Welcome to Ruder Finn’s travel and tourism newsletter.
With this newsletter, we aim to provide our clients and others in the travel and tourism industry with a broad overview of the latest trends and newest regulations related to the Chinese travel and tourism industry.
This month, a variety of trends are shaping the industry:
A significant number of Chinese continue to travel with a purpose…
- A 2008 study by the European Travel Commission, an industry group, estimates that Chinese tourists reserve more than a third of their holiday budgets for shopping.
- Tourism is certainly not about discovering new food. A 2006 survey of Chinese coach travellers found that 46% had eaten “European” food only once, and 10% not at all, during holidays on the continent.
Chinese tourists are becoming more and more sophisticated…
Jiang Yiyi, from the Centre for Recreation and Tourism Research at Peking University, said outbound tourists are generally well educated, with at least a 5,000-yuan ($750) monthly income, and are aged from 25 to 44. “They speak English and use the Internet. These tourists are also willing to try new things,” she said. Chinese tourists are filling the gap left by other tourists for a number of destinations…
- The International Visitor Survey Far North Queensland for the year that ended in September 2010 shows Chinese holiday makers are up by 81 per cent
- Ho Chi Minh City’s Department of Culture, Sports and Tourism, said there has been an increase of 189% Chinese visitors, as compared to last year.
- The number of Chinese tourists to the US is set to pass the 1 million mark by the end of this year, the National Tourism Administration of China said. The 2 million mark is likely to be passed in 2015, the State agency said.
- A fall in the number of visitors to New Zealand from Britain and continental Europe was offset by more tourists from China (up 34.5 per cent to 14,875).
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Director, Travel & Tourism
About Ruder Finn China’s Travel and Tourism Experience
Over the past 12 years, Ruder Finn China has developed and implemented numerous multi-faceted public relations programs in the travel and tourism sector. Ruder Finn’s work on behalf of international clients includes projects and programs promoting countries, airlines, resorts and major tourist destinations.
Ruder Finn China’s travel and tourism experience, combined with its worldwide track record, offers its clients a combination of truly knowledgeable local and international teams, delivering results that meet their needs and objectives – on time and on budget. Feel free to get in touch with us to discuss your requirements. Our contact information is indicated at the beginning of this newsletter. We look forward to hearing from you!
China Travel Industry News
China Consumer and Economic News
China Travel Industry News
The Travel Gold Rush 2020
Travel Weekly Web, December 1, 2010
Amadeus and Oxford Economics have just released The Travel Gold Rush 2020, a recent study featuring the key findings in the global travel and tourism industry.
Here are some key points from The Travel Gold Rush 2020:
- The global travel industry is making an uneven recovery from the recession. 2010 has seen a return to growth with global arrivals increasing 5.6 percent in the first six months of the year. However, Europe remains sluggish and there are lingering economic concerns. Hotspots remain Latin America and Asia-Pacific.
- Asia will represent one third of travel spending by 2020 – up from 21 percent today. Asia will account for nearly 22 percent of global arrivals by 2020 (up from 18 percent in 2008) and the region’s residents will account for 32 percent of travel spending by 2020.
- The global aviation industry mirrors these trends. Whilst it is forecast to return to profitability in 2010, its forecast annual net profit margin is only 0.5 percent. Questions over industry viability and the need for new revenue sources remain.
- Agents face the additional challenges of the demise of commission-based travel and increasing use of the internet in place of traditional F2F contact; and thus likely to reinvent their role as bespoke travel advisors and as a trusted source of information.
Options for Growth
Ancillary revenue generation has spread from low cost carriers (LCC) to major carriers and become an increasingly important source of revenues; however uncertainty remains about how important they will be in the long term, especially to major carriers. Nonetheless, with estimates suggesting that ancillary revenues contribute anything up to 35 percent of revenues in the future, the industry needs to fully understand where the opportunities lie.
Exploring The New Frontiers
Emerging nations’ travel habits remain the great unknown. The demographic trends associated with Western travellers may be less relevant when applied to the emerging markets.
Macroeconomic Forecasts for Future Travel
As indicated below, in terms of resident trips abroad, average 10 year growth rates range from 4.1 percent per annum (Europe) to 6.0 percent per annum (Asia Pacific) with China in isolation accounting for 6.9 percent.
High-tier tourism market not influenced by hike of CPI
Nanfang Daily, December 1, 2010
China’s CPI continued to rise in Q3. Chen Baiyu, President of GZL International Travel Service Co., Ltd was recently quoted as saying that the tourism market will be in part impacted by the CPI rise, however high-tier tourism should not be affected.
Invitation process opens for ILTM Asia 2011
Travel Weekly Web, December 7, 2010
Invitations to take part in ILTM (International Luxury Travel Market) Asia, the only luxury travel event dedicated to luxury travel buyers from across the Asia-Pacific region, are now open to VIP Buyers and Exhibitors at the 2011 event, 13 – 16 June 2011, Shanghai. ILTM Asia is exclusively created for Pan-Asian buyers, planners and designers of luxury travel to meet directly with the world’s leading luxury travel suppliers in a series of bespoke pre-scheduled one-to-one meetings. Founded on a strict qualification process for both buyers and suppliers, ILTM Asia only brings together the very best from the global luxury travel community to this exclusive, ‘invitation-only’ event.
India, China to drive global tourism industry
Indian Express, December 8, 2010
According to Hospitality 2015: Game Changers or Spectators by Deloitte, the middle classes of China and India along with the aging population of the US are the two key demographic trends that will create new patterns of travel and demand. It says the middle classes of China and India will create new trends as their travel patterns evolve from domestic to regional to international.
China’s tourists are carving out a new European itinerary, with some unexpected stops
Economist, December 16, 2010
In China foreign travel is part of a slightly different compact between the state and the new middle classes: unprecedented freedom and fun in exchange for the maintenance of one-party rule at home.
China’s newly mobile middle classes like to visit established European spots like the Eiffel Tower, the Louvre and Venice’s Grand Canal. But the visitors have also marked out a grand tour all of their own, shaped by China’s fast-developing consumer culture and by distinctive quirks of culture, history and politics. The result is jaw-dropping fame, back in China, for a list of places that some Europeans would struggle to pinpoint on a map: places like Trier, Metzingen, Verona, Luxembourg, Lucerne and the Swiss Alp known as Mount Titlis.
A sketch map of the Chinese grand tour must begin in France, the country seen as offering all the essential European virtues: history, romance, luxury and quality. Paris shops such as Louis Vuitton are essential stops: witness their Mandarin-speaking staff. The south of the country is also popular, thanks in part to a slushy Chinese television mini-series, “Dreams Link”, which was filmed amid the lavender fields and walled citadels of the Midi. China’s freshly minted millionaires and billionaires are particularly obsessed with the wine country of Bordeaux, as red wine has taken over from expensive brandy as the business lubricant of choice.
From France, Chinese groups typically travel south towards Italy via the casinos in Nice or Monaco. Venice and Rome are stops for every nation’s tourists, but the Chinese grand tour also demands a visit to Verona.
In Germany cities such as Bonn and Trier are as important as more obvious sites like Cologne and Frankfurt (a hub for many China flights). A short drive from Frankfurt, Metzingen (headquarters to suit maker Hugo Boss) is home to several factory outlets, where Chinese shoppers vie with Russians and Indians as the biggest spenders.
As France means wine and handbags, Belgium means chocolate. Most Chinese think Belgian chocolate too sweet, although this does not stop them buying large quantities for friends and colleagues back home.
Many of the Chinese tourists in the Benelux countries are members of daibiaotuan, official or business delegations with a reputation as boondoggles. As a result of this bureaucratic orientation, the grand tour’s Belgian leg includes stops outside the Berlaymont, as the headquarters of the European Commission is known. In Luxembourg the Chinese tourists pause just long enough to photograph the palace of its reigning grand duke.
France, Germany, Belgium and Luxembourg all lie within the Schengen Area, a border-free zone that can be visited on a single visa. This appeals to Chinese tourists, who must submit reams of papers and face a long list of intrusive questions about their finances, employment and personal circumstances to obtain visas for Europe. In 2008 Switzerland joined the Schengen club and Chinese visitor numbers instantly soared. In Switzerland the essential stop is the canton of Lucerne. With a lake, an historic city and mountains all in a compact area, it amounts to a “mini-Switzerland”, saving time. Surprisingly few tourists visit Britain.
Enjoyment isn’t the point
Chinese tourists know they are more coveted for their money than loved in Europe. In surveys of Chinese travel agents, the continent is most frequently described as “beautiful” and “historic” – but rarely as friendly. Europeans are described as both “civilised” and “cold”. Even before they leave China, the travellers are nagged to mind their manners and told to act as “ambassadors” for their country. Several times in the past few years the Spiritual Civilisation Steering Committee of the country’s Communist Party has issued chivvying circulars calling on Chinese tourists to avoid queue-jumping, loudness or haggling in shops with fixed prices.
The European travel industry uses the sniffy phrase “sleep cheap, shop expensive” to describe Chinese visitors. Chinese tour operators are notorious for bargaining down travel and hotel costs. A 2008 study by the European Travel Commission, an industry group, estimates that Chinese tourists reserve more than a third of their holiday budgets for shopping.
Tourism is certainly not about discovering new food. A 2006 survey of Chinese coach travellers found that 46% had eaten “European” food only once, and 10% not at all, during holidays on the continent. This is because excitement and acquisition are prized over pleasant, relaxing experiences. The Chinese are keen on European luxury, they just aren’t so interested in luxurious hotels and lavish meals. Coming from a newly affluent, increasingly unequal society, they have a strong preference for the accumulation of material goods. After all, a Swiss watch lasts a lifetime, whereas “if you want a good bed, you can have that at home.”
A new vision of Europe
The face of Chinese tourism is also rapidly changing. The heyday of the daibiaotuan has passed. A decade ago, an official fancying a holiday more or less had to land a spot on one of these delegations, paid for from state or company funds or by joint-venture partners from the West. Today, such delegations are under much more scrutiny, and tourist visas are easier to obtain. Many travellers are now on their second or third visit to Europe: group tours are duly slowing down and stopping to savour local culture. Individual tourism is tipped as the next big thing. Yet individual visitors may create itineraries no more conventional than those dictated by tour groups. Their list of important sights and experiences does not resemble the genteel image that Europeans have of their own homeland—it includes more duty-free shopping, for a start. But it is a fresh vision. With their economic power and hunger for new experiences, China’s restless middle classes have conjured a new Europe into life.
Foreign-invested travel agencies “will bring more experience and benefit”
The Beijing News, December 24, 2010
In July, China began to permit foreign travel agencies to engage in outbound travel services in the Chinese market. Sun Changcai, a manager from CITS, shared his views on this subject, stating that this will bring more concepts and experience to Chinese counterparts as foreign tourism operations began 100 years before those in China.
“Innovation” becomes key word for online travel service
China Consumer Journal, December 27th, 2011
According to a report issued by the travel website www.qunar.com, the online travel service offers more convenient services for visitors compared with conventional service styles. “Innovation” has become the highlight word for online travel services.
Travelport is first foreign GDS to partner with a university in China
Travel Weekly Asia, December 27, 2010
Travelport, the business services provider to the global travel industry, has signed a groundbreaking training partnership agreement with Shanghai DongHua University. This is the first time a Chinese university has partnered with a foreign GDS for training. The new Travelport training course is open to fourth year students studying travel and tourism at the university.
Five highlights for tours during Spring Festival
Mirror, December 28, 2010
A recent survey shows that the highlights for 2011’s Spring Festival tour are : 1) chartered plane tours, 2) Canadian and American tour, 3)higher-tier tours, 4) island tours and 5) New Year’s Eve dinners abroad.
Ctrip.com issues “Report on 2011 Tourists’ Propensities”
www.travelweekly-china.com, December 29, 2010
On December 29, Ctrip.com issued the “Report on 2011 Tourists’ Propensities for Tours”. Several thousand web citizens took part in the survey. The results showed: 1) citizens continue to favour tours; 2) self-service and leisure tours are the preferred tours; 3) websites are the main channels for tour reservations; 4) expenditures on tours will rise in 2011; 5) over-spending at home is the top reason why consumption abroad is reigned in.
China Consumer and Economic News
MasterCard Spending During Shanghai World Expo
Asia Travel Tips, December 3, 2010
Total spending by MasterCard cardholders in Shanghai during the Shanghai World Exposition (Expo) 2010, held between 1 May and 31 October 2010, more than doubled from the same period last year. The total number of transactions made by MasterCard cardholders in Shanghai also rose by just over 100% during the Expo period.
BCCI picks up slightly
Shanghai Morning Post, December 12, 2010
UnionPay and Xinhua News Agency have jointly released the Xinhua • CUP Bankcard Consumer Confidence Index (BCCI for short) for November 2010. Statistics show that in November, the BCCI was 85.86, achieving a year-on-year increase of 0.17 but a month-on-month drop of 0.81 of a percentage point. Cardholders’ expectations for price dropped and short-term income growth combined to slightly push the BCCI up.
New sign of macro adjustment about inflation from Central Economic Working Conference
21st Century Business Herald, December 13, 2010
Li Daokui, academic member to the central bank’s monetary policy committee (PBOC Monetary Policy Committee), forecasted that the economic growth in 2011 will range from 10.3% to 10.5% and that the CPI will be over 3% but no more than 5%.
Over one quarter of the urban population use online banks
Beijing Youth Daily, December 16, 2010
According to a survey from CFCA (China Financial Certification Authority), 26% of urban residents use online banking services on a regular basis.
Exchange rates for RMB rise in Nov
21st Century Business Herald, December 17, 2010
On December 16, according to data from BIS (Bank for International Settlements), RMB nominal and actual exchange rates have resumed their upward trend from the slight fall in November, with rising groups of 0.72% and 0.47% from last month. Rising scopes have reached 32.8% and 56.6% since 1994, respectively.
Individual Chinese tourists could bring in US$40 mil. to Taiwan
The China Post, December 8, 2010
Taiwan’s tourism business could well be poised to gain an excess US$40 million in revenue next year as mainland Chinese tourists will be allowed to Taiwan for individual visits starting Jan. 1, a local realty agency has forecasted.
Taiwan’s Tourism Bureau will launch its individual visit scheme for business tourists from Beijing and Shanghai at the start of the next year, allowing a maximum of 500 individual tourists to enter Taiwan daily on top of the current quota for visitors in tour groups. This signals a theoretical increase of mainland tourists of over 180,000.
Taking into consideration the average buying power of mainland Chinese tourists of US $232 per person per day, the individual tourists could potentially bring extra revenues of over US$40 million to the Taiwan market, said Bright Lee, communications manager of the Yung-Ching Realty Group
French tourism products promoted
www.travelweekly-china.com, December 8, 2010
The tourism promotion entitled “Have a Date with France” was recently held in Beijing, Shanghai and Guangzhou. Atout France China Office collaborated with 22 French tourism agencies that were promoting their products.
America tour without security deposits
www.travelweekly-china.com, December 13, 2010
Nanhu International Travel Service has launched a tour to America that does not require a security deposit. Previously, visitors were required to pay RMB 50,000 as security deposit before being permitted to participate in tours to America.
Number of Chinese visitors to Far North Queensland doubles in 12 months
www.travelweekly-china.com, December 13, 2010
The number of Chinese visiting the Far North has almost doubled in a year, while the numbers of Japanese are almost back to the pre-global financial crisis levels, the latest data reveals. The International Visitor Survey for the year that ended in September 2010 shows Chinese holiday makers are up by 81 per cent to 58,000, while the Japanese have almost topped 100,000 (up 1 per cent to 98,000). Overall, international holidaymakers to the region have grown by 1 per cent to total 612,000, up 6000 on 2009.
Surge in Chinese visitors to Ho Chi Minh City
Saigon Daily, December 13, 2010
The number of Chinese visitors travelling to Ho Chi Minh City by air has increased dramatically in the first eleven months of this year. The city’s Department of Culture, Sports and Tourism, said there has been an increase of 189%, as compared to last year.
The department said that China has become one of the top sources of foreign arrivals in the city for the very first time. Vietnam welcomes from between 70,000- 90,000 Chinese visitors each month.
Free and easy tour in Australia
www.travelweekly-china.com, December 14, 2010
After nearly one year of operations, the self-service tourism product “A Wonderful Holiday at Qantas” jointly organized by Qantas, Tourism NSW and Melbourne, Victoria, Australia, has had a remarkable amount of attention. The organizations recently upgraded and renamed their tourism product.
Britain opens new visa service centre in Beijing
Beijing Times, December 16, 2010
The new British visa service centre began operations on December 15th, and is twice the size of the old centre.
Business before fun for Chinese
The Telegraph India, December 17, 2010
For the Chinese, an India trip means business before leisure. A survey by the Indian tourism ministry shows that more Chinese, compared with other foreign visitors, come with “business and professional’’ purposes. Of the 96,997 Chinese who came to India in 2009, as many as 50.4 per cent said business was their priority. Another 41.5 per cent said they had come on vacation and were looking for recreation, while the remaining 4.1 per cent had come to “visit friends and relatives’’. This is in keeping with the history of Chinese tourism to India, for Faxian and Xuanzang too came on business — to learn about Buddhism and acquire Buddhist texts — in the fifth and seventh centuries.
Brisbane makes China top priority for MICE trip promotion
www.travelweekly-china.com, December 20, 2010
Brisbane Marketing Director Business Events Annabel Sullivan recently travelled to Shanghai to meet with counterparts in Shanghai for further cooperation opportunities and held an industry training meeting to promote her city’s MICE resources.
Chinese head to U.S. for Christmas
China Daily, December 23, 2010
Thousands of Chinese tourists will spend the Christmas holiday period in the United States this year.
New York City, California, and Hawaii are among the more popular destinations as organizations such as United Airlines, Disneyland Park in California, the California Travel and Tourism Commission and the Hawaii Tourism Authority have been begun promoting luxury tours.
“The American tours for the coming holidays are the most luxurious and comfortable ones since the US opened as a tourist destination for Chinese citizens in 2008,” said Liu Chuang, manager of the American marketing department of byecity.com, one of the biggest online tourist agencies in China.
As a result, the number of Chinese tourists to the US is set to pass the 1 million mark by the end of this year, the National Tourism Administration of China said. And the 2 million mark is likely to be passed in 2015, the State agency said.
Guo Jianing, vice-general manager of Total Travel International Travel Services Co Ltd, said that thanks to the increase in personal income and the depreciation of the dollar, outbound tourism for his company has risen 30 percent this year.
Jiang Yiyi, from the centre for recreation and tourism research at Peking University, said outbound tourists are generally well educated, with at least a 5,000-yuan ($750) monthly income, and are aged from 25 to 44.
“They speak English and use the Internet. These tourists are also willing to try new things,” she said.
Surge in Chinese tourists to New Zealand offsets fewer Europeans
Stuff.co.nz, December 23, 2010
A record number of visitors from China helped boost the number of tourists to New Zealand by 3 per cent in November.
Last month 226,500 visitors came to New Zealand for a short period, Statistics New Zealand said yesterday. The numbers were up 6600 on the same month a year ago, but 3400 below the record for November in 2006.
A fall in the number of visitors from Britain and continental Europe was offset by more tourists from China (up 34.5 per cent to 14,875).
The Chinese market, boosted by growing trade with New Zealand and new direct air links, grew by 15 per cent in the year to the end of November, to 120,222.
Australia tours getting hot for Spring Festival
Beijing Business Today, December 23, 2010
According to travel agencies in Beijing, outbound travel registration is currently very popular in Beijing and Australia is the top destination for the city’s tourists. An official from a tourism website reasons that this is due to February being a peak season for Chinese travel and that Australia is favoured as it hosts several festivals during this period.
10-day California tour quotes not over RMB 20,000
www.people.com.cn, December 27, 2010
California Travel & Tourism Commission has launched a 10-day deluxe tour to California with quote of no more than RMB 20,000. So far, over 100 visitors in Guangzhou have registered for the tour.
South Australia Tourism launches interactive microsite
www.travelweekly-china.com, December 27, 2010
South Australia Tourism has launched the interactive microsite www.gotosa.net for visitors to gain easy access to see South Australia via mouse-click.
Boutique Series by Kosmopolito debuts in China
Travel Weekly Asia, November 29, 2010
Kosmopolito Hotels has announced the launch of Yue @ Century Park, Shanghai. The design-led hotel is the first in the Boutique Series by Kosmopolito in China. Other hotels in the Boutique Series include award-winning Lan Kwai Fong @ Kau U Fong, Central Park, and Cosmo Hong Kong. Hotels under the Boutique Series by Kosmopolito are experiential with design elements weaved into creative features.
IHG launches The Hotel Indigo brand
Travel Weekly Asia, December 3, 2010
Hotel Indigo, IHG’s upscale boutique brand, hosted a grand event in Shanghai, China, to celebrate its brand launch in Asia Pacific. Hotel Indigo Shanghai, the 184-room property on the Bund and the first Hotel Indigo in the region, is expected to open by the end of 2010.
Club Med Opens First Int’l All-Inclusive Ski Resort In China
Hotel Interactive, December 7. 2010
Sixty years after its creation, Club Med officially opens the very first international ski resort in China, Club Med Yabuli, on Nov. 27, 2010. This is Club Med’s first undertaking in China.
Conrad, Doubletree properties open in China
Travel Weekly, December 30, 2010
The luxury Conrad brand has made its debut on the Chinese mainland with the opening of the Conrad Sanya Haitang Bay. Opening alongside the Conrad is the Doubletree Resort Sanya Haitang Bay. Hilton Worldwide owns both the Conrad and Doubletree brands.
Dubai considers selling stake in Emirates
Breaking Travel News, December 1, 2010
Investors from around the world will be offered an opportunity to take a stake in Emirates Airlines as Dubai considers the sale of state assets. The emirate remains approximately $110 billion in debt to creditors, despite a bailout from neighbouring Abu Dhabi earlier this year. With swathes of its debt due for repayment over the next two years, all options are being considered.
The emirate is “working on opening the capital of some of our leading companies to the public,” explained Sheikh Ahmed bin Saeed Al Maktoum, chairman of Emirates Airlines and a three-man committee charged with plotting the emirate’s economic recovery. Control of the airline would remain with Dubai for the foreseeable future Sheik Al Maktoum said.
Air China launches flight-shuttle bus combined ticket for domestic routes
Travel Weekly Asia, December 27, 2010
Air China today became the first Chinese airline to offer combined tickets that include domestic flights and shuttle bus services to nearby cities. The first combined flight-shuttle bus ticket will connect Tianjin via shuttle bus with domestic flights passing through Beijing. The service will later be expanded to hub cities such as Shanghai and Chengdu, connecting them via shuttle bus to their peripheral cities.
The new service will expand Air China’s network and make it much more convenient for passengers living in cities surrounding the nation’s airport hubs. Previously, passengers transferring to or from a shuttle bus had to fill out a form to carry on their journey. But now passengers are able to check, book and buy combined tickets on Air China’s website or through the sales hotline.