Collection No 1
In 2011, Ctrip, one of China’s popular online travel services companies, launched an “Around the World in 60 Days” package for 660,000 Yuan. Within 30 seconds of launch, the packages were completely sold out.
Following its success in 2012, Ctrip launched another “Around the World” package—1.01 million Yuan for 80 days. It sold out within 17 seconds. With higher purchasing power and pent-up demand for exclusive travel experiences, today’s Chinese tourists are venturing farther and spending more than ever before.
China’s National Tourism Bureau estimates that the number of outbound Chinese travelers in 2012 reached 77 million. To give a few points of comparison, 77 million is almost the entire population of Germany; it is 1.2 times more than the number of outbound tourists coming from the United States and 3.5 more than those coming from Japan. Not only is the sheer volume of international travelers impressive, so is the amount of money they spend. According to the U.S. Travel Industry Association, in 2010, Chinese tourists to the U.S. spent an average of $6,200 per trip.
Based on frog’s interviews with Chinese travelers and sources published in Chinese media, many of these travelers are opting for independent, exclusive, and memorable international trips, citing dissatisfaction with the level of service and customer experience provided by domestic tour package companies. For the affluent market, travel/tourism has emerged as one of the main sources of leisure and entertainment.
The Honeymoon Boom
One of the emerging segments of high spenders is China’s Generation X, the first generation born into the one-child policy, whose spending powers are even greater than those of older Chinese. Many couples in their late 20s and 30s planning to marry are now seeking unique honeymoon experiences. And to ensure their only children enjoy such a distinctive and memorable experience, the parents flip the bill.
Instead of traveling within China, young couples prefer travelling abroad, and for many, a honeymoon is their first chance. As a result, a honeymoon can be quite a significant investment, as couples are more adventurous and willing to explore never-before seen places.
Interestingly, over the past several years, the Maldives has emerged as a primary hot spot for young honeymooners. Despite a two-week vacation costing 25,000–35,000RMB, an amount considered astronomically high, Chinese travelers are more than willing to splurge on their honeymoon.
Today, the largest source of visitors to the Maldives is China. In 2010, 120,000 Chinese tourists visited the small island nation, with 198,000 making the trip the next year—a 12% increase.1
China’s Silver Segment
Another emerging group of travelers worth mentioning is China’s elderly population. Defined as those above the age of 60, China’s official retirement age, Boston Consulting Group’s April 2012 “From Silver to Gold” report forecasts that the silver segment will nearly triple from 165 million in 2010 to almost 440 million in 2050 (more than one-third of the total population). Meanwhile, China’s middle class and affluent market will more than double from 150 million to over 400 million in the next decade. Consequently, a segment of Chinese elders will retire with higher personal incomes than previous generations and greater expectations for quality of life.
Domestically, China’s seniors are incentivized to travel, with benefits such as free train tickets and discounted entry fees for tourist sites. Yet for senior travelers, Hong Kong, Macau, and Taiwan are the top destinations. Up until the last few years, travel to China’s special administrative regions and Taiwan was fairly restrictive, and the ease in the visa application process has led to an uptick of travelers to these three places. frog’s interviews have also revealed that a growing number of elderly travelers are venturing even further. Inspired by travel books and magazines, some of the seniors are willing to splurge and visit places in Europe and the US to fulfill lifelong dreams. Unfamiliar with the destination’s culture and language, they rely on travel agencies to book customized travel packages based on budgets and preferences. One travel agent interviewed by frog recalls how her customer, an elderly woman requested a 10-day travel itinerary for 15,000 RMB to visit Provence, France after seeing photos in a magazine. Another couple interviewed by frog at the US embassy didn’t know the name of the islands, but had already booked an 11-day tour to visit Hawaii.
求驴友/Seeking “Donkey Friends”
In early January 2013, Chinese news media Xinhua published an article claiming that “donkey friends”, or 驴友 in Chinese, will be the next disruptive wave of travelers.2 On January 3rd, the keyword “求驴友” or “seeking donkey friends” was reportedly mentioned and re-posted 22,000 times on Sina Weibo. Literally translated as “donkey friend”, the phrase 驴友 is a play on the Chinese phrase for travel (旅游) and refers to people aged 18-35 who join social networks and online forums to self-organize trips based on personal hobbies and passions while seeking for other like-minded travelers.
“Donkey friends” are not interested in package tours, but prefer to do all the planning and research on their own. They also visit far-flung and off-the-beaten path places such as Nepal, Inner Mongolia or the mountainous areas of Guizhou in southwestern China. What’s also interesting is that donkey friends are willing to meet and travel with strangers. In many cases, these travelers will embark on 5-day to 15-day adventure hikes without ever meeting their travel companions beforehand. Doyouhike.net is an example of a popular web site used by donkey friends who are passionate about hiking. Users will post messages announcing their intention to visit a destination and “求驴友” or call for other interested travelers to join them. Some will also post tips and photos to offer advice to other future donkey friends. In one of frog’s interviews, a user mentioned that Doyouhike.net features hostels and other accommodations that organize meet-ups for strangers to congregate and seek new adventures together.
Not all Chinese are fans of donkey friends. On the evening of January 9th, 2013, a group of 24 travelers were stranded at sea and posted distress messages on Sina Weibo3. All were later rescued, however recent deaths and accidents related to donkey-friend traveling have prompted public criticisms of these thrill-seeking individuals. “A lot of donkey friends are inexperienced at hiking or swimming,” says Steve, a 30-year old marketing manager from Shanghai. “Without proper training, donkey friends will sometimes get into trouble and this becomes a burden for taxpayers and government resources.”
It’s not difficult to see that, given the spending habits and travel interests of the Chinese in recent years, the size of outbound tourism from China could prove to be quite significant, and is likely only to increase. Vacation destinations around the world would be wise to start preparing for, and appealing to, this new wave of visitors.