Chinese travelers want personalized service

Chinese wealthy gentleman - China Elite FocusChina’s outbound luxury travelers spend $65,000 per household on tourism per year, including $34,000 on travel shopping, according to a new study from Marriott International.

Chinese outbound tourists have long been a high-priority group for luxury brands, but the demands and habits of younger travelers are changing quickly. The digital natives aged between 18 and 36 years old want a more personalized experience, including superior guest services and smart device integration.

China’s young luxury travelers go abroad between three and four times a year on average, primarily for leisure. While France remains the most popular destination in Europe, Japan is the preferred shopping destination given its proximity and favorable exchange rates, while Australia is the preferred leisure destination.

Australia has long been a developed economy, but it is less commonly seen as a haven for growth than North America, and luxury’s home in Europe has also pushed Australia to the back burner for many brands aiming to capitalize on China’s growing tourism rates. A strong presence in Australia could entice wealthy vacationers to make a purchase.

Moreover, western brands should be aware that summer travel is less common in China. National Day Golden Week travel in the early fall and travels for Chinese New Year are nearly two and three times as likely, respectively.

As with North America’s millennials, China’s young travelers get most of their travel information digitally, largely from official WeChat accounts, underscoring the platform’s importance. C-Trip, Qunar and Tuniu are also popular third-party platforms on which hotels should strive for good placement.

While the above generation is more closely defined by a desire for material goods, a reaction to globalization and advertising in the wake of China’s emergence from poverty, its young travelers strive for more adventurous travel. Hotels and retailers alike should tailor messages to these consumers to emphasize experiential components and offerings.

More specifically, over the next three years global travel is expected to increase 25 percent, while polar exploration grows 32 percent, adventure travel by 52 percent and road trips by 75 percent.

However, personalized service is still the biggest consideration in traveling for luxury travelers. Besides a liking for amenities, being able to choose pillows of different firmness and having a butler or personalized service through digital channels are also important. Seventy-three percent demand WiFi while 55 percent want smart TVs, while unique art and design are also high draws.

With luxury growth stalling around the world and quarterly earnings being largely at the mercy of Chinese tourists and which markets they enter, the country remains the top concern for marketers. As it transitions to a consumer-driven economy, China’s growth has fallen below the double-digits that were beginning to feel normal, but it still offers enormous opportunity.

Chinese residents will make 90 million outbound trips in 2020, with that number increasing by an additional 36 million over the following decade, according to a report by Euromonitor.

Outbound trips have increased on average by an impressive 13 percent since 2000, helping China overtake Japan as the second largest consumer market in 2011. With the significance and size of the Chinese tourist market only projected to swell, brands will need to develop a more nuanced understanding of the market in order to reach consumers. In particular sophisticated native advertisement campaigns in influential digital travel publications catering to China’s super-rich, such as the Shanghai Travelers’ Club (STC) magazine, give good results to reach China’s elite.

However, as brands cater to Generation Y consumers and look to the future, they must be as aware of generational differences in China as they are in the West.

In a reversal of the more materialistic tendencies of their parents, almost 95 percent of Chinese Generation Z consumers say it is essential for brands to be sustainable and environmentally conscious, according to a report by RTG Consulting.

The continued growth of China over the next several years will ensure that its consumers remain prime targets for brands for the foreseeable future, as even a slowed China exceeds the growth rate of western nations. As a result, brands will need to make a connection to this group, the first born in a fully modern China, in the interest of long-term success

Source: TheTopTier

In a twist, Trump’s administration policies could deliver more Chinese tourists and students for Australia & New Zealand

CHinese woman at home - China elite focusAustralia’s tourism and education providers may benefit from Chinese consumers holding a more negative view of the United States since the election of President Donald Trump, according to a new survey.

While China’s state media has pulled back on its outright hostility towards Mr Trump since his election, the survey of 2000 people from across the country found that 41 per cent of respondents viewed America in a less positive light.

“America’s soft power has historically provided a distinct advantage for many of its products and services in China, driving preference for travel and study packages, Nike shoes, iPhones and Frappuccinos at Starbucks,” said Mark Tanner the managing director of digital consulting firm China Skinny, which jointly commissioned the survey with research firm Findoout.

He said many Chinese people believed Europe to be unsafe, due to the threat of terrorism, and would therefore seek out other western-style destinations, such as Australia and New Zealand.

“The desirability of tourism and studying in America has decreased since Trump was elected,” said Mr Tanner.

“This isn’t just good for the travel and education sectors [in Australian and New Zealand], but has a wider impact as Chinese consumers develop affinities with food, property, fashion, health and a host of other products when visiting foreign countries.”

The so-called daigou trade, which has seen a spike in popularity of everything from A2 infant formula to Weetbix and Blackmores vitamins, was built around tourists coming to Australia and discovering these brands.

Many took the products home and then sought out Chinese friends or relatives living in Australia to send them regular supplies via the post.

This spawned a multimillion-dollar industry and often provided the basis for brands opening offices in China and beginning direct sales.

“New Zealand is a very popular destination for affluent Chinese travelers” said Pierre Gervois, CEO of China Elite Focus, the media agency which was in charge of the “Luxury New Zealand” campaign to promote the country to Chinese travelers from 2011 to 2013. “Chinese leisure travelers, real estate investors, businesspeople and students are choosing New Zealand as an alternative to European destinations or the United States”. The survey by China Skinny and Findoout found 18 per cent of Chinese consumers felt more negatively about buying property and stocks in the US, while 14 per cent were less inclined to travel there and 10 per cent were more negative on studying in the US.

Conversely, the rise of Mr Trump appears to have piqued interest in American culture in China with a small uptick in sentiment towards US movies, music, sport and the media. Chinese consumers have historically shown themselves to be sensitive towards geopolitical ructions. In September 2012 during a heated territorial dispute with Tokyo, Japanese automakers suffered year on year sales declines of up to 50 per cent in an otherwise buoyant market.

“Remarkably the results were consistent across respondents’ city tiers, gender, age and professions, signalling that Trump is impacting behaviour in every corner of China,” said Yu Bowei the chief executive of Findoout.

Source : Financial Review, original story by Angus Grigg

Tunisia Attracts More Chinese Tourists After Announcing Visa Exemption

Chinese passenger airport - china elite focusLast February 16, the Tunisian Ministry of Foreign Affairs officially declared the exemption of Chinese nationals in entry visas to Tunisia. However, conditions were also set in exchange of the said exemption.

General Director of Consular Affairs of the Tunisian Ministry, Chafik Hajji, was quoted as saying: “From today, the tourists of Chinese nationality will not need a visa to enter Tunisian territory, in the conditions of having a round-trip flight ticket and a valid hotel reservation voucher within 90 days.”

During the previous years, Tunisia has struggled to revive the country’s tourism after the occurrence of several terrorism attacks which killed over 70 civilians which had also included tourists from other countries. The country has exerted efforts to relive the tourism industry of the country. In fact, in 2016, 5.7 million foreign tourists visited Tunisia compared to the 5.3 million that was recorded in 2015.

China International Travel Service (CITS) in Shanghai office manager Fang Yi expressed that what makes Tunisia more appealing to foreign tourists are the World Cultural Heritage Sites in the country where unique and amazing cultural and traditional activities can be found.

“Thanks to its mild and humid Mediterranean climate, Tunisia could become a tourist destination in winter when it is cold in Europe, the traditional destination for Chinese,”Fang explained.”

Among the first Chinese citizens to experience this exemption was Wu Wenzhao, who is from Beijing. She came to Tunis, the capital and the largest city in Tunisia, for a business trip. Wu Wenzhao confirmed that she easily took a boarding pass and left the Chinese border. She added that it only caused her less than a minute to enter the territory of Tunisia after her plane landed.

Geographically speaking, Tunisia is placed between the Sahara Desert and the Mediterranean basin. It is also accessible to the Atlas Mountains which make the country more popular among tourists especially for adventure-seekers.  The Tunisia Welcome Service (WTS) believes that the visa exemption of Chinese citizens to Tunisia will boost the Chinese economic interests to country which will eventually lead to the improvement of the African market.

Source: Travelers Today

Europe Bets Big on Chinese Tourism but should leave to the States their marketing strategy

Chinese family - China Elite FocusIn a press event hosted by upcoming travel trade fair ITB China and its Chinese joint venture partner TravelDaily China, Europe laid out its plans for greater efforts to boost tourism between China and the EU.

Eduardo Santander, executive director of the European Travel Commission (ETC)—which represents European national tourism organizations—said that the European Commission is making huge investments in the 2018 EU-China Tourism Year. Santander argued that Europe as already reached the “awareness phase” in the Chinese market, and that the challenge now is to enhance Chinese consumers’ understanding of Europe as a destination. Santander also emphasized that Europe needs to understand the Chinese market better, and to look beyond the large cities in East China.

Even though the EU-China Tourism Year still lies a year into the future, efforts are being made to enhance the promotion of Europe as a destination already in 2017. ITB China, the Chinese counterpart of ITB Berlin—the world’s largest tourism fair—is hosting Visit Europe as its official partner destination for the inaugural event in May 2017, and outlined further collaboration during the tourism year in 2018.

The European Commission has also invested in what is called the World Bridge Tourism initiative; an EU initiative carried out by the ETC and the European Tourism Association (ETOA) that aims to grow the number of Chinese visitors to Europe by encouraging stronger business ties between European and Chinese tourism businesses. The initiative includes a conference as well as business workshops that bring European tourism suppliers and Chinese tour operators together, first for two days in Shanghai in conjunction with the ITB China fair, and later in the fall of 2017, doing a similar round of events on European soil. According to Tom Jenkins, CEO of ETOA, both events will host 150 European tourism suppliers and 100 Chinese tourism buyers. It was also announced that the EU had granted additional funding to carry out tourism workshops in both China and the EU to strengthen tourism ties further. The European Commission, which created the initial outline for the project, as well as funds the project, was also represented at the press event, briefly emphasizing the importance of Chinese tourism to Europe as a region.

But industry experts have a more cautious approach, like Pierre Gervois, Expert in marketing to Chinese outbound tourists, who declared “Europe in itself does not mean a lot for Chinese travelers. A coherent marketing approach should be done at country level, as each European country is so different, with different languages and cultures, promoting at the same time 28 very different countries is a waste of the European’s taxpayers money”

“European countries should promote themselves using their unique cultures.  For a Chinese traveler, you don’t dream on a trip to Europe, but to a trip to Italy and a trip to France, for example”, Mr Gervois added.

While strengthening the European tourism businesses with the help of Chinese tourism is a clear goal of both the World Bridge Tourism initiative and the 2018 EU-China Tourism Year, Santander also underlined that the designated tourism year “goes beyond tourism,” emphasizing the importance of more people-to-people interactions to reduce existing “misunderstandings” between Chinese and European people.

The event also hosted speakers from some of China’s largest tourism companies, including representatives from Jin Jiang Hotels, Ctrip, and Tuniu—all outlining their ambitions for future growth. Jin Jiang, which acquired Europe’s second-largest budget hotel chain, Groupe De Louvre, back in 2015 also has to ambition to expand in the European luxury hotel market. Ctrip, meanwhile, acquired Scotland-based Skyscanner to strengthen its position in the European market late last year. Tuniu, meanwhile, has partnered with ITB China and promises to send a large number of its buyers to the May event—where 40 percent of exhibitors represent European destinations and tourism businesses. While Europe may be looking to China for future tourism growth, it seems like large Chinese tourism businesses are looking to Europe for their own global expansions.

Sources: Jing Daily / ITB / European Travel Commission / ETOA

Private Jet charters for Chinese medical tourists

Chinese couple at home - China Elite focusChinese ultra-rich individuals use private jets for luxury overseas medical and wellness trips.

private jet chartering  sees a growing interest amongst Chinese ultra-rich individuals in luxury overseas medical and wellness trips.

The top destinations for mainstream Chinese medical tourists are Japan, Korea, Malaysia, the United States and Thailand.

The ultra-rich with a personal net worth of at least USD50 million however, are less price sensitive. They prefer to fly by private jet and are increasingly choosing to travel further abroad to Europe and the United States for more advanced treatments, drugs and technologies that are not available in China or the Asia Pacific region.

Global Growth Markets estimates that 4,300 ultra-rich Chinese sought medical care and health treatments overseas in 2015, spending over USD450 million on IVF, advanced cancer and cardiac treatments, stem-cell treatments, health check-ups and wellness programmes. On top of that, these ultra-rich patients spent over USD100 million on travel and sightseeing for these medical trips.Annual growth of 30% over the next few years is predicted, as more ultra-rich people will seek overseas treatment in the future.

Pierre Gervois, Publisher of the STC magazine, a luxury travel publication in Chinese Mandarin about the United States, said “The U.S. are the #1 medical tourism destination for High Net Worth Chinese patients.  We are working with the most prestigious hospital in the U.S., the Johns Hopkins International Medicine, to create for them a successful media campaign targeting very affluent Mainland Chinese patients”

China CMTHC digital media cluster editor Xue Chiao said: traffic as an important part of the medical tourism industry chain, the depth of participation in the industry has a unique advantage, development potential  is big.

L’voyage founder Diana Chou says: “We are seeing a growing number of inquiries about flying by private jet to France, Germany, Switzerland, the United States and the United Kingdom from our ultra-rich Chinese customers for the purpose of medical tourism. Not only are there advanced specialist hospitals in these countries, but also cultural landmarks and experiences that are popular with our clientele. Sometimes, relatives will travel overseas together for health checks and a family holiday. To cater to the growing trend in wellness and medical tourism, we cater our inflight menus to strict dietary instructions upon request and help pre-book return flights on the desired private jets for follow-up doctor appointments. At the moment, many of our Chinese ultra high net worth customers take off from airports in Beijing, Shanghai, Shenzhen, and Guangzhou but we expect a gradual increase in flights from interior cities, such as Dalian, Chengdu, and Chongqing, where the population of ultra-rich individuals is set to grow at a faster rate than other cities.”

Marketing to Chinese Outbound Tourists: Towards Normalization.

By Pierre Gervois, Founder & Publisher of the STC magazine, CEO of China Elite Focus Magazines LLC (New York), keynote speaker and expert about marketing to outbound Chinese tourists.

In 2005, I had the first conversations with executives in luxury hospitality groups about the importance of improving the welcome for their first Chinese guests. I knew they used to receive a very poor quality of service, in large part because of the ignorance of the Chinese culture from the staff of luxury hotels, and also because of the persistence of stereotypes about Chinese travelers.

The General Managers of five star hotels I talked to from 2005 to 2007 told me more or less the same thing “Chinese tourists don’t stay in five star hotels”, and, as a consequence, they did not see the point of investing resources to improve the service for their Chinese guests.

Today, these same hotels advertise in the STC magazine and ask us to define their marketing strategy to attract more of high-spending Chinese guests and offer them the best possible service.

Wealthy Chinese tourist- China Elite FocusThings have obviously changed over the last ten years.

To better understand the way Chinese outbound tourism has dramatically changed over the last decade, let’s go back fifteen years ago, in the early 2000’s.

I would define three periods to describe the evolution of Chinese outbound tourism:

From 2000 and 2005, most of Chinese outbound travelers were business travelers traveling in official delegations to attend to trade shows and official business meetings in Western Europe and in The United States. At that time, it was nearly impossible for individual Chinese leisure travelers to obtain an independent leisure visa for Europe or the U.S., and the only way to have holidays overseas was to travel in the famous (or infamous) group tours organized by Chinese State-owned outbound travel agencies, in partnership with selected destination management companies in their country of destinations.  Basically, their passports were confiscated by travel agencies during their trip in coaches and low quality hotels, which is not a very enticing way to travel.

I talked with many of these first Chinese leisure travelers between 2000 and 2005, and they told me how displeased they were by the very poor quality of their travel experience, and how their feelings were hurt by the stereotypes who were widely spread within the travel industry: Chinese tourists were supposed to love to travel in coaches, were allegedly obsessed with discounts, and would prefer to stay in one star hotels. In fact, my Chinese friends were at that time willing to be free to explore a country on their own, were searching high quality – and expensive- travel experiences, and were particularly fond of nice suites in five star hotels. Basically, like a lot of affluent western travelers.  But not of a lot of travel and tourism professional understood and even listened to them at that time.  You were a Chinese tourist?  Then you had to fit in a certain category of negatively stereotyped traveler. Period. In some cases, that was very close to segregation, and surprisingly, very few western travel & tourism professionals realized how painful and sometimes humiliating it was for Chinese leisure travelers.

From 2005 and 2010, The travel and tourism industry started – slowly – to give up on stereotypes concerning Chinese travelers, and at a slower pace to gradually improve the service for Chinese travelers.  Some hotel chains started to offer in-room Chinese tea (It took several years of studies and commissioned researches for hoteliers to take such a simple and inexpensive step), or started to recruit a few Chinese speaking staff members.  But the industry did not yet understood where the core problem was: the structural inability of both the outbound travel agencies (OTA’s) and destination management companies (DMC’s) to understand this massive change in international outbound tourism.  In less than ten years, faster than in any other country in the history of international leisure tourism, a group of outbound travelers was growing at an impressive and never seen rate, from 5 million in 2000 to 57 million in 2010. With old fashioned organizations, Chinese OTA’s could not offer the kind of service that the new generation of Chinese travelers wanted from them: a good understanding of international travel opportunities.  On the other hand, DMC’s in Europe and the U.S. were still stuck in their preconceptions about Chinese leisure travelers and kept offering the same standardized programs (Traveling in coaches from a discount shopping mall to another and sleeping in very low quality hotels), that were by the way never favored by the Chinese travelers themselves.  But their advice was never solicited.  That was before the social media era.

GERVOIS magazine Advertising and sponsored content opportunitiesAround 2008, the first social media networks started to become popular in China.  And yes, I remember the time (somewhere in 2008), where Facebook and Twitter were freely accessible in China. With the launch of Weibo in 2009 and dozens of other Chinese social media networks, Chinese outbound travelers started to post stories about their experiences about their overseas travel, and make comments about hotels (since 2008 with the launch of DaoDao, the Chinese version of TripAdvisor). I frequently read translations in English of comments written in Chinese Mandarin about famous luxury hotels in New York, London or Paris, and the first comments and reviews were incredibly negative. Most of them expressed how the staff of these famous hotels lacked of respect with their first Chinese guests, and did clearly offer them a second-class experience compared to other guests from western countries. I was also surprised to see that nobody in these hotels made the effort to request a translation of comments made by their Chinese guests and analyze them.

From 2008 to 2010, the first travel destinations, travel agencies and hotels started to realize that they needed to communicate properly with Chinese outbound travelers, but very few marketing options existed. China Elite Focus was historically the first digital marketing agency (founded in june 2008 in Shanghai) who was exclusively specialized on digital travel marketing for affluent Chinese outbound travelers, with a unique focus on luxury destinations.  The launch of China Elite Focus was followed by a flurry of creation of other independent digital marketing agencies in China, Europe and the US, and defined all together an entire new marketing category: digital marketing to Chinese outbound travelers. The quick development and the popularity of Chinese social media networks as well as the first digital campaigns to promote international travel to Chinese potential travelers contributed critically to a better connection between travel operators worldwide and the emerging category of young and affluent Chinese first-time outbound travelers.

But access to the information was still a big issue, specifically for high spending travelers: From China, how to know what is the best hotel in New York you absolutely want to stay in? What is the best exclusive golf course in Scotland? How to book a table in the Paris’ finest restaurants?  No curated information was available at that time in Chinese Mandarin.  The existing travel magazines published in China did not had such sophisticated informations, and no website existed. That is the main reason we launched the Shanghai Travelers’ Club magazine (or the STC magazine) in 2009 as an electronic newsletter and since 2012 as an iPad & iPhone digital publication.

Chinese tourist having lunch - China Elite FocusFrom 2010 to 2015, all the elements of the complex puzzle were in place: a dynamic social media network environment in China, the emergence of digital only Chinese travel agencies using extensively social media, the growing desire of Chinese travelers to discover foreign countries, and the understanding by western travel, tourism and retail companies that, yes, this is it, Chinese travelers are the world’s biggest spenders and the #1 group of Chinese outbound travelers. This is an interesting period where we saw two different categories of Chinese travelers intersecting on different paths. Senior travelers, mostly top executives of large Chinese companies who reward themselves after a life of hard work with a once or twice a year luxury international travel experience, and their children, in their early twenties, who quickly become frequent global travelers (six to ten times a year), and end up spending more than their parents in travel and shopping.

One of the important reason for the exponential growth of Chinese outbound tourism (120 million in 2015) is luxury shopping, and in particular the desire to have a genuine shopping experience. Buying a Gucci bag in Milan, a Louis Vuitton suitcase in Paris or a Tiffany diamond in New York was seen in the early 2010’s as a necessary sign of social status for the young and affluent generation. International luxury brands understood too late this trend and hastily opened too many stores in China in this period, many of them with more sales associates than Chinese customers. (They are now closing stores and start to focus on improving the customer relations at their flagship stores in the US and in Europe for Chinese shoppers.)

On January 19, 2012, President Obama issued the “Executive Order #13597” who had a major impact in Chinese outbound travel.  This decision had to major consequences:
First, “to increase nonimmigrant (i.e. tourists) visa processing capacity in China by 40% over the coming year”, meaning allocate more human resources at U.S. consulates in China in order to be able to review and process more leisure visa requests.  Second, “to ensure that 80% of nonimmigrant visa applicants in China are interviewed within 3 weeks of receipt of application”, meaning to allow a much faster process for individual Chinese tourists planning holidays in the U.S..  This rather technical Executive Order created a psychological change in the perception the United States as a  luxury holidays destination by Chinese travelers.  Previously more considered as a business destination, the U.S. were seen as of the beginning of 2012 as a much more “tourist friendly” destination by the Chinese, and they started massively to consider to spend holidays in this country, who appeared as newly opened to them. We saw a surge in requests on Chinese search engines about “travel and holidays in the US” in the first half of 2012, and the U.S. travel and tourism industry operators started to feel the economical benefits of an increased influx of Chinese leisure visitors as early as the summer 2012. (1.5 million Chinese visitors came to the U.S. in 2012, 3.1 million are expected for 2019).

STC magazine - Gervois Hotel Rating CoverIn november 2014, China and the United States negociated a reciprocal agreement to extend the validity of tourists visas up to ten years (multiple entries).  It means that since november 2014, a Chinese tourist with a valid tourist visa to the United States can keep this visa for up to ten years, with multiple entries. That is very close to the “Visa Waiver program” with european tourists, and has strongly encouraged Chinese travelers to choose the U.S. over Western Europe destinations, who do not offer tourists visas with such a long validity for Chinese visitors.

At the end of 2015, We could say that 80% of tourism offices, hotel chains, retailers, and airlines had in place elements for a marketing strategy focused on Chinese tourists, even a modest one. What a change if we compare to 2005, where virtually less than 5% of them had a strategy in place.

Today, what could be the trends for the years to come? The first world that comes to my mind is normalization. For the last fifteen years, travel and tourism marketers considered Chinese tourists as a kind of “exotic” category of international traveler, with all the stereotypes and preconceptions attached. Now that more than 100 million Chinese travelers discover the world every year in virtually every country on the planet, tourism and travel professionals have a much better understanding of what the most important group of tourists really want.  And it’s – how surprising – exactly what Americans and European travelers want when they travel abroad: A carefully curated travel experience, nice hotels, local cultural and food discoveries, and the possibility to choose, alone, what to do during the day. Before starting a marketing campaign focused on Chinese outbound travelers, it’s now time to have the exact same mindset that for a marketing campaign targeted at any other nationality of tourists. And, please, forget about the stereotype of the Chinese traveler allegedly only interested by discounts. They are not. They want quality, sophistication and authenticity.  And they know it doesn’t come cheap.

 

Pierre Gervois: What Chinese Travelers Want

Hospitality guru Pierre Gervois on how to cater to Chinese tourists.

PIerre Gervois TV Interview News China 2016