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

Marriott hotels rush to invest in China, maybe too fast.

Chinese photographer- China Elite FocusThe Chinese economy may be slowing but tourist numbers are still growing, prompting international hospitality giants to place bullish bets on the sector by opening new hotels and cruise routes.

Marriott International and Royal Caribbean Cruises are among companies looking to cater to a rapidly growing number of wealthy Chinese who are not only spending more at home but also flocking overseas, executives from the companies told CNBC.

“Outbound Chinese travelers are still growing faster than the economy in China, so we don’t see the same thing that everyone is talking with the economy happening with the Chinese travelers,” said Marriott International’s president and managing director for Asia Pacific, Craig Smith.

Over the week-long Lunar New Year holidays, room revenue growth in Marriott resorts within China rose 12 percent from a year ago, Smith told CNBC’s Squawk Box on Wednesday.

To target fast-growing middle class Chinese who will not just need leisure but business accommodation, Marriott and China’s Eastern Crown Hotels signed an agreement recently to open 100 mid-scale Fairfield by Marriott hotels in mainland China by 2021. Another 40 hotels are slated to open later.

Intercultural aspects are also important: “U.S. hotel chains like Marriott should carefully analyze what Chinese travelers want. A common misconception is that Chinese travelers are interested in cheap, mid-range hotels.” said Pierre Gervois, CEO of China Elite Focus Magazines LLC, a publishing & consulting company based in New York. “The truth is that most of Chinese travelers are ready and willing to pay for five star premium hotels, and are tired of these stereotypes” added Pierre Gervois. “Marriot should focus more on attracting High Net Worth Chinese in their U.S. five star properties rather than investing in hastily strategized risky ventures in Mainland China ” he concluded.Gervois Rating Banner 01

As for outbound travel, Chinese tourists undertook more than 120 million trips overseas in 2015, according to the China National Tourism Administration. That number is expected to grow by 11 percent this year, Smith added.

To tap this growing market, Royal Caribbean Cruises will in April launch cruise ship Ovation of the Seas, with Tianjin as the home port.

Royal Caribbean is upbeat on the nascent cruise industry in China even though it is likely to capture just a fraction of the vacation traffic—typically 2 percent globally—said president and chief executive officer of Royal Caribbean Cruises, Adam Goldstein.

With over 100 million outbound departures a year, there are “not enough ships based in China right now … to even take 2 percent of the outbound travelers”.

There are just about one million cruise passengers in China now, he added.

Sources: CNBC / Huilen Tang / The New Chinese Tourist / Chinese Tourists in America

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