China-U.S. tourism on growth trajectory

Chinese family at beach - China elite focusChina-U.S. tourism is on a growth trajectory and can help promote closer people-to-people links between the two countries, CEO of China’s top online travel service provider Ctrip has said.

Ctrip sees huge growth potential for Chinese tourists traveling to the United States, Jane Sun said at Columbia University Business School’s Chazen Institute of Global Business.

Last year, a record of 1.3 million people booked air tickets to the United States on Ctrip, she said. The company served in 2016 more than 160,000 Chinese tourists who traveled to the U.S. by providing package tours and other tour products, she added.

GERVOIS magazine Advertising and sponsored content opportunities“People are entrepreneurial in China and want to explore opportunities in other markets. That’s why there is a lot of demand for travel from China to Australia, Europe, New Zealand and the U.S. along with other areas,” said Sun, who was recently rated by Forbes China as one of China’s most powerful business women.

Ctrip made strategic investment in three U.S. tour operators to support the demand by Chinese for trips to the United States last year.

Sun said that there was still room for growth and that her company wanted to further expand its market share.

“I have lived in both the United States and China and I cherish the friends I have in both nations. Travel can be a bridge between the two countries,” she said.

Gervois magazine - Marriott HotelsCtrip, which had an initial public offering on the Nasdaq in 2003, is an industry heavyweight with over 30,000 employees and market valuation of about 25 billion dollars.

“Ctrip is doing a great job to promote the U.S. as a luxury leisure destination” added Pierre Gervois, CEO of China Elite Focus Magazines LLC, a New York based publishing company specialized in luxury travel magazines in Chinese Mandarin. “I have a lot of admiration for Ctrip’s business model.  When I was living in Shanghai, I have been one of their customers for all my plane tickets reservations”

Statistics showed that the number of Chinese tourists traveling to the U.S. jumped by 14.7 percent in the first three quarters of last year from a year earlier, while the number of American tourists traveling to China increased by 7.3 percent during the same period.

Source: Xinhua

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With more Chinese tourists traveling abroad, hotels expand their chains in the U.S.

Chinee couple - China Elite FocusMore and more Chinese tourists are visiting the US and other foreign destinations and hotels in China are also expanding their chains in these places. In 2015, more than 2.5 million Chinese came to the US, and that figure rose significantly in 2016, which was designated “2016 China-US Tourism Year”.

One hotel group aiming to cash in on this rising trend of Chinese tourists visiting abroad like never before is Shanghai-based Green Tree Hospitality Group, which has five hotels in Arizona and California in the US. Kevin Brooks, a co-managing director, said the company operates more than 2,000 hotels in China that range from budget or limited-service options to five-star designations. He said that a Green Tree budget or limited-service hotel in China is similar to a Holiday Inn Express in the US. To quote Chris Petroff, co-managing director, “About 18 months ago, the company decided to expand in the US; and last year, we converted five hotels to our brand. In 2017, we have embarked on franchising.” Petroff said that the company is hoping that existing franchise operators in China will aim for US location to spread the brand name.

Gervois magazine - The new travel magazine for millennials travelers in the United StatesDriven by an increasingly growing middle class, Chinese outbound tourists are expected to reach 150 million in 2020 from 122 million in 2016, with an estimated average annual growth rate of 5.09 percent, according to the China National Tourism Administration. Another growing segment of Chinese overseas travelers are parents sending their children to study in the US. Alex Xu, the founder and chairman of Green Tree, envisions the company as a global brand, “We are also exploring other countries in Asia and Europe for expansion.” In addition to traditional inns, online marketplaces like Airbnb, which enables homeowners, renters and others to offer accommodation to travelers, are also expected to benefit from rising Chinese outbound tourism.

Source: travelandtourworld.com.

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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.

Things 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.

Gervois magazine - The new travel magazine for millennials travelers in the United StatesI 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.

Around 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.

From 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.)

GERVOIS magazine Advertising and sponsored content opportunitiesOn 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).

In 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.

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Luxury hospitality guru Pierre Gervois on how to cater to Chinese tourists in the U.S.

Watch Pierre Gervois’ exclusive interview for China News

Pierre Gervois - TV interview for China News 2016

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Chinese tourists spend more than $1Billion in Los Angeles last year.

Shanghai Travelers Club magazine - March 2016 coverChinese tourists have been making their presence felt around the world but one place they can’t seem to get enough of is Los Angeles, California.

780,000 Chinese tourists visited L.A. last year, spending more than $1.1 billion. Last year also marked the first year that China overtook Canada as the city’s second-largest source of international tourists.

Los Angeles has long promoted itself as a tourist destination in China, and was the first city in the world to open a tourism office in the country in 2006. At the time, China was not even in the top 10 of international visitors to Los Angeles.

“Chinese visitors are spending more money than others, and they are staying longer,” said Ernest Wooden Jr, president and CEO of the Los Angeles Tourism and Convention Board. “They are one of our best visitors, and that’s why we have such a focus on our marketing efforts in China.”

To that end, aggressive marketing efforts called “China Ready” and “Nihao China” are currently targeting cities like Beijing, Shanghai, and Guangzhou in order to boost numbers even more.

Lisa Pisaturo, director of international and domestic tourism sales at Universal Studios Hollywood, said she expects the number of Chinese tourists to continue to grow.

“We experienced double-digit growth over the last year, so that’s an indication to us that it hasn’t really affected the groups that are traveling,” she said. “The middle class and affluent Chinese families may spend less on shopping, but it sounds like, from everything we hear, that there are still big groups that will be traveling.”

In 2014, about 7,000 Chinese tourists visited Orange County in an eight day trip, breaking records at the time. The event was estimated to have earned $85 million for the Anaheim area in which the 7,000 attendees had filled 13,000 to 14,000 hotel room at some 30 area hotels.

Even Los Angeles fashion brands like Sharpe have now Chinese fans: The Cover of the prestigious Shanghai Travelers’ Club magazine of this month’s issue (March 2016) is about Sharpe and features a full story about this brand created by Leon Wu in Los Angeles.

Source: Charles Liu, The Nanfang & China Daily / Chinese tourists blog

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2016 year of U.S. tourism for Chinese tourists boosts travel to NYC

Shanghai Travelers Club - Whyte hotel brooklyn

An article about the Whyte Hotel in Brooklyn published in the Shanghai Travelers’ Club magazine (March 2016 issue)

If there was just one thing the world’s two largest economies could agree on both wanting, tourism would be it.

China and the United States announced this week in Beijing that 2016 will be the year of mutual tourism promotion, one of the outcomes of President Xi Jinping’s visit to the United States last year.

The focus on tourism between the two countries come as overseas travel booms in China, in fact more Chinese vacation abroad than any other nation. More than 120 million Chinese traveled abroad last year, up 12 percent year on year, and they spent $104.5 dollars, up 16.7 percent over the same period.

“The scale and the speed with which the market grow is quite remarkable,” said Fred Dixon, CEO of NYC & Co., the agency responsible for promoting New York City, the top US destination city for Chinese travelers.

Despite New York being the top destination less than 3 percent of Chinese outbound tourists go to the United States. The Republic of Korea, Japan and Thailand are much more popular choices, partly because of their proximity.

Despite this, Chinese visitors to the United States has been growing at a double digit rate over the past few years.

In 2015, 2.67 million Chinese visited the United States, compared with less than 400,000 in 2007. Goldman Sachs estimates that the number of Chinese visitors will almost double to 5 million by 2025.

This growth prospect has excited tourism players across the States. Many have sent delegations to China and the news about the tourism exchange will no doubt see them double down their promotional efforts.

“New York City is definitely the #1 dream destination in 2016 for Chinese travelers” said Pierre Gervois, Publisher of the Shanghai Travelers’ Club magazine, a luxury travel publication for affluent Chinese travelers planning a trip to the United States. “The attractivity of NYC is extremely stong for all categories of Chinese travelers, from Chinese  real estate investors to students. We now publish more than 30% of our editorial content about NYC, per request from our readers”, Gervois added.

Travel agencies and tourism promoters say a more powerful boost to Chinese tourists inflow to the US is visa relaxation. In November 2014, the two countries extended visa validity for tourists from one to 10 years.

This policy has pushed up the share of Chinese travelling to the United States purely for leisure. Data compiled by various popular destination cities in the United States show that for Chinese visitors, leisure travelers have begun to outnumber business travelers in many places.

Gervois magazine - The new travel magazine for millennials travelers in the United States“The 10 year visa extension is really a game changer,” Dixon said, adding that the relaxation has paved the way for more Chinese to visit the United States for pure leisure and on their own, instead of on business trips or organized group tours.

Chinese online travel service provider Ctrip also reported a surge in US visa application through its platform between January to August last year following the visa relaxation.

With more tourists heading to American shores on their own, tourism promoters say they are reviewing their messages here in China. While travel agencies are still valuable partners, they have begun to engage with prospective travellers directly.

“In the very beginning our work was very much about working closely with the trade on the group side, but now we are seeing a move toward independent travel,” Dixon said.

That shift led promoters to prioritize their online presence, as websites, social media and apps have become prime channels for information and planning.

More than 259 million Chinese booked their travel online last year, of which 80 percent did so on their mobile devices, according to China Internet Network Information Center.

The demographics are changing too. China’s outbound travel boom is fueled mostly by a new generation of travelers. 67 percent of China’s overseas tourists in 2014 were born after 1980s, data compiled by Goldman Sachs show.

All these changes impact travel decisions. Promoters say group travelers want to see iconic sites and things they have seen on TV and in the movies. But reaching out to the new generation of savvy Chinese outbound travelers takes more than that.

The appeal for them, Dixon said, lies beneath the surface, in lesser known communities, parks and museums that add more personal character to their travel experience.

“This is an exciting time,” he said. “You don’t often see a market emerge the way China has. And we probably won’t see anything like this again.”

“Retaurants for hipsters in Brooklyn & boutique hotels in former industrial buildings are now packed with Chinese travelers: This is the future” concluded Pierre Gervois

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United targeting more Chinese passengers

United - Shanghai Travelers Club magazineUnited Airlines aims to woo more Chinese flyers after agreeing a deal to offer Alipay online payments on its Chinese language website.
United has partnered with Ant Financial, the Alibaba unit which operates the Alipay platform, giving United access to more than 400 million registered Alipay users.
Users on the United website can click the ‘Pay with Alipay,’ button which connects to a user’s debit card, credit card or a cash balance on their account.
“This exciting new partnership with Ant Financial’s Alipay is another good example of our strong commitment as we prepare to celebrate 30 years of doing business in China in 2016,” said Walter Dias, United’s managing director for sales in Greater China and Korea.
“I am confident that this service enhancement will offer more Chinese consumers the chance to travel to the U.S. along with our convenient China-U.S. flight schedules and Chinese services, both on the ground and in the air.”
More than 2.5 million Chinese visitors came to the US in 2015 and that figure is set to rise significantly this year, especially as 2016 has been designated ‘2016 China-US Tourism Year.’
This is a joint effort by the two governments to encourage more travel between the US and China, supported by the recent easing of visa restrictions.
Source: Travel Mole.

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