【Record】Mr. Chang Yang, Vice President of Alibaba Group delivers a speech at the forum of Tourism as a Catalyst for the Revitalization of the World Economy

Chang Yang, Vice President of Alibaba Group

Chang Yang: Hello, distinguished guests. I am very honored to have the opportunity to participate in this forum. As a representative of an enterprise, today I would like to share our findings, that is, our practice, amid the impact of the epidemic on the tourism industry. I hope this sharing can bring you some new ideas.

As for the impact of the epidemic on the tourism industry, the guests have just shown the shocking figures, so I won't go any further. Undoubtedly, this epidemic is a major crisis for the tourism industry. But in the development of all industries, the "crisis" and "opportunity" coexist at the same time. When there is “crisis”, there is “opportunity”. Who is the opportunity for? Opportunity must be for those who are good at thinking, at summing up, and at turning this thinking into innovative actions.

Let's look at the thinking part first, from the impact of this epidemic on the tourism industry and various industries, what is our thinking?

We have seen the impact of this epidemic around the world and have summed it up in three aspects: the first is the acceleration of digitalization; the second is the growth of new business forms; and the third is the change in consumption power.

The first is the acceleration of digitalization. The epidemic is certainly a process of compellent acceleration of the popularization of the Internet for all industries. Many people aged 50, 60, 70, and even 80, who have never used the Internet, had to force themselves to learn and use it during this epidemic. We can also see a lot of companies, including those in culture and tourism industry, who were already thinking about how to push digitalization to keep doing business when the epidemic first started. We can see that in many tourism attractions, although the number of tourists to the scenic spot is drastically reduced or they even stopped going there, these tourist attractions made many short videos and other media forms to maintain the popularity of this scenic spot among tourists through online communication. We call this "recommendation", and the act of "recommendation" has been ongoing.

The second is the growth of new business forms. In addition to tourism industry, we found that during the epidemic, many new industries suddenly appeared, such as meetings at home and classes at home. At the same time, the offline business of the culture and tourism industry has gradually stopped, but online performances have sprung up. What had never happened in the theater, or in a concert, now happened online. The growth of the new business form is the second finding in the epidemic phase.

The third is the change in consumption power. The original habit of users is to travel offline, watch performances offline, and so on. But during the epidemic, there was also a strong demand for culture at home, so watching various performances online, including online museum tours shared by the guest just now, is also a new trend. We believe the epidemic cannot make people give up their desire for a better life, or for tourism, which is something wonderful.

As the epidemic gets under control, more and more people go to travel. We believe that the impact of the epidemic on everyone will be reflected in consumption power, so people will pay more attention to the experience and the cost-effectiveness of tourism. Therefore, digitalization, new business forms and changes in consumption power amid the epidemic are worth more thinking.

The main theme of the conference is how we can accelerate the recovery of the tourism industry. We believe that accelerating the recovery of the tourism industry requires not only the efforts that have been made in the tourism industry and continuous improvement, but also the addition of new engines to the tourism industry. Newton's fundamental law tells us that acceleration can only be achieved with new engines. As for the new engines, we Alibaba mainly share our practice from three aspects: the first is IP-based, the second is digitalization and the third is ecologization. We believe these three aspects will bring new engines to the culture and tourism industry.

The first one is IP-based, we have observed that places with stories are relatively less hit by this epidemic. As we know, a good drama can drive a city's tourism industry and even a country's tourism industry. In Suzhou, there is a very hot restaurant, which was relatively little affected during the epidemic. It is because the restaurant has appeared in a very good TV show. So IPs that have nice stories and evoke long-lasting emotions can give a strong impetus to tourism.

The second is digitalization. We believe that we can through digitalization connect offline and online practices, connect offline consumers and online consumers who are ready to spend money, better promote tourism attractions, and enhance ecological protection in offline tourism, so as to provide a better experience for tourists. So we believe that digitalization is the second engine.

The third is ecologization. Tourism is not only to visit a site, but also to know the background of it, to pay attention to the local native products, to enjoy the local special products, to enjoy the travel process by plane or train. Tourism itself is an ecologization process. How can we add new engines to tourism through IP, digitalization as well as ecologization? Now let me introduce the specific events that Alibaba has done during the epidemic.

First of all, IP. In these two years, there is a very hot drama called The Longest Day in Chang'an. We found that within a week after the show was broadcasted, people's search on Trip.com and the number of flight tickets to Xi'an rose by 130%. Special snacks in Xi'an, which were not very famous before, like fire crystal persimmons and basin mutton, had a very big sales growth in Xi'an at that time. This is an example of tourists consuming this kind of tourism product because of watching the drama.

The second example is The Eight Hundred, which many of you have seen and of which Alibaba Pictures Group is one of the investors. On August 21 this year, on the first day of the release of The Eight Hundred, many tourists visited the prototype of The Eight Hundred in Foursagade in Jing'an District, Shanghai. Now, Foursagade has become a popular local tourist attraction in Shanghai. So we believe that IP-based must be an important engine for tourism.

During the epidemic, Alibaba had more experience in combining IP and tourism. A lot of tourism businesses slowed down during the epidemic, so we used the epidemic period to plan the next hot tourism attraction and explore what the tourism attraction with IP attribute really is. On August 12 this year, we signed an agreement with Zhouzhuang, the "No.1 Water Village in China" in Jiangsu Province. We have a very good IP about which we are going to make five TV series, called The Picture Code of Along the River During the Qingming Festival. We signed a contract with Zhouzhuang to build an offline real-life base, which will truly reproduce the natural condition, social customs and culture, and prosperity of the Song Dynasty in China. The construction of this real-life base will take one year to one year and a half, we just happen to make strategies, planning and construction during the epidemic. We believe that one year and a half later, this real-life base with IP attribute will attract more high-quality Internet IP content in China, and can build the IP matrix of Chinese style. The constant Internet traffic IP will drive the local tourism and bring more Internet traffic to the tourism industry. We will combine it with the current tourism sites in Zhouzhuang to create a matrix of tourism sites, bringing more visitors and more stay time. That's what we're doing now.

The second one is digitalization. Regarding digitalization, the first thing I want to share with you is that during the epidemic, there were some companies that responded very quickly and did very well. Beijing People's Art Theatre is a very old and professional theater in China that has created a lot of great dramas. During the epidemic, it was not allowed to do offline performances at all. In June this year, it was holding an academy celebration that needs to be held every year. This year marks the 68th anniversary. Although the offline performances were still going on, there were no audience. Therefore, Beijing People's Art Theatre fully entrusted to Alibaba the job of live content planning and distribution, and the number of viewers on the whole network exceeded 5 million. This theatre used to seat 800 to 1,000 people, but this broadcast drew 5 million viewers. The average time each person watched was 28 minutes, which is a very long time.

So when reviewing and summing up this matter with the staff of Beijing People's Art Theatre, we were all very excited. Firstly, we found that although the offline performances are temporarily unavailable, we can try to disseminate the excellent content created by Beijing People's Art Theatre. Secondly, these excellent contents are not only seen by 800-1000 people at a time in the original theatre. You can divide the 5 million by 800 or 1000, and you can see that how many years it will take for these people to learn about the excellent culture content created by Beijing People's Art Theatre. At the same time, we believe that these 5 million people will become the best and most loyal users when the theatre reopens. This is also an example of combining online and offline practices. Although the offline performances have a pause, we are doing the online publicity and distribution at the same time, and even some of the content of the live broadcast is quite popular.

We are also hosting concerts in the "Parallel Mic Live" mode. Since offline performances are not allowed for the time being, we will perform online. In one case, the revenue from online shows exceeds that from offline shows.

While doing tourism-related digitalization, we are also trying to connect the whole business. We talked with various business partners related to tourism in a region, about connecting regional tourism service businesses through Alibaba's current infrastructure, so that users can get a better experience. As you can imagine, I bought a ticket to a show, but I need to plan my transportation route, I need to plan my dining, I need to plan what kind of souvenirs to buy, I need to plan the city hotel where I'm staying today and other things. How to do these things through the digitalization of performance areas? As you know, London and New York have their own performing arts circles and are large tourism destinations in themselves. How can we connect this thing through digitalization?

Alibaba has a lot of other ecology. For example, just now we mentioned how to ensure the safety of tourism. Amap is currently negotiating with the responsible persons of many tourism destinations to develop "one-click tour" project to optimize user experience. With just a mobile phone, users can know the destination they want to go to, plan and buy tickets. As for the destination, we can monitor the density of passenger flow and pedestrian flow in real time with the management of tourism attractions to ensure the safety of tourism.

During the 20 years of development, Alibaba has actually built a lot of commercial infrastructure, including Alibaba Cloud, payment method, finance, and marketing. This is the construction of infrastructure. Among them, we have established full connection with users in various scenarios, including tourism, catering, e-commerce and other consumption scenarios. We want to use these infrastructures and the understanding of the users that we have built, to contribute more to the recovery of the tourism industry.

I think the tourism industry is a very wonderful business because it promotes mutual knowledge, respect and synergy between people of different cultures. We hope that Alibaba can better use our technology to serve the whole culture and tourism industry, promote the recovery of the industry, and rebuild world tourism for prosperity. Thank you everyone.