The noiseless, cashless journey from pre-pandemic to post-pandemic China. While much, if not most of the travel-related news discuss in China’s consumer and trade channels focuses on the present pandemic-driven crisis, a recent webinar featuring a Dragon Trail Interactive presentation prepared for ChinaDaily and featuring George Cao, Dragon Tail’s CEO, effectively took a look forward and what it is happening with digital consumer trends in China and how that will impact post-pandemic Chinese digital behavior.
Key points noted in the presentation, from a report by The Moodie Davitt Report, included the following:
• The pre-pandemic digital landscape offered plenty of variety and was saturated with many players. The market was highly susceptible to change; Chinese customers made purchasing decisions based on word of mouth and were often prone to abandoning older platforms for newer versions. Said Cao: “A few years ago, Alipay was the most popular mobile payment application. However, customers switched to WeChat Pay, which now dominates 40 percent of the market.”
• So, it’s a different and crowded landscape. The average Chinese internet user flits between 15.5 apps and social platforms on their phones every day. Some of China’s most popular applications and social platforms include WeChat, Sina Weibo, Douyin, Kuaishou, and Xiaohongshu. Each platform is used for a myriad of functions and can be leveraged to seize lucrative commercial opportunities for the tourism and travel retail industries
• China’s digital landscape is mobile-driven. The country has over 788 million smartphone users, with over 98 percent using mobiles over desktops.
• A video boom has been underway. Prior to COVID-19, China was experiencing a video boom, buoyed by the rising popularity of short-video platforms such as Douyin and Kuaishou. More than three quarters (78.2 percent) of China’s online population used short-video platforms at the beginning of 2019, which rose to 96 percent by June of the same year. According to Cao, 821 million people in China spend at least 58 minutes each day consuming video content on their mobile phones. These have combined to lead to the rise of China’s lucrative live-streaming industry.
• Social word of mouth is important—the social factor is decisive for purchasing behavior.
• China now has a de facto cashless society. In China, more than $41 trillion was spent via mobile payments in 2018; $36 trillion in payments was spent for the first three quarters of 2019.
• The rise of live streaming has been dramatic. Live streaming’s growth, said Cao, is one of the most important digital trends that has emerged during the crisis. In China, there are 560 million live stream viewers, encompassing 62% of all internet users in the country. The trend skyrocketed during lockdown, with live stream ecommerce sales projected to reach $14 billion in 2020 (up from $4.4 billion in 2018).
The live-streaming trend has also been adopted by Chinese celebrities and CEOs. Gree Electric’s CEO, Dong Mingzhu, reached almost $100 million in sales during her company’s live-streaming event on June 1st, while tech entrepreneur and KOL Luo Yonghao produced US$17 million in his first live-streaming event. Trip.com Chairman James Liang — who has now become a live-streaming celebrity in China — has sold over 520,000 hotel room night stays across 11 live streams since March.
• COVID-19 has changed the Chinese traveler’s online journey. Before the COVID-19 crisis, the traditional digital customer journey began with inspiration, research and planning, followed by booking, interaction with providers, consumption of products and services during the trip, and then sharing the trip online. In China’s case, each step of the customer journey is determined by different sets of applications and social platforms. This journey, Cao emphasized, has been completely transformed by the global health crisis. Today, it is now characterized by virtual experiences such as online exhibitions, augmented reality and live-streaming.
Importantly, the post-pandemic customer journey collapses the long process of awareness building, inspiration, evaluation and purchasing into a single event. Products are purchased before the research phase, leading to several challenges and limitations in planning.
• Digital will become more prominent in the travel planning process, Cao noted, highlighting the role of mobile tools and platforms, particularly video streaming. He also stressed the importance of understanding the data for these new trends.
• The expectation for contactless services in a post-pandemic marketplace will also change in-destination experiences significantly, said Cao. He pointed that most consumer journeys for travel will now be primarily completed through lifestyle and ecommerce platforms.
• It is critically important to choose the right platform to navigate China’s growing social ecommerce ecosystem. Customer research is key and leveraging data will help companies understand the changes in China’s ever-changing digital landscape and control the consumer journey in a more efficient way.
(For the full article on the above, click here.)
Three Factors Affecting How Chinese Travelers Choose Destination after Pandemic. Complementing the above article, which explains to the reader the three factors affecting how Chinese travelers choose a destination after COVID-19 pandemic, which greatly changed Chinese travelers’ mentality. After the pandemic, some factors will affect how Chinese travelers choose their holiday destination in a more significant way. Those used to be popular might be less attractive. They include the following.
• Destination Safety – Crowded popular attractions might not be attractive.
• Geopolitics – Countries and regions joint hands with China in covid-19 combat might become more popular.
• Live Streaming – A new communication form for destination marketing.
(For the complete article, click here.)
Chinese Will be First to Travel Once Borders are Open
With restrictions on international travel to and/or from China that may overlap or, in some cases, avoided when some Chinese hold passports from Macau or Hong Kong, it is a challenge to speculate on when such travel will return to pre-COVID levels, but it appears that Chinese are more ready than others, according to a report by ChinaDaily.com.
The news site indicated in a recent article that Chinese travelers are likely to be the first to restart traveling after lockdown restrictions lifted domestically and internationally, with so-called “revenge travel” coming underway for the National Day holiday at the beginning of October—this according to a report by Rentals United, a vacation rental channel manager.
According to James Burrows, Rentals United’s CEO, China offers a playbook for other countries on how to contain the coronavirus, therefore the world can look to China for recovery strategies and as an indication of what to expect once travel restarts. As the majority of businesses resume in China, the two hardest-stricken industries—out-of-home dining and tourism—will witness huge rebounds when citizens’ attitudes gradually turn positive but cautious. More from Burrows follows:
—Citing a study by Kantar, a UK-based data and consulting company, he said that 82 percent of Chinese said they will resume their canceled out-of-home dining spending once the outbreak is over, and 78 percent will resume their canceled spending on travel.
—Both flight and accommodation bookings across the country have shown constant recovery since April, and peak recovery time is expected to arrive after September, especially during the National Day holiday a peak time for long-distance travel; it begins Oct. 1.
—Younger generations without families tend to be more adventurous and eager to travel first. On April 4, Tomb Sweeping Day, the first big holiday after the pandemic in April, 60 percent of the people who booked trips were below the age of 30, an increase from 43 percent in the same period last year.
—Travelers’ behaviors and preferences on destinations have changed during the outbreak. The mental and emotional effects of lockdowns push people out of cities to get away from crowds.
—”Our data is showing an upsurge in bookings at remote, off-season locations – especially for luxury rentals,” said Burrows. “Families are looking for longer stays at rural hideaways to isolate themselves while also being close to nature,” according to the report.”
—Group and guided-tour packages will no longer have as much appeal as before since social distancing rules are still relevant, the report said, however, self-guided and self-driven markets mark a huge opportunity for short-term rentals as they are more attractive for large families and off-the-beaten-track locations.
—As they determine how much to spend on a trip, Chinese consumers are seeking more economical options. A trip.com survey found that 85 percent of travelers in China will spend less than 10,000 yuan ($1,415) on travel this year. This segment accounted for only 27 percent in 2017, which suggest that mid-scale to economy-priced travel packages will likely to rebound faster.