
On the one hand, as the supply in core cities and popular business districts gradually saturates, the industry has shifted from incremental - driven growth to stock - based competition. The previous strategies of "scaling up" and "expanding aggressively" can no longer build competitive barriers. Instead, how to improve user retention and compete for the stock market through high - quality development has gradually become the key to winning in the market.
On the other hand, consumers' demands are changing. Nowadays, they are no longer satisfied with just "cost - effectiveness." Instead, they expect a combination of price, experience, and emotional value. Especially consumers represented by the younger generation require that accommodation be worth every penny, or even offer more value than the price.
Under the dual pressures of industry supply adjustment and external demand upgrading, the Chinese hotel industry, standing at the crossroads of the era, urgently needs a solution that can address the current cycle and ensure sustainable development.
Jinjiang Hotel in Shanghai
Recently, 36Kr had a conversation with Zhou Wei, the vice - president of Jinjiang International (Group) Co., Ltd., and Mao Xiao, the CEO of Shanghai Jinjiang International Hotels Co., Ltd., attempting to find the path to resilient growth (composure) of this Chinese hotel giant from Jinjiang's 90 - year development.
I. Innovation in Management Capability: Internal Reshaping Based on Agility and Digitalization
An undeniable fact is that the hotel industry is a product of global capital.
In terms of asset attributes, the hotel industry is half heavy - asset and half light - asset. Property development requires a large amount of capital investment, while hotel management companies rely on their brands and management capabilities to achieve large - scale development in a light - asset model.
This is why, in the era of low interest rates, scale and capital leverage once became the keys for leading players to gain competitiveness. Even in 2024 when interest rates were still high, the global hotel industry completed more than 800 merger and acquisition transactions.
Jinjiang, founded in Shanghai 90 years ago, also experienced the "land - grabbing" period of the Chinese hotel industry. In 2015, riding on the "wave of Chinese capital going global," Jinjiang acquired Louvre Hotels Group, a leading hotel group in Europe, and entered the international market. In the same year, it acquired Botao Group and obtained several brands such as 7 Days, Le Feng, Zhe Fei, Xi An, and IU, thus laying the foundation for its scale in the Chinese market.
Subsequently, targeting the strong demand in the mid - end market, Jinjiang acquired 80% of the equity of Vienna Hotel Group in 2016, expanding its brand portfolio in the mid - high - end and mid - end markets with Vienna International and Vienna Hotel. In 2018, Jinjiang took a crucial step towards internationalization and high - end development by acquiring an equity stake in Radisson Hotel Group in the United States.
Based on its dual - market layout in China and internationally, Jinjiang has become the largest hotel group in China and the second - largest in the world. As of June 30, 2025, the total number of hotels under its contract reached 17,771, and the number of contracted hotel rooms exceeded 1.68 million, covering 31 provincial - level administrative regions in China and 53 countries and regions around the world.
In the 2024 annual list of "Hotels," Jinjiang ranked as the second - largest hotel group globally
However, when the industry tide recedes, scale expansion does not directly lead to an increase in brand value and sustainable development. A large market scale also means greater difficulties in integration and development.
On the one hand, the integration of multiple brands is relatively difficult. From the digital information system, to the employee organizational culture, to the overlapping brand positioning, all need to be carefully sorted out and reorganized. On the other hand, judging from the pressure on RevPAR and profit margins in the hotel industry, the rapid expansion of the entire hotel industry in the past two years has not brought significant improvements in efficiency. Instead, it has intensified the irrational supply in the era of stock - based competition.
Facing the changes brought about by industry development, Jinjiang Hotels, a giant in the Chinese hotel industry, has initiated a reform process from within.
Zhou Wei, the vice - president of Jinjiang International Group, told 36Kr that to enhance the agility of the structure and the flexibility of market response, Jinjiang Hotels (China Region) under the group has started to transform into a platform - based organization. In essence, this is a decentralized organizational transformation that improves organizational efficiency by shortening the decision - making process.
Through the organizational structure reform, the initiative of regional teams can be better unleashed. "One team is fully responsible for marketing, operations, and finance. Only such a team will actively think about what measures can be taken to achieve sustainable growth in the region in the future," Zhou Wei said.
According to internal data, this reform has been effectively verified. From January to July this year, the approval efficiency of development projects of Jinjiang Hotels (China Region) increased by 33.1% year - on - year, and the implementation cycle of development projects increased by 17% year - on - year. At the same time, the semi - annual report data for 2025 showed that its management expense ratio also decreased by 2.66 percentage points year - on - year.
During the summer vacation from July to August this year, the cumulative number of guests received by hotels under Jinjiang Hotels (China Region) reached 89.9 million, a 29% increase compared with the same period last year. The "agile" transformation towards a platform - based organization has enabled Jinjiang to respond better to the market.
It's not just the reform of the decision - making structure. The construction of digital capabilities has also made "agility" penetrate into every aspect of the enterprise.
According to Mao Xiao, the CEO of Shanghai Jinjiang International Hotels Co., Ltd., from September to December 2024, Jinjiang Hotels (China Region) completed the unification of system codes for 10,000 stores, and more than 5,000 of them switched multiple PMS (Hotel Management Systems) simultaneously. Mao Xiao said that the scale and efficiency of this digital transformation are "unprecedented globally."
Based on the unity of the digital system, Jinjiang can integrate the data of its hotels. On this basis, Jinjiang Hotels (China Region) further promoted the work of "cutting off private connections." Through the central reservation system, it manages orders and prices of its hotels more standardly.
Previously, some stores bypassed the central reservation system of the hotel management company and privately "lowered prices" to attract short - term guests. However, for hotel brands, the chaotic price system caused by private connections often damages consumers' rights and interests.
In Zhou Wei's view, hotel operations should not only focus on short - term interests but also on long - term growth. Therefore, promoting the "cutting off private connections" is a necessary step for Jinjiang's long - term and sustainable development. At that time, Jinjiang Hotels' digital transformation was basically completed, and the changing market environment also put pressure on franchisees in terms of customer sources and commissions. So, Jinjiang Hotels "seized the opportunity" and fully promoted the work of "cutting off private connections."
Franchisees' cooperation with Jinjiang in promoting the "cutting off private connections" is essentially to strive for a more favorable business environment through "unity." Through the direct - connection model, Jinjiang Hotels can give full play to the scale advantage of multiple brands, gain more bargaining power in cooperation with OTA platforms, and free franchisees from the vicious cycle of "competing for traffic with low prices."
It can be said that the essence of Jinjiang's promotion of cutting off private connections lies in transforming the scattered and short - term individual interests of franchisees into long - term collective advantages. As of now, the direct - connection rate of all channels of Jinjiang Hotels (China Region) has been increased to over 80%.
Without the support of unified management capabilities and digital infrastructure, decentralization will only be a formality. Only on the same foundation can agility have a fertile ground for growth. This is undoubtedly a difficult but correct and long - term development path.
II. From Supply Chain to Membership System: Ecosystem Building Aimed at Win - win Results
Why does the hotel industry need to build a win - win ecosystem?
In terms of industry characteristics, this is a complex industry that highly depends on upstream and downstream collaboration. The investment behind a hotel room involves multiple aspects such as site selection, decoration, bedding, bathroom facilities, cleaning, and catering. No hotel can fully control the entire chain, and any problem in one link will affect consumers' actual stay experience.
In terms of the expansion model, in the context that more than half of Chinese chain hotels are operated under the franchise model, franchisees are eager for a sustainable hotel investment ecosystem. How to reduce procurement costs through supply chain integration and whether to provide stable customer sources for franchisees are the keys for hotel groups to build trust and returns.
Therefore, the core competitiveness of the hotel industry is never determined by a single factor but is the result of the synergy of the entire industrial chain. Building a win - win ecosystem is not only about reducing costs but also about ensuring consistent consumer experiences, sustainable development for franchisees, and long - term brand value for hotel management companies.
If the internal organizational reform and digital capability building are the foundation for Jinjiang Hotels' resilient growth, then the external win - win ecosystem building is the key link that forms an interest community among Jinjiang, franchisees, consumers, and the supply chain.
The supply chain and the membership system are two crucial links in this ecosystem.
In terms of the supply chain, Jinjiang has built a global procurement platform (GPP) that is "open, transparent, and efficient." When talking about the original intention of building the GPP platform, Zhou Wei, the vice - president of Jinjiang International Group, said, "As an innovative platform for centralized procurement, the purpose of GPP is not for the headquarters to make money but to benefit Jinjiang's franchisees and investors." As the "Taobao Mall" in the hotel industry, the GPP platform adheres to not making a profit from price differences. It only charges a commission far lower than the industry average to maintain the basic operation of the platform, and the rest of the profits are transferred to Jinjiang's franchisees.
Now, as consumers have deeper and more personalized requirements for hotel quality, design, experience, and service, how to meet consumers' needs while reducing procurement costs has become the key to the success of this platform. Relying on Jinjiang's powerful group resources and scale effect, the GPP platform can connect with more than 1,000 core leading suppliers. While ensuring price advantages, it also provides high - quality product selection to ensure consumers' usage experience. This is particularly important at the critical moment when the Chinese hotel industry is moving towards high - quality development.
Jinjiang's GPP offline "Excellent Sourcing Space," an innovative industry experience
On the basis of building supply - chain capabilities, Jinjiang unified its internal brand standards to further reduce the procurement costs of franchisees on the GPP platform. Zhou Wei took the paper cups in hotel rooms as an example. In the past, each hotel purchased paper cups according to its own preferences, often having to compare prices among different suppliers repeatedly, and the cost was high. But now, the specifications are unified, and the procurement cost has come down. At the same time, the position of the logo on the paper cups also leaves room for brand differentiation, "making the brand memorable to consumers and laying a good foundation for centralized procurement."
From not making a profit from price differences to high - quality product selection, the GPP has gone beyond the traditional positioning of a cost center. It can not only help franchisees reduce costs through large - scale centralized procurement but also support the development of the hotel industry's chain operation with an open, transparent, efficient, and high - standard supply - chain ecosystem.
In terms of the membership system, Jinjiang has built a large network with stable customer sources globally. In addition to the "Jinjiang Hui" membership platform with over 200 million members, Jinjiang's membership system also includes Jinjiang Hotel Business Travel with over 200,000 corporate customers and 23 million overseas members of the "Radisson Rewards." This customer - source network is the lifeblood of Jinjiang's entire hospitality ecosystem.
However, for the hotel industry, membership is never a "one - time" business. The core challenge in operation is how to maintain member vitality and enhance member trust within a large - scale system. In terms of individual experience, price is the first "anchor" of members' trust in the brand. If the price system is chaotic and consumers find the prices of the same hotel vary greatly on different channels, their trust will be directly weakened.
As Zhou Wei mentioned, "The core competitiveness of a hotel management company lies in the pricing ability of the central reservation system and the overall planning ability of customer sources." Through the implementation of the "Three Optimal Policies for Official Channels" and the execution of the "Double - Compensation for Price Difference" activity, Jinjiang can fully guarantee the basic rights and interests of members, further enhance member stickiness, contribution rate, and repurchase rate, and continuously provide high - quality customer sources for franchisees. According to the semi - annual report data for 2025, compared with January, the central reservation rate of Jinjiang Hotels in June increased by more than 11%, and the current member contribution rate exceeds 70%.
On the basis of guaranteeing basic rights and interests, providing more diverse and convenient service experiences for members is another important factor in winning consumers' favor. For the win - win ecosystem built by Jinjiang, its membership system represents not only hotel rights but also covers multiple lifestyles such as tourism, hotels, transportation, food, and cultural, business, sports, tourism, and exhibition experiences. It is not limited to the Chinese mainland but has also gone overseas, becoming the traffic entrance of the entire hospitality ecosystem, where one can "redeem globally" on the "Jinjiang Hui" platform.
