As the number of Chinese outbound travelers continues to grow, new opportunities and challenges for destinations around the world are on the rise as well. Given this, 2018 finally saw an impressive uptick of savvy Western destinations and cultural institutions staking their claim to this most desirable travel segment. Here, Jing Travel offers our year-end look at 8 (traditionally a lucky number in China) of the most important factors influencing Chinese outbound travel this year.
Take My Visa – Please!
2017 was a big year for visa exemptions and visa facilitation for Chinese citizens, and while 2018 didn’t see quite the same rise in Visa growth, it was a year in which a few countries (the United Arab Emirates and Belarus) took radical new steps in the process by offering visa-free access to Chinese tourists. There aren’t many other major destinations around the world that will offer visa-free travel for Chinese citizens, but the desire to make travel easier for China’s tourists is stronger than ever, and destinations from Europe to Thailand are insisting on easier visa requirements for China’s travelers.
Mobile Pay, All Day
Last year saw an explosion of mobile payments from Chinese tourists, particularly via the trusted Chinese apps WeChat Pay and Alipay. While introducing mobile payments isn’t a shortcut to luring more Chinese tourist arrivals, not having these payment options available definitely results in a major spending loss for retailers, particularly those in travel markets. The fact that mobile payments operators — not tourist destinations or online travel agencies — were the big winners at this year’s Golden Week holiday is further proof that these apps are taking over, and now, other businesses want a piece of the pay app pie. Japan’s ANA airlines announced that it was developing its own mobile payments platform this year because of mobile pay’s popularity with China’s tourists, and Japanese banks are following suit, hoping to popularize mobile payments in Japan for similar reasons.
College Road Trips
Renowned universities in countries like the United Kingdom, Australia, and the United States remain major draws for Chinese students looking for a leg up in the job market — both in China and around the world. The growing popularity of studying abroad has also led to the booming trend of “educational tours” where families pay thousands of dollars for their children to tour prospective universities, and surprisingly, it’s a craze that has been the most lucrative per capita of any major travel segment for the U.S. travel market.
“I’m a loner, Dottie, a rebel”
Group travel is still king when it comes to the Chinese — both domestically and internationally — but China’s younger generations are increasingly opting for independent and solo travel. China’s Single’s Day shopping holiday (11/11) saw a major boost in sales for solo travelers on China’s most popular online travel agency, Ctrip.
Women Rise Up
One big change among independent Chinese travelers is the gender ratio. Two years ago, 54 percent of free independent travelers (FIT) were men. Now, that number has risen to 58 percent, according to a Ctrip report released this year. That’s a major shift in the Chinese travel market, although it reflects how a majority of travelers from the world’s most important tourism markets are now women. So in some ways, it shows how the Chinese travel market is slowly transforming into something that more closely resembles its Western counterpart.
The Daigou Death Knell
One major facet of the outbound Chinese travel market that is actually in decline is the practice of re-sellers traveling abroad to buy luxury products for their clients on the cheap. This customer segment has been a reliable source of revenue for luxury retailers in Japan, South Korea, and Europe for years. These “daigou” (as they are called in China) have been hit hard by Chinese authorities cracking down on their services in an attempt to drive more domestic spending. Daigou have adopted some new strategies to get around rules limiting purchases abroad, but these new laws may end the importance of this practice to luxury brands, many of which have come to depend on this part of the Chinese travel market.
Do Your Duty-Free
On the other end of the spectrum, luxury purchases are beginning to shift to retail outlets in China. The Chinese government is hoping that expanding allowances for duty-free purchases in China’s Hainan province (one of China’s most popular getaways) will make buying luxury goods in China a more attractive option than buying from gray-market daigou re-sellers. Expect to see more efforts like this next year as the government continues to try and keep Chinese luxury purchases within China.
We All Scream for Activities!
If there was any big up-and-coming change in the travel market this year, it was in the explosion of interest in the activities market. This year, Hong Kong-based Klook became a unicorn and Alibaba made high-profile investments into travel activities companies. What makes activities such a worthwhile market is that it allows companies to offer experiences that fit into both independent and group travel plans. Given the shift in the Chinese market from group travel towards independent travel, it’s hard not to see the potential in this type of travel marketing.