They involve the young, rich and educated and those from second-tier cities., associate editor of Jing Travel, the travel news publication that focuses on Chinese travel trends—especially among the well-to-do or luxury travels—left little doubt when she spoke to delegates at NAJ’s RTO Summit East in New York on what she and Jing see as the top two trends for the world’s largest source country for outbound travel.
Trend Number 1—the Rise of FITs:
- A shift from group travel to independent travel is taking place/has taken place.
- There has been a shift from visiting o seeing the “most famous
sights and things to “authentic” experiences.
- There has been a shift from a reliance on travel agents and tour guides to digital tools.
- Customized itineraries are now de rigueur.¹
FIT travelers are: young (mostly millennials), well educated, affluent, have skills in languages other than Chinese, are digital and “live by WeChat.”
What kind of travel product are they looking for? Pan said that the new FITS have a growing appetite for holistic, experiential vacations. This could include:
- Experiencing local life
- Self-driving tours
- Sampling new cuisines
- Discovering cultural events like the museums, theatres and concerts
Pan pointed out that Key Opinion Leaders (KOLs) are extremely influential online, with scores of bloggers who have a million followers or more. Recently, a Chinese travel blogger with 69.3 million followers on Weibo posted a video documenting his latest safari trip to Dubai, creating a boomlet in interest in the destination.
Digitally, the behavior of the new FITs is reflected in the exponential growth of WeChat, the growth of Weibo (“China’s Facebook”) and the recent launch by Ctrip, China’s dominant online travel agency, of a “customized travel platform” and virtual tour manager.
Pan’s advice on what do in order to accommodate the rise of FITs:
—Use the right digital tools.
—Embrace the digitalization of the market and nurture new customers online.
—Understand the difference between digital platforms.
Trend Number 2—Travel from Lower-tier Cities:
“Don’t just focus on tier one cities,” Pan told delegates, predicting that China’s second- and third-tier cities will be the primary drivers of economic growth and demand for international goods and services in the future. This is due to the fact that per capita incomes are rising rapidly in many of these Chinese cities.
China has 15 cities that have metropolitan areas of more than 10 million people. The largest of these—Guangzhou, 44.3 million; Shanghai, 36 million; Chongqing 25.2 million and Beijing—have been the principal source of long-haul travel to date. But other cities, with populous metropolitan areas, further away from the country’s eastern arc, have been getting international airline service and are beginning to generate substantial numbers of outbound travelers. These include cities such as Jinan, Xi’an, Tianjin, Chengdu, Wuhan, Fuzhou, Hangzhou, Harbin, Shenyang, Qingdao and Nanjing.
Pan told her audience that those who are serious about cultivating business in tier two cities should have representation offices in those cities.
¹ At roughly the same time Pan was delivering her presentation; Ctrip Customized Travel and the China Outbound Tourism Research Institute (COTRI) issued a report, on the customized travel patterns of Chinese visitors to Europe, which showed that European travel saw a 130 percent year-on-year increase between 2016 and 2017.
Overall, the Chinese customized travel market in 2017 grew rapidly, and it already accounts for 10 percent of the whole outbound business.
Speaking at the Customized Travel Summit in Budapest, COTRI director Dr. Wolfgang Georg Arlt said: “The demand and consumption of customized travel by Chinese consumers is unique. Such travel patterns are not common in Western countries, where they are typically limited to middle-aged and older customer groups from high net worth backgrounds. Customized travel in the Chinese market, therefore, is unique in that it is characterized by its popularity, youthfulness, and high growth rates.”