Interview with Cape Town Tourism CEO Mariette Du Toit-Helmbold

cape-town-tourism-logo

China Traveller

November 2009

 

Q: Definition of the Chinese traveler for the Cape Town market?

A: To date Chinese tourists to Cape Town have been defined by group tour ADS travellers as well as significantly government delegation group travellers. Due to the predominant group tour nature of their visits they are limited to short stays of one to three days visiting the major attractions like Table Mountain, V&A Waterfront, Cape Point and the Wine Route. A popular part of their itinerary often includes shopping experiences like diamond purchases and Chinese visitors enjoy Cape Town’s offering of seafood. It is important to note that most Chinese visitors still prefer restaurants that specialise in Chinese cuisine. There are very few FIT travellers from China and this combined with the often “rushed” nature of itineraries, limits the overall exposure to Cape Town’s broader offering is limited.

 

Cape Town Tourism has hosted many groups from the Chinese government, business sector and media. We work hand-in-hand with local government in Cape Town to expose delegates to a broader Cape Town experience.

 

Q: Trends you foresee increasing in popularity?

A: There is a general increase in travel amongst the Chinese population, although the immediate trend is towards domestic travel. There are, however, a small increase in the  number of FIT independent travellers who not only have the confidence to travel alone or in smaller personal groups but also relish conducting their own destination research. These individuals travel for longer periods of time, get to see the real vibrancy that we have to offer and ultimately spend significantly more money while on holiday. This is the category of travellers we would like to see grow in popularity. Unfortunately foreign arrivals from China have been impacted by issues such as last year’s Olympic Games, internal disturbances such as the Sichuan earthquake, heightened competition from an increase in ADS countries, and safety concerns related to crime. Much work must be done by SA Tourism to educate and inform the Chinese market on South Africa as a destination. Cape Town Tourism plays a supportive role in this regard.

 

Q: Most recent figures for outbound Chinese travel to Cape Town?

A: While we don’t have specific figures solely for Cape Town the overwhelming majority of Chinese tourists who visit South Africa visit the Mother City. An estimated 37,000 Chinese tourists visited Cape Town in 2008.

 

Q: Breakdown in terms of ADS versus FIT travelers? What are the respective growth rates?

A: The overwhelming majority of Chinese tourists are still on ADS tour packages. More focus should be on attracting the FIT market, but we realize that this will take time and investment in particular media and PR representation to educate the Chinese market on Cape Town as a destination.

 

Q: Financial crisis and swine flu impacted on arrivals from China?

A: The global financial crisis had a negative impact on most long-haul destinations and this was no different for Cape Town. During times of increased hardship or caution the Chinese travelers tend to restrict their travels more to their immediate region of South East Asia. Swine flu naturally impacted travels worldwide, and in particular travel to and from East Asia. To my knowledge it did not have a direct impact on specifically Cape Town as our destination was not perceived as a hot bed for this potential pandemic.

 

Q: Is Cape Town expecting a boost in tourism from China for the FIFA 2010 World Cup?

A: Cape Town looks forward to hosting Chinese tourists attending the FIFA 2010 World Cup South Africa. There seems to be a growing awareness of South Africa hosting this premier sporting event on the Mainland and we get a sense there is growing interest in our destination in particular for Chinese fans privileged enough to travel here. It is a great pity that the Chinese national football team did not qualify for the World Cup that would have potentially resulted in a huge boost of tourism from China. It is difficult to predict, but we do expect a small percentage of Chinese football fans. The hosting of the FIFA 2010 World Cup is naturally an excellent event to leverage in our favour and attract visitors from new markets like China beyond 2010. Our focus is on media, PR and eMarketing to reach as many football fans as possible; inspiring these potential visitors to chose Cape Town as their next travel destination.

 

Q: How would you define brand Cape Town and what does it offer travelers?

A: Cape Town is an iconic world city; boasting incredible natural beauty and authenticity. It is often described as a “soft-landing” into Africa – a surprisingly sophisticated City, but boasting a rich cultural offering that is unlike any other world city.  It has a well-established tourism infrastructure with excellent hotels and restaurants. Cape Town can cater to different needs 365 days a year because the city’s offerings are diverse and plentiful. There are beautiful mountains and forests in which to hike, much-visited landmarks such as Robben Island and Table Mountain as well as endless beaches and natural attractions. There are museums that narrate our tempestuous history and art galleries that interpret our culture. Markets sell local produce and township tours take visitors on safe, guided visits through the Cape’s bustling townships. Another one of Cape Town’s gems is the Cape Winelands; an exquisite part of our city which shows off all the local vineyards, offering guided tours, wine tastings and stops at gourmet restaurants. A visit to Cape Town is filled with history, culture, excellent dining and enough relaxation time to soak up whatever the season has on offer. With the 2010 FIFA World Cup just months away, Cape Town’s infrastructure has been upgraded to offer world class transport and information, ensuring the visitor convenience and ease when moving around.

 

Q: How is brand Cape Town perceived in the China market and who does it target?

A: Although still fairly “unknown” as a destination, Cape Town is perceived in a very positive light by Chinese tourists in the know. Every single Chinese person learns of the Cape of Good Hope when they are in school so the Cape is viewed with mysticism and romance. Cape Town is known to be a very beautiful city with delicious seafood and this is definitely a pull factor for Chinese tourists. Our current target for Chinese tourists is that of ADS tour groups and we have been blessed with a significant amount of such groups arriving on our shores.

 

Q: Which cities compete with brand Cape Town?

A: Most long haul seaside cities compete with brand Cape Town such as Sydney, Rio de Janeiro and San Francisco.

 

Q: Major obstacles to positively brand Cape Town to a Chinese audience?

A: One of our biggest challenges is that Cape Town is very rarely differentiated from the rest of South Africa or even Africa in the eyes of the Chinese tourist. As such what is positive for the total South Africa brand is positive for the Cape Town brand, but it goes the other way as well. Accordingly, if any negative incidents occur in other parts of South Africa or Southern Africa it may well have occurred in Cape Town. Furthermore, the general perception of South Africa is that it is a country inundated with natural wildlife, elephants, lions etc. As such many tourists do not know that Cape Town is a wholly different experience, a vibrant, sophisticated city with world class hospitality infrastructure. Many of the tourists cannot believe their eye’s when they arrive in Cape Town for the first time, they honestly did not expect to find such a thriving and modern city in a spectacular setting. Our job is to educate potential tourists on the reality of what Cape Town has to offer and what differentiates Cape Town from other cities in Southern Africa and the world.

 

Q: What methods/tactics does Cape Town employ to generate better awareness in China?

A: South African Tourism plays a leading role in terms of destination marketing in new source markets such as China. Cape Town works with and supports these activities with the focus on PR, media and guest relations. Accordingly, whenever media and trade FAM tours are arranged we implement the Cape Town part of the itinerary. Recently the City of Cape Town Mayor visited China and while in Beijing he engaged with the leading travel media and held discussions with China’s leading tour operators. We are currently committed to improving and extending relationships with China’s tourism industry stakeholders and key decision makers. This is a lengthy process but we are making good progress. 

 

Q: How does Cape Town plan to leverage the 2010 World Expo Shanghai?

A: The City of Cape Town, along with its fellow South African cities and provinces will be allocated a significant period of time to make use of the South African Pavilion at The Expo. We are currently finalizing our Expo participation plans but will definitely take maximum advantage of the opportunity to show case Cape Town as an ideal ‘Better City, Better Life’ example on earth.

 

Q: Most creative or audacious tactic/ strategy/ campaign employed in China?

A: Cape Town does not promote itself independently from South Africa in China, but work in partnership with SA Tourism and other role-players. Penetrating a new market like China is expensive and a long-term approach is required where we work with key partners both in South Africa and China, focusing on media awareness and educating the Chinese market.  As a “watch-market” China holds tremendous opportunity for our city, but we are aware that it is a complex market to brand oneself in. We are thus cautious in our approach and want to ensure that the essentials are in place before we start attempting audacious campaigns.  

 

Q: New branding strategies becoming more popular over time? 

A: With the advent of time I expect Cape Town to start developing a much stronger online position as that is where the future of this industry lies. The Chinese citizen, in particular, the younger market, is becoming increasingly web-savvy. Working with web-media and platforms we hope to reach this very important and growing market, turning them into future travelers to Cape Town. Continued research and joint marketing agreements with relevant partners in China are essential.

 

Q: How is Cape Town leveraging off its host status of the 2010 FIFA World Cup to attract greater Chinese travellers?

A: As mentioned the promotion of the World Cup is playing a large role in our overall tourism promotions, but with the focus on a long-term marketing strategy that will reach potential visitors and educate new markets on the appeal of Cape Town as a destination. When the Cape Town Mayor was recently in Beijing, we placed great emphasis on the hosting of the World Cup when engaging key stakeholders. From the feedback we have received from the Chinese media and the media coverage we have seen thus far, it is clear that the local media is very interested in this topic and we will continue to focus our efforts on PR and Media.

 

November 20th, 2009 | Michael Jones | Tags: , , , , , , , , , , , , | No Comments »

David Liu on Mainland Tourism to Taiwan

David LiuChina Traveller

October 2009

 

While I am delighted to see Taiwan being awarded with Approved Destination Status (ADS) it appears as if there is little in terms of a concerted effort to promote and attract Mainland travellers to the Island thus far. The granting of ADS was a recent event and as such most stakeholders are still trying to find their feet but complacency over this new tourism ‘hot spot’ should not be permitted.

 

Initial feedback from Mainland travellers who have now had the opportunity to visit Taiwan have not been overwhelming in their praise with some commenting that they were somewhat disappointed by the lack of modern designed cities, saying that the Mainland cities compared more favourably. This to me indicates that a perception error is in place and the Taiwan promoters would do well to highlight the more enjoyable aspects of travelling to Taiwan.

 

This is merely a symptom of a larger issue however that it is essential for Taiwan promoters to define their messages and ensure that they are relevant to the Mainland target audience, the relevant messages must be an extension of Taiwan’s real attractions. So far it seems as if Mainland travellers mostly only visit the orthodox attractions such as Taipei 101. While these are natural itinerary stops, what in my opinion impresses Mainland travellers the most about Taiwan are the numerous alleys in Taipei that host hidden treasures of exquisitely designed restaurants and shops, the juicy and exotic fruits, scrumptious seafood, magnificent night markets and endless restaurants with delicious menu listings. Furthermore, I think Mainlanders are often taken aback by Taiwan’s exhibited friendliness, its greatest hospitality asset. China as a successful developing country has the best of all hardware, but Taiwan has unparalleled software, friendliness and helpfulness that comes from the bottom of the heart. This is Taiwan’s key differentiator and must thus be strongly promoted.

 

The majority of Taiwanese also have misperceptions of China. Many believe that Mainland China is a rural backwater and while this is correct in some areas, it is clear to all who have visited China that the country is so vast that its first and second tier city dwellers can be described as nothing less than cosmopolitan consumers with a taste for the world. China’s outbound tourists are largely consumers with a higher education and are seasoned travellers, as such their expected levels of service are high. 

 

Mainland travellers to Taiwan are not normally first time travellers, by the time they travel to Taiwan they have already experienced the high levels of service competing South East Asian hotels and destinations have on offer. Taiwan must show through its hospitality industry that Mainland travellers are welcome, they have to show their high level of services offerings. Many Taiwan hospitality practitioners ask me what the ’secret’ is to successfully attracting Mainland travellers, but I tell them that it does not exist, it is a myth. One has to invest in order to be successful, you have to invest in PR, marketing, and you have to be consistent. Taiwan did an excellent job enticing Japanese tourists, but now they must start to entice the Mainland tourists, they need to catch up. Frankly speaking, I have not noticed any promotional work of Taiwan yet.

 

For starters Taiwan needs to establish a visible representative office in Beijing as soon as possible for both relationship purposes but also to get a clearer understanding of the local consumer market. B2B engagement and promotions are very important and a good place to start as well.

 

Before your relations with the tour operators are even in place however, one needs to define what messages your destination wishes to carry. The messages must be relevant, colloquial and easy to remember. Furthermore, it is advised to focus a large proportion of your resources on Internet promotional platforms due to its inherent cost effectiveness. This would include titan platforms such as C-trip but also ordinary chat forums and bloggers. Advertising and marketing can be very expensive on the Mainland, much more than in Taiwan, and as such creative online solutions must be employed to get a better return on investment.

 

The Mainland China audience appreciates celebrities so the Taiwan market will be well advised to leverage off such famous spokespersons, thankfully, Taiwan has an inexhaustible supply. 

 

In conclusion, based on my experience Mainland travellers are eager to travel to Taiwan and I am confident that if the appropriate itinerary is provided, it will be as memorable a trip as any other comparison. I am not convinced however that at this moment in time Taiwan is being proactively and appropriately promoted on the Mainland. Taiwan needs to catch up quickly, it is not the only available destination and the current emerging promotional and experiential trend is not an attractive one.

 

David Liu is Managing Director of Weber Shandwick China. Born in Taiwan, David has been working in the Mainland’s public relations industry for the past 10 year. He can be reached at dliu@webershandwick.com

October 12th, 2009 | Michael Jones | Tags: , , , , , , , | No Comments »

Interview with Small Luxury Hotels of the World

Small Luxury Hotels of the World LogoChina Traveller

August 2009

 

Q: China expansion plans?

A: We have noticed an increase in the number of hotel applications from China, which is a reflection of the growing maturity of the market and the subsequent proliferation of luxury boutique hotels across the country. SLH added three Chinese hotels to its 2008 global portfolio and we have already welcomed Han’s Royal Garden in Beijing, Pudi Boutique Hotel in Shanghai and Wuzhen Clubhouse in Tongxiang this year. Our first ski resort in China, Sun Mountain Lodge in Shangzhi, is also scheduled to open this year. This growth demonstrates Small Luxury Hotels of the World’s commitment to China and reflects the high standards of boutique accommodation that is developing across the country. Each of these has added to the breadth and depth of Small Luxury Hotels of the World’s offering in China.

 

Q: Occupancy percentage of outbound travelling Chinese staying at SLH abroad?

A: China is an increasingly important source market for SLH. Demand from Chinese travellers visiting SLH hotels in Europe and the Asia Pacific region is particularly high, whilst a growth in bookings for hotels in the Americas is expected in the next year now the destination has opened up to visitors from China. We have actually already seen a number of bookings for our hotels in the US from the China market. Compared to last year, Spain seems to be an increasingly popular destination for Chinese travellers – as does Bali, Australia and New Zealand. Despite the global economic downturn, revenue from bookings made from China has increased this year. Compared to the same period last year bookings from China have grown by 150 per cent in the first six months of 2009.

 

Q: How is brand SLH perceived in the China market?

A: We are seeing a growth in the number of bookings made through the GDS by travel agents in China. We have worked hard to build our relationships with the trade here – for example, through our attendance at trade shows such as Asia Luxury Travel Market (ALTM). Travel agents know that their clients will only experience the very best when they recommend an SLH property – wherever it is in the world. They trust us and they know they can rely on us to take care of their valued clients.

 

Q: What gives SLH the competitive edge?

A: We were recently awarded top honours for the third year running in the New York-based Luxury Institute’s annual Luxury Brand Status Index survey. SLH was voted number one luxury hotel brand by wealthy consumers beating off 21 other luxury hotel brands, including Ritz- Carlton and Peninsula. No brand is better placed than Small Luxury Hotels of the World to provide our guests with the best of the best. The fact that only five percent of the hotels that apply to join are successful is testament to the high standards we demand. Although our hotels have their own interpretation of luxury, they all subscribe to a single standard of excellence.  Although we are keen to grow, we will never compromise on our strict standards – our reputation depends on it. As well as personalised service, it is really the experiences our hotels offer that set us apart as a brand. From medieval sword fighting, moonlit sleigh rides, bob sledding at 80 miles an hour, exploring the Scottish countryside in a Jaguar E-Type Roadster, a one-to-one Thai cooking class to a private shopping spree in Cartier, the range of experiences is extensive. SLH hotels can also organise behind the scenes tours or opportunities to engage with the local community – for example, tea with the Berbers in Morocco, mingling with the Masaai tribes in Kenya or an overnight stay with a nomadic family in Mongolia.

 

Q: Major obstacles in positively branding yourself in China

A: We have not encountered any major obstacles. We are building the profile of our brand amongst consumers, trade and hoteliers. China is a market which is poised to be one of significant growth for SLH – and we are dedicating the resources necessary to fuel this growth.

 

Q: Outbound Chinese traveler’s loyalty to foreign branded hotels?

A: Traditionally Chinese travellers have been extremely loyal to the large, international hotel brands. However, our brand positioning matches exactly what experienced Chinese travellers are beginning to demand – individuality, memorable experiences and as sense of self-identity.  These discerning travellers do not want cookie-cutter hotels.

 

Q: Methods/tactics to generate better awareness in China?

A: We have an integrated approach to Sales, PR and Marketing. We hold a regular media event in Shanghai which is attended by representatives from our hotels around the world. We also have a presence at the top consumer shows such as Millionaire Fair, Extravaganza Fair, China International Luxury Property Fair and events such as the 9 Dragons Hill Polo Event. We have attended ALTM in Shanghai since the first event three years ago. We support a number of charity events across the region, such as annual charity fundraising event for The British Chamber of Commerce in Shanghai, as part our commitment to responsible tourism – an initiative we call ‘Caring Luxury’. We are also participating in various industry initiatives in-market. I am on the judging panel for the inaugural China Best Design Hotels Awards which are being organised by The Bund.

 

SLH appointed travel industry expert Alison Roberts-Brown as Area Director, Asia Pacific in June 2008. Alison is responsible for overseeing business development, sales, PR, marketing partnerships and stakeholder liaison.

August 18th, 2009 | Michael Jones | Tags: , , , , , , , , , , , , , , , , , , , , , | No Comments »

Interview with Ritz-Carlton’s Regional Sales & Marketing Vice President, Simon Manning

Ritz-Carlton LogoChina Traveller

July 2009

 

Q: Average occupancy rates in China?

A: Our occupancy rates are different for different cities. Hainan and Guangzhou are doing very well, in fact Guangzhou is quite unique as it is one of the few luxury five star hotels and we are doing well there. Ritz-Carlton is the fastest growing luxury five star group in China. We currently have six hotels with more than 2200 luxury rooms and 263 club and suite rooms. Some 60-70% of occupancy in our China properties are made up of local Chinese, while up to 80% in second tier cities.

 

Q: How to differentiate from competitors?

A: Firstly, we pride ourselves on our high levels of service and this is really the brand DNA of The Ritz-Carlton. During the financial crisis we did not cut down on staff. Secondly, what we refer to as our ‘Ladies & Gentlemen’, we highly value our internal staff and accordingly have achieved the best employer in Asia and China accolades. Opportunities exist for our Ladies & Gentlemen to move overseas and operate in different environments to improve their skills. This includes our rank and file and is not limited to management. Ritz Carlton is furthermore striving to become the social centre of cities, and we are moving towards that end through not only guests staying with us, but by enjoying our experience through weddings, dinning etc. Through this we are defining and generating loyalty beyond the normal hotel-customer relationship.

 

Q: Define the Ritz Carlton local Chinese clientele?

A: Out of the business travel segment our clientele is made up of local Chinese working for MNC’s, they are usually educated abroad. Our clientele also include SMME owners and a large percentage is also made up of MICE group tours. In the luxury travel segment we have young people between the ages of 23 and 40, children of SMME owners, overseas educated professionals and the generally affluent.

 

Q: Breakdown of Chinese travellers staying at The Ritz-Carlton abroad?

A: We are aware that numerous Chinese travellers stay with The Ritz-Carlton in Los Angeles, San Francisco, New York, Washington and Atlanta. Similar to the States, we also have many Chinese professionals staying at Ritz-Carlton in Europe when visiting their company headquarters. In addition to business travel, we also receive incentive travel groups but these are normally smaller groups, however, the MICE segment is enjoying good growth.

 

Q: How is brand Ritz-Carlton perceived in the China market and who does it target?

A: As the local experience grows our brand increases in stature. Top business persons are very familiar with our brand. As people show their wealth through visible consumer goods, Ritz-Carlton will always do well amongst Chinese people with high disposable incomes.

 

Q: How do your branding activities differ in terms of targeting potential foreign and local clientele?

A: It is different in China as all of our communications with consumers are conducted in Mandarin however, we never translate our Ritz-Carlton logo for any market. We leverage off the European originated ‘legacy of service’ whereby we never show the actual products but instead support our brand with visuals that taps the individual’s emotions. Our local operations are executed in a local friendly manner and we are furthermore proud of our China specific CSM programmes that are unique in the world, such as our Dinning Programme.

 

Q: Major obstacles encountered in China?

A: We only open our hotels when we are 100% ready, and this was something that was very difficult to educate our operators on from the very beginning, by far our biggest operational challenge. Initially we also spent much time on a suitable translation of Ritz-Carlton into Chinese which in the end resulted in a phonetic translation. We never benchmark ourselves to other hotels, we instead benchmark ourselves against other luxury brands. Furthermore, we don’t advertise our restaurant brands as they are secondary to our Ritz-Carlton brand. Other challenges are sometimes of a political nature, such as the visa restrictions that were in place last year during the Beijing Olympics.

 

Q: What methods/tactics does Ritz-Carlton hotels employ to generate better awareness of itself in China?

A: We have clearly defined market segments that we target. For example, out of the total China team we have a dedicated team of 15 professionals focusing exclusively on the business travel market, whilst we have duplicate teams focusing on lifestyle, group travel etc. These efforts are supported by our dedicated PR team and all teams contribute in an integrated manner with goals determined at the centre. All divisions operate as one team and that is our strength.

 

Q: Additional comments?

A: Ritz-Carlton is ahead of its competitors in China with the right deal structures and the right partners, and the best is still to come. Our new properties in China will be our flagship properties, namely the Ritz-Carlton in Pudong which will be the best five star hotel in China, and the new Ritz-Carlton to be launched in Hong Kong is also set to become one of the best hotels in the world which will win all the accolades, set in a phenomenal location, the tallest building in the world, the International Commerce Centre.

July 7th, 2009 | Michael Jones | Tags: , , , , , , , , , , , , , , , , , , , | No Comments »

Interview with Tourism New Zealand’s Asia Regional Manager, Mark Frood

Tourism New Zealand LogoChina Traveller

June 2009

 

Q: Definition of Chinese traveller?

A: We are targeting the ‘Interactive Traveller’, persons who participate in all the activities we have to offer, longer duration stays and higher spender. Chinese travellers are on their way to becoming interactive travellers, they don’t necessarily bungy jump yet, but they are at least going to watch, showing interest. The interactive travellers are normally in smaller groups, two couples, a family, of independent travellers. Currently they are small in number, but they exhibit very high growth.

 

Q: Breakdown of ADS versus FIT travellers? Growth rates?

A: ADS tour groups make up about 40% of overall travel to New Zealand. FIT travel accounts for 8-10% of total travel, however it becomes complicated as visiting friends and relatives account for about 8-10% of total Chinese travel to New Zealand, however, many of these then go on to become FIT travellers as well. FIT growth is estimated at around 80% per annum.

 

Q: How would you define brand New Zealand?

A: ‘100% New Zealand’, our global campaign, is an emotional connection with our natural surroundings that include clear, blue skies, pure foods etc. Our brand is about connection with people, with the various cultures our Islands offer, whether it be the indigenous Maori people, our farmers, operators of the tourism activities etc. We understand that we are not the only brand with beautiful scenery, and our destination is a far distance to travel, so we need to convey an essential experience and be the best at it.

 

Q: How is brand New Zealand perceived in the China market?   

A: We are perceived well when understood. There is an awareness of New Zealand, mostly focused on sheep, mountains and so forth. Through our branding exercises we are making Chinese more aware, for example, we currently have a consumer campaign in Shanghai in full swing.

Q: Emerging trends amongst travelling Chinese?

A: Sustainable tourism has a good hook as China is going to lead the world in green technology, energy etc., and this is going to permeate into the rest of the society. New Zealand is known as a clean and green country so this works well for us. So sustainable tourism already resonates in China to a degree. The younger Chinese back packing style of travel will definitely get there one day.

 

Q: Evidence of Chinese interest in sustainable tourism?

A: Yes, Chinese are more and more interested, this is what we are about. Taking photo’s of glaciers, taking these natural wonder photo’s by themselves, it is a statement of freedom.

 

Q: Is New Zealand branded differently in China than abroad?

A: As part of our global campaign the age segment we are targeting in China is the youngest target audience. In China we target 35-50 year olds. We also focus on families and couples, people who have normally travelled 3-4 times before. These travellers normally have no visa issues and they are English independent. We also find that for our target segment the travel decision is quite collaborative between the male & female in the family or group, with perhaps the female having perhaps a little more decision power, but the planning of the trip is a lot of fun for them, both male and female.

 

Q: When will the China market mature?

A: New Zealand is perfect for FIT and in the past some thought it strange of us to focus more on this segment. Now local tour operators are approaching us more and more to target the FIT travellers. Online bookings are starting to take off but for the present travel agents remain important. I believe China’s market will mature within five years.

 

Q: Methods/tactics to generate greater awareness?  

A: We currently have a consumer campaign in Shanghai that is focused on TV and online media. We have also completed translating the Tourism New Zealand consumer, trade and media websites into Mandarin.

 

Q: How much emphasis placed on the new media?

A: A great deal. We are not so sure how well newspapers are doing and we have shifted our attention to screens (motion & sound), and online media does this well. Our activities include use of bloggers, video sharing platforms such as Tudou and Youku, standard TV, outdoor TV such as Focus Media etc. Through these platforms you get immediate feedback, you need to provide the essential experience, and do it the best. Such a campaign needs to be 100%, everybody needs to be on their toes and the consumers will judge you and judge you swiftly. We have done our research though, so we know what we are doing, we are ready.

 

Q: Most creative or audacious campaign?

A: Our most audacious campaigns have been those focusing on opinion leader FAM tours as we don’t put any restraints on them. For example, we have sent Wang Zhongjun of the Huayi film company, Hong Huang (blogger, TV host), Wang Chaoyong (founder of Chinese America’s Cup), Yuan Yue (blogger, TV host) to New Zealand in the past. These individuals are of a high profile so become great ambassadors to our country. In this way, these individuals, and their followers, experience their own emotional attachments to our brand. Tourism is an emotional purchase.

 

Q: Branding strategies that will become more popular over time?

A: More referral strategies, where consumers become the biggest referrals. If you get it right they will do your job for you, but if you do it badly you will find out very quickly, word of mouth to the extreme.

June 8th, 2009 | Michael Jones | Tags: , , , , , , , , , , , , , , , , , , , , , | No Comments »

Interview with Los Angeles Convention & Visitors Bureau – Jamie Lee, China Chief Representative

 

Jamie Lee, Chief Representative of LAWA/ LA INC China Office

Jamie Lee, Chief Representative of LAWA/ LA INC China Office

 

 China Traveller

May 2009

 

Q: Description of foreign travellers to LA in 2008?

A: LA received 2,345,741 foreign travellers in 2008. Our largest foreign market was Asia with 892,951 arrivals comprising Japan (279,748), South Korea (157,389), Chinese Taipei (108,267), Mainland China (83,327) and Hong Kong (36,530) leading the group. Europe produced the second largest regional group of arrivals with 824,512.

 

Q: What impact has ADS had on Chinese arrivals?

A: Prior to ADS, arrivals from China grew at 10% but it is currently growing at 20 – 30%. This needs to be seen in the context of Japanese arrivals experiencing double digit decline. 

 

Q: Breakdown of Chinese travellers by geographic location?

A: Beijing is responsible for the largest share of arrivals evident with its 7 flights per week. Shanghai also has 7 flights per week but includes cancelations from time to time, while Guangzhou has 4 flights per week. Beijing delivers a mix of travellers with various purposes while Shanghai is mostly for business and Guangzhou mainly for leisure travel. 2nd and 3rd tier cities also make a strong contribution with an estimated 30% of Beijing’s travellers originating in outlying cities.

 

Q: How has the financial crisis affected Chinese arrivals?

A: According to our January 2009 arrival figures there has been no impact thus far.

 

Q: When did LA INC establish representation in China?

A: We were the first US city-level tourism office to be approved by CNTA and consequently established our office in 2006. To date we do not know of other cities that have the same approval and thus they operate through PR companies.

 

Q: How is LA perceived by Chinese travellers?

A: LA is a recognised city with Hollywood playing a prominent role. There are both good and bad misconceptions however, but generally expectations are extremely high. Part of our job at LA INC is to moderate expectations, (e.g. they will not necessarily meet any of the Hollywood stars), ensure that the correct messages are disseminated that our visitors have a positive experience and return again in the future. 

 

Q: Characteristics of average Chinese traveller to LA?

A: Previously it was dominated by government officials attending functions and events, but now it has shifted to leisure groups. We still maintain a good mix of leisure and function purposes groups as LA is a must visit place with perfect weather all year round. Roughly 70% of our travellers come in groups while business travellers account for 10% and 5% independent travellers.

 

Q: Greatest challenge to promoting LA in China?

A: Sending out the correct messages and ensure that tour operators don’t package tours at too much of a discount that might have a negative impact of the traveller’s experience. We want to ensure we are offering the correct value.

 

Q: Measures taken to combat effects of financial crisis?

A: Hotels etc., have already reduced their prices. We are utilizing the time to conduct proper in-house training and improve strategic relations to ensure we are 100% ready when the crisis subsides and the market explodes.

 

Q: Who are your natural competitors (domestic and abroad)?

A: Domestically we all work together. Internationally our competitors are generally English speaking long haul destinations.

 

Q: LA’s strategy for attracting increased Chinese travellers?

A: We are looking towards the future of FIT travellers from China. With the maturing of the market, we expect China’s 1st tier cities to be more inclined towards FIT travel within three years.

 

Q: Tactics to promote LA in China?

A: We engage in media interviews and FAM tours. On a limited basis we also conduct receptive trainings which are coordinated with tour operators. We will also be coordinating more road shows into other provinces such as Hunan, Hebei and Shanxi etc.

 

Q: Most creative campaign undertaken?

A: China’s first Olympic gold medal was won at the 1984 Olympics in Los Angeles and accordingly last year on the 8th of August we organised an event with LA officials, Chinese sports persons, media and travel agents to celebrate that history. Corresponding visits were undertaken including a gold-to-gold itinerary for travel agents visiting the LA sports centre within an overall sports themed itinerary. The campaign met all our expectations. We continuously conduct direct-mailing to our partners, media, tour operators, airlines and other contacts as well as a monthly newsletter and press releases.

 

Q: Strategies/ trends becoming more popular over time to promote in China?

A: Promotions will become more hi-tech, greater focus on IT with multi-media presentations to underscore strong promotional strategies.

May 26th, 2009 | Michael Jones | Tags: , , , , , , , , , , , , , , , , , , , , , , , | No Comments »

Interview with PATA’s John Koldowski

PATA Director of Strategic Intelligence Centre

PATA Director of Strategic Intelligence Centre

 China Traveller

January, 2009

 

In our first Thought Leadership column we interviewed John Koldowski, Director of the Strategic Intelligence Centre of Pacific Asia Travel Association (PATA), to gain his insight of the travel industry affected by the global financial crisis.  

 

Q: Can you provide us with a background of the travel industry up until the financial crisis struck?

A: Over the last 5 years, international travel & tourism has generally been growing in both arrival numbers and revenues earned. The average rate of growth for arrivals has been at around 7% per annum, while revenue growth has averaged at around 13% per annum over the same period. So the last few years in particular have seen relatively strong growth.

 

Q: What about the Asian market?

A: Asia has been a particularly strong performer, in both arrival numbers and revenue. Even though earlier in the year (2008), expectations were for a reduction in the growth of international arrivals, we were still bullish about Asia and were still predicting growth, albeit at a much slower rate.

 

Q: Has the crisis already struck or are we already experiencing its peak?

A: We have experienced growth so far this year (2008), but at a much lower rate than 2007. This is true for nearly all sub-regions within Asia Pacific, the only exception being the Americas, where the trend has been stronger growth over 2007.

 

Q: What about China?

A: The last few months have seen strong contractions in international arrivals, both at the aggregate inbound level and for foreign arrivals. Although China has a blooming domestic market, globalization will not allow any country to go unscathed. So it appears the downward trend will not be reversed in the short term.

 

Q: What does the immediate future hold in store for us?

A: This is what we are currently analyzing. But I would first like to speak of a related matter. In the aviation sector, our lifeline to the travel industry, the trends are all negative. Particularly through the month of September 2008, the Asia Pacific region all but led the global decline. According to the data from IATA, we found a very poor year-to-date result in Revenue Passenger Kilometers and freight movements as well. I just spoke with a friend from the Association of Asia Pacific Airlines, who informed me that in terms of actual passengers carried, June was flat and July saw a contraction in numbers on the Asia Pacific airline fleet. The negative forecasts for airports are therefore understandably somber. Premium traffic growth in particular has been taking a beating. And the forward bookings are looking soft too.

 

Q: We noticed many analysts have adjusted their economic outlook for 2008 and 2009, will there be no growth in the travel sector?

A: While the economic outlook is certainly weaker, there is still growth. It will vary greatly from country to country. But these top-level aggregate numbers are masking a more worrying concern, that of profitability. For example, the price of aviation fuel, while coming down in price, it is still unstable. The operating margin for the world airline fleet is very weak at the moment, and operating losses are expected to continue into 2009 at least. If this holds true, the aviation sector will only see profitability in a year.

 

Q: We are seeing news reports of airlines reducing or eliminating routes with weak demand, what impact will this have?

A: This leads us to another scenario, with reduced capacity, demand will push air ticket prices higher and it will not be as easy to get the booking you want, on the route you want, on the day you want and at the time you want. Air travel will get even harder, at least over the immediate future.

 

Q: Is it all bad news?

A: It is not all bad news. Some operators actually perform very well during a recession. I read an article from Lodging Econometrics recently stating that while there has been a reduction in the number of hotel projects in Asia Pacific between the first and second quarters of this year (2008), total planned room capacity is still on the rise. I am sure a very large proportion of that construction is planned for China.

 

Q: Let’s get back to China and our tourism sector. Will China still be the engine of growth during the recovery period?

A: Yes. Some analysts firmly believe that emerging economies such as China could do very well in a global economic downturn. In the long-run, the world economy always expands and then goes through periods of contraction. But the world will look different, from where new funds will come. Not only in China, but the rest of the world, to the fragmentation of our industry and the emergence of ‘long-tail economics’ into the business world, it is up to us to identify and capture the advantage when and where it appears. Over the medium-term however, we still expect the travel industry, buoyed by the business element, to generate growth. It will just be at much lower levels than we have been used to over the past half decade.

 

Mr. Koldowski is responsible for the collection, analysis and interpretation of travel statistics for PATA.

 

May 15th, 2009 | Michael Jones | Tags: , , , , , , , | No Comments »

The China Traveller

Travel

Since my parents took my sister and me on a long road-trip holiday to Durban at the age of five, I have been hooked on traveling. Sure, there were times where my sister and I were pulling each others hair out while isolated from our parents on the back of the bakkie (pick-up truck) but the freedom from routine daily life and the exposure to everything new, new sights, new food, new culture, new friends etc., made it extremely memorable.  

The first time I flew on an airplane was when I was 17 years old, on a direct flight from Cape Town to London where my friends and I worked arbitrary jobs for a year with the objective to travel the world. Some were more successful in meeting the objective than others but the foundation for a life of travel was established with snowboarding trips to Scotland, visits to European cities and a tour of 100% pure adventure to Pamplona for the running of the bulls in northern Spain.

It was during my travels as a university student that I first started to consider the impact that tourism as an industry has on the development of communities. The positive, developmental role was made crystal clear to me while travelling on a shoestring with the closest of friends to neighbouring Namibia and the Xhosa tribal lands of Transkei on South Africa’s east coast. The rural areas we travelled to had been completely overlooked by other commercial planning and its was inspirational to witness how these economically less fortunate communities benefitted from travellers who could hardly be described as wealthy. Since those days I have always tried to observe and analyse internally the impact that tourism has on the socio-economic development of communities. I am a strong believer that few industries nurture innate entrepreneurism at the community level better than tourism does. It not only gives dignity to disadvantaged individuals in the form of employment, but truly empowers families, clans, villages, towns and cities like no other.  

Having lived in Beijing for over seven years I have had the enviable opportunity of using China as a springboard to travel to a multitude of near and neighbouring countries in addition to domestic China itself and have found the same spirit of entrepreneurism and social improvement throughout.

My career in the communications industry started in 2003 when the Managing Director of Weber Shandwick China, no doubt pitying me, offered me an internship, and some time later we landed our first travel destination client, The Bahamas. The passion of my personal life and my career finally collided and merged. Through my career I have been increasingly exposed to the role that upper end tourism plays on communities when large scale hotel & resort developments are established creating stable employment and nurturing advanced service training for larger numbers of local people’s. If implemented with a sensitivity to the environment and the local community’s social fabric, there can be no denying the beneficial influence these investments have for a country.     

Over the years, by travelling to south-east Asian countries with my adventurous wife during China’s golden week holidays I have also had the opportunity to engage with and observe China’s growing outbound travellers. Watching them transform into a more mature market of travellers has been fascinating, especially when viewed in tandem with the other great consumer changes tearing up the past.

But why do I find China’s outbound travel & tourism so fascinating? Above and beyond the stellar growth that this particular industry is experiencing in a time of decline across the mature markets board, which should be sufficient reason, China’s outbound travel market is one of the few vehicles through which countries can narrow their trade deficits with China. The number of countries which have a trade surplus with China is limited to a handful of oil exporting and hi-tech nations and while the onus lies with trade deficit countries to modernise their economies, the reality is that few have the capacity to do so, especially developing countries lacking economies of scale.

Thankfully, after decades of being closed to the world, Chinese consumers are not only curious of foreign cultures but put their money where their mouth is and travel a considerable amount. The world is now their oyster and they do not seem to discriminate in terms of destination (so long as the destination is not too unsafe) or class of travel (from backpackers to 7 star hotels). In a nutshell, their interest to travel is there and the numbers will continue to experience significant growth so long as China’s economy continues to prosper, the only challenge that exists however is the competitive landscape of destinations and brands battling it out for China’s outbound travel market share, something that will only intensify with time, and this is were my job begins…

May 10th, 2009 | Michael Jones | Tags: , , , , | No Comments »