How outbound Chinese travelers book, spend
 
How outbound Chinese travelers book, spend
22 FEBRUARY 2019 9:39 AM

Chinese travelers are becoming savvier, more independent and more demanding as they travel globally in greater numbers. Hoteliers at the Gulf & Indian Hotel Investors’ Summit talked about how critical it is to capture demand from Chinese guests.

ABU DHABI, United Arab Emirates—Every hotel company is aiming to secure its share of Chinese travelers, but to be successful, hotel sales departments must understand Chinese travel patterns and booking windows, according to sources.

At the recent Gulf & Indian Ocean Hotel Investors’ Summit during a session on Chinese travel trends, Carmen Hui, global commercial director of owner partnerships, Booking.com, said Chinese consumers plan their trips differently.

“China has two longer holidays that last a week and a few shorter ones that last three days, and if you do not know this diary you will miss that opportunity,” Hui said. “And understand the (Chinese travelers’) pre-planning calendar or you might as well not have a China policy.”

Katharine Le Quesne, senior director of hospitality consultancy HoCoSo, said surges in bookings are common around holidays.

“Holidays are pretty limited in China, apart from those for senior management,” she said. “Its national holidays see huge movements, so understand when the bulk of their travel is possible.”

Le Quesne said trips booked by Chinese travelers often outnumber other countries by the tens of millions.

“Most countries are behind the curve when it comes to the Chinese,” she said.

Stefan Leser, CEO, Langham Hospitality Group, whose owner Great Eagle Holdings is based in Hong Kong, said a “good share of Chinese business is done on the day of the booking, and a great deal is within three days.”

“Even though we are Hong Kong-based, we need a Chinese-specific team,” Leser said.

The number of global Chinese travelers is likely to grow, Hui said.

“Less than 10% have passports. We are just starting,” she said.

Le Quesne said the second area of analysis needed is where the Chinese are traveling.

“Mostly it remains short haul, as long haul takes up significant time,” Le Quesne said. “The Chinese government have given approval status to 130 global destinations and expect 300 million (Chinese travelers) to have passports in the next decade.”

Upon reaching their destination, Chinese travelers are more apt to schedule lengthy day trips, Le Quesne said.

“We have seen travel from Edinburgh to Skye for a day,” Le Quesne said.

Leser said longer bus trips have lost their appeal to travelers.

“Nine-days-on-a-bus travel has gone completely,” he said.

More mobile than ever
Panelists said a strong mobile presence is required to win Chinese bookings.

“It is hugely mobile, if not 100%,” Hui said. “There are twice the number of mobile phones in China as there are people in the U.S., and the Chinese are masters of e-commerce.”

Hui added that three companies dominate the internet in China—Baidu, Alibaba and Tencent—and said recent strides in translation technology have allowed the Chinese to become very adventurous “as long as they can get Wi-Fi.”

“You have to know which channels to leverage,” Hui added.

Leser said Chinese language skills are still a must in hotels, though.

“We have to have language capabilities as we have top-end (food and beverage), including Michelin-starred Chinese restaurants whose staff do not always speak English,” Leser said. “In the ultra-luxury bracket, we have seen the development of consumer behavior changing rapidly over the last five years. Then it was either Rolls Royces or bicycles. We just opened in the fall in a city I had not even heard of, with 8.5 million people, but when I saw the guest profile, it became apparent of the tech and service needs.”

Spend and brands
Shopping historically was the biggest demand driver for Chinese travelers, but now Chinese guests are spending more in entertainment and F&B, panelists said.

“I asked some Chinese travelers at an airport what they were going to do, and they said shopping, museums, a bungee jump,” Le Quesne said. “They are looking for experiences, and culture is important to them.”

Social media also plays a huge role in shaping Chinese booking behaviors.

“They do not want to waste time, and one of the ecosystems they live on to not do so is WeChat. (Hoteliers) must master it, and (WeChat) is Instagram, Facebook, Twitter all in one,” Leser said. “Know who are the influencers and that it is a 24/7 activity, because without this insight it is impossible to do a campaign.”

For Booking.com, Hui said the size of the Chinese travel world still came as a revelation.

“We, too, have a China team,” she said. “You have to be hyper-focused as to who your target is, and even if you are, you still have a lot of work, and the need for large investments. We co-branded an aircraft, we took over a metro station and entered a $500-million deal with DiDi, the Chinese Uber equivalent.”

Hotel sales departments must realize that it is difficult to grow their Chinese travel demand due to the practice of Chinese companies vertically controlling much of the overall travel experience, panelists said.

“Recognize that there are a lot of deals that are pretty much sewn up, but there is a rising number of educated, well-travelled, savvy tourists who are looking to book things more individually,” Le Quesne said.

Leser said he is seeing young adults traveling with their parents more commonly than families traveling with their children, while Hui said due to China’s one-child policies it is not unheard of to see six adults traveling with one child.

The panel also agreed that it’s still worthwhile for Western hotel companies to have flags present in China to foster recognition for travelers domestically and internationally.

“Being brand-present is to build equity. We have entered second-tier cities to be the first luxury experience in those places,” Leser said, who added the importance of having Chinese-language reviews of Western hotels.

Where to build to attract Chinese guests is no longer a case of concentrating on the top cities, Leser said.

“I would not have put my money on The Maldives, as there is not so much to do, but suddenly there is a report on it being the perfect place for honeymoons, and bingo!” Leser added.

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