3 COTRI China Outbound Tourism Research Institute The world's leading independent research institute for information, training, quality assessment, research and consulting relating to the Chinese outbound tourism marketEstablished: 2004Offices: Heide (Germany), Beijing, Shanghai, Guangzhou (China)COTRI Country Partner in: Argentina, Australia, Bhutan, Bosnia and Herzegovina, Cambodia, Chile, Croatia, England, Estonia, Finland, France, Ireland, Italy, Kenya, Kosovo, Laos, Latvia, Lithuania, Macedonia, Mauritius, Mexico, Montenegro, Morocco, Myanmar, New Zealand, Peru, Russia, Scotland, Serbia, Slovenia, Spain, Thailand, Tunisia, USA, Vietnam, WalesCOTRI Germany Headquarter:Fritz-Thiedemann-Ring 2025746 Heide / GermanyPhoneFaxCOTRI China Headquarter:Suite 412 Lido Office Tower6 Jiangtai RoadBeijing PhoneCOTRI Office Shanghai:Suite 1512 Shui On Plaza333 Huaihai Rd.ShanghaiCOTRI Office Guangzhou:Suite 2412 South Tower WTCHuanshi East Rd.Guangzhou
4 COTRI founder and director Prof. Dr. Wolfgang Georg Arlt FRGSFirst visit to People’s Republic of China in 1978owner of Inbound Tour Operator China -> Europe (offices in Beijing and Berlin)COTRI founder and director since 2004Professor for International Tourism Managementat West Coast University of Applied Sciences (Heide)Visiting Professor at universities in China and United KingdomFellow Royal Geographical Society (London)Research Fellow Japanese Society for the Promotion of Science (Tokyo)Latest publication:Editor ofZhang Guangrui: China’s Tourism Development COTRI eBook 2013COTRI Blog at Forbes.com:Editor:China Outbound MarketIntelligence
12 1 HistoryTravel has been an important part of the (self-)education process in Imperial China, but outbound travel has no traditionXu Xiake ( ), China’s most famous traveller, was no Ibn Battuta or Marco PoloChinese are still learning to be an international tourist, lack of role models
13 2 Demand Demand pushing open the gates After 1989 (Tiananmen movement and Fall of Berlin Wall) resisting the demand for outbound tourism (politically dangerous and expensive) is no longer feasibleSince 2004 incremental paradigm change toward “Soft Power” approach of using outbound tourism2013 new party leadership curbing official pleasure travels and conspicuous consumption, but for the first time officially “encouraging” outbound tourism
14 3 InvestmentChinese Outbound Travel will continue to grow despite bursting of credit bubble in China (Chinese GDP +2% and deflation in 2015?)Long-distance outbound travel for Top 5 percent of Chinese society is investment, not holidayDirect investment : Business travel, real estate and company investment for profit and for passportsIndirect investment : “Leisure” travel for self-esteem and peer group confirmation of status and prestigeLong-term investment : Formal and informal education, market knowledge, experiences
15 4 ROI Chinese outbound traveller seek Return on Investment If international travel is investment, the products offered should be organised in a way to guarantee the Chinese visitor a good Return on Investment (ROI):Value for money and for timeGuaranteed quality as seen from a Chinese point of viewNo more time spent as needed for prestige gainSupporting the specific bragging value of a product: famous, typical, oldest/highest/awarded, celebrities choice, unusual (but not unknown), authentic (but not against expectation), hard to get, VIP only, as seen in TV and moviesConnecting fun und investmentGiving face to China and all ChineseSafe and without risk
16 5 Segmentation“The” Chinese outbound tourists does not exist (anymore).The four most important groups:Mass-market package tour participants, often first-time traveller, from second/third tier cities, interested in cheap trips, sightseeing and shopping for prestigeMore affluent and more experienced self-organised travellers, interested in value for money, intensive short experiences and shopping for lifestyle affirmation, “money-rich but time-poor”Business/official travellers, interested in luxury and conspicuous consumption (when nobody watches)Chinese temporarily living outside of China (Chinese expats, students), travelling themselves and receiving guests
17 6 Package SelfChinese traveller continue to embrace self-organised travelAccording to COTRI research, almost all adult affluent Chinese have been outside Mainland China at least once, 90% of all adult affluent Chinese have already visited EuropeEach year more travel experience, higher percentage of overseas university graduates, and more information available combined with new Chinese tourism law pushes affluent Chinese to travel self-organisedWith the domino effect of easing of visa restrictions well under way in 2014, need to use tour operator for visa diminishes
18 7 Future A history of waves: 100 million aspiring Chinese living in 2nd and lower tier city inhabitants are still waiting for their turn to see the Mona Lisa and to visit European brand stores with package groups for as little cost as possible50 million more experienced travellers moving from ticking off sights and from buying the most famous brands to finding destinations, travel styles, hotels and products which fit the lifestyle of their specific peer group
19 Time to learn more about your Chinese customers. 8 ActionGetting happy and profitable Chinese customersConcentrating as much on direct bookings and direct (social media) marketing as on working with Chinese tour operatorsProviding prestige by using Chinese language, symbols, decoration, quality labels, credit card services – but in an unobstrusive wayProviding services for money-rich but time-poor guests – no waiting!Turning the attraction/hotel/sight into a destination with a story – something to tell at home aboutAnticipating the needs of Chinese visitors – Chinese photographer for honeymoon couples, exclusive limited edition souvenirs which can only be bought on the spot or in O20 (offline to online) shopsTime to learn more about your Chinese customers.
21 Have Fun and Profit in the Wood Horse Year! Contact Thank you for your attention, looking forward to your comments and questions!Have Fun and Profit in theWood Horse Year!ContactCOTRI China Outbound Tourism Research InstituteProf. Dr. Wolfgang Georg ArltTelMailWebBlogThank You!