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oo China Overview
Welcome
Facilitators: Janene Rees
Overview of China Market
1.4 MILLION
INBOUND CHINESE TO
AUSTRALIA
2016-17
Source: Chinese International Travel Monitor
86.7% increase
in Chinese visitors NSW from 2012 -2016
Source: Destination NSW
Travel patterns last 10 years
and
into the future
2005 to
2010 2005 to
2010
3.2 million Chinese visited Japan in 2015, an 83% increase on the previous year.
In 2016 Thailand welcomed 8.3 million
Chinese tourists
http://www.bangkokpost.com/business/tourism.
The Future
Tourism Australia
International Snapshot
Source: Tourism Australia
Aviation Statistics
1.4 million Chinese visitors to Australia
Sept 15 -16 Total expenditure
$9.1 billion.
A New Report AUSTRALIA is
the number one
destination that
Chinese travelers
intend to visit in
the next few
years
(Source: latest Visa PATA Travel Intention Survey)
Ranking Destination
1 Australia 15%
2 Japan 13%
3 Hong Kong 11%
4 South Korea 7%
5 Maldives 6%
6 Thailand 4%
7 Singapore 4%
8 Macau 4%
9 France 3%
10 Taiwan 3%
Chinese traveller wish
list for the year ahead
Source: Chinese International Travel Monitor 21 July 2016
• Flight direct capacity to Australia from China increased 37 per cent in September 2016
• 5 December 2016, Australia and China entered a landmark open aviation market agreement between the two countries, removing all capacity restrictions to further strengthen the bilateral relationship
• Eight airlines operate 25 direct routes between China and Australia.
• Over half of Chinese visitors to Australia fly on Chinese carriers.
Flights between China & Australia
(Source: Tourism Australia Aviation Statistics)
New Flights between China & Australia
Route Airline Aircraft Weekly
frequency
Effective operation
dates Beijing-Sydney Qantas A330-200 7x Jan-17
Guangzhou-Adelaide China Eastern Airlines A330-200 3x Dec-16
Shanghai-Brisbane China Eastern Airlines A330-200 3x Nov-16
Hangzhou-Sydney China Eastern Airlines A330-200 3x Nov-16
Xi'An-Melbourne Hainan Airlines A330-200 2x Jun 17
Changsha-Melbourne Hainan Airlines A330-200 2x Nov-16
Sydney-Kunming China Eastern Airlines A330-200 2x Nov-16
Chengdu-Sydney Air China A330-200 3x Oct-16
Shenzhen-Melbourne Air China A330-200 4x Jun-17
Wuhan-Melbourne China Eastern Airlines A330-200 2x Jun-17
Qingdao-Melbourne Beijing Captital Airlines A330-200 3x Jul-17
Xi'An-Sydney Hainan Airlines A330-200 3x Sep-16
Changsha-Sydney Hainan Airlines A330-200 2x Sep-16
Xiamen-Melbourne Xiamen Airlines B787-8 2x Jun-16
Shenzhen-Brisbane Hainan Airlines A330-300 2x Sep-17
Hong Kong-Gold Coast/Cairns Hong Kong Airlines A330-300 3x Jan-16
(Source: Tourism Australia Aviation Statistics)
3X
Ge
ne
ratio
na
l T
ravel
3x Generational Travel
Top 5 Most Important Factors when Selecting a Holiday Destination
27%
35%
45%
46%
57%
SPECTACULAR COASTAL HISTORY
RICH HISTORY AND HERTIAGE
A SAFE AND SECURE DESTINATION
GOOD FOOD,WINE, LOCAL CUSINE AND PRODUCE
WORLD CLASS BEAUTY AND NATURAL ASSETS
(Source: Tourism Australia)
` The New China
1st 2nd & 3rd Tier Cities
The BIG 4
• First tier cities – Beijing, Shanghai, Guangzhou & Shenzhen • Second tier – Chongqing, Tianjin, Chengdu, Wuhan, Xiamen
• Third tier – Kunming, Xi’an, Tsingdao and Guilin
My Chongqing Story
• 34 m in Chongqing province
• Smart , sophisticated city
• Young affluent want to travel
Direct flights to Sydney with:
• Hainan Airlines
• Sichuan Airlines
2nd tier city
Asian Tourism Growth NEW CHINA/NEW ASIA
VIDEO??????
WHY CHINA? 中国
Because this is the
NEW CHINA
Understanding Market Segments
• ADS Groups
• FIT’s
• MICE
• Visiting Friends and Relatives (VFR)
• Student Travel
• Luxury Travel
Understanding Market Segments
Target Market Breakdown
56%
20%
15%
9%
Holiday
VFR
Education
Business
Source: Understanding the Chinese Market 2016, Tourism Australia
Free Independent Traveller (FIT)
Mode of Travel
• Fly In/Fly Out
• Fly and self drive
• Self Drive
• Day tour
Definitions Free Independent Traveller (FIT)
• An FIT is an individual (or small group of < 10, probably self-drive) traveling and vacationing
with a self-booked itinerary, not part of a tour group - research and book independently
• FIT approx. <10, with a driver guide
• FIFO FIT – fly into Sydney, Melbourne & Gold Coast – research and book independently
• Self-drive, but have guide in lead car – up to 30 people
• FIT’s on day tours
• FIT’s make up to 70% - 75% Chinese inbound visitors to Australia
Chinese FIT Holiday Age
33%
31%
29%
7% 30 to 44 years
15 to 29 years
45 to 59 years
60 years+
Free Independent Traveller (FIT)
75% of Chinese travelers are high yield free independent travelers
The top five regional destinations in Australia visited by the Chinese FIT holiday market to
Australia were : Sydney (54%),
Melbourne (45%),
Tropical North Queensland (27%),
Gold Coast (24%),
Brisbane (14%).
Free Independent Traveller (FIT)
FIT’s travel on Subclass 600 visa
(Australia is trialing a ten year multiple entry visas for Chinese visitors)
Tourism stream – valid for tourist, FIT, study less than 3 months
Teachers accompany students need to apply for business visa
25% ADS Groups
Free Independent Traveller (FIT) Types of FIT traveller • High end luxury traveller
• Honeymoon market
• VFR
• Youth market – backpacker
• 3x Generational travel
(Image source: Destination NSW)
Market
Fit/Target
Audience 2017
Luxury Traveller
• Growing market, exciting part of FIT
• Dynamic
• Driving Change – having new experiences
They want flexible travel
Creative
Products
• Know your market
• Wedding photos three
months prior to the
wedding
• Looking for amazing
backdrops
Definitions Approved Destination Status (ADS) –
Tour Groups The Approved Destination Status (ADS) scheme allows Chinese tourists to travel to Australia in guided
groups. Tourist visas under the ADS scheme are only available to people travelling in tours organised by inbound tour operators (ITO’s) approved by Australian and Chinese government authorities.
Established in 1999, administered by Austrade
Makes up approx. 30% of Chinese inbound visitor market
Group Travel • ADS Groups (Approved Destination Status scheme)
• Leisure Groups
• Shopping Groups
Shopping Groups
Leisure Groups
(Image source: Destination NSW)
Meetings, Incentives, Conferences, Exhibitions (MICE)
MICE • Growth market for Australia
• Australian tourism operators get business from MICE
• Every state in Australia has a business events team in mainland China to market Australia as a conference destination
• Eg 2017 Amway brought 7000 delegates to Australia over 2 months
• VIP component of a few hundred delegates will have different itinerary and requirements
Visiting Friends and Relatives (VFR)
• Act like FITS
• Nature experience
• Self drive tours
• Tend to stay longer
Student Travel
• 46,400 Chinese students currently studying in Australia
• VFR stay 30 nights +
New Emerging Trends • Sporting
• Gold Coast Airport Marathon
• Sydney Running Festival
• Cairns Ironman
• 1.5 million last year
• 5 years 50000 competed in marathons in China
• Marathon running is being dubbed the religion of the middle class
Visitor Expectations • Visitor expectations differ between market segments
• Types of products
• Traditional itineraries
• 8-12 days
• Itinerary determined on market segment
• Self drive one state
FIT Expectations
1. Flexibility
2. Being able to decide on the day what they are doing
3. Minimum 4 star
4. Want a Western experience – funky cafés, restaurants, vineyards
5. High users of Mafangwo & TripAdvisor – sourcing accommodation, experiences travel
6. Book and visit attractions that are award winning
7. Translation in simplified Chinese
FIT Expectations FIT travellers are: • Unique
• 40-50% are return visitors
• More confident and independent
• 80% are booking accommodation and attractions before leaving china
Visitor Expectations • Key Opinion Leaders (KOL), eg.
Running Man
• Seeing beautiful blue water, sandy beaches, they want a part of it
• Already in mind with marketing from Tourism Australia
Self Drive • Exciting growth segment
• Many self drive itineraries in place
• Most popular: Legendary Pacific Coast, Sydney – Gold Coast
The Legendary Pacific Coast Drive
From Sydney to the Gold Coast Has been a success among Chinese self-drive travellers
Itineraries
• ITO’s are selling itineraries to Wholesalers in China
• 4 star accommodation
• Inbound Tour Operators (ITO)
Distribution Network
• Retail Outlets (in Mainland China)
• Wholesalers (mainland China)
• Inbound Tourism Operators (in Australia)
• Online travel agents (mainland China)
• Online Travel agents (Australia)
• Hotel Concierge
Retail travel outlets based in mainland China
Eg Nahu Travel in Guangzhou
Throughout mainland China you will find shopfront travel agents for consumers to directly walk into
Retail definition – consumers can buy direct
Wholesalers – create itinerary and sell packages to retailers
Emerging trend – online travel agents are buying shopfronts to have retail presence
Wholesalers
• Based in mainland China
• Travel wholesalers that promote tours to Australia throughout their own networks in mainland china
• May include shopfronts
Wholesalers
Book direct with tour operator in Australia
Examples:
• CTS – China Travel Services
• CITS – China International Travel Service
• China Comfort Travel
• CYTS – China Youth Travel Service
• U-Tour
• China Women International Service
Inbound Tour Operators (ITO’s)
Roles:
• Land operator organises every aspect of tour group
• From start to finish transfers booking tours and attractions on the ground in Australia
• Sales calls to wholesalers in mainland china
• Very competitive business to be in
• Over 200 inbound tourism operators in Australia
Inbound Tourism
• Becoming important business to
understand in mainland china
• Many online travel platforms which consumers can book tours and attractions in Australia
Online
• More for attractions are on selling products, including regional areas
Hotel Concierge
Packages • Identify operators in your region already working with
China/Asia
• Can you collaborate to create packages
• Make sure you are seen as the primary exporter
• And you control the invoicing – own the package
• Staff training in greetings, cultural understanding
Preparation tips
Packages Preparation tips
• Accommodation • Location • Family apartments • Restaurants – Chinese options • Free Wi-Fi • China friendly • Good relationship
Packages
Preparation tips
• Consistent rate all year
• Rate 12 months ahead 1 April
• Red represents good fortune; however writing someone’s name in red is associated with the end of a friendship
• The number 4 has a similar pronunciation to the word ‘death’ in Cantonese, and is considered unlucky in some parts of China
• The number 8 represents wealth and prosperity
• Warm to hot bottled water not cold
Cultural Do’s & Don’ts
Losing Face Losing face is translated as ‘honour’, ‘reputation’ and ‘respect It can literally make or break a deal
Losing Face – Showing a weakness or criticising someone in public will damage their reputation Giving someone a compliment or giving a gift will earn yourself or someone face.
Losing Face
The distinction between different levels of management
is important
Respecting superiors is well observed
In China, a subordinate would rarely question, interrupt or disagree with
their manager, especially in a public
When dealing with your superiors or elders in China it is always
important to respect their position and ensure that they ‘keep face’
Chinese business circles hierarchy
Business Cards • Business cards are exchanged upon meeting
• Business cards should be printed in English on one side and Simplified Chinese on the other
• Always exchanged with two hands (as a sign of respect)
• Business cards represent the person to whom you are being introduced, so it is polite to study the card
• Business cards should be clean and neat; no dog-eared corners or smudges
Giving Gifts
Red Envelope ”Hong Bao”
This practice is not official protocol but rather a
customary ritual and very common.
Helps build a solid and friendly business
relationship
When you present a gift there is a ritual for it to be
refused a few times out of politeness, you should
respond similarly.
Don’t open a gift after accepting it unless asked to
do so, open it privately.
The recommended colour for wrapping paper is
red.
‘Hello’ – “Ni Hao”
‘Thanks’ - “XieXie”
‘Goodbye’ - “Zai Jian”
‘Welcome’ - “Huan Ying”
Translation