China’s National Tourism Administration expects 6 million mainlanders will travel outside of the country in CNY 2017 – 10% more than last year.
During the Chinese New Year Festival a human migration of epic proportions takes place as individuals from across the vast country head back to their hometowns. Ctrip, China’s biggest online travel agency, suggests that there will be over 2 billion trips made, an almost unfathomable movement and pushing the country’s infrastructure to the limits.
This is not a holiday in the western sense, but a festival that is brimming with tradition and celebrations. And for brands and marketers trying to leverage the huge opportunities it presents, it is vitally important to get to the core and show empathy with the need to be with family, and understand the personal motivations at work.
Increasing sense of adventure reflected in spending
Marketing to tap into this opportunity is not straightforward however. CNY outbound travellers have higher disposable income but their patterns of spending may be changing. The preferred destinations of previous years may not be the same in the time ahead. Yan Xin, a publicity officer at Ctrip was quoted as saying, "In the seven days of the holiday, Chinese tourists will visit more than 100 countries and regions, with the farthest being the Antarctic." This shows the increased sense of adventure for celebration but also look at what might be driving the trends in a more immediate sense. The popular destinations for bookings this year are the United States, Singapore, Thailand, Japan and Vietnam, which have all improved their visa application processes and improved flight connections recently.
While the wider Chinese economy may be facing some pressures, the Chinese consumers continue to defy the macro-environment. Marketers will be well-aware of the increasing amount this group is able to spend, but need to work hard to capture it as their spending patterns are changing.
Ensure relevance of your offering in a changing world
You could as a provider make sure you offer a CNY product, such as Apple and its special edition red and gold iPhone, or discount a service, but long term success will come from anticipation rather than reaction.
The luxury market was for a number of years driven by Chinese consumers, but this demand has fallen away to an extent, driven by a change in what is perceived as value and the preferences of these travellers. Over the years, Chinese travellers have become increasingly independent and sophisticated. While quality consumption still matters, they have become more rational when they spend overseas – not buying for the sake of buying,. Seasoned travellers are showing a bigger desire to experience authenticity and explore the nature of their destinations, according to a spokesperson at the China Outbound Tourism Research Institute.
Influence users’ knowledge and buying decision on mobile
iResearch data suggests that 57.7% of Chinese outbound travellers in 2016 were independent or semi-independent – meaning that they are increasingly planning their own itineraries. Search engines (80.8%), social media sites or apps (73.7%), travel sites (58%) as well as other sources of UGC contents were the destinations they went for pre-trip research. Information and purchases are predominantly through online and social applications meaning that efforts and budgets for brands need to be adjusted accordingly to influence knowledge, awareness and purchase decisions at the critical micro-moments. In 2016, the total amount spent on online travel booking was RMB602.6B while the amount spent with traditional offline agents was only RMB400B, according to Ctrip.
Make good use of data insights for segment targeting
“It is important to avoid stereotypes as the outbound Chinese market is becoming more sophisticated, more mature and more segmented,” according to a spokesperson at a Shanghai-based tourism consulting firm. As iClick’s Chief Product Officer, Yan Lee, has suggested, data-driven marketing is the answer. Any marketing campaign should be grounded in solid user insights gained from big data analytics. This would create an approach with clearly defined groups of target audiences along with a set of tailored messaging for each. Without the adoption of data insights, your marketing budget can be gone in the blink of an eye while your intended message is simply not reaching the right audience, no matter how nicely crafted the visual or content is.
Keep an eye on the impact of international affairs on Chinese consumers’ travel intentions
Chinese users get access to what’s going on in the world in a real-time manner nowadays and this certainly influences their interest or intention across different aspects in their daily life, including outbound travel. For instance, Brexit last year and subsequent fall in the value of the British Pound has brought about an influx of Chinese capital into the UK’s travel and higher education markets. The signing of visa-free agreements between China and Morocco, Zimbabwe and Tonga right before the October Golden Week holidays last year made these countries the dark horses in this high season of the Chinese outbound travel. All this reflected Chinese consumers’ sensitivity to international affairs and makes it more important for brands to pay attention to these news announcements and adjust their marketing strategy and tactics accordingly.
Darren Jacobs, Head of Agency Sales, Southeast Asia & Europe