In recent weeks the Chinese marketing engine has been whirring with restaurants, hotels, airlines and tourism agencies all focusing their efforts on the February 10thcelebrations that will mark the beginning of the year of the snake.
But the hospitality industry is not the only one with eyes on China. The upwardly mobile, and increasingly on the move, Chinese consumer is also the focus of governments. An estimated 80 million Chinese are expected to go abroad this year, and a quarter of those will travel further afield than the popular destinations of Hong Kong and Macau. According to ChinaContact’s managing director, Roy Graff, who will be speaking at EyeforTravel’s upcoming Travel Distribution Summit in Singapore this represents a huge and growing opportunity for both companies and countries that are able to adapt to needs of Chinese people and the unique challenges in China.
On the public sector front, only a few weeks ago the UK press reported that the Chinese consumer spends on average £1600 when they visit Britain. “That’s a lot of money,” says Best Western GB’s chief executive, Richard Lewis, who will be speaking at the EyeforTravel’s European Travel Distribution Summit. “And if they are spending that sort money then we need to understand exactly what the Chinese consumer is looking for.”
One thing they are definitely not looking for is a lengthy visa application process. In the UK this is around 25 pages long and has to be completed in English. This could explain why right now Europe and the USA are leading the way in attracting visitors from emerging BRIC markets. For every one Chinese tourist who visits Britain, eight go to Paris and ten visit America.
Making the visa application process less arduous would certainly be a good first step from the public sector, says Graff.
A moving target
There are also opportunities — both on the international and domestic travel fronts – for the private sector to more accurately engage with the Chinese consumer. Big hotel names like Hilton, Marriot and Accor, have already put Chinese-tailored programmes in hotels popular with Chinese visitors. Yet more can be done to attract the growing numbers of international travellers.
Getting under the skin of the Chinese consumer, as Best Western’s Lewis recognises, to really understand what they want is key but that is a moving target. The stereotype of the Chinese traveller is of a person wanting a group package, but as the world has got smaller the Chinese have become far more intrepid. “They don’t want to necessarily travel in groups or be told what to do but they do still want action packed itineraries,” says Graff.
One area where foreign travel firms can really up their game is on the social media front. “The Chinese are very social and love to share images and content with others while on the road,” says Graff. So facilitating the ability to share and tag content and check-in to places while on site – and not just on Twitter and Foursquare but also on Chinese equivalents like Sina-Weibo — could be a competitive advantage.
The Chinese also prefer user-generated content over official channels which, “makes it a very lively environment for review sites and travel tourism boards”. The Australian Tourism Board and Canadian Tourism Commission are a good example of organisations that are actively engaging with the Chinese consumer on social media. Singapore Airlines’ social strategy in China is another to look at, says Graff.
Since Twitter and Facebook are still banned in China, brands must turn to local equivalents. “Sina-Weibo is the biggest and the easiest for the travel industry to monetise because of its public nature,” says Graff. However, just because brands have a Facebook marketing and media strategy does not mean the same applies for China. Content has to be local and relevant. According to Graff, the campaigns that work well are those that involve competitions or prizes or use a viral online game that is then shared. To have a profile on Sina-Weibo is free but to be verified as the trusted official source of a brand you need to submit a business licence and so on. Graff admits that it is a bit bureaucratic and using a specialist agency China will make life easier.
Word-of-mouth marketing, localised marketing, working with social media and engaging with the travel trade – through newsletters or exhibitions – are all ways that foreign firms can up their game. However, nothing beats a local presence or at the very least a partnership with local firms.
Domestic challenges
There are a number of challenges facing foreign companies that wish to play in the Chinese travel distribution landscape. There obvious ones are language and culture, but should not be underestimated. China is a big country and in every province there are differences of language and culture and acceptable business etiquette can vary widely. For this reason Graff says it is really important to conduct thorough research and to fully get to grips with the “lie of the land”. Having a local presence can certainly help. Chinese consumers are wary of brands they don’t know so with local partners or local presence on the ground, it will be very difficult to succeed.
Issues around intellectual property and copyright protection highlight this only too well. At the moment only Chinese companies can have a dot.cn domain name and if you haven’t got this registered a copycat might. “The solution is to partner with a local company to act as a proxy and register this for you,” says Graff.
Rapid adopters
Much of the technology and innovation that is happening elsewhere can also be applied to the Chinese market. In every area there are opportunities, providing companies are willing to adapt to local circumstances. For example although they are quick to adopt new technologies, the Chinese are still not that comfortable with booking online. While this changing and market for online travel is growing at twice the pace of overall travel industry, today firms that are able to offer a hybrid payment solution will fare better.
One thing that is arguably preventing growth in online travel – especially on the domestic front – is high card charges. Low-cost labour in China still allows many domestic firms to offer a real-world agency or call-centre at an affordable price, so this is unlikely to change in the short term. It also makes it harder for foreign online players to compete.
Still, there is everything to play for as just 15% of the 1.3 billion strong population book online. Just consider what Chinese online travel-booking site, Qunar.com, is hoping to achieve in 2013. The company’s chief executive was recently quoted saying that he expects to double online sales to about $160 million this year. Moreover, 20% of bookings are expected to come from mobile devices. The company’s mobile app was downloaded over 25 million times by the end of 2012.
It seems that all eyes will be on China this weekend and for the foreseeable future.
To find out more about how you can take advantage of the exciting travel market, join us during May in Singapore for the Travel Distribution Summit Asia or in London for Travel Distribution Summit Europe.
Source: Eye for Travel
