Harnessing the dragon: Localization and the Chinese tourism market

When localization or travel companies consider how to get the most out of the global tourism market, it pays to go back to basics. Which country’s tourists spend the most? The answer shouldn’t come as a surprise. With a huge population, a growing, aspirational middle class and excellent transport links, China is the number-one tourism market worldwide. Chinese tourists spent a massive $292 billion on outbound travel in 2015, making them comfortably the most reliable source of tourist income for most of their destination countries. This has followed a consistent upward curve since the Chinese economic boom began in the 1990s, and is continuing to grow despite China’s recent economic stutter steps. Provisional numbers for 2016 suggest a growth rate of around 10% on 2015.

Where do they go?

The top five destinations in 2015 were unsurprisingly all neighboring countries in Asia — South Korea, Thailand and Japan, plus the Special Administrative Regions of Hong Kong and Macau, which are counted as foreign destinations. The next top five countries were all European — France, Italy, Switzerland, Germany and the UK. With such huge overall spend, even though these countries are lower down the list, the benefits for them are enormous — in the UK alone, Chinese tourists spent nearly $750 million in 2015.

A closer look at these numbers reveals some interesting trends. The vast majority of visits to Hong Kong and Macau were day-trippers from neighboring regions of Southern China, flocking to cities that have become meccas for shopping and gambling respectively.

In contrast, when Chinese tourists visit Europe, they take their time. The average length of stay in 2015 was two weeks, with most tourists spending a few nights in several countries — France and Italy for their art galleries and architecture, Germany to shop for high-quality manufactured goods, and the UK for the history and culture, especially the royal palaces.

Crunching the numbers for the UK, just under 270,000 visits were made by Chinese visitors to Britain in 2015, with their total spend of $732 million breaking down to an average of just over $2,500 per visit. The gender split of the 270,000 visits was even, with half made by women and half by men.

One interesting long-term trend is that the previous mainstays of Hong Kong, Macau and Taiwan are declining in importance. They lost 8% of their market share between 2014 and 2016, indicating that Chinese travelers are increasingly more ambitious in their outlook. This obviously represents a significant opportunity to firms based elsewhere in the world in terms of attracting Chinese visitors.

Who are they?

Most people probably have a typical (and stereotypical) view of the average Chinese traveler. They see them as older, and traveling as part of a group of similarly aged people. They will travel by coach around Europe or North America on a set tour of each country’s highlights — in the UK, they’d go to Buckingham Palace, Stonehenge, Stratford upon Avon (Shakespeare’s birthplace), Oxford and Cambridge for the universities and maybe Bath for the Roman ruins. They’ll stay in hotels booked months in advance through their group’s tour operator and won’t stray from their rigid itinerary.

This may have been how most Chinese people visited the West 20 years ago, but this idea bears less and less relation to reality. A recent study suggested that only 40% of Chinese tourists are over 40 and travel as part of a group, a similar proportion to Western countries. Over a third, 35%, were classed as “semi-independent” travelers — those who travel several times a year, sometimes as part of a set itinerary and sometimes organizing things themselves. This group was usually between 25 and 35 years old.

The remaining 25% of Chinese tourists are the most interesting in terms of analyzing where Chinese tourism is heading in the coming years. These are “independent” tourists who travel alone or in small, non-organized groups, and are between the ages of 20 and 25. These adventurous youngsters (similar to their slightly older, “semi-independent” counterparts) will research and plan their own trip using specialist websites and are heavily reliant on social media reviews and blogs for information on where to go next.

Another growing trend in Chinese tourism is family travel. In the past, family trips for Chinese tourists tended to be internal or to neighboring countries, due to the cost concerns of flying the whole family across the world, which any parent can relate to. However, there is a growing niche for family travel, fueled on the one hand by successful young professionals based abroad who are flying their relatives out for the holidays — Lunar New Year for example, which this year saw an 18% rise in family bookings for four or more people.

In addition, according to Forbes, “more and more families are also going on self-organized trips, looking for quality time for the whole family,” rather than the schedule of shopping and sightseeing that would have been the norm in the past. Another important aspect of the growing family holiday trend is that the vast majority of family trips, like the independent trips of younger travelers, are self-booked and self-researched.

Why do they go?

Twenty years ago, or even ten years ago, the answer would have been: mainly shopping and sightseeing. The aforementioned coach trips that shuttled groups of older Chinese tourists between five-star attractions used to leave very little space for any other activities. The stereotype ran that when they weren’t photographing Buckingham Palace or the Colosseum, Chinese visitors would be buying Gucci bags or Rolexes, taking advantage, according to TrekkSoft, of “significant price differences and generally better product quality and design.”

These days, however, the picture is changing rapidly. Some unscrupulous tour operators used to operate unsustainably cheap tours which included a “shopping trap,” forcing tourists to spend on shopping to make up the price difference, and a government crackdown on this has greatly reduced retail spend by Chinese tourists. The rising cost of housing and education in China has also made a difference, reducing the disposable income of Chinese people abroad.

As a result, the younger travelers now making up over half of the Chinese tourism numbers are looking for experiences rather than goods. They want to taste the local cuisine, drink the local wines with their meal and tour the vineyards with a savvy guide, rather than buy a $600 bottle to take home as a status symbol. They also value unique cultural experiences — a Scottish Ceilidh, an English football match or a Venetian gondola ride, for example.

One interesting trend in the next few years will be the rise of tourism linked to winter sports. The 2022 winter games have recently been awarded to Beijing and its neighboring mountainous areas, and in tandem with the spectacular stadiums and perfectly choreographed opening ceremony we have come to expect since Beijing’s summer Olympics in 2008, there is sure to be an increased interest in snowsports in China.

Established skiing destinations are already catering to this expected trend, with Canada putting in place a nonstop route between Beijing and Calgary. However, countries and resorts hoping to cash in should be aware that the majority of Chinese tourists will not have previously booked a skiing holiday — they’ll need plenty of guidance and a streamlined booking process, with a website to match.

How can you reach them?

As we’ve seen, increasing numbers of Chinese tourists are planning and researching their own trips rather than relying on agencies. This being the case, there are a number of relatively simple steps global companies can take in order to tap into this market.

Unsurprisingly, the first and most important thing travel companies can do to enhance their appeal is to effectively localize their content, including websites, brochures and, increasingly, videos, which will need to be perfectly subtitled or voiced over. Word of mouth being an important component of marketing in China, it’s always advisable that the content is written in an informal, relatable style, as if a friend were telling you about a favorite destination. With this in mind, it may well be that transcreation may be a better approach than translation, but of course all content should be approached with an open mind.

As always, a coherent search engine optimization strategy should go hand-in-hand with effective localization. A comprehensive approach that establishes Baidu (China’s equivalent to Google) search volumes and then weaves the resulting keywords into the final text will ensure potential bookers can find your website.

Another important factor to consider is mobile optimization. In China, online is mobile. It’s the biggest smartphone market on the planet, with 466 million smartphone users identified by a PwC study conducted in 2014. According to TrekkSoft, 98% of Chinese consumers use their smartphone to initiate the shopping process, even if they don’t use their phone to make an actual purchase. It’s therefore vital that any company aiming to engage with potential Chinese tourists optimizes its site for mobile, and once it’s localized into Chinese, carries out a full round of quality assurance and testing to iron out bugs and issues caused by the localization process. Nothing puts consumers off more than a poor look-and-feel experience on a mobile site.

Lastly, social media. China’s internet users make use of platforms like Weibo, Qzone, WeChat and Kaixin001 to research their holiday choices on a scale not always appreciated by Western firms aiming to make market gains. 80% of China’s population has a social media profile and people constantly swap opinions on potential destinations and tourist attractions — it’s almost like a Chinese equivalent of TripAdvisor, a staple of preholiday research in the UK and US. Therefore, a coherent social media strategy incorporating paid ads and local advocates is fundamental to any successful market drive. Firms might consider hiring an agency based in their home country for this, or possibly a Chinese agency that can bring local knowledge to bear.

It’s not going to be easy or cheap, and you can’t do it overnight. But for companies with the ambition and the vision, it is possible to win a share of this huge and growing market. They just need to make sure they don’t drop the ball by choosing a bargain basement localization option.