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China - hype or opportunity? 

Almost 300 people wanted to come to our recent Tourism Network Meeting about the Russian and Chinese markets (see the VisitBritain presentations) so there is clearly strong interest in this market. We’ve asked Roy Graff to give some of his insights on the market. He’s just come back from 3 years working in China for Gullivers Travel and Octupustravel.com and speaks fluent Mandarin Chinese so is well placed to comment on the current opportunities. Roy now specialises in helping companies target the Chinese market.

There probably isn't one hotel, incoming operator, tour attraction or travel service provider who doesn’t hope to cash in on the much hyped Chinese tourist bonanza.

China's population just topped 1.3 billion people. 150 million of them are financially able to travel abroad; outbound tourism has been growing at a phenomenal 26% annual average for the past 5 years, and could top 35 million in 2005.

Now that Britain has signed the coveted ADS agreement with China, are we about to be flooded with Chinese tourists who will visit all the UK attractions, spend thousands of pounds on travel and shopping and transform our travel industry?

Apart from the uncertainties associated with both the tourism industry and China politics, answering this question requires separating hype from facts. Much about China remains shrouded in a fog of misunderstanding, a result of both the short time that China has had her doors open to the west and our own Euro-centric education and world view. To understand the Chinese travel market we need to understand not only China's modern economy and social structure but also her history and culture. This certainly can’t be addressed in a short article, but we can look at the practical realities of this market.

Approved Destination Status is awarded by China's National Tourism Administration (CNTA) in a bilateral agreement sanctioned by China's Foreign Ministry. To date, China has awarded this status to 90 countries and territories. An ADS destination can be visited by mainland Chinese groups over 5 people for the purpose of leisure tourism.

The destination is allowed to open a tourism promotion office in China, advertise freely in the specified markets and cooperate with ADS licensed Chinese travel agents. However, it has no effect on other travel sectors such as FIT, business travel or study abroad and is limited to specific geographical markets in China, typically Beijing, Shanghai and Guangdong province.

The announcement of ADS for Britain came last February. It will take several months for the agreement to come into effect, which is wise considering there is much preparation work needed. The ADS agreement stipulates that the destination country prepare a list of authorised inbound suppliers and only these are allowed to receive the Chinese tour groups. VisitBritain has yet to compile that list or decide on the criteria, so forward thinking companies can take the lead and prepare themselves now to ensure they will be the first port of call for the tour groups from China. Even prior to the agreement taking effect, opportunities exist to attract business cum leisure groups and wealthy FITs.

Chinese tourists are eager to discover new destinations and bring back pictures and souvenirs of their travels. They are good shoppers and followers of trends. With the right product and service they will be an extremely lucrative market that has the power to drive UK's travel industry for many years to come. But we should consider the 89 other destinations competing for their custom, many of which have been actively promoting in China for several years. Chinese groups prefer to visit a multitude of countries in a single trip which makes EU a more attractive offer currently, with a single visa covering many countries.

As an industry we should lobby for an integrated policy on visa that will allow tourists to add Britain to their European itinerary. As individual companies we can start now to prepare an attractive product for Chinese visitors, understand what they like and what they buy, and importantly, how to market these products successfully in China. If you have not had experience with this market yet, some practical tips can get you started, but it is important to obtain updated information as much as possible - China moves too fast to encapsulate in an article:

Language- either hire a Chinese speaker or ensure your information is translated correctly. Mandarin Chinese is the official dialect, and simplified Chinese is used in Mainland China. Taiwan and Hong Kong use Traditional Chinese characters.

Food- while they may like to try local cuisine occasionally, comfort food when in a foreign land is still Chinese food. Breakfast items like soy milk, steamed dumplings or congee will be appreciated and Chinese restaurants that cook authentic food need to be on the itinerary.

Normally you can tell authentic restaurants by the number of first generation Chinese customers. In places with less choice, it is necessary to work with the restaurant manager and chef on special menus for Chinese groups. You will get extra points if you find out the local specialty from their home province and provide it to them as a surprise half way through the tour.

Shopping- people who travel to Europe have usually already visited Southeast Asia and experienced high pressure shopping tours. Show them that Britain is different by allowing them freedom to shop with ease. They look for souvenirs that either cannot be found in China, or that are very expensive there, but reasonable over here.

Web- if you have a website, preparing a Chinese version will give your potential customers a glimpse of what you offer, and comfort in researching their trip in advance. Mirroring your site in China and paying attention to its design, is as important as the language. China's internet users have different tastes to western ones, and sites on overseas servers are often slow to access and sometimes unavailable altogether.

Prepare now for the Chinese market, and begin the process of building your brand in China.

Roy Graff
Owner - China Consulting on Tourism Action


 

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