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 »

Calm Before the Storm

Calm before the stormChina Traveller

August 2009

 

While health officials continue to caution that H1N1 swine flu remains a serious risk to all nations one would be forgiven for thinking otherwise considering the lax attitude adopted by seemingly all travellers today. The shock of worst case scenario swine flu projections no doubt caused initial self restricting measures but there currently seems to be little dampening effect on regional and international travel due to any health concern.

 

Attitudes towards virus outbreaks seem to have softened a degree since SARS all but obliterated travel in Hong Kong and on the Mainland in 2003. Those who lived in Beijing during the height of 100 people getting infected with SARS per day back then will remember the damaging effects of bringing great swathes of the economy to a grinding halt, especially the travel and leisure industry.

 

Generally speaking, China’s consumers can be described as anything but risk prone adventurers. The government’s stringent measures to prevent an H1N1 epidemic, the multiple temperature measurements before getting out of the airport for all passengers and the strict quarantine of potentially affected passengers spoke volumes of China’s health official’s learning curve since SARS. Furthermore, a number of Chinese tour operators were quick to cancel trips to North America immediately upon the H1N1 outbreak in Mexico reinforcing the nations cautious attitude. China’s outbound tourism industry is still dominated by ADS styled group travel, which by definition is a risk managed form of travel. The consequences of group travel market domination are that cancellations due to perceived risk will be total as opposed to independent travellers who might still weigh up the pro’s (including elements articulated by the destination’s crisis communications team) and con’s individually. This further compounds a potential damaging period for affected destinations.      

 

A number of leading health authorities have started to voice their concern that amid global warming, virus outbreaks similar to SARS and H1N1 will become more routine. While initial outbreaks will result in initial short-term panic, human nature dictates that over time consumers will start to become accustomed to such outbreaks and view such disruptions as unavoidable, yet temporary, inconveniences rather than life threatening pandemics. Assuming that this risk adverse nation, China, can acclimatise to such risks is a very liberal assumption however (especially with the tour operators making the decision), and it will nevertheless result in temporary, yet significant, spikes in travel, creating havoc for the industry.

 

Political instability also serves as an equally strong risk to tourism, of which Thailand must be the textbook example of a great travel destination plagued by divisions that have negatively impacted on tourist arrival numbers. Chinese arrivals to Thailand experienced a significant drop of 38% for the first quarter of 2009 following the protest enforced closure of Bangkok’s main airport last year while the ASEAN summit protests which prevented the free movement of world leaders including President Hu Jintao was sufficient evidence that Thailand remained a destination of choice only if you didn’t mind risk being holed up in an airport or hotel for a few extra days. Since then the Thai authorities have been slowly reclaiming ground through aggressive campaigns and the relaxing of visa restrictions that are already paying dividends. To be sure, Thai authorities are not promising an end to the disruptions, but their strategy of attacking the wallet and ease of use will perhaps shorten consumer’s memories when picking a holiday. 

 

A particular risk when targeting China is furthermore that of bilateral relations political risk. The collective urge to travel to Paris has lost its sparkle somewhat since Parisian demonstrators took it upon themselves to disrupt the Beijing Olympics torch relay through their capital. Even most recently, following Turkey’s Prime Minister’s declaration that the upheavals in Xinjiang could not be described as anything other than a ‘kind of genocide’, the Chinese official diplomatic notes of protest filtered rapidly through to its citizens that under no circumstances was Turkey to be promoted or engaged with inside China so long as bilateral tensions remained in place.

 

The combination of the perception of lack of development and outright personal danger has stifled Chinese outbound travel to numerous regions including the Middle East, Africa and South America. Mexico serves as a good example here where despite its renowned beautiful surroundings the destination is generally avoided by Chinese tourists out of fears for person safety from criminal elements whilst their North American and European counterparts take it more in their stride. While the reporting of a murder in Mexico does make the average Western tourist think twice about a Christmas getaway, the publicised news of a Chinese person being singled out in a criminal act serves as a progressively powerful deterrent.

 

Nothing tests a destination’s crisis communications system more than a wholly unexpected and immediate disaster however. Although the crisis can take on a number of forms, if the cause was man made and the consequence of extreme negligence or latent discrimination (i.e. avoidable) destinations with the appropriate systems in place will without doubt fare better than the unprepared.   

 

Crisis’ of all shapes and sizes catch those in responsible positions either by complete surprise or the magnitude of the crisis is the surprising factor. Either way they will not disappear as a threatening source to the reputation of destination’s we have been tasked to protect, the ‘calm’ we are enjoying right now would be a good time to prepare for the next storm to strike.

August 18th, 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 VisitScotland

visitscotland-logoChina Traveller

August 2009

 

Q: How would you define the Chinese traveler for the Scotland market?

A: 40% of our travellers from China are made up of business travellers and other short-term travellers. Another large component includes scholars. We receive on average around 10,000 Chinese travellers per year, basically, 10-15% of Chinese travellers who go to the UK travel to Scotland. 

 

Q: Breakdown in terms of ADS versus FIT travelers?

A: Over the past two years FIT travel has been the emerging trend amongst Chinese travelers, evidence of which can be seen on Ctrip and other online operators. This, FIT, will no doubt be the future trend but it is still early days. A very rough estimate of FIT travel to Scotland puts it at 10% of total Chinese travel.

 

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

A: The biggest impact of the financial crisis is that booking lead times are much shorter now and people are searching for greater value for money. From the China side trips to Scotland have also been delayed as a consequence but it is good news that travel has started to pick up from June. Nevertheless, tour operators continue to search for bargains to kick start stalled operations. Like the rest of the world the UK is not immune to the effect of swine flu, but in terms of outbound travel the US and Mexico have suffered greatly, while Scotland by comparison have not been that badly affected. The UK is very aware of these challenges and taking the threat seriously. 

 

Q: Define brand Scotland?

A: We have a shared industry ambition to grow revenues from tourism by 50 per cent by 2015.  Attracting visitors who want to experience a luxury break in Scotland will be an important element in achieving this goal.  Scotland has much to offer the luxury traveller, from world class five star resort hotels, to Michelin stared restaurants and high quality local produce – all set against a backdrop of vibrant cities and some of the most breathtaking scenery and heritage in Europe.” VisitScotland brand research shows that Scotland has world famous icons such as whisky, tartan, golf and castles along with strong, romantic and rich imagery. The people of Scotland are respected and admired throughout the world but there were issues with the destination being seen as expensive and remote. Emerging from the research were three key words, each representing the Scottish brand: Enduring – The buildings and architecture, history, culture and tradition. Dramatic – Dramatic scenery, beautiful light and the drama of the changing weather. Human – The Scots are seen as down to earth, innovative, solid and dependable, and full of integrity and pride.

 

Q: Golf as a draw card for Chinese tourists?           

A: Due to being the home of golf, St. Andrews, 8% of travelers to the UK include golf as part of their itinerary and the Chinese are showing great interest in this area. Accordingly, our golf operators are working very closely with their Chinese counterparts. Recently, VisitScotland and Connect2Golf launched an amazing opportunity for golfers in China to become Scottish golf club members in the Home of Golf by joining the new Scottish Prestige Golf Club. This includes the opportunity to play at over 30 courses throughout Scotland, from Gleneagles, venue for the 2014 Ryder Cup, to Carnoustie Championship, seven time venue of the British Open, and Turnberry, home of the 2009 British Open, and experience the world’s oldest and best greens and fairways, played on by so many of the world’s greatest golfers. The Scottish Prestige Golf Club has been created for Chinese golfers.

 

Q: Who do you target?

A: While our main target is affluent and well travelled Chinese, business extenders, golf players and repeat travellers to the UK, at the same time we will continue to push for increased ADS business most ADS tours only stop at Edinburgh as part of an eight day tour through the rest of the UK. At VisitScotland we would like to show the other parts of Scotland, especially of the more high end offerings. Accordingly we are working closely with golf operators and our PR key messages include golf as part of our priority target.

 

Q: What methods/tactics to generate better awareness in China?

A: We have engaged in a number of travel trade training activities for the larger tour operators and have also focused on FAM tours that tour operators, travel agents and the media can see for themselves exactly what we have on offer. VisitScotland was the first UK destination to launch a Chinese language agent training website. In terms of creative tactics we have tended to refocus our attention to hosting non-travel trade media. Furthermore we have successfully hosted the ‘Scotland Home of Gold Challenge Day’ in Shanghai in 2006/07. All our efforts are backed-up by annual trade missions to China. Our strategic partner, VisitBritain presents the whole of Britain to the China audience.

 

Poling Lee joined VisitScotland as Trade Promotion Executive in September 2005. She is responsible for identifying markets and developing the trade network in the Middle and Far East markets, in particular in her native China.

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

Über Luxury Cornering the China Market

China Traveller

July 2009

 

As China continues to contribute to the enlargement of the world’s high disposable income pool, five star accommodation is becoming par for the course amongst China’s burgeoning elite. Revitalized by this new market that is currently growing in stark contrast to the rest of the world, owners and managers of ‘luxury’ five star hotels and resorts are sparing no effort to attract the generals of opulence.

 

While even group package Chinese tourists have already proven their passion for purchasing luxury products when abroad it is the upper most section of the ladder that the decadent brands are pursuing. For those who have both a before and current view of China’s urban life the targeting of China as a new luxury market will come as no surprise. Previously dominated by RMB1.2 Xiali taxi’s (with exception of the government driven black Audi’s); RMB10 per dish meals; RMB6,000 per/m2 apartments and clothing & accessories not even attempting to replicate international fashion trends, urban China today is virtually another world with stretch limo Hummer’s (not to mention the previously unheard of Sichuan province based company that just bought Hummer!); fantasy restaurant bills under RMB200; RMB30,000 per/m2 apartments and Gucci/ Prada outlets seemingly everywhere. In fact, similar to other newly wealthy countries, China’s growing adjustment to wealth has gone from the sublime to the ridiculous resulting in a situation where it is now almost impossible to order a bottle of champagne in a club without the accompanying sparklers and fanfare screaming ‘look at me, look at me’. Even my favourite burger joint now has a promotion offering Moët & Chandon, seriously…, champagne with a burger?         

 

Make no mistake, China’s new economic elite have serious money and they are happy to depart with a significant amount of it so long as the exercise heightens their social standing, music to the ears of luxury brand marketer’s intent on finding their emotional pressure points. But the challenge of targeting China’s economic elite is everything but child’s play, not only is the market unique due its relative youth but is further compounded by China’s cultural uniqueness long shut off from the rest of the world, which begs the question, how does an international marketer successfully attract the attention of individuals from a historically inward looking society?

 

Those in the best position to target China’s wealthy will not only have a reputed international brand but will also have dedicated operations on the Mainland itself targeting the source of the market. The aggressive entry of the world’s top luxury hotel brands is further depressing an already saturated market for the time being but the backroom planners are well aware that the pure numbers game that only China can produce will save the day in the near to medium future, and result in an enviable brand loyalty along the way essential in attracting a nation that is starting to look outwards.

 

Luxury hotel and resort groups without a China presence will find it more difficult in attracting sustainable Chinese numbers but do have the benefit of utilizing platforms such as the recently held Asia Luxury Travel Mart in Shanghai in addition to other traditional marketing tools. Such establishments might find it challenging to retain the loyalty of Chinese travellers however due to their lack of on-the-ground experience of satisfying particular Chinese clientele requirements, ranging from basic communication, hospitality offerings to cuisine.

 

Contrary to previous fears of Chinese group tour stowaway’s and the accompanied discriminatory visa procedures a number of informed destinations, led by Japan, are changing tack to target this lucrative Chinese luxury market by making provision for FIT visa procedures ensuring that those that have the means no longer have to be accompanied by tour guides and bank embarrassing deposits as a return guarantee. By cooperating with inventive partners such as VISA, who already have all required information of the potential traveller readily available, this trend is set to snowball.               

 

So just how does a luxury brand marketer target China’s economic elite? If looking for a silver bullet you will surely be disappointed as the answer is: ‘by getting back to basics’. Throughout the various interviews conducted on behalf of the China Traveller since its inception I have rarely heard the word ‘research’ mentioned. Dissimilar to the heyday of ADS promotions, the shotgun targeting approach is no longer relevant if brands expect to see a return on investment. Market segmentation, the most basic of marketing concepts in any MBA course or ‘10-Day MBA’ book for that matter, will also have to dig far deeper than the current ‘white collar target audience’ declaration and shed light on the varying preferences held by wealthy consumers based in different geographic locations, different age groups, different gender, different industries, different language abilities and different behavioural segmentation etc.               

 

Every luxury brand on earth will soon be gunning for the Chinese Yuan and if my Google alerts are anything to go by a new luxury hotel or resort seems to be launching every day somewhere on earth, ensuring that the international luxury market will remain a buyers market for the foreseeable future. Unlike the luxury market obligation, Chinese market share will not be served on a silver platter.

July 7th, 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 Jumeirah Hotels & Resorts’ David Loiseau

Jumeirah Hotels & Resorts LogoChina Traveller

July 2009

 

Q: Current China operations?

A: Our first China hotel will be located in Shanghai’s Xintiandi, the Covent Garden’s of Shanghai, a great location that is set to be come THE luxury area of Puxi. Pudong is an important area of Shanghai but Xintiandi remains the premier location, as our hotel will in fact be one of the closest to the World Expo Shanghai. We are scheduled to open in early 2010 in time for the Expo and we are already receiving booking requests for the Expo period.

 

Q: China expansion plans?

A: We are constantly looking for new opportunities in China but we officially have two projects in the pipeline that include Guangzhou and Macau. The Guangzhou property will be smaller in size with 200 rooms and 100 service apartments and is scheduled to open in 2012. Our Macau property is scheduled to open in 2013. Furthermore we are talking to developers in Beijing, Hong Kong, Hangzhou & Sanya to see what other opportunities exist.

 

We furthermore expect that 30% of our growth will come from Asia going forward and by 2012 we will be the proud guardians of 60 hotels & management agreements in place. 

 

Q: Breakdown of guests by geographical location?

A: In Dubai, where the majority of our hotels & resorts are located at the moment, we have recorded that 25% of guests originate from the UK, 16% from the Middle East, 12% from CIS countries, 9% from Germany, 9% from the US, 7% from Western Europe, 2% from China and 1.5% from Japan.

 

Q: Jumeirah’s competitive edge?

A: We are privileged in owning the most luxurious property on earth, the Dubai Burj Al Arab. The breakdown of guest staying at the Burj Al Arab includes the UK in 1st position, 2nd – CIS countries; 3rd – Middle East; 4th – Germany while China commands the 5th place of most frequent visitors. Part of the reason why the China market has responded so well to our brand is due to Dubai’s excellent branding activities over the past 10 years which has given us great visibility. Secondly, by building an iconic property such as the Burj Al Arab, we have properties that are compared with other iconic marvels of the world such as Paris’ Eiffel Tower, the Sydney Opera House etc. Lastly, at Jumeirah we naturally maintain the highest levels of service which sets us apart from our competitors. Besides the iconic status, location and excellent service, we also employ brilliant branding tactics. For high end Chinese travellers, staying at a Jumeirah hotel lends the individual unparalleled status, an important aspect within the ‘face’ conscious society.     

 

Q: Jumeirah brand recognition in China?

A: In 2007 & 2008 we conducted consumer surveys in China which showed that 16% are now familiar with Jumeirah, up from 9% in 2007. Despite not having a property in China yet we are thus gaining on the luxury market leaders in Asia Pacific. Of those surveyed, 78% said they would consider staying in a Jumeirah hotel while staying in Dubai, London or New York, up from 65% in 2007. Furthermore, 44% or respondents recognise the Jumeirah tagline of ‘Stay different’ while the Jumeirah Burj Al Arab is recognised as the number one property in Dubai. There is great branding strength in the association of Jumeirah and the Burj Al Arab with one in two respondents recognising Burj Al Arab as the most luxurious hotel in the world.

 

Q: How has Burj Al Arab impacted on the Jumeirah brand?

A: It has been a very important influence on our overall experience. Once people have stayed in the Burj Al Arab they want to see our other properties and experience our other ways of conducting business and providing a unique service. These guests are now forming their own preferences for our different styles.

 

Q: China branding methods?  

A: Brand awareness skyrockets with the establishment of a property in that country. With our property in New York our global US clientele now makes up for 18% as opposed to the previous 4%. Regarding China we are already positioned well globally while for the Asia Pacific region, and China in particular, this is our new target market. We established a sales office in Shanghai in 2008 which focuses on Guangzhou, Shenzhen, Beijing, Shanghai, Shenyang, Chongqing and Dalian. We look first at who are our main B2B clients, build the team and learn about the market. We have started to cooperate with the Dubai Tourism board to educate travel agents targeting 250 of them in Beijing, Shanghai and Guangzhou. We also focus our efforts on expo’s in China such as the current Asia Luxury Travel Mart. Thus our B2B programmes and expo participation are initial steps in China while we avoid a full marketing plan until our first China property is up and running. We furthermore already embarked on Jumeirah road shows in Beijing, Shanghai and Hong Kong exposing partners to all of our products, Guangzhou and Shenzhen will be next.

 

Q: Branding obstacles?

A: We are experiencing no difficulties in branding Jumeirah in China. The travel industry is very excited about our brand and products. For example, recently Ctrip cooperated with us to conduct a 200 person media training, something very rare for Ctrip to do.

 

Q: Chinese travellers loyalty to foreign brands?

A: We have 200% year-on-year growth in our loyalty card membership amongst Chinese guests along with 100% growth in revenue for visits. China’s most loyal members visit the Burj Al Arab twice a year. Nevertheless we are conducting further research into this area. By the end of this year we will conduct a survey on ‘How to conduct a dialogue with a Chinese millionaire’, how to talk to them and how they want to be communicated with. We are very curious about this and are willing to try new things. The main difference between Asia and the rest of the world right now is that of ‘face’ and status, and this is something we know we can deliver on.

 

David Loiseau is Regional Vice President of Sales & Marketing for Asia Pacific.

July 2nd, 2009 | Michael Jones | Tags: , , , , , , , , , , , , , , , , , , , | No Comments »

Interview with Disney USA Parks and Resorts

Disney USA Parks & ResortsChina Traveller

July 2009

 

Q: What offerings does USA Disney have for Chinese travellers?

A: Disney USA Parks and Resorts is new to the China market and accordingly we have different information going out to the travel trade including park maps, recommended attractions, specific programmes in the parks etc. We are also highlighting our Youth Educational Series, which is popular in China so far. We are furthermore looking at how we can offer Chinese meals.

 

Q: What is the year-on-year growth of Chinese nationals visiting?

A: While we don’t disclose specific attendance figures but I can say that our growth in the China market is acceptable under the current circumstances. We look to tourism from China as a growing business opportunity.

 

Q: Do you think Disney Paris limits potential Chinese visitors to USA Disney?

A: Absolutely not. It is important to understand that each of our worldwide parks and resort hotels are different and have their own character and offerings. Not all Chinese who visit Paris visit Disneyland Paris. Visits to Disneyland Paris sometimes compete with many of the other popular itineraries set by tour operators.

 

Q: Do you think Disney Hong Kong has a positive or negative impact of Chinese visitors to USA Disney?

A: It has no impact at all. The USA Disney is the original and therefore is very different from the Hong Kong Disney. Hong Kong Disney is more for short-to-medium haul destination travelers etc.  It is important to understand that we successfully operate Disney Parks in many regions of the world. For example, even though Disneyland Paris is closer to the UK, we still see strong attendance from the UK at our Florida parks. Each experience is different.

 

Q: Profile of the typical Chinese visitor?

A: Our customers come from all over China. Prior to ADS our visitors were mainly older ones of group trips or government delegations. Post – ADS we are attracting more family travel, students and generally white collars.

 

Q: What is the breakdown of Chinese visitors in terms of group travel vs. FIT travelers?

A: At a very rough guess I would say about 80% ADS and 20% FIT travelers.

 

Q: Who is your target audience in China?

A: We are targeting the middle class, ages 30-50. We are currently not engaging in B2C promotions but focusing our energies on training and educating travel agents, how to package and sell our product. Media also plays a big role in this.

 

Q: How is the Disney brand perceived in the Chinese market?

A: As a place for kids. The local market does not know what a theme park actually is whilst the US market naturally understands. Our job is to educate that it is not only for kids, but for adults as well.

 

Q: What type of strategy/ tactics does USA Disney employ to generate a better awareness on the Mainland?

A: We educate and rely on the media to get the correct messages out. We leverage on FAM trips through cooperation with airlines, executive profiling interviews and exhibition participation.

 

Q: What is the most creative campaign USA Disney has ever undertaken to brand itself in China?

A: As we have just entered the China market we rely on cooperating with airlines and tour operators. For example we have hosted theme trips with United Airlines and CITS to offer a 12 day USA tour that included Disney USA Parks and Resorts. The group consisted of over 300 people from all over China for Chinese New Year. The trip was a great success that resulted in loyal future customers. We have also teamed up with Continental and Ctrip’s Elite Traveller magazine that featured Disney in a 30 page article.

 

Q: New media branding? 

A:  We have a fully translated Chinese website with all of Disney’s international information and our 5 global parks. We have new media plans that are to be implemented but until then we will continue to rely on Sohu and Sina cooperation.

 

Q: Additional comments?

A: We have great faith in the China market with all the pent-up excitement that is building u here, a Disney destination for all ages.

 

 Nicky Tang is the Asia Pacific Sales Director for Disney USA Parks and Resorts

July 1st, 2009 | Michael Jones | Tags: , , , , , , , , , , , , , , , , | No Comments »

Pursuing Green for Green

Naked Retreats eco-resort in Moganshan, Zhejiang province

Naked Retreats eco-resort in Moganshan, Zhejiang province

 

 

China Traveller

June 2009

 

With the steady maturing of China’s outbound tourism market a number of destination and hospitality brands are banking on the emergence of a growing segment of Chinese travellers now opting to partake in the niche ecotourism market to ensure their continued growth.

 

Despite China’s place as the world’s third largest economy and source of an enlarging pool of consumers with considerable disposable incomes, it is debateable what length of time will be required before a significant number of Chinese tourists start to chose eco-sensitive options, especially when considering the country’s delayed industrial revolution and accompanied level of development in comparison to its developed counterparts.

 

All who have visited China’s famed tourist sites can attest to the hundreds of packed buses offloading thousands of local tourists dashing for the restaurants, souvenir vendors and the obligatory photo opportunities creating everything but a tranquil experience. Even famed natural sites are inundated by these large crowds staying in eye-soaring concrete hotels heaving with activity completely devoid of any selling point other than ‘renao’ (lively). An over simplified presumption of current mass tourism (read: group) as it exists in China could not be further from conservation – it is all about consumption.

 

But evidence has started to emerge that a niche market of ‘back to nature tranquillity seekers’ is starting to emerge. From a personal observation, I never observed any Chinese travellers when trekking in the Thailand jungles five years ago. At that time, Chinese tourists were confined to group tour packages that would not go beyond itineraries packed with multiple sites, activities and shopping stops in a single day. A comparison of the same time with personal trips to neighbouring countries with incentive company outings consisting mainly of local staff members could not produce a more stark contrast. Back then there was an absence of eco-sensitive travel push-pull factors, the tourists themselves, who at that time had limited international travel experience, had little interest in anything other than a destination’s main attractions, while tour operators stood to lose out on the lucrative multiple-stop itineraries that have come to define group travel profitability.    

 

However, over the past two to three years I have observed a growing number of independent group travellers from China who seek a more relaxed and tranquil travel experience when abroad in South East Asia. These groups, usually four to six people consisting of families, couples or friends, are the trailblazers of China’s maturing market who either pick a relaxing spot (e.g. Koh Samui-Thailand) to spend the majority of their holiday, or who travel off the beaten track (e.g. North Luzon-Thailand) seeking the destination’s premier natural landmarks and landscapes. While these trailblazers might not share the same socio-economic status as they range from third-tier city teachers to first-tier city company executives, what unites them is the ability to conduct their own research and develop their own itineraries, the curiosity to dig deeper in alien cultures, the confidence to communicate in a foreign language (English), and the aspiration to travel freely and independently. While all forms of travel cannot avoid consumption, these trips have a far greater emphasis on emotional over material consumption and thus bode well for the emergence of eco-sensitive travel.

  

Before eco-sensitive destinations abroad can realistically expect to attract Chinese tourists it would be prudent to first take a look at the home market. To date China’s domestic tourism market has little to offer in terms of eco-friendly resorts for the simple reason that eco-friendly models are rarely supported and are often hindered by local stakeholders stress on quick profits in a booming economy. This challenge is compounded by the lack of a universally agreed upon definition of ecotourism, a banner that disappoints more often than not – containing only some flora with no supporting sustainable policies whatsoever. Despite high levels of development and environmental consciousness abroad, no international consensus on green tourism standards exists, so it is possible to infer that such standards will not be developed and abided by in China anytime soon.

 

In the absence of local ecotourism options a number of entrepreneurs have taken the initiative to fill the void and respond to a potentially lucrative domestic market. One such example is Naked Retreats which operates a boutique eco-resort in the pristine bamboo forest of Moganshan (Zhejiang province). Commenting on the growth of sustainable tourism in China, Naked Retreats Chairman Grant Horsfield says: ‘In many cases the term is misused by the tourism and hospitality industries which often use the term ’sustainable’ for their marketing purposes…a good example of how you notice the increase in this form of tourism in China is the rapid increase in outdoor environmental clubs, but once again, these clubs are not necessarily doing anything environmental. The most important element of eco-friendly and sustainable tourism is how the local communities are benefiting. This is still small in China.” He further added that there “was absolute evidence of growth in sustainable tourism in China but that it is still in its early stages because of the lack of real understanding of what eco-friendly and sustainable tourism actually means.”

 

 

Entrepreneurs have taken note of the gap in China, more established brands in the eco-sensitive realm such as Banyan Tree (See ‘Interview with Banyan Tree’s Claire Chiang’) can expect a two-fold result, near term profitability for local properties and medium to long-term brand loyalty development for properties abroad, operations of which are all guided by the company’s triple bottom line (economy, society and environment). Claire Chiang, senior vice president of Banyan Tree Holdings, has observed that: “today’s Chinese traveller is seeking rewarding travel experiences and cultural exploration, as opposed to previously when the interest was largely to accumulate as many travel destinations as possible”, and considering that the majority of Banyan Tree’s clientele at properties in China are of local origin and the fact that they enjoy a hospitality experience that abides by eco-sensitive practices, it has a net positive effect on nurturing this new market.   

 

While numerous country destinations are also set to profit from the emergence of this niche market and leading the charge is New Zealand with its 100% Pure New Zealand global campaign (See ‘Interview with Tourism New Zealand’s Asia regional manager, Mark Frood‘). Asked if he had observed any evidence of Chinese interest in sustainable tourism, Mark Frood stated: “Yes, Chinese are more and more interested, this is what we are about. Taking photos of glaciers, taking these natural wonder photos by themselves, it is a statement of freedom.”

 

Thus in anticipation of the maturing of the Chinese outbound market accompanied by a shift in emphasis of quality over quantity in the near to medium future, a number of destinations and hospitality brands have already adjusted their strategies to profit from the most lucrative potential of China’s future tourism: longer stays, higher spending, return customers in search of something more authentic as well as tranquillity and exclusivity.

 

The very nature of sustainable tourism implies exclusivity as an environmental protected and conservation area by definition cannot host hordes of tourists at one time due to the damaging effect on the environment. Accordingly, destinations that effectively implement sustainable tourism strategies will be the recipients of the most sought after economically blessed tourists.

June 8th, 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 »
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