Hubei-Norway week 2009 tourism promotion Roy Graff, ChinaContact Marketing Europe to the Chinese market 7-8 September 2009

How to market a new destination in China? 15 minute presentation: Overview of current state of Chinese tourism to Europe Identifying the challenges and opportunities in Chinese outbound tourism Special interest tours Luxury travel General recommendations on the promotion of tourism from China to Europe

15 minute presentation:

Overview of current state of Chinese tourism to Europe

Identifying the challenges and opportunities in Chinese outbound tourism

Special interest tours

Luxury travel

General recommendations on the promotion of tourism from China to Europe

How to market a new destination in China? Workshop on European tourism promotion in China Analysis of Chinese outbound tourism trends from 2000-2010 Explanation of the unique characteristics and travel patterns of Chinese tourists in Europe Case studies of successful tourism marketing in China by European tourism boards How destinations, cities, tour operators and hotels can market themselves in China with a limited budget Overview of the various travel exhibitions and forums in China used for tourism promotion Overview of online tourism marketing in China Questions and Answers

Workshop on European tourism promotion in China

Analysis of Chinese outbound tourism trends from 2000-2010

Explanation of the unique characteristics and travel patterns of Chinese tourists in Europe

Case studies of successful tourism marketing in China by European tourism boards

How destinations, cities, tour operators and hotels can market themselves in China with a limited budget

Overview of the various travel exhibitions and forums in China used for tourism promotion

Overview of online tourism marketing in China

Questions and Answers

Growth in outbound tourism from China

Defining the Market The market definition for China covers Greater China and a Chinese speaking audience. The territories covered in this definition are: China P.R.C Hong Kong SAR Macau SAR Taiwan

The market definition for China covers Greater China and a Chinese speaking audience. The territories covered in this definition are:

China P.R.C

Hong Kong SAR

Macau SAR

Taiwan

Characteristics of the Market Spoken language: In China PRC and Taiwan, Mandarin Chinese is the official spoken dialect. In HKG and Macau, Cantonese is spoken as the prevalent dialect. Written language: In China PRC Simplified Chinese is used. In Taiwan, HKG and Macau Traditional Chinese is used. Singapore uses Mandarin as an official language alongside English and uses Simplified Chinese characters. English is widely used by Singaporeans. Outbound tourism from Singapore, HKG, Macau and Taiwan in percentage terms is much higher than from China PRC and is a mature industry. China PRC outbound tourism accounts for less than 5% of overall tourism by Chinese. with 95% domestic travel.

Spoken language: In China PRC and Taiwan, Mandarin Chinese is the official spoken dialect. In HKG and Macau, Cantonese is spoken as the prevalent dialect.

Written language: In China PRC Simplified Chinese is used. In Taiwan, HKG and Macau Traditional Chinese is used.

Singapore uses Mandarin as an official language alongside English and uses Simplified Chinese characters. English is widely used by Singaporeans.

Outbound tourism from Singapore, HKG, Macau and Taiwan in percentage terms is much higher than from China PRC and is a mature industry. China PRC outbound tourism accounts for less than 5% of overall tourism by Chinese. with 95% domestic travel.

Market restrictions Taiwan, HKG, Macau and Singapore residents do not face restrictions on travel to the UK and have convenient air routes via Taipei, HKG and Singapore. China PRC residents face visa restrictions and are currently limited to the following visit options: Business visa - individuals or groups Education visa - students on long term study courses Visiting Friends and Relatives visa - individuals Tourist visa - ADS tour groups of minimum 5 people

Taiwan, HKG, Macau and Singapore residents do not face restrictions on travel to the UK and have convenient air routes via Taipei, HKG and Singapore.

China PRC residents face visa restrictions and are currently limited to the following visit options:

Business visa - individuals or groups

Education visa - students on long term study courses

Visiting Friends and Relatives visa - individuals

Tourist visa - ADS tour groups of minimum 5 people

China outbound tourism dampeners in 2008 Tibet Torch Earthquake Olympic Games Stock & Real estate market Visa, Invitation letters, Shopping tours Restrictions on official travel

China outbound tourism dampeners in 2008

Tibet

Torch

Earthquake

Olympic Games

Stock & Real estate market

Visa, Invitation letters, Shopping tours

Restrictions on official travel

China outbound tourism in 2008 Example: Galeries Lafayette, Paris February: Counterfeit Money Incident April: Torch Incident in Paris September: Normal business with Chinese

China outbound tourism in 2008

Example: Galeries Lafayette, Paris

February: Counterfeit Money Incident

April: Torch Incident in Paris

September: Normal business with Chinese

China outbound tourism in 2009 Remedy in turbulent times? Rich people stay rich in China Quality products can earn money Status factor “International Traveler” stays New opportunities for enlarged Schengenland New opportunities for “smaller” destinations

China outbound tourism in 2009 Remedy in turbulent times?

Rich people stay rich in China

Quality products can earn money

Status factor “International Traveler” stays

New opportunities for enlarged Schengenland

New opportunities for “smaller” destinations

Traditional Distribution

Recommended Exhibitions Name Date Location Rational PATA Travel Mart 22-25 Sep 09 Hangzhou Meeting with high level tourism officials, agents CIBTM 8-10 Sep 09 Beijing Corporate travel fair for North China ITB Asia 21-23 Oct 09 Singapore Regional travel trade exhibition CITM 19-22 Nov 09 Kunming China’s largest international travel fair GITF 25-27 Mar 10 Guangzhou Regional trade fair for South China WTF 27-29 May 10 Shanghai Regional trade fair for Eastern China COTTM 28-30 Apr 10 Beijing Outbound tourism fair for travel trade only ITE 10-13 Jun 10 Hong Kong travel trade fair for HKG travel agents ALTM 14-17 Jun 10 Shanghai Luxury travel for buyers from across Asia

Localisation Tips Language differences in Greater China (Mandarin/Cantonese/Shanghainese...; Traditional/Simplified) Lack of confidence in foreign languages Chinese search engines (Baidu, Google.cn) Trust in local presence Making the customer feel appreciated

Language differences in Greater China (Mandarin/Cantonese/Shanghainese...; Traditional/Simplified)

Lack of confidence in foreign languages

Chinese search engines (Baidu, Google.cn)

Trust in local presence

Making the customer feel appreciated

Networking in China GuanXi Trust Harmony Face Reciprocity

Online penetration Broadband infrastructure in all major cities Travel trade penetration good. Consumer penetration rising fast (80% increase) & now overtaken USA Baidu main search engine in China, not google Finance system still limiting e-commerce Regulation restricts foreign companies c

Broadband infrastructure in all major cities

Travel trade penetration good.

Consumer penetration rising fast (80% increase) & now overtaken USA

Baidu main search engine in China, not google

Finance system still limiting e-commerce

Regulation restricts foreign companies

Successful Online Travel Distribution in China Overcome these barriers to entry Market size: Pure online market limited to young, urban web-surfing professionals Flexibility : Need to build into system multiple payment options and flexible service solutions. Branding : Establish a presence early and wait for the growth in e-commerce Niche : Focus on the products/markets where e-commerce is a reality – B2B, low cost and last minute inventory. Compatibility : localised systems with acceptable design interface.

Overcome these barriers to entry

Market size: Pure online market limited to young, urban web-surfing professionals

Flexibility : Need to build into system multiple payment options and flexible service solutions.

Branding : Establish a presence early and wait for the growth in e-commerce

Niche : Focus on the products/markets where e-commerce is a reality – B2B, low cost and last minute inventory.

Compatibility : localised systems with acceptable design interface.

Online information sources are vital where do you get your travel advice? where do you get your travel advice? where do you get your travel advice?

Booking online is becoming more important Where do you you book your travel? Where do you you book your travel? Where do you you book your travel?

Key issues of online travel development in China Leading brands enhancing trust in online travel booking (Ctrip, eLong) ‏ Consumer market not ready for pure online booking model (over 80% of transactions offline) Disjointed banking system and fear of fraud deter online payments Worries about online booking misused for visa applications Customers want physical presence even from an online operator Ctrip continue to dominate domestic market Qunar.com now number 1 travel site in visitor numbers. DerbySoft, Hubs1 pushing for increased connectivity of hotels and agents TravelSky still a GDS monopoly

Key issues of online travel development in China

Leading brands enhancing trust in online travel booking (Ctrip, eLong) ‏

Consumer market not ready for pure online booking model (over 80% of transactions offline)

Disjointed banking system and fear of fraud deter online payments

Worries about online booking misused for visa applications

Customers want physical presence even from an online operator

Ctrip continue to dominate domestic market

Qunar.com now number 1 travel site in visitor numbers.

DerbySoft, Hubs1 pushing for increased connectivity of hotels and agents

TravelSky still a GDS monopoly

Online Marketing Design concepts: difference in design sensibility The Great Firewall of China: server hosting and self censorship Travel media: e-marketing through press release and adverts Email marketing: contact databases and parterships Advertising on Chinese portals: ppc vrs. space rental

Design concepts: difference in design sensibility

The Great Firewall of China: server hosting and self censorship

Travel media: e-marketing through press release and adverts

Email marketing: contact databases and parterships

Advertising on Chinese portals: ppc vrs. space rental

Direct online distribution - social network sites

Market entry steps Review and audit your services Adjust and prepare suitable products Localise your information Launch and promote through the trade Build relationships over time Follow through on promises

Review and audit your services

Adjust and prepare suitable products

Localise your information

Launch and promote through the trade

Build relationships over time

Follow through on promises

China Outbound Travel Handbook

ChinaContact Tourism Network

China Outbound Tourism Quality Label Travelers are looking for more sophisticated offers. They are willing and able to spend more if they get high quality services – quality according to the specific Chinese customs, values and demands. The China Outbound Tourism Quality Label is established by the China Outbound Tourism Research Institute to identify companies, organizations and destinations who offer such specific quality for Chinese visitors for the benefit of Chinese tour operators and Chinese travelers. The COQ Label is awarded following a strict procedure, with an online training program followed by the submission of a “Self-Analysis and Action Plan” which is evaluated by a global team of China outbound tourism experts. The COQ Label is offered in Silver on a general level and in Gold on a branch-specific level. Being based on a qualitative approach, it is flexible and scalable and can therefore be likewise used for smaller and larger companies and organisations from different sectors of the tourism industry.

Travelers are looking for more sophisticated offers. They are willing and able to spend more if they get high quality services – quality according to the specific Chinese customs, values and demands.

The China Outbound Tourism Quality Label is established by the China Outbound Tourism Research Institute to identify companies, organizations and destinations who offer such specific quality for Chinese visitors for the benefit of Chinese tour operators and Chinese travelers.

The COQ Label is awarded following a strict procedure, with an online training program followed by the submission of a “Self-Analysis and Action Plan” which is evaluated by a global team of China outbound tourism experts.

The COQ Label is offered in Silver on a general level and in Gold on a branch-specific level.

Being based on a qualitative approach, it is flexible and scalable and can therefore be likewise used for smaller and larger companies and organisations from different sectors of the tourism industry.

More information on www.china-outbound.com

For further information: TEAM Tourism Consulting China Advisers Network China Business Network

TEAM Tourism Consulting

China Advisers Network

China Business Network

About the founder Roy Graff has been immersed in Asian business and culture since 1994 and speaks fluent Mandarin Chinese. He launched ChinaContact in 2005 after working in Shanghai and Beijing for three years with Gullivers Travel Associates as Senior Manager and E-Commerce Director. Currently focuses his consultancy practice on China's tourism and hospitality sectors. He has over 14 years of experience in the travel sector. Holds a BA degree in Chinese and Economics from the School of Oriental and African Studies, University of London. Roy speaks business level Mandarin Chinese fluently. Roy made his career in travel and tourism business development with an emphasis on China. He has a deep understanding of China's culture and business practices developed from academia, public and private sector work since 1994. He is an experienced travel marketing and distribution executive involved in e-commerce, online travel and events. Roy enjoys close and personal relationships with senior executives in the China outbound travel sector and influential media writers and editors.

Contact details web: www.chinacontact.org email: [email_address]

web: www.chinacontact.org

email: [email_address]