At the World Economic Forum in Davos yesterday, Ctrip CEO Jane Sun predicted the number of Chinese passport holders would grow to 240 million by 2020. Currently, about 120 million Chinese citizens hold passports, about 8.7 percent of the population. If Sun’s prediction is correct, then the potential market of Chinese outbound tourists will effectively double in only two years.
Ctrip CEO, Jane Sun, predicts that the number of Chinese passport holders will double to 240 million by 2020
It’s a bold prediction, and given the gap of 120 million passport holders, it seems unlikely. Then again, outbound travel is growing increasingly popular in China. Chinese consumers are growing more affluent and traveling around the world from China is becoming cheaper and more convenient.
A big part of the increased ease of international travel for Chinese citizens is the growing power of the Chinese passport itself. On the Henley Passport Index, which ranks the relative power passports by citizenship, the Chinese passport rose 10 places to 75th overall for 2018. A big part of this growing strength stems from the rising number of visa-exempt agreements between China and other countries, along with visa on arrival and e-visa agreements.
The growing power of both Chinese consumers and the Chinese passport itself will drive Chinese outbound tourism
All of this means that tourism stakeholders and destination marketing organizations (DMOs) have a big opportunity to market their offerings now for a huge number of potential customers.
While a Chinese citizen may not be able to travel abroad now, making potential travelers aware of what’s out there through smart marketing will likely help make destinations and service providers secure a new wave of customers.
Just as significant in this regard is understanding that these new travelers will have basically no travel experience. DMOs especially need to be able to reach these future travelers and show them what’s on offer at a destination that these travelers may be wholly unaware of.
These new tourists will have no experience, so it’s up to DMOs and travel firms to inform them of what’s out there
Nonetheless, it’s very likely that most of these new travelers will be going abroad closer to home. Whether it’s because of concerns over long travel time or the potential cost of a European or North American getaway, a nearby destination like Indonesia, Vietnam, or Japan may prove more attractive.
Indonesia especially has an edge in this regard because of its visa-exempt agreement with China. But that doesn’t mean that European or North American destinations can’t succeed.
Many of these new outbound tourists will be younger, giving “aspirational” destinations like the United States and Europe an advantage
Aspirational travel is more important for younger travelers, which will undoubtedly make up a large portion of this growing number of passport holders. Destinations like the United States and France are already very much on the radar of China’s youth. Being able to inform potential travelers about specific U.S. or European destinations will help immensely in attracting these new travelers.
While it may be unlikely that a new Chinese tourist will travel across the world for the first time to go to Seattle or Chicago over New York or Los Angeles, it doesn’t mean that lesser-known destinations won’t be on their itineraries.