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China’s outbound tourism looks upbeat with preference for DIY trips

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China’s outbound tourism looks upbeat with preference for DIY trips

In 2014, the total number of outbound trips organized for Chinese tourists rose to 114 million, overtaking the U.S. as the world’s largest outbound market. Do-It-Yourself (DIY) trips have become popular among Chinese tourists. Most are keen on traveling to East Asian destinations. Although expenditure on skin care products is the highest, preference for Japanese electronics is not far behind. Tourists also prefer online platforms for their airline and hotel bookings. However, frequent fliers complain of language barrier, harsh weather conditions and lengthy Visa procedures. These are the findings from a survey conducted by strategic market research consultancy Spire Research and Consulting in May 2015.

Spire’s survey of 100 tourists from Eastern China (across Shanghai, Zhejiang, and Jiangsu) – the most developed area in China with booming DIY travel – concentrated on preferred tourist destinations, shopping and expenditure patterns, DIY travel trends as well as challenges encountered by tourists. The survey used an online interviewing methodology.

A majority of tourists from all income levels prefered DIY trips over non-DIY trips. 75% of respondents with an annual income above CNY300,000 chose DIY trips. This can be attributed to the freedom of preparing their own travel itineraries which not only helps avoid the shackles of group tours but gets rid of designated shopping hours as well.

Preferred destinations and shopping expenditure patterns

Interestingly, 40% of the respondents surveyed preferred travelling to East Asian countries whereas 26% preferred Southeast Asian countries. Their proximity to China and lower transportation costs are factors that make these countries attractive. Moreover, the culture and customs of East and Southeast Asian countries are similar to those in China which travelers find easier to adapt to.

As shown in Table 1, Spire’s study revealed shopping expenditure is mainly focused on skin care products, cosmetics and perfumes (32%); as well as the others category (21%) which consists of food & beverage, entertainment products and dietary supplements followed by clothing (16%).

With all categories are taken into account, Estee Lauder – the popular American brand – is the most commonly purchased brand at 11%. 56% of respondents preferred US brands, including Nike and New Balance under the shoes category. For electronics, Japanese products were trusted for their quality, especially Zojirushi rice cookers.

Third party channels dominate airline and hotel bookings via online platforms

95% of DIY travelers use traveling guides available online or via mobile apps. Among travelers who refer to guides, 29% of them use more than one traveling guide.

A majority (92%) of Chinese travelers also use online platforms to search for travel recommendations and plan their itineraries. Mafengwo (34%) and CTrip (29%) are among the popular platforms.

For airline bookings, 81% used third party channels or agents to register slots. Chinese travelers frequently use CTrip (59%) and Qunar (28%) to book flights. The popularity of CTrip is due to the fact that it offers travelers’ convenience, abundance of discounted flight packages and reliability.

Needless to say, 96% of the DIY tourists book hotels through third party channels – out of which 47% use foreign online booking websites, namely Booking.com (68%), Agoda (30%) and Hotels.com (3%). Connectivity (proximity to major transportation hubs), cost efficiency and cleanliness are the top three considerations while choosing hotels.

Challenges encountered by Chinese tourists

English-speaking respondents highlighted that sales persons and waiters in some countries – such as South Korea and Spain – speak accented English which is difficult to comprehend. Most of the other Chinese tourists do not speak English, making language a big barrier in their DIY tours.

Most tourists from Eastern China are used to mild temperatures during winters. Therefore, when they travel to countries with four distinct seasons, adapting to harsh weather conditions become cumbersome. Many are not equipped with adequate warm clothing.

Furthermore, DIY tourists have to go through complicated and lengthy Visa application procedures in the absence of centralized arrangements done especially for group tours. Respondents end up spending several months and significant sums of money to get their Visas ready. Not to mention, the risks involved in last-minute rejections and delays in approvals.

At the same time, tourists often spend more than their planned budget, disrupting their annual finances substantially.

Conclusion

Spire’s study indicates that China’s travel and tourism industry is riding a growth curve with considerable increase in the volume of outbound tourists. DIY trips are on the rise with a preference for East and Southeast Asian countries.

While traveling, most Chinese spend on skin care products, cosmetics and perfumes. Popular international brands are Estee Lauder, Nike and New Balance. Furthermore, DIY travel trends include the rise in popularity of online travel guides, third party pre-bookings for airline tickets as well as accommodation.

However, language barriers, harsh weather conditions, tedious procedures for Visa applications and overspending are some of the challenges cited by the respondents.

Annex

Profile of respondents for East China


For media enquiries, please contact:
Nidhi Singh
Assistant Manager,  Group Corporate Communications
Spire Research and Consulting
Phone: (91) 124 646 5499
E-mail: nidhi.singh@spireresearch.com

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