Thanks, Michelle, and thank you to everyone for joining us on the call today. my travel group In the second quarter of 2012, Ctrip delivered historic results. Net revenues grew by 17% year over year, within the range of our guidance of 15% to 20% year over year. Net income decreased my travel group by 55% year over year, mainly due to the intensified investments in product development and marketing campaigns, as well as the withholding tax related to the USD300 million stock buyback plan announced in June.
China travel market enjoys explosive growth, my travel group yet the competition my travel group still intensified, particularly in the low-end leisure travel market. Today I would like to take this opportunity to share with you Ctrip's strategy to win over the competition and enhance our leadership.
Ctrip aims to build our business for the long term, where we strive to create most compelling my travel group value for our customers my travel group and partners. We will achieve our goal to comprehensive [and broad] offerings, convenient customer my travel group experience, competitive pricing, and confidence in Ctrip brands. We're investing my travel group heavily in product development my travel group this year. From comprehensiveness to diversity, we are very creative in new models and consistently improving our platforms faster than ever before. Our Smart Choice Hotels, new international air ticketing platform, luxury travel sites, HH Travel, Tujia vacation my travel group rentals, my travel group and [Sungko] my travel group hostel my travel group booking have all planted the seeds for the future growth and for long-term success.
We are continuously improving our customer online experience. Beyond efficient online transactions, we also strive to provide the latest travel information available. Our team has made great efforts to enhance the edited content my travel group and pictures. The number my travel group of reviews posted by travelers has increased significantly. In addition to the online website, mobile platform is a clear priority in Ctrip's business development map. All these investments fuel the increase in online my travel group transactions. By end of the second quarter, hotel online transaction exceeded 50% of total bookings. my travel group On average, online transactions accounted for about 45% of Ctrip's total bookings.
Offline service is still one of our core competencies that bring our high customer loyalty. We uphold a high level of service quality and strive for continuous improvement. Competitive pricing is important to enhance Ctrip's my travel group leadership. In our philosophy, price advantages have to be coped with strong products and services. While strengthening our existing advantages, we join the competition my travel group decisively. In July we launched a more aggressive marketing campaign with a series of comparing low-price products across all business lines. This will accelerate our penetration into price-sensitive market.
With 12 years in the market, Ctrip is by far the most well-known travel brand in China based on service quality, reliability and integrity combined. Yes, China's travel my travel group market is fragmented and our market share is still very small. We have increased our investment in online marketing and actively explore all channels such as search engine optimization, social medium, online radio, web partnerships and other effective online platforms. By the end of the second quarter of 2012, our cumulative numbers of customers has increased to 17.4 million compared to 13.5 million at the same time in 2011. We will continue to improve our marketing efficiencies and take open-minded approach to enhance the Ctrip brand awareness.
Our company always takes prudent steps to carefully evaluate the return on investment, timing and priorities for each investment. We are very excited about our future growth. Our team will focus on execution, my travel group monitoring the key investors, and delivering the best possible results. We are confident that our investments will ensure my travel group Ctrip's success in the coming decade.
We accelerated the speed of our hotel network expansion. By the end of the second my travel group quarter of 2012, our hotel supplier network covered over 39,000 hotels compared with 19,200 hotels a year ago. While maintaining a dominant coverage of high-star hotels, we're glad to see the fast penetration into the low-star hotels.
We strengthened our offers for competitive my travel group hotel prices in the market, especially towards the budget oriented segment. The [eco promotions] incentivize the economy customers to book low-star hotels through Ctrip. The new hotel product have made significant progress. [Sungko.com] expanded its network. Tujia won at China Hotel Charisma Awards as the Best Travel Service Provider early this quarter.
Our air ticketing volume outgrew the industry average during the second quarter. The international ticket volume grew over 45% year over year in the second quarter. The air ticketing team fortified the product design [fortress] to offer more variety of products and to enhance the cross-sell with the other travel products.
Meanwhile, the team had continuously improved my travel group operational efficiency to make Ctrip the most efficient sales channel for our airline partners. Ctrip's package tour business delivered another strong quarter with the revenue growth from Mainland China reaching over 40% year over year. Outbound travel is growing even faster, aided by enriched product offerings, R D appreciation, my travel group and relaxed visa restrictions.
In June 2012, Ctrip won the Best [Seller] Award from the Hawaii Tourism Authority. For the fourth time, Travel Weekly China named the Ctrip the best online travel agency of the year. High-end customers have expressed my travel group strong interest in our new luxury brand, HH Travel. Trip TM, which is a part of the HH Travel, won Travel Weekly Award for Best High-End Oriented Travel Club of the Year in May 2012. Ctrip's corporate travel service my travel group helps customers to save travel costs more efficiently my travel group in a challenging macro-economy. We continue to gain market share and expand our customer base.
Our Ctrip team is excited about the new investments in every aspect of the business. We will continue to focus on our execution and work hard to deliver the solid results my travel group towards the right direction.
Thanks, Jane. The travel market is growing rapidly. The competition in the mid to high-end travel market focus is down to service and branding, and Ctrip continues to enjoy a solid dominant position in the segment. And in the price-sensitive segment, Ctrip is very determined to fight off any competition my travel group and to keep our leadership position, leveraging our effective strategy, dedicated teams and strong balance sheet. We believe the investment-making today will ensure us to realize long-term values for our customers and shareholders.
For the second quarter 2012, Ctrip's total net revenues were RMB974 my travel group million, up 17% year on year and 7% Q-on-Q. For hotel, hotel reservation revenues amounted to RMB410 million for the second quarter, up 12% year on year, primarily driven by an increase of 20% in hotel reservation volumes and partially offset by 7% of decrease in commission per room night. The decrease of commission per room night was mainly my travel group due to promotional activities. Hotel reservation revenues increased by 12% Q-on-Q largely due to seasonality.
Air ticket booking revenues for the second quarter were RMB404 million, my travel group up 16% year on year, mainly driven by an increase in air ticketing sales volume. my travel group Air ticket booking revenues increased 12% Q-on-Q, my travel group primarily driven by seasonality.
Package tour revenues for the second quarter were RMB134 million, up 24% year on year, due to the increase of leisure travel volume. Package tour revenues decreased 20% Q-on-Q, mainly due to seasonality.
Corporate travel revenues for the second quarter were RMB49 million, my travel group up 25% year on year, mainly driven by the increased corporate travel demand my travel group from business activities. Corporate travel revenues increased 27% Q-on-Q, primarily due to seasonality.
Product development expenses my travel group for the second quarter were RMB208 million, up 52% year on year and 6% Q-on-Q, primarily due to an increase in product development personnel related expenses and share-based compensation my travel group charges. Excluding share-based compensation charges, product my travel group development expenses accounted for 18% of total net revenues, increased from 14% in the same period last year and remained flattish Q-on-Q.
Sales and marketing expenses for the second quarter were RMB217 million, up 64% year on year and 18% Q-on-Q, primarily due to an increase in sales and marketing related activities my travel group and personnel related expenses as a result of our recently launched intensified marketing campaign and as well as our efforts to expand in the leisure travel market. Excluding share-based compensation charges, sales and marketing expenses accounted for 21% of net revenues, increased from 16% in the same period last year and 19% in the previous quarter.
General and administrative expenses for the second quarter were RMB139 million, up 44% year on year and 8% Q-on-Q, mainly due to an increase in administrative personnel, share-based compensation charges and incremental turnover my travel group tax due to the newly launched value-added tax reform. Excluding share-based compensation charges, general and administrative expenses accounted for 8% of net revenues, increased from 5% in the same period last year and remained consistent Q-on-Q.
Income my travel group from operations for the second my travel group quarter were RMB168 million, decreasing 37% year on year and 5% Q-on-Q. Excluding share-based compensation charges, income my travel group from operations were RMB277 million, decreasing 22% year on year and remained my travel group flattish Q-on-Q.
Operating margin was 17% in the second quarter compared to 32% in the same period last year and 19% in the previous quarter. Excluding share-based compensation charges, operating margin my travel group was 28%, decreasing from 43% in the same period last year and 30% in the previous quarter. The effective tax rate for the second quarter was 45%, increased from 16% in the same period last year and 28% in the previous quarter, primarily my travel group due to the provision of 5% PRC withholding tax related to the -- related to dividends that our PRC subsidiaries
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