109 million Chinese tourists travelled ‘abroad’ last year – a particularly impressive number given just 31 million did so in 2005. Yet, what many reports don’t highlight is that more than two thirds of those travellers were visiting Hong Kong, Macau and Taiwan.
Nevertheless, those travellers staying close to home are part of the normal tourist life cycle, which sees them whetting their appetites in Greater China and travelling further afield in the future. This is represented in the rising trend of long haul travel such as the 25-30% growth in Chinese tourists expected in the U.S. this year.
Long haul travellers influence their peers in many ways. Chinese consumers are inherently curious, and are interested in learning about other countries. Those who visit exotic locations are often closely followed by family, friends and colleagues back in the Mainland, helped by the 84% of travellers who share their experiences on social media during and after their trip according to Hotels.com research.
Holiday moments shared on social media aren’t just the hotel foyers, trips to the zoo and bungy jumping, but a slew of local experiences and products from food to fashion to fancy apartments. With shopping still accounting for the largest share of Chinese spending abroad, retailers and brands who cater well to Chinese tourists can raise awareness of products back in China.
China’s tourism growth can be mainly attributed to rising affluence, more confident travellers and fewer visa restrictions. This is most noticeable in China’s fast rising tier 2 and 3 cities, especially its lesser-known mega cities. Whereas many of their Tier-1 cousins have had the ability to travel for years, hundreds of millions of potential travellers from lower tier cities are coming on stream for the first time, supported by dozens of airlines flying them direct to foreign locations.
With more and more cities now genuine tourism markets, travel operators are expanding across China. Yet tourist needs vary from region to region, requiring marketing to be targeted and localised to be most effective. China Skinny can assist you with this. We hope you enjoy this week’s Skinny.
China Has Even More Megacities Than You Thought: The UN counts six Chinese cities as ‘megacities’, however a new OECD study calculated 15 cities with more than 10 million people. The bigger city in China, the higher its average GDP per capita, however cities with a population of 1.5-5 million have the fastest growth rates.
China60: Assessing Real Estate Dynamics and Opportunities in China’s 60 Secondary and Tertiary Cities: Infograph summarising JLL’s report on China’s 60 most important Tier 2 and 3 cities. Of the top ten forces for change, five are new to the list this year including: (1) slower, but smarter economic growth; (4) the digital revolution; (5) rising city regions; (6) a new era of city competition; (7) growth of private domestic competition; and (9) anti-corruption measures.
Segway’s Second Chance in China: Segway has a second chance to revolutionise transport after its purchase by Chinese competitor Ninebot, who sees it as a solution to China’s much-needed urban transportation problems. A 2011 UBS study into the average speed of traffic in five Chinese cities found Wuhan’s average speed of 12.7km/h was the only city to exceed Segway’s basic model’s top speed of 12.5km. Beijing was 7.5km/h.
5 Ways Entrepreneurs Get It Wrong With China-Expansion Strategy: Some good basics to remember in China: (1) understand China’s culture and history; (2) Localising strategies from other markets; (3) resolve conflicts effectively; (4) ensure the Chinese Government is a friend; and (5) realise change starts at the top.
Chinese Tourists’ Luxury Spending Soars: The weaker Euro has helped spending by Chinese tourists soar by 122% in March after a 52% rise in February, bringing the increase for the first quarter to 67% according to Global Blue.
Budget Airlines See Booming Business from China: 94% of potential travellers in the Asia Pacific region would consider budget airlines according to Expedia, with the number of budget airline flights growing 9.5% in the past year. Airlines such as TigerAir are expanding to second and third tier cities, where they face less competition and receptive consumers.
IHG Targets Chinese Guests With New Service Initiative: IHG has trained more than 10,000 employees globally to be ready for Chinese tourists, with the programme expected to be rolled out in 250 hotels by the end of 2015.
This Chart Explains Everything You Need to Know About Chinese Internet Censorship: A nice illustration of what trips up the 13%-16% of online content that’s removed in China. Fame has a different price in China.
Daily Reading Time Over 40 Minutes on WeChat in China in 2014: 72.9% of WeChat users read articles shared on WeChat Moments and 67.1% read articles published by WeChat Official Accounts. Of those reading articles, they read twice a day for more than 40 minutes on average each day.
China’s Growing Appetite for Luxury Seafood Will Push Up Prices: Rising demand for premium seafood in China is seeing significant increases of aquaculture in countries such as Ireland, Scotland and Norway, and across Africa, Latin America and Australasia. China’s advantages as the world’s largest producer of seafood are diminishing.
Maps That Tell You When It’s Safe to Breathe: China’s three biggest Internet companies, Baidu, Alibaba and Tencent are innovating to attract users to their free mapping tools to draw larger mobile users and the data they provide. Local pollution readings allow users to plot cleaner routes inside about 2,000 commercial buildings, with Baidu Maps experimenting with indoor routes by mapping shopping malls. Real-time traffic patterns and public-transit alerts are available too.
Chinese Consumers Among the Most Environmentally Conscious in the World: 72% of Chinese consumers claim they only buy products which match their values, beliefs and ideals, with 80% feeling that brands and companies have to be environmentally responsible according to GfK. With that in mind, there is no evidence of consumers paying more for an environmentally friendly product like they do for safe or healthy products.
Volkswagen Is No. 1 Brand for China’s Auto Buyers: Volkswagen is the top pick for Chinese consumers considering buying a vehicle, followed by BMW and Buick according to MNI. Price and safety are the most important factors for choosing a car.
Alibaba Makes an Advanced Move in China by Partnering with Shanghai General Motors: Alibaba is spreading its net wider by inking a deal with GM to sell and offer financing for its vehicles through Tmall, and using big data to better target Chinese buyers.