Royal Intel - Tourism Intelligence Consultants » China

Change in Policy to Boost Chinese Tourism in 2010

Lara — Fri, 08 Jan 2010 06:41:37 +0000

The China Tourism Academy reports that total revenue in the country’s tourism industry is expected to grow 13% to hit a high of USD 205 billion in 2010 as the country rolls out favorable policies to back the industry.

In this regard, the forecast point towards 2.1 billion Chinese tourists taking domestic trips this year, up 12% from 2009 while the number of inbound trips by overseas tourists would reach 136 million, up 8% from a year earlier. On the other hand, the forecast for outbound trips is expected to advance 15% to 54 million. The Chinese government has indeed posted guidelines last December to promote the development of the tourism industry, vowing to lower market threshold and simplify approval procedures for tourism enterprises, and encourage local authorities to attract overseas investment, opening the domestic tourism market to foreign companies.

Opportunities Outlined in China’s Online Travel Market Driven by Its Large Broadband and Mobile Consumer Base

Lara — Fri, 11 Dec 2009 08:24:39 +0000

The large number of broadband Internet users in China, combined with an exponential increase in mobile subscribers, is paving the way for travel-related companies to introduce rich media and mobile applications. This has been revealed in a report by PhoCusWright on the Emerging Online Travel Marketplace in China, which highlights that an impressive 84% of China’s 300 million Internet users now have broadband access.

PhoCusWright’s Emerging Online Travel Marketplace in China explores the unique characteristics of Chinese travelers, and looks specifically at how the emergence of rich media, user-generated content and social networking are impacting their travel planning behavior.The research further found that as the Chinese population has become increasingly well-connected to the Internet, they exhibit a clear preference for online media content. This shift suggests considerable opportunities for applications in the travel searches, shopping and buying processes. PhoCusWright’s General Manager Asia Pacific, Ram Badrinathan, asserts that as China emerges as the largest broadband user market in the world, coupled by an additional 650 million mobile users in the country, points towards a tremendous opportunity for companies in the online travel space to create and deliver practical and dynamic tools and services to China’s increasingly sophisticated travelers.

The study was based on a comprehensive, six-month study of the Chinese travel marketplace providing a detailed examination of the Chinese travel industry, with an emphasis on trends and opportunities in the online space. The reports repute to have cleared the mysteries of this rather complex and regionally diverse market, paving the way for innovative companies to take advantage of the vast Chinese travel opportunity. The PhocusWright study aligns with that of Abacus International which had earlier revealed that the “star performer” of the travel industry in 2009 is the online travel booking segment, which has shown “remarkable stability” through the otherwise volatile market of the past 12 months and where this segment is expected to continue growing in the second half of the year.

In terms of volume growth, Abacus International reported that a very real opportunity exists for travel suppliers to position themselves to tap into upcoming online markets including Malaysia, which is regarded as the next emerging market where online travel booking is tipped to boom in the coming years. Further along the timeline, China, Indonesia, Vietnam and Thailand were equally tipped to develop into the next group of online markets.

Asia Pacific Airlines Body Advised to Include Major Chinese Airlines so as to Strengthen its Global Clout; Seeks Reduced Government Interference

Lara — Wed, 02 Dec 2009 08:05:23 +0000

The Association of Asia Pacific Airlines (AAPA) has been urged to woo major airlines in China to strengthen the clout of the association on the global stage. Singapore Airlines CEO, Chew Choon Seng, affirms this need as the association acknowledges China’s present status and ability at taking a leading position on the world stage.

The CEO further notes that the region’s share of international traffic was of similarly significant proportions given that countries of the Asia Pacific at present account for more than half the world’s trade, and is the fastest growing region to boot. This advice comes as the AAPA has called on governments in Asia Pacific to support the development of a regional framework that will address the air traffic management infrastructure needed to support future regional industry growth in an efficient and cost effective manner, including the adoption of inter-operable globally harmonized technologies. On their part, the AAPA seeks to be more representative and reflective of the region’s strength and rising stature, and have more influence in international aviation matters, especially with membership from principal airlines in China.

To further boost recovery of the airline sector in the region, the AAPA has also called on regional governments to reduce restrictive policies against airlines as government inefficiency remained a clear obstacle to recovery. The Director of AAPA, Andrew Herdman, in this regard notes that in order for the industry to achieve long term sustainability and growth, it was time for governments to accommodate the idea of removing policies that have inhibited development for decades, noting the issue of government taxes and charges which account for around 15% of the average ticket price, even though the industry pays separately and in full for its own infrastructure.

Source: TravelMole at www.travelmole.com

New Study Reveals Chinese Business and Leisure Travelers Motives to Hong Kong

Lara — Wed, 25 Nov 2009 01:27:33 +0000

A new study suggests that the explosive growth in the outbound Chinese travel market is set to continue especially among business and leisure travelers. Undertaken by a lead market information company, TNS, the study probed the travel preferences of mainland Chinese businessmen and holidaymakers from tier 1 and 2 cities across the country.

According to the study findings, 90% of both business and leisure travelers claim they are travelling more (or at least the same), in 2009 as they did in 2008, and the indications are that this trend will continue in 2010. The study additionally found that there were few reasons for travelling less with Business travelers claiming instead to be switching to webcasts or teleconferences, while reasons cited by leisure travelers was fear of H1N1. Less than 10% of travelers are travelling only on business, with around 60% combining both leisure and business. Commenting on the findings, head of Travel & Leisure practice for TNS in Hong Kong, Neel Banerjee, notes that the findings suggests opportunities for persuading business travelers to extend their trip for a few days of leisure, perhaps including their family or friends as well.

The leisure travel market is being driven mainly by travelers taking advantage of attractive packages, low airfares and budget airlines, and budget hotels. Hong Kong is therefore in a prime position to take advantage of these combined Chinese business and leisure trips. It is already the number one destination for both business and leisure travelers from Mainland China and offers further advantages with its convenient flying distance if family or friends intend to join the business traveler. Hong Kong has another advantage. According to the study, 45% of respondents rely on family and friends for traveling advice, but the main source of advice for Chinese travelers is still the internet, with 86% consulting one or more sites.

Since Chinese consumers rely on the internet and family/friends as the main sources of information for their next trip, word of mouth could play a strong role in increasing the attractiveness of a destination. Clearly investment in digital media will be critical if Hong Kong is to reach this target efficiently and communicate its benefits. Top attractions in Hong Kong have been and remain Disneyland, Victoria Harbour and Ocean Park, with 83%, 82% and 82% having been to these attractions during their last visit. Future destinations of interest, which may be used as draw cards in communication, include the Hong Kong Wetland Park, the Giant Buddha and Ngong Ping 360, with 55%, 48% and 46% of travelers planning to see these attractions on their next visit.

Travelers feel that prices outside of China are often better than at home and they like both the service and the shopping environment in foreign destinations. Hong Kong is in an excellent position to offer a great shopping experience and to provide all of the top merchandise travelers are looking for. Again, communication is important so that travelers know where to buy what and where the best deals and shopping experiences are to be found. The internet is key to this, with 75% relying on the internet for shopping information.

Source: Travel Daily News at www.traveldailynews.com

Unabated Surge in Hotel Construction in China and India

Lara — Tue, 24 Nov 2009 09:14:55 +0000

According to a recently released October 2009 STR Global Construction Pipeline Report, the development of hotels in the Asia Pacific hotel industry shows 985 hotels currently under construction and which altogether comprise 235,931 rooms. Among the key markets, Shanghai, China, reported the largest amount of rooms in the total active pipeline (12,445 rooms) and equally in the “In Construction” phase (9,291 rooms).

Shanghai is followed by those in New Delhi, India, with 6,736 rooms in the total active phase and 4,792 rooms in the “In Construction” phase. Beijing, China, ended the month with 6,267 rooms in the total active pipeline and 4,388 rooms “In Construction”. Among the chain scale segments, four segments made up over 80% of the total active pipeline. The upper upscale segment accounted for 23.9% of the total active pipeline with 56,461 rooms, followed by the upscale segment, which made up 23% with 54,365 rooms. The unaffiliated segment made up 20.8 of the total active pipeline with 49,093 rooms, and the luxury segment accounted for 16.6% and 39,093 rooms. The STR Report findings confirm what an interesting article in the International Herald Tibune indicated that the outlook for the hotel industry in Asia is set to defy the current economic slowdown.

There is a lot of runway left in the emerging Asian economies given the population in these countries. The United States has 4.9 million hotel rooms catering to a population of 300 million, while Europe has about 5.3 million rooms. China, with its population of 1.3 billion, has only 1.7 million, and India barely has 120,000. According to the General Manager Asia at Fairmont Hotels & Resorts, Ian Wilson, China is expected to have a middle class of 400 million in 10 years time and a growth rate of 6%-plus this year. While hotels in China’s main international gateways of Shanghai, Beijing and Hong Kong are under pressure, business in the secondary and tertiary cities in the country’s vast interior has mostly stayed resilient, as those areas depend less on international travel, and are more exposed to domestic Chinese travelers.

Cities like Hefei and the resort of Sanya for instance, have recorded more than 80% Chinese clients, and demand is surging coupled with good infrastructure. According to the Finance chief and head of commercial development at InterContinental Hotels Group, Richard Solomons, China is the place to be given that the country has built tens of thousands of kilometers of highways and railway track, and 97 new airports. Coupled with its large and potential consumer base, there is indeed a massive growth opportunity in Asia-Pacific and one that is unsurpassed anywhere in the world, according to the Chief Executive of Starwood, Frits van Paasschen.

Source: TravelMole at www.travelmole.com

Adaptation Seriously Amiss in Meeting the Needs of the Traveler from China and India

Lara — Tue, 24 Nov 2009 09:13:24 +0000

The traditional package holiday requirements of sun, sea and sand will be replaced with sightseeing, shopping and status as emerging markets shape the travel industry in the new Millennium.

These are the predictions of travel consulting company Tourism Intelligence International which monitors travel patterns across the globe at a WTM seminar on emerging markets. According to the firm’s Managing Director, Dr. Auliana Poon, travel providers need to understand the “new markets” and their requirements as they would be the saving grace of the industry as old economies continue to struggle. Traditional markets have slower growth, have a slower rate of growth in millionaires and have an ageing population. On the other hand, new markets have a young, dynamic, increasingly wealthy demographic who will lead the path towards economic recovery. Trends indicate that travelers from emerging markets return home with shopping purchases to show they have the wealth and status to travel.

According to the Managing Director, reference on the emerging market dynamics is on China and India’s growing middle class that have a huge appetite for travel. Marketers have been warned that the travel industry was too entrenched in serving the typically white, European holidaymaker when what it needs is realize the needs of the new markets were very different. The market is acknowledged for being extremely segmenting and adaptation is required in this respect especially for emerging markets that are going to generate the income needed for the future. With 253 million web users in China and more mobile phones than landlines in China and India, travel providers have been advised to make sure their offering was totally accessible on as many platforms as possible.

Source: TravelMole at www.travelmole.com

China Predicted to Set Pace for Global Recovery in Business Travel and Investment

Lara — Fri, 06 Nov 2009 03:53:26 +0000

Two surveys by American Express predict that China will lead the global recovery in business travel coupled with investment in the country by global companies increasing as well by next year. The surveys were undertaken among Amex’s Global Business Partnership (GBP) clients, as well as other clients based in Shanghai, Beijing, and Guangzhou through its annual China Business Travel Survey (The Barometer).

The results of the survey were made during Amex’s fifth annual China Business Travel Forum in Shanghai. More than two third (68%) of respondents from the GBP noted that China’s economic prospects were better than those of the US, while a large majority of companies (89%) reported that they expected to invest in China in the next 12 months while 79% noted their preference to also invest in India. Among Chinese respondents, a significant number thought that China would be the first country to emerge from the current economic crisis with 72% reported that they expected to invest in the country in the next year. Already 60% of China based companies indicated already having started staff recruitment.

The surveys also found that most global companies at present thought the worst of the crisis was over with 79% predicting a “modest expansion” over the next year. However, 50% of respondents noted that their companies would still cut travel in 2010 while a further 25% indicated that spending would stay the same as in 2009. The surveys additionally found that meetings and events had borne the brunt of the cuts but 70% of respondents believed the crisis had given companies a chance to control better MICE spend. Far fewer respondents noted that they could reduce air or hotel spending by a similar amount. Companies outside China were also more reluctant to take on more staff with only 25% indicating that they would be hiring from Q1 in 2010 while 36% said they would wait until 2011.

According to the President of American Express Global Travel Services, Charles Petruccelli, the coming year will see travel spending playing a crucial role in fueling recovery not only in China, but on a broader scale as countries begin to emerge from the recessionary environment. The President predicts that businesses that will be best placed to take advantage of business opportunities in China, the US, or anywhere, will strike the right balance between supporting necessary business-generating travel with applying smarter controls that do not deplete the bottom line.

Source: Air & Business Travel News at www.www.abtn.co.uk

Disneyland Shanghai Set for Boom in Visitor Numbers

Lara — Thu, 05 Nov 2009 09:02:10 +0000

Walt Disney has won approval from the central government of China to build a Disneyland-style theme park in Shanghai. With this news, analysts estimate that Shanghai Disneyland, minus hotels and resort infrastructure, will cost USD 3.5 billion, making it one of the largest-ever foreign investments in China.

The park is expected to open in five or six years. The initial resort, with a mix of shopping areas, hotels and a Magic Kingdom-style theme park, will sprawl across 1,000 acres of the city’s Pudong district. The theme park is expected to occupy about 100 acres, making it a little bigger than Disneyland in Anaheim, California, and on par with the parks in Paris and Tokyo. Disney has been in talks with China about a theme park for almost 20 years. The agreement for a Shanghai Disneyland is a landmark deal that carries enormous cultural and financial implications. Disney’s plans are ambitious in that further development of the resort will encompass more than 1,700 acres and have a capacity rivaling Disney World in Florida, which attracts about 45 million annual visitors.

The company’s goal is to create an impetus that will drive demand among China’s 1.3 billion residents for other Disney products, ranging from video games to Broadway-style shows to DVDs. Throwing open its doors to such a uniquely American, and permanent entertainment experience, is a milestone for China, which is known for aggressively protecting its culture from Western influences in general and Hollywood in particular. Only 20 non-Chinese films are allowed to be shown in theaters each year, for instance, and often edited. Only the Magic Kingdom-style portion of the project needed Beijing’s approval; Disney is set to negotiate with Shanghai authorities on construction plans, but that is considered a matter of process. Disney, which already does more business in China than most foreign media companies, has more than 600 employees in Beijing, Shanghai and Guangzhou.

Merchandise like plush toys and Mickey Mouse apparel is sold at about 6,000 branded locations. The company also delivers about a dozen hours of television programming for “Mickey Mouse Clubhouse” to local stations each week, and its Broadway unit has toured “The Lion King,” among other shows. With this approval, analysts’ note that the project inadvertently portrays that the Chinese leadership may after all be more open to Western investment. Unlike most theme park operators, Disney has managed to keep attendance high by applying steep discounts to hotel rooms and dining, a valuable attraction towards attracting high visitor numbers, and one that Shanghai will benefit immensely from. This gain is expected to come at the probable expense of Hong Kong’s Disneyland, which will be a much smaller sized park when compared to Shanghai’s.

Source: TravelMole.com at www.travelmole.com

China’s Online Travel Market Surpasses Economic Gloom

Lara — Wed, 28 Oct 2009 06:33:40 +0000

Despite the global recession, the online travel marketplace in China is growing rapidly. This has been revealed by a travel industry research company, PhoCusWright Inc., which further predicts that online travel revenue in China will as a consequence of this growth increase by 19% this year alone.

In its first-ever ‘Emerging Online Travel Marketplace in China’ report, PhoCusWright highlights that China’s online travel space currently totals approximately USD 6.9 billion, accounting for about 11% of the country’s entire travel market. Due to a variety of factors, the online channel is expected to continue on a strong growth trajectory, and by 2011 will account for about 20% of the total market. According to the PhoCusWright’s general manager, Asia Pacific, Ram Badrinathan, China’s has rapidly emerged as the largest travel opportunity in the APAC region, but that does not make the entire market accessible to entrepreneurs. The GM adds that key parts of the Chinese travel value chain are in varying stages of deregulation and government control.

He advises that it is vital to understand the triggers that will allow for innovation and opportunity and harness the vast potential as represented by Chinese online consumers, based on the fact that the country is emerging as the largest broadband user market in the world. This consumer segment is expected to create a unique dynamic in the travel buying process. China’s travel market is not only different from any other, but within the country its characteristics vary tremendously by region and population group. The PhoCusWright study advises that understanding these differences can provide a strategic advantage to travel companies targeting or engaged with the Chinese market.

PhoCusWright’s report on ‘Emerging Online Travel Marketplace in China’ explores the country’s dynamic travel market, based on an in-depth, six-month research study, where it sizes the Chinese travel market by major segments and identifies key trends and developments. The report further attests to revealing some of the unique behavior patterns of Chinese travelers, and unveils reasons that make China’s travel market unique unlike those in the West and other markets in Asia and the Pacific.

Source: Travel Daily News at www.traveldailynews.com

Japan, China and Korea Agree on Joint Tourism Administration

Lara — Tue, 27 Oct 2009 09:19:38 +0000

Japan, Korea and China have agreed to a joint cooperation in tourism administration. This was revealed in a joint communiqué by representatives of the three countries at the 4th Meeting of Tourism Ministers convened at Nagoya and Takayama on October 18. The meeting equally dealt with measures against travel impediments including impacts of a renewed insurgence of influenza, promotion of tourism linked with international events like the Shanghai Expo 2010, and simplification of visa issuance, all aimed at paving the way for an advent of “grand tourism era in East Asia”.

The three countries have equally pledged to address greenhouse gas reduction in their respective country-tourism sectors. Japanese Minister for Land, Infrastructure, and Transport and Tourism, Seiji Maehara, noted his satisfaction on the outcome of a fruitful discussion. Other imminent issues discussed at the meeting included measures against global financial crisis and fears over the new influenza, and stimulus package for recovery of international tourism. With regard to the new influenza outbreak, the joint ministers’ communiqué pointed out the necessity to transmit accurate information to travelers and to people engaged in travel-related industries, in order to call for calm and prudent behavior, and to enhance better coordination with other government agencies in respective countries so as to minimize against adverse effects to international tourism.

Indeed the Japanese Minister for Land, Infrastructure, and Transport and Tourism, noted that Japan has already set strategies aimed at fostering the momentum of overseas travel by way of solicitation to Shanghai Expo, making intensive promotions abroad in connection with the ‘Visit Japan Year in 2010′, and boosting human exchange from 2010 to 2012 to mark ‘Visit Korea Year’. These strategies are all designed to restore travel demand. In preparation for the forthcoming “grand tourism era in East Asia,” the ministers stated that measures were in place to facilitate better visa issuance services and thereby reduce the time required for entry formalities. The other agendas discussed during the meeting included encouragement of global business networking and collaboration among players in the tourism sector, and that of human resource development coupled with overseas study tours.

The ministers agreed on institutionalizing periodic trade meetings, enhance international coordination for consumer protection, and information sharing among players in the tourism industry. The next meeting is scheduled in 2010 in China, followed by another in 2011 in Korea. Thereafter, all subsequent meetings are to take place every two years from 2013.

Source: Travel Vision Weekly at www.travelvisionweekly.com