Attracting Chinese shoppers to New York City’s luxury flagship stores

At the 5th avenue Cartier Flagship store, a Chinese customer in Gucci flip flops, Abercrombie & Fitch T-shirt and a Niuyue Mag Cap on his head is buying three gold “Tank” watches incrusted with diamonds “One for me, one for my wife, and one for my daughter, who is studying in Chicago”, he says with a big smile. “I’m also platinum member of the Shanghai Travelers’ Club”, he added ,“that gives me a VIP welcome in most of luxury stores here”.
Cultural training is imperative for New York-based luxury flagship store employees to build trust among affluent Chinese tourists and creating a custom experience for this group of travelers will help marketers gain brand loyalists, experts say.
Many luxury brands are focusing marketing efforts to Chinese consumers back at home, but with a rising wave of Chinese tourists coming to New York, it is important that brands cater to this group. Luxury marketers need to be more proactive to reach Chinese travelers by training employees and partnering with high-end travel services.
“New York flagships should be more aggressive in inviting and giving a fabulous experience to Chinese tourists,” said Milton Pedraza, CEO of the Luxury Institute, New York. “The city seems to be behind in attracting and nurturing Chinese consumers.
“New York has been slow to appeal to Chinese tourists, even though there is such as large Chinese population in the city,” he said.
“Retailers need to create personal, emotional connections with these consumers by nurturing them and caring for them, which will create a lasting impression.”
In the capital cities of European countries, luxury flagship stores get 50 percent of their value from Chinese tourists, per Mr. Pedraza.
Europeans have been smart in the way they care for Chinese tourists, who tend to buy in volume on shopping trips.
Meanwhile, the United States has not been as open to tourists in its efforts and may have suffered, given the economic times.

According to Pierre Gervois, author of “How U.S. Retail, Travel and Hospitality Industries Can Attract Affluent Chinese Tourists”, “The U.S. travel and tourism industry has understood the financial power of the new generation of affluent Chinese inbound tourists, and how it can give a boost to the country’s economy, but needs to improve the way Chinese visitors are welcomed and understand better the intercultural issues of marketing”
In the past, European tourists were key for New York-based retailers, but tourism from Europe is on the decline. Travelers from China are now the largest group of tourists in New York, and Indian tourists are another group to look out for in the next decade.
To get Chinese consumers into New York flagship stores, luxury brands should partner with high-end hotels, tour operators and restaurants to keep the brand top-of-mind, according to Mr. Pedraza.
But the marketing strategy for luxury retailers also starts in China, when affluent Chinese travelers are planning their NYC shopping trip, and use Chinese social media networks such as Niuyue Mag, with 200,000 registered members, giving shopping tips and specific insights to Chinese shoppers.
Also airports, limos and hotel concierges play a major role in influencing affluent Chinese tourists since these are all stops on the journey to New York.

“There is no question that luxury brands should be using print and their Web sites to attract tourists to their New York stores by showing the experience that they can expect,” Mr. Pedraza said.
“The travel industry is also a huge opportunity,” he said. “Luxury brands have to romance travel agents to get on the map within the travel industry.”
“Brands need to do a better job at creating these partnerships with travel-oriented brands.”
Once in-store, affluent Chinese tourists will need to be made comfortable. To do so, New York flagship stores should start by training their staff on the Chinese culture and traditions.
Stores should have, at minimum, Mandarin-speaking employees and may also want to train in other dialects from Asia.
“Employees should be well-educated in relationship building, not just to process tourist transactions, but to develop longtime relationships with the brand,” Mr. Pedraza said.
“There are luxury brand stores in Shanghai, Beijing and Hong Kong, so these tourist transactions are not a one-shot deal,” he said. “They can also be relationship building.”
Luxury retailers should be aware of the Chinese holiday calendar to understand buying habits during certain holidays and target Chinese consumers for in-store gift buying, per Ken Morris, principal at Boston Retail Partners, Boston.
The holiday calendar may also hint at the time when Chinese tourists are more likely to travel.
Training sales associates on cultural greetings can quickly build trust with incoming tourists and encourage foot traffic.
Stores should also offer in-store shipping options so that Chinese consumers can ship items home. This will eliminate the need to pay sales tax and leave the customer more room in their luggage, per Mr. Morris.
“Not only is the size of the luxury market in China significant, but it continues to grow with a burgeoning middle class aspiring to own luxury brands to demonstrate their wealth,” Mr. Morris said.
“New York is a unique, international city where tourists can readily find bilingual associates,” he said. “By focusing on hiring multilingual staff, a retailer has the opportunity to offer exceptional customer service and make the customer comfortable shopping in the store.”
Source: Luxury Daily

In the first half of 2012, +46% of visa applications processed at U.S. Embassy for Chinese leisure travelers

President Barack Obama’s initiative to boost international tourism has pushed the US government to process a record 1 million visa applications from China so far during fiscal 2012.
“This extraordinary accomplishment represents visa processing growth of almost 43 percent over the same period last fiscal year, when we had processed just over 675,000 visa applications in China,” the State Department announced Thursday.
The US federal government’s fiscal year begins Oct 1 and ends Sept 30, so the department was referring to visa-processing totals through the end of the third quarter on June 30. As China Daily reported in April, through the first half of fiscal 2012, the State Department had processed 453,000 visa applications from Chinese citizens, up 46 percent from the first six months of fiscal 2011.
To reach the 1 million figure through the current fiscal year’s first nine months, department staff at the US Embassy in Beijing and the four consulates across China processed at least 547,000 visa applications from Chinese citizens in the three months from April 1 through June 30 – reflecting especially high demand for the busy summer travel season.
The State Department credited the opening of more windows for interviews, expansion of consular office space and better-maintained waiting areas for visa processing at the Beijing embassy and its consulates in Chengdu, Guangzhou, Shanghai and Shenyang. Furthermore, it said the average waiting time for a visa interview has been reduced to about a week from the several months it used to take to get an appointment.
According to Pierre Gervois, CEO of China Elite Focus and the author of the Book How U.S. Retail, Travel and Hospitality Industries Can Attract Affluent Chinese Tourists “This initiative is the direct result of a very successful lobbying campaign organized by the retail, travel, and hospitality industries that were the first-hand witnesses of the incredible purchasing power of Chinese tourists in the last few years. Roger Dow (president of the United States Travel Association) and Joe McInerney (president of the American Hotel & Lodging Association) have done a fantastic job of explaining to Washington the vital necessity to the American economy of finding ways to increase the number of Chinese leisure visitors.”
Dong Xue, a senior at Purdue University in Indiana, has just returned from China and it took her only a week to get a visa, even at the peak of summer. As a repeat traveler to the US, Dong was able to use a bank drop-off service to renew her visa. Without having to go for a personal interview, she submitted her paperwork through the bank and got her visa in five business days.
“As the Chengdu consulate (nearest to her hometown of Chongqing) was very busy then, their colleagues in Guangzhou processed my application,” Dong told China Daily. “It’s so fast. Usually it will take two weeks.”
The Obama administration, pointing out the value of travel and tourism to the US economy, introduced in January a strategy to make the United States the top destination for foreign visitors. More than 1 million jobs could be created over the next decade if the US increases its share of the international travel market, Obama has said.
In 2011, about 1.18 million Chinese visited the United States and the number is expected to reach 2 million in 2015, according to the National Tourism Administration of China.

Chinese Outbound Travel Agencies promote “quality travel” to Korea

The stereotypical image of Chinese tourists abroad is of large tour groups following a guide with a red flag through sightseeing spots and shopping malls.
But all that could be about to change, as the country’s leading travel agencies attempt to replace traditional tour packages with high-end experiences.
China Travel Service, a big player in the travel industry,  has announced it will cooperate with vacation resorts in South Korea to provide packages that appeal to well-off families, eco-golfers and winter sports enthusiasts.
“Getting in and out of a tour bus at tourist spots and being in a rush is no longer working with outbound tourists,” said Zhang Ping, president of CTS. “We have to move upstream in quality and create tourism products tailored to the demands of individuals and that give people more freedom for unique experiences.”
The company says its cooperation with South Korea’s GB Networks, an agency that provides travel services to 14 resorts, will give Chinese tourists access to large-scale ski resorts, golf courses, water parks, hotels and convention centers.
Jin Chengxiu, director of the CTS’ branch in Seoul, said it was the first time a Chinese travel agency has attempted to tap into the South Korean resort market, which currently attracts a large number of Korean and international tourists, but few Chinese.
“Most resorts are in northern Gangwon Province, which has a smooth, sandy coastline and is known as the epicenter of winter sports in Korea,” he said. “Chinese tourists, especially those traveling with their families or for business conventions, can spend several days and nights in one place relaxing.”
The province is also the site of the 2018 Pyeongchang Winter Olympic Games, and authorities expect to draw 10,000 tourists from China each year in the lead-up to the event.
According to Zhang, Chinese tour agencies are making bold attempts to offer a variety of high-end tourism packages to cater for a booming market demand.
“Some remote but captivating destinations that were believed to be too expensive for Chinese tourists are becoming more popular,” said Zhang, adding that the agency has organized trips to Seychelles in the Indian Ocean with chartered flights this year. “Because the number of Chinese outbound tourists is increasing, the prices of hotels and airline tickets are getting lower, which can cut the price for outbound travel.
“Amid the economic downturn, people are more likely to spend money on tourism to relieve stress. The industry is now also promoted by the Chinese government as a way to stimulate consumption.”
According to the National Tourism Administration, 38 million Chinese tourists traveled overseas in the first half of this year, up 18 percent from the same period last year.
After Japan, China is South Korea’s second largest source of inbound tourists. A new visa policy will come into effect next month, loosening restrictions on Chinese tourists in a bid to promote tourism.

The rise of the new Chinese International Traveler: Younger, Independent and Affluent.

The number of Chinese travelers making international trips was up by a strong 22 per cent in 2011, compared to 2010, and experts predict China is on track to overtake Germany and the US as the world’s largest outbound tourism market in the next few years.

The inaugural Chinese International Travel Monitor (CITM) from Hotels.com, one of the world’s leading online hotel booking websites, gives an insight into how the rise of the Chinese traveller is changing the dynamics of the global hotel market.

Johan Svanstrom, Managing Director of Hotels.com Asia Pacific, commented: “The Chinese made a staggering 70 million international trips in 2011 and, while many of these were to Hong Kong and Macau, the number going further afield is growing significantly. Implementing strategies to cater specifically to this burgeoning source market is moving from a nice-to-have to a competitive necessity.”

Surveying more than 5,000 Hotels.com’s hotel partners around the world, the report found the majority of respondents envisage the boom in outbound Chinese travel continuing. One in five (22%) expect to see an increase of as much as 40%. Many national governments are facilitating the boom by relaxing visa requirements. Japan and Spain are examples of popular tourism markets that have already done this and Korea, amongst others, will implement similar changes later this year. Chinese international travelers are known to spend significant amounts on shopping and there is a clear opportunity for the hotel industry to grab a share of that spend for the stay experience itself.

The study found that the profile of Chinese guests is changing as they become increasingly more independent, confident, younger and more familiar with foreign cultures and customs.

According to Pierre Gervois, author of the Best Selling book How U.S. Retail, Travel and Hospitality Industries Can Attract Affluent Chinese Tourists, “Chinese outbound tourists are now extremely mature consumers, and know what they want – and do not want. The time of low cost group tours is now definitely over as they want a true travel experience, specifically in the United States, the #1 dream destination according to China Elite Focus’ survey”

Among hoteliers polled, it is clear that many are starting to adapt, offering Mandarin-speaking staff, translated materials, Chinese menus, entertainment options and the China UnionPay card services for payments. Examples from the study found that 41% of hotel respondents are planning to offer Chinese TV channels, while 66% of European hotel respondents are planning to offer Chinese breakfast options.

The Chinese economy continues to grow at a fast rate, contributing to the build-up of a travelling middle class of several hundred million people. With the the ongoing economic uncertainty in key markets, catering to Chinese travellers should be high on the list of priorities.

“Hoteliers should form concrete plans in two areas. Firstly, develop marketing strategies to reach the Chinese source market; concentrating on online as the Chinese internet population has now crossed the 500 million mark. Secondly, adapt hotel property services to cater to the expectation and needs of this growing audience,” concluded Svanstrom.

Source: Travel Daily News, August 2012

US hotels bending over backward to win the hearts of Chinese travelers

Major hotel brands are bending over backward to cater to the needs of the world’s most sought-after traveler: the Chinese tourist.
Now arriving on American shores in unprecedented numbers thanks to a streamlined visa process and a rising Chinese middle class, Chinese tourists are being treated to the comforts of home when they check in at the front desk. That means tea in rooms, congee for breakfast and Mandarin-speaking hotel employees.
Chinese “welcome programs” at chains like the Marriott and Hilton even address delicate cultural differences: No Chinese tour group should be placed on a floor containing the number four, which sounds like the word for death in Mandarin.
“They’re very relieved, like finally somebody’s doing these things that make sense,” said Robert Armstrong, a sales manager who handles bookings for Chinese travelers at the Waldorf-Astoria in New York.
More than a million Chinese visited the US in 2011, contributing more than US$5.7 billion ($7.2 billion) to the economy. That’s up 36 per cent from 2010, according to the Department of Commerce. By 2016, that figure is expected to reach 2.6 million Chinese.

In a striking departure from the traditional Chinese business traveler, a growing number of them are coming to America for fun – with lots of cash. (The average Chinese visitor spends more than US$6000 per trip.)
“Chinese Social Media networks are very important to help Chinese travelers to choose their hotel in the U.S.” said Pierre Gervois, Chief Executive Officer of China Elite Focus, a digital marketing agency based in Shanghai and Hong Kong. “New social media networks focused about travel in the United States have emerged last year, and are now very popular, such as Luxury Hotels of America (美国奢侈酒店), or Niuyue Mag (纽约志), and VIP Golf USA (美国VIP贵宾高尔夫). These social media networks allow Chinese travelers to ask for advice to other Chinese tourists coming back from the U.S., and also to rate hotels, golf courses, and retail stores. They are much more influent than travel agencies.”
And so hotels are competing to win the hearts of the Chinese. That may take the form of slippers and a tea kettle in the room or a Mandarin-speaking employee at the front desk.
“They drink tea. Eastern style, everything cold,” explained Charlie Shao, president of Galaxy Tours, a New York City-based Chinese tour agency. “They don’t walk inside the room with bare feet.”
It’s rare that Shao has to ask hotels for anything anymore. Marriott International, for example, now offers several Chinese breakfasts, depending upon which region of China the traveler hails from: there are salted duck eggs and pickled vegetables for eastern Chinese, for example, and dim sum and sliced pig’s liver for the southerners.
Major chains are also training employees to avoid cultural missteps that would offend a Chinese visitor. Superstition is a big one: Red is considered a lucky colour, along with the number eight, which signifies wealth. The colour white, meanwhile, is frowned upon.
Failing to respect the pecking order in a Chinese group is another common blunder.
“We try to make sure nobody’s on a higher floor than their boss,” Armstrong said. “Even if the boss is on a beautiful suite on the eighth floor, if the assistant is in a standard room on the 38th floor, it doesn’t translate.”
The race is also on to build loyalty within China’s borders. Last year, Starwood Hotels, which has a Chinese “specialist” at each American hotel, relocated its senior leadership team to China for a month. The Ritz-Carlton rotates general managers and other hotel staff into its Chinese hotels for three-year stints at a time. And both chains are banking on the success of their customer rewards programs, which have been a big hit in China.
“It’s important for our leaders to understand what’s going on there at a more personal level than just the statistics,” said Clayton Ruebensaal, vice president of marketing for the Ritz. “Everybody’s going after this market because of the sheer volume of luxury customers. At the same time, it’s a very crowded landscape.”
In response to the surge in Chinese visitors, the State Department decided earlier this year to spend US$22 million on new facilities in several Chinese cities and add about 50 officers to process visa applications. And in February, the US government said Chinese visitors who had obtained an American visa within the last four years did not have to reapply in person but could apply via courier.
As a result, visa interview wait times in China are just under a week.
But some experts say the US still lags far behind other countries, especially in Europe, when it comes to attracting Chinese tourists. America is woefully ill-prepared to welcome China at an industry-wide level, especially at restaurants and major attractions, said Rich Harrill, director of the Sloan Foundation Travel & Tourism Industry Centre at the University of South Carolina.
“We’re not as ready as we should be,” Harrill said.
“We don’t have the language skills. We have an opportunity to be on the ground floor of something that could be very, very big.”

New Zealand urges to attract affluent Chinese tourists

Pierre Gervois, CEO of China Elite Focus, speaking at TRENZ 2012

Visiting tourism experts from Asia are urging New Zealand to focus on attracting high-end Chinese travellers through premium marketing and by gaining a better understanding of the market’s potential – forecast to reach 80 million outbound travellers by 2013.
Supporting this view is Auckland Airport with the launch of a highly-targeted premium programme as part of its Ambition 2020 initiative outlined last week, which aims to showcase “luxury New Zealand” to young wealthy Chinese. The airport has also launched complimentary three-day “China Ready” workshops designed to help tourism businesses learn more about marketing to and servicing Chinese travellers.
Speaking at TRENZ as part of the Auckland Airport International Speaker Series and as a partner in the Airport’s premium programme, Pierre Gervois, CEO of China Elite Focus, provided conference delegates with insights into targeting the new generation of affluent Chinese.
“Chinese people love to travel, and given China’s location in the world they have unlimited holiday options to choose from. New Zealand is a similar flying time to other must-see destinations such as London, Paris, New York and Las Vegas. That said, only a relatively small number of Chinese can afford a long-haul holiday, and those that can demand luxury over camping and outdoors holidays.”
“To compete, New Zealand needs to be less shy about marketing its premium offer and dare to sell to this affluent audience. The super wealthy in China – about 0.5 per cent of the population – would only consider a minimum $US50,000 a week holiday package or it’s not of the right value for them,” he says.
Through his company China Elite Focus, Mr Gervois and Auckland Airport’s promotion of luxury tourism in New Zealand to affluent Chinese travellers uses premium marketing and targeted social media to reach this extremely discerning audience.
“Luxury New Zealand is a highly-targeted initiative designed to reach Chinese travellers interested in New Zealand and luxury travel. Predicated heavily on social media, Luxury New Zealand was able to tap into an exclusive invitation-only network of very wealthy young Chinese. Since launching in May 2011 the feedback has been positive with many I’ve spoken to pleasantly surprised to learn New Zealand is a luxury destination, not just a family-orientated place, good for camping, biking and so on.”
Also speaking at TRENZ was Trevor Lee of TravConsult, specialists in international customer service and tourism development who are also running the China Ready workshops for Auckland Airport. Mr Lee says New Zealand, like many markets, needs to better understand what Chinese are looking for when they travel.
“There are more than one million millionaires in China and another 60,000 Chinese who are classified as ‘super-rich’, with more than $15 million dollars’ worth of assets to their names. These people expect a level of service and product quality when they travel. Our advice to New Zealand tourism businesses is to invest what you can now to enrich your offer to suit Asian markets including accommodating multiple languages and different cultures.”
“Not all Chinese travellers are the same but their language is by-in-large universal. Where possible, ensure your product can communicate with them from basic translated factsheets to multi-language audio guides and personal translators. A Chinese traveller isn’t going to truly appreciate an $800 scenic helicopter trip if they can’t understand what they are seeing or experiencing,” says Mr Lee.
Auckland Airport has some ambitious targets to significantly grow the value New Zealand sees from Chinese travellers as part of its Ambition 2020 initiative.
The Airport believes by 2020 Asia, especially China, will provide the largest growth potential both in visitor arrivals and in the amount they spend when they’re here. Asia could provide $2.9 billion of the projected $8.5 billion in inbound tourism value by 2020, with China providing the lion’s share at $1.5 billion.
Glenn Wedlock, Auckland Airport General Manager Aeronautical Commercial, says China is a vital market for New Zealand with annual growth of about 20 per cent likely.
“Auckland Airport has a number of initiatives in place to promote New Zealand to Chinese travellers including the Luxury New Zealand initiative, as well as our work in growing air links with China. We are also investing in helping the industry become better equipped to market to and service the Chinese traveller through the launch of our market intelligence workshops.”

Sharjah eyes massive Chinese tourism market

The number of Chinese travelers to Sharjah has seen a dramatic increase in recent years in tune with the growing phenomenon of Chinese visitors flocking to exotic destinations around the world. The number of Chinese visitors to Sharjah has jumped from 8,231 in 2009 to around 30,000 last year, over a period of three years whereas the emirate recorded a 5% increase in the Chinese tourists last year.

The Sharjah Commerce and Tourism Development Authority hopes to exploit and expand this promising market further in months and years to come.

“Our objective is to make the most of the growing Chinese and Asian interest in Sharjah and to benefit from the immense potential the fast burgeoning Chinese and Asian tourism market,” said SCTDA Chairman HE Mohamed Ali Al Noman. He pointed out that with 20 million tourists a year, a figure that is projected to cross 100 million by 2020, today China is easily the biggest tourism market in the world. “We need to tap into this massive market,” he added.

The SCTDA is leading a delegation of high fliers from the emirate’s travel and tourism industry and government agencies to BITE for the seventh consecutive year as part of the Authority’s strategy and efforts to enhance Sharjah’s profile on global tourism map and attract more visitors from Asia and China.

Al Noman said that in recent years Sharjah has seen a surge in Asian and Chinese tourist interest in the emirate.

Al Noman said: “Our participation in BITE is in line with our commercial and tourism marketing strategy and is aimed at keeping ourselves abreast of the new trends, ideas and opportunities in the global tourism bazaar. In the past few years, Sharjah’s tourism industry has witnessed rapid growth in infrastructure and service sectors. This in turn encourages and drives new investment opportunities in the tourism industry in the emirate.”

The SCTDA is looking to use its presence at BITE as a focal point to attract more Asian and Chinese tourists to Sharjah. The Authority will showcase the cultural capital of the Arab and Islamic world at the Beijing exhibition from a uniquely designed stand, which received the Best Exhibitor Award last year for its design excellence. The SCTDA launched its Chinese website last year to cater to this growing tourism market.

The Sharjah delegation, led by the SCTDA, will include Shurooq (Sharjah Investment and Development Authority), Sharjah Museums Department, Coral Beach Resort Sharjah, Hotel Holiday International, Golden Tulip Sharjah, Sharjah Grand Hotel and Fairmont Holidays.

Established in 2004, the Beijing expo has emerged as one of the major international tourism and travel exhibitions and networking events of the industry, bringing the best and brightest from the East and West together in the Chinese capital.