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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.

Ctrip, 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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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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Niuyue Cap on the head, Shanghai Travelers’ Club “Platinum” Card in hand, Wealthy Chinese tourists arrive in New York City

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: Chinese Tourists Blog

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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.

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From complimentary Chinese tea to social media marketing, U.S. hotels try hard to entice more Chinese guests

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.”

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The new generation of Chinese tourists in Hawaii

Somewhere between Chen’s Gourmet Buffet and the statue of King Kamehameha, Wayne Lu lost half his audience.

Lu is a tour guide for a Honolulu travel company called Dragon Tours & Travel, and his audience is a group of 30 vacationers from mainland China on the first day of a whirlwind, 12-day, eight-city tour of the United States.
He met them in the morning at the airport, whisked them off to see the Arizona Memorial, then brought them to lunch at Chen’s, an all-you-can-eat Chinese buffet along Nimitz Highway. There, he made a prediction: “Fifty percent will fall asleep after lunch.”
After a 15-hour trip to Honolulu from Shanghai, via Tokyo, the group was beat. By the time its motor coach stopped across from Iolani Palace, beside the Kamehameha statue, Lu’s prediction had come true. Despite his amiable, nonstop patter, at least half the bus had nodded off.

“They always fall asleep after lunch,” Lu said again, after his bleary-eyed charges descended from the motor coach to take photos beneath Kamehameha’s outstretched arm.

Meet the weary pioneers of Chinese leisure travel, forerunners of a rapidly building new wave of wealthy and middle-class visitors from the People’s Republic of China. Increasingly, you can find them piling out of buses at the usual tourist attractions, or forking out huge sums for designer handbags and watches at luxury shops in Ala Moana and Waikiki, or learning the hard way that haggling at the Apple Store will get you nowhere.
Although they make up a tiny fraction of the 7.2 million visitors overall that Hawaii  saw last year, their numbers are growing quickly—from 28,664 in 2001 to 79,531 in 2011. Just as China’s economy surpassed Japan’s as the world’s second-largest in 2010, so, too, could the number of Chinese tourists in Hawaii  someday surpass the number of Japanese tourists.

“One day, in my opinion, it will happen,” says Sadie Goo, China market brand manager for the Hawaii  Tourism Authority. “Given that China’s population is 1.4 billion, and they have so many wealthy people and so much disposable income, they will eventually be the No. 1 outbound source market in the world.”

To make the acquaintance of these fledgling travelers with the potential to transform the face of Hawaii’s visitor industry, HONOLULU Magazine shadowed Lu and his 30 travelers on their two-day tour of Oahu.

Fewer than 15 percent of Hawaii’s Chinese tourists come to Hawaii as independent travelers, booking their own trips, following their own schedules, renting cars and confounding local drivers unfamiliar with China’s first-is-right rule of the road. The majority of Chinese tourists in Hawaii today come with group tours, often part of steeply discounted, multi-city packages that jam as much Hawaii into as little time as possible.

Such was the case for Lu’s people, who Dragon Tours, agent for the Hawaii leg of their trip, would host for their two days on Oahu. After that they were off to Los Angeles, San Diego, Las Vegas, Buffalo (with a side trip to Toronto, for those with Canadian visas), New York, Washington, D.C., and, finally, San Francisco. Honolulu was just the first dot on the map.
Escorting them from Shanghai across America and back was the trip leader, Zeng Wei Ji, a boyish 45-year-old who introduces himself to Westerners as “Ricky.” Ricky studied to be an industrial engineer, but, 20 years ago, he got an opportunity with a Hong Kong-based travel company to lead a tour to the United States. He’s been an international trip leader ever since. Originally, his company catered to groups from Hong Kong and Macau, but, in the last few years, it’s expanded to mainland China. Now that’s where almost all his tour groups come from.

The competition among travel agencies for these outbound Chinese travelers is highly competitive. If one company offers an all-inclusive, nine-city, 12-day trip across America for the ultra-rock-bottom low price of, say, $2,000 (as Ricky’s company does), another company will offer the same thing for $1,950. Then another will come along and offer the same deal for $1,900. “It’s a hard business,” Ricky explained. “Everybody undercuts everybody.”

For China’s fledgling world travelers, the smart choice is widely regarded as the package that offers the greatest number of foreign cities for the least amount of money. “They think  that is the best deal,” Ricky said. “But they will spend most of their time sitting on buses.”

Tourists from mainland China are not hard to spot, at least to Lu’s seasoned tour-guide eyes. “They don’t dress like the Japanese or the Koreans,” Lu said while waiting at the airport that morning for his group to emerge from customs. Even their suitcases look different, he said: “Their luggage is always more beat up. It looks like it’s had lots of rough handling.”

In contrast to the fashionably dressed mass of Japanese tourists outside the airport’s international terminal, Wu’s 30 travelers, once he’s rounded them up, looked perfectly unassuming in their simple plaids and stripes, denim jeans, starter jackets and sequined sweaters. A few wore bulging fanny packs, and all appeared to wear off-brand, no-nonsense shoes. One otherwise matronly woman wore a T-shirt adorned with a bejeweled heart and the words “Good Love First Time.”

China’s growing ranks of millionaires and billionaires aren’t the ones blasting through Hawaii on tours like these. Among Lu’s group there was an accountant, several retirees and a cagey man who claimed to be a bus driver, then said he was a clerk, but, frankly, had the air of a low-ranking Communist Party official. There were also two young women who worked for different travel agencies. They were each traveling alone, on vacation, and had just met, but were clearly destined to be great friends. To keep accommodation costs down, Ricky had paired them as roommates for the duration.

For decades, the Chinese could travel to the United States only on business, as students or to visit family. The door opened to tourism for the sake of tourism in 2008, after the U.S. pledged to speed up the glacial pace of its visa processing, and China, in turn, granted the U.S. “approved destination status,” allowing Chinese visitors to come here for no better reason than to sightsee and shop. From 2008 to 2011 the number of Chinese visiting Hawaii climbed by more than 25,000.
Last August, China Eastern Airlines launched the first direct, regular air service from China to Hawaii, with 287-passenger flights arriving from Shanghai every Tuesday and Thursday. These are expected to push Chinese visitor numbers for 2012 above the 100,000 mark.

While the Japanese are still way out ahead, with 1.3 million travelers expected this year, the Chinese stats come with a footnote that has the visitor industry abuzz: the Chinese spend more. Way more. Last year that amounted to $382 per person per day—nearly $100 more than the Japanese, who have have traditionally been Hawaii’s biggest spenders.

Much of this spending is on luxury goods at high-end shops like Chanel, Tiffany & Co. and Gucci, brands which are available in China, but always with heavy tariffs and the spectre of the counterfeiter. “You can buy what looks like a Gucci bag in China,” says Frank Haas, dean of the hospitality, business and legal-education program at Kapiolani Community College, “and never really be sure it’s authentic.”

Hawaii’s tourism machine has been gearing up for this lucrative new market for some time now.

Delegations of high-ranking state officials frequently trek to China to promote tourism and trade. The Hawaii Tourism Authority has opened offices in Beijing and Shanghai, and launched a Chinese-language version of its website. The Bank of Hawaii has made arrangements with China’s largest issuer of bank cards, permitting electronic transactions with thousands of merchants throughout the Islands. Shops from Luxury Row in Waikiki to the factory outlets in Waikele have been staffing up with sales people fluent in Mandarin.
Nobody, however, has rolled out the red carpet quite like Starwood Hotels & Resorts, whose Hawaii hotels include The Royal Hawaiian, the Moana Surfrider and the Sheraton Waikiki. Mandarin speakers greet Chinese visitors at the front desk when they check in and check out, and are on hand around the clock to troubleshoot. There are amenities in the rooms to which the Chinese are accustomed, such as tea pots, green tea, slippers and fresh toothbrushes. There’s Chinese programming on the TVs and Mandarin translations of most hotel literature, including menus, which feature dumplings and congee (rice porridge) for breakfast. There’s a general awareness of Chinese cultural indiosyncracies, such as the association of the number four with death. A Canadian traveler probably wouldn’t think twice about Room 444, but a Chinese traveler might sleep better elsewhere.

Using the curriculum Starwood developed, more than 2,000 hospitality workers throughout the visitor industry have gone through crash courses in Chinese cultural fundamentals at Kapiolani Community College, learning that “nihao” means hello and that one should not be taken aback if the Chinese, not the world’s greatest huggers, seem a little stiff during the Hawaiian lei greeting.

While Hawaii is figuring out how to make the Chinese feel at home, the Chinese are figuring out how to travel abroad gracefully.

There are some high cross-cultural hurdles to clear. Take tipping, for instance, which isn’t something they are accustomed to doing, or haggling, which isn’t something they are accustomed to suppressing. “Bargaining and haggling are the Chinese tradition,” says Ted Sturdivant, president of the Hawaii Chinese Tour Association and publisher of a guidebook to Hawaii for the Chinese. “In fact, it’s fun for them.” Tour companies don’t typically warn Chinese visitors that U.S. retail prices aren’t negotiable, according to one visitor-industry insider, because they don’t want to deflate their morale.

Then there’s the delicate matter of bad manners. Complaints about the bad behavior of early waves of Chinese leisure travelers abroad so alarmed the state-run China Daily that it declared the culprits had “damaged the image of China as a civilized country.” The China National Tourism Administration, along with the Office of Spiritual Civilization Development Steering Commission, followed up with a list of dos and don’ts for international travelers, including: don’t spit, don’t litter, don’t talk loudly, don’t cut in line and do observe the “ladies first” rule.

Lu’s group wasn’t ill-behaved, so perhaps the outbound Chinese are absorbing the government’s etiquette tips. Or maybe everybody was just too tired to get into any trouble. In any case, after 12 minutes at Kamehameha’s statue, the group got back on the motor coach and headed for The Waikiki Sand Villa, an aging budget hotel located across the street from the Ala Wai Canal. It is not a Starwood property. There are no Mandarin speakers at the front desk, and breakfast consists of toast, juice and coffee. But the signs warning pedestrians to stay off the automobile ramp have been translated into Mandarin.

Ricky handled the check-in and Lu announced he would meet everybody back in the lobby in three hours so they could walk together to the Chinese buffet at Hokele Restaurant for dinner. He would also show them how to get to the DFS Galleria, where foreign travelers can shop duty free.

It was important that everyone could find their way back to the duty-free shops after dinner. There’s no profit margin for Dragon Tours in selling cut-rate packages like these, which are known in the industry as “zero-dollar tours.” Instead, the money is in the commissions Dragon gets for selling add-ons, like submarine rides and sunset cruises, and for bringing business to restaurants and retailers, like the shops at DFS Galleria.

Lu’s group was on the move again the next morning, seeing Waikiki Beach, the Diamond Head lookout, and luxurious Kahala homes through the motor coach’s darkly tinted windows. A few brand-new iPads, purchased the night before, came out to record the sights. After a 20-minute stop at Haunauma Bay, and another 20-minute stop at the Blow Hole, the motor coach barreled back into town and rolled to a stop on unglamorous Young Street, in front of a jewelry store called Keoni.

During the drive, Lu put in a few good words for black coral, red coral and black pearls, all of which are prominently featured in the Keoni collection. The group dutifully filed into the display room, where elegant young women stood behind glass counters, ready to deal. Johnnie Fong, Keoni’s owner, greeted Lu warmly and slipped him a crisp $20 bill for his trouble, then slipped the bus driver a $10.

Fong said he moved Keoni from Waikiki to Young Street specifically to accommodate bus tours like these. While this particular group didn’t show much interest in his jewelry, “it just takes one good customer,” as Fong put it, to make the whole thing worthwhile. When the group boarded the motor coach, 20 minutes later, only one piece of the Keoni collection went with it, a relatively inexpensive olivine stone.

As the motor coach headed back for Waikiki, Lu put in some good words for the healthful benefits of Hawaiian noni and an antioxidant product from the Big Island called BioAstin. Both of these could be found at the group’s next stop, AMW Wholesale, a vitamin and souvenir shop hidden away on the second floor of the Waikiki Trade Center. Lu’s shoppers were far more enthusiastic about this place than the jewelry store, and as they followed him to their next stop, lunch at China Garden Restaurant, they carried bags full of mac nuts, Hawaiian chocolate, BioAstin and noni in its capsule, tablet, soap, gel and body lotion forms.

After lunch Lu, turned the group loose in Waikiki for more shopping. He returned later that afternoon to take the 16 who had signed up for the sunset cruise to Pier 8, where they would board the Star of Honolulu. “Sixteen’s pretty good,” he said. “Not great, but pretty good.” The next morning, he would pick everyone up at 4 a.m. and take them back to the airport for their early morning flight to LAX and the beginning of the rest of their grand American tour.

“They will spend a lot of time on the bus,” Ricky said before taking back the reigns of the tour from Lu. “When they get home, they will show their family and their friends the pictures, and they can tell everybody that they have seen the United States.”
Source: http://www.honolulumagazine.com

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