U.S. Delegation Meeting. October 27, 2014

Size: px

Start display at page:

Download "U.S. Delegation Meeting. October 27, 2014"

Alfred Moore
5 years ago
Views:

1 U.S. Delegation Meeting October 27, 2014

2 China Outbound Travel Market

3 China Economic Overview Population (m) 1,341 1,347 1,354 1,361 Nominal GDP (US$ bn) 6,040 7,298 8,447 9,250 Real GDP growth (%) GDP per head (US$ at PPP) 4,361 5,414 5,432 6,796 Household Consumption Expenditure (%)

Emerging GNP Growth 2013/14 Average Overview Text is black color and Arial regular fonts sized at 20 points Copy goes here and here and here and here and here and here and here Copy goes here and

4 Emerging GNP Growth 2013/14 Average Overview Text is black color and Arial regular fonts sized at 20 points Copy goes here and here and here and here and here and here and here Copy goes here and here and here and here and here and more copy goes here and here and here and here and here and here and here Copy goes here and here and here and here and here Copy goes here and here and here and here and here Copy goes here and here and here and here and here and here and here and here Second level copy goes here Second level copy goes here Second level copy goes here

5 China Outbound Travel Market : 83 million - 6% of China s population 2013: 97 million - world s #1 source market 2014 (est.): 114 million outbound spending $140 billion 2020 (est.): 200 million outbound

6 Estimated Total Long Haul Departures United Kingdom France Australia China Canada Germany Japan Russian Federation Brazil India Italy Korea, Republic Of Spain Switzerland Argentina 5000 Mexico Sweden Belgium 0 6 *Tourism Economics

7 Destinations of Chinese Travelers

8 Aspirational Long-haul Destinations for Chinese France United States of America Australia Canada New Zealand Italy United Kingdom Germany Brazil Greece % 22% 24% 24% 37% 38% 35% 37% 32% 36% 42% 44% 42% 43% 50% 54% 53% 50% Question: What country(ies) will you likely visit during your next holiday to a destination outside of Asia? Select all that apply. Base: China intercontinental travelers (2013 N=1,475, 2014 N=1002) Source: Brand USA Custom Study 63% 58%

9 Key China Source Markets

10 Chinese Travel to the U.S.

11 Market Share of Long Haul China Outbound Travel U.S. vs. Competitors % 25% 20% 15% 10% 5% France United States Russian Federation Germany Australia Switzerland Austria Canada United Arab Emirates Spain 0%

Chinese Visitors to the U.S. Key Message: China has soared up the rankings to #5 in terms of overseas visitor number and spending in the U.S. in 2013, and is projected to rise to become our top overseas source market within 6 years.

12 Chinese Visitors to the U.S. Key Message: China has soared up the rankings to #5 in terms of overseas visitor number and spending in the U.S. in 2013, and is projected to rise to become our top overseas source market within 6 years Under 200, million million (+22.6%) #5 overseas market 2014 est million (+21%) #4 overseas market 2017 est million (+18% ) #3 overseas market 2018 est million (+18%) #2 overseas market Sources: U.S. Department of Commerce, ITA, National Travel and Tourism Office

13 USA Overseas Arrivals 6,000 United Kingdom Arrivals (000) 5,000 4,000 3,000 2,000 1,000 - Japan Brazil China Germany France Korea, Republic Of Australia India Italy Colombia Venezuela Argentina Spain Netherlands Sweden Switzerland Russian Federation Chile Year

14 Chinese Expenditure in the U.S. Spend Per Person Per Trip: $6,000 spend per person per trip to the U.S. makes Chinese the highest spending visitor group per person per trip to the U.S. Travel Spend: China s middle and upper classes spend 19% of their annual salaries on overseas travel dramatically more than any other source country Luxury Spend: 75% of Chinese tourists purchase more than 3 luxury items per trip Global Force: Chinese tourists make up 25% of global spending on luxury goods

15 China Airlift to the U.S. China s Gateway Cities to the U.S Beijing Shanghai Guangzhou Chengdu Wuhan Hangzhou (new in 2015)

16 China Airlift to the U.S. U.S. Gateway Cities to China Los Angeles San Francisco New York Honolulu Seattle Washington D.C. Boston Chicago Houston Dallas Saipan Detroit Anchorage

17 New China-U.S. Flights January 2014 Beijing to Honolulu (Air China) April 2014 Beijing to Honolulu (Hawaiian Airlines) June 2014 June 2014 June 2014 June 2014 August 2014 October 2014 December 2014 January 2015 Beijing to Boston (Hainan Airlines) Beijing to Washington (Air China) Shanghai to Dallas (American Airlines) Chengdu to San Francisco (United Airlines) Guangzhou to New York (China Southern) Shanghai to Guam (United Airlines) Guangzhou-Wuhan to San Francisco (China Southern) Changsha to Anchorage/Los Angeles (Charter) April 2015 Hangzhou to Los Angeles (Hainan Airlines) May 2015 Beijing to Dallas (American Airlines)

18 U.S. Visa Updates Interview Wait Times: v 2011: over 50 days v Now: under 5 days v France & Australia: 4-5 days Close to 90% of non-immigrant applications from Chinese nationals are approved New on-line system allows Chinese applicants to: v Schedule visa interview appointments v Pay visa processing fees v Check on status of issued visas on-line rather than in person Next step? è 5-year multiple-entry visas for Chinese to the U.S.?

19 China Travel Trends

20 Preferred Leisure Pursuits by Chinese Middle/Upper Class

21 Key China Trends Rapidly Evolving Profile of Chinese Travelers v Leisure travel soaring: 63% share and rising v Package tours still key (70% share) and will dominate for the next decade v Rapid shift from multi-destination to multi-experience v Accelerating shift from package tours to air-tel/fit 30% and rising thanks to visa flexibility and rapidly growing sophistication of Chinese travellers v $1,100 spent per day when traveling (excluding accommodation) Implications v Beyond-the-Gateway Potential: the Chinese travel trade are hungry for new itineraries and new tour products v FIT/Luxury Booming: FIT/luxury travel products are rapidly becoming established and will see the greatest growth over the coming decade v MICE Market: China is a huge MICE market, esp. for midsize and large-size incentive groups to the U.S.

22 Duration of Next Trip: nights or less 1% % Total Likely Visit U.S. in Next Trip 4-6 nights 8% 10% 7-13 nights 55% 57% nights 29% 33% 21+ nights 4% 4% Question: How long will this holiday likely be? Base: China intercontinental travelers (N=1,002), China travelers who will likely visit the U.S. in their next intercontinental trip (n=539) Source: Brand USA Custom Study

23 Months Likely to Travel January February March April May June July August September October November December 2% 3% 4% 5% 3% 2% 4% 5% 4% 4% 3% 3% Total Likely Visit U.S. in Next Trip 17% 18% 15% 17% 20% 22% 21% 23% 17% 19% 29% 29% Question: In what month(s) will you likely take this holiday? Select all that apply. Base: China intercontinental travelers (N=1,002), China travelers who will likely visit the U.S. in their next intercontinental trip (n=539) Source: Brand USA Custom Study

24 Booking Window for Pre-packaged Holiday/ Guided Tour Packages day or less/did not reserve in advance 2 to 6 days 1% 2% 11% 10% Total Likely Visit U.S. in Next Trip 1 to 2 weeks 27% 28% 3 to 4 weeks 23% 25% 1 to 2 months 23% 27% 3 to 5 months 8% 8% 6 to 12 months 2% 3% More than 1 year 0% 1% Question: How far in advance of your departure date did/will you book the travel products for this holiday? Select one option from the drop-down box. Base: China intercontinental travelers who booked /will likely book pre-packaged holiday or guided tour package (N=360), China travelers who will likely visit the U.S. in their next intercontinental trip (n=194) Source: Brand USA Custom Study

25 Chinese Destinaiton Selection Drivers Destination Selection Criteria Affordability 61% Dining 58% Safety 57%

26 Destination Selection Tools 1. Travel Agencies: travel agencies remain the dominant destination selection tool with most Chinese travelers still using local bricks-and-mortar travel agents and travel agency or airline websites in making a final destination selection 2. Online channels: including destination websites, travel portals, social networking channels, and blogs are soaring in importance as a destination selection channel 3. Word of Mouth: bragging rights are extremely important in the China market -- being able to boast to friends and family about having visited a given destination and purchased given luxury goods increasingly on-line word of mouth is becoming key via blogs and video sharing sites

27 China Travel Trade Landscape Total Outbound travel agencies in China: over 1,500 Top 10 travel agencies: CITS Jinjiang Tours CYTS Spring Intl Travel CTS GZL TTS Nanhu International Travel U Tour Guangdong CTS Top MICE agencies: CITS MICE CYTS MICE CTS MICE Top OTAs: Ctrip Tuniu Qunar E long

28 China Media Landscape 16 National dailies with circulations of 480,000+ Newspapers Over 200 Regional newspapers with circulations of 260,000+ Magazines Countless 50 Lifestyle, tourism and fashion magazines Average circulation of 80,000+ Travel Trade Publications Travel Trade magazine, circulations of 50, Travel Trade newspaper, circulations of 150,000+ Major Newswires: China News Service, China News Agency, etc. Daily Broadsheets/Newspapers: Global Times, China Daily, Shanghai Morning Post, Southern Metropolis Daily etc. Weekly Lifestyle Publications: Lifestyle, The Bund, The Weekend, Let s, Traveler Weekly, Grazia, etc. Power Fashion Publications: Vogue, Cosmopolitan, ELLE, GQ, Esquire, Modern Bride etc. Leading Consumer Travel Publications: Condé Nast Traveler, Voyage, National Geographic Traveler, Top Travel, etc. Video Sites: iqiyi, Phoenix, Channel Young, World Traveller etc. Radio stations

24 billion mobile users 800 million mobile internet users as of April 2014 53% of Chinese book their hotels online or via

29 China Online and Social Media Landscape 1.37 billion population 686 million internet users as of June 2014, 5% YoY growth over December billion mobile users 800 million mobile internet users as of April % of Chinese book their hotels online or via mobile apps 61% ask for opinions online before a purchase/ destination selection 73% go online to give their opinion on a purchase they made Weibo: 500+ million users with 67 million daily active users Wechat: 600+ million users

30 China Market Recap: Alignment of Key Factors Size: massive market size of 1.3 billion Potential: only 7% of this population now traveling overseas versus 25% for Korea Growth: number of outbound travelers to double in next 6 years to 200 million U.S. Market Share: only 3% of outbound Chinese travelers are now traveling to the U.S. Disposable Income: Chinese incomes growing at 20% per year Willingness to Spend: 19% of disposable incomes spent on travel RMB appreciation: making travel to the U.S. increasingly affordable U.S. Visa Barrier: now manageable for Chinese travel trade Booming Airlift: new gateways and airlift to the U.S. rapidly developing Hungry Travel Trade: want new U.S. packages beyond the gateways Hungry Media: on-line and off-line media hungry to feature the U.S. Positioning: the U.S. is seeing the fastest growth in aspiration to visit Spend: per visitor per day already leads all overseas markets Arrivals: #1 overseas market for the U.S. within 5 years

31 Brand USA in China

32 2015 Brand USA China Pillars Educate Travel Trade Nationwide Secure the development of a wide range of new U.S. tour product beyond the traditional U.S. gateways Co-op with Chinese travel trade & airline partners to secure increased investment in U.S. travel promotions Extend Brand USA marketing programs into Secondary Markets throughout China Target both Leisure & MICE markets Secure launch of new airlift/new gateways/new airline partners Rapidly boost earned media coverage/visibility nationwide Launch brand advertising campaign Leverage booming Online & Social Media channels via Mailman Generate China Co-op investment opportunities for US partners Offer China Market-Entry Platform for U.S. Partners

33 Brand USA China Team Yoichi Hayase Asia Strategy Director Michael D. Merner Managing- Director, Asia Mavis Zheng Beijing Office Director Diana Liu Guangzhou Office Director Tina Yao Shanghai Office Director Jenny Guan Travel Trade MarkeZng Manager Sunday Wang Public RelaZons & Co- op Manager Spring Zheng Travel Trade MarkeZng Director Anita Jia Public RelaZons & Co- op Director

34 Tapping the China Market Send press releases, newsletters, promotions, images & videos to Brand USA China Translate into Chinese at a minimum, a simple fact sheet and a map Host China FAM groups Join the Brand USA Mission or have the Brand USA China team set up a one-on-one Mission for you Have your website translated into Chinese by Mailman and co-hosted on Buy into a Brand USA China co-op Buy into the Brand USA China Market Entry Program for a year-round coordinated program of PR, Travel trade, and digital programs

35 Doing Business in China

36 Chinese Psyche 101 Emphasis on the Collective not individual (harmony) Respect for authority Patriotism Face (Mianzi): winning/losing/giving Relationships (Guanxi): the art of building and keeping Guanxi

37 Meeting Mechanics Seating Protocol: in China, the first person who enters the room is the head of the group seated directly opposite or immediately next to will be the principal host Handshake is soft -- sometimes bow Have Chinese cards don t write on them Surnames come first in China Conversation Topics: avoid western-style jokes, politics or religion. Good topics: Chinese food, sports, places one should visit in China, places the counterpart has visited in the U.S. Be ready for personal questions how much do you earn? Are you married? If a Chinese person gives you a compliment, deny it graciously -- modesty is highly valued in China Use simple English and speak slowly and clearly

Meeting Mechanics Gift-giving: Gifts indicate that you are interested in building a relationship Gifts should always be wrapped, but do not use plain black or white paper because these are the colors

38 Meeting Mechanics Gift-giving: Gifts indicate that you are interested in building a relationship Gifts should always be wrapped, but do not use plain black or white paper because these are the colors of mourning. Beware of unlucky numbers, superstitions consult with us Gifts are received but not opened unless your Chinese host does so first Patience: at times, Chinese can appear to be stalling before moving to business -- they are working towards building as great a mutual respect as possible.

Survival Tips Only drink bottled water even brushing teeth Chinese point at objects with an open hand instead of the index finger Beckoning to someone is done with the palm

39 Survival Tips Only drink bottled water even brushing teeth Chinese point at objects with an open hand instead of the index finger Beckoning to someone is done with the palm facing down -- avoid beckoning with your index finger Learn a few words of Chinese Don t try too hard to "go Chinese" keep the above guidelines in mind, but just relax and be yourself!

40 Xie Xie! Thank You!!

41 Brand USA Updates Jay Gray Vice President- Global Market Development Brand USA

42 Brand USA Focus on China Trade Relations (Guanxi) Welcome China Event China US Tourism Leadership Summit CITM Country of Honor

43 Brand USA Focus on China Trade Education and Awareness In-Market Roadshows, Missions and Tradeshows Trade and Media Fams

44 Brand USA Focus on China Trade Education and Awareness Discovery Program

45 Brand USA Focus on China Trade Coop Marketing Partnerships CYTS Experience Hall CITIC Bank

46 Brand USA Focus on China Media Coop Partnerships Top Travel Global Times Trading Up Magazine

47 Brand USA Focusing on China The Great Outdoors

48 Importance of Destination Characteristics by Country U.K. Mexico Korea Japan India France Activity options (e.g. mountain climbing, diving) Reputation/popularity as a travel destination Leisure attractions (e.g. dining, shopping, nightlife) Quality of beaches Germany China Canada Brazil Australia Total Landmarks and sightseeing options (e.g. historical sites, museums) Appeal of local culture (e.g. food, music, etc.) Ease of travel to the destination (e.g. length of flight, number of stops) Natural features/landscapes (e.g. mountains, lakes) 0% 10% 20% 30% 40% 50% 60% Question: When deciding on which country to visit for an INTERNATIONAL holiday, please rate how important each of the following destination characteristics is to you. Please rate each characteristic on a scale from 1 to 5, with 1 being 'not at all important', 3 being 'moderately important' and 5 being 'extremely important'. Base= Extremely Important

Destination Characteristics: Mean Rating for US U.K. Mexico Reputation/popularity as a travel destination Korea Japan India France Germany China Canada Brazil Australia Appeal of local culture (e.g. food, music, etc.

49 Destination Characteristics: Mean Rating for US U.K. Mexico Reputation/popularity as a travel destination Korea Japan India France Germany China Canada Brazil Australia Appeal of local culture (e.g. food, music, etc.) Quality of beaches Ease of travel to the destination (e.g. length of flight, number of stops) Natural features/landscapes (e.g. mountains, lakes) Leisure attractions (e.g. dining, shopping, nightlife) Landmarks and sightseeing options (e.g. historical sites, museums) Activity options (e.g. mountain climbing, diving) Total Question: When considering the United States as a holiday destination, how would you rate it on the following characteristics? Please rate each characteristic on a scale from 1 to 5, with 1 being 'poor', 3 being 'adequate' and 5 being 'excellent'.

Great Outdoors 2015-16 Campaign The United States of Great Outdoors Content Hub and

events for consumer and trade summer/ fall 2015 Multi-channel consumer and trade

50 Great Outdoors Campaign The United States of Great Outdoors Content Hub and Social Platform- Fall 2014 Giant Screen Film Launch September 2015 Film premiere events for consumer and trade summer/ fall 2015 Multi-channel consumer and trade advertising throughout 2015 Media spin-offs TV series with Travel Channel summer/fall 2015

51 Great Outdoors Large Format Film

53 Web Media Social Media IMPACT EVERYWHERE Blogger Trip Content Opinion Leaders

Results WEB SOCIAL KOLs FAM 1m visitors p/m 6,000 reads blog/activity 50 x Unique p/m 850,000 followers 100+ posts p/m 25,000 reads each Over 20 of China s

54 Results WEB SOCIAL KOLs FAM 1m visitors p/m 6,000 reads blog/activity 50 x Unique p/m 850,000 followers 100+ posts p/m 25,000 reads each Over 20 of China s top influencers have tweeted our content to over 50,000,000 followers 5x trips 20 participants 100m views THATS OVER 400,000,000 IMPRESSIONS IN THE PAST YEAR

PACKAGE 1 PACKAGE 2 PACKAGE 3 CREATE A CAMPAIGN MINI SITE MINI SITE & BLOGS All sites are optimised for

55 Partnering With You GoUSA is designed to support you, the DMO, the retailer, the hotel or experience. Packages include localized micro websites, social media marketing, content creation and promotion. PACKAGE 1 PACKAGE 2 PACKAGE 3 CREATE A CAMPAIGN MINI SITE MINI SITE & BLOGS All sites are optimised for mobile and developed in dual languages to fit into China, Taiwan, and Hong Kong. Social media packages are also available by request.

56 Media Supported Blog & Media Packages Content syndication opportunities both promoted and on GoUSA channels Editorials and content features that are produced quarterly Media purchases on top travel and media sites Video Opportunities Video promotions across top IPTV sites Full production crew to film in destinations in the USA Online media purchase and promotion supported

57 Massachusetts launched its mini-site on May 2014 with an intention to build it s China presence through GoUSA. 2,100,000 SITE VISITORS OVER 3,000,000 PAGE VIEWS A BOUNCE RATE OF 32% 2,000,000 READS FROM THE KOL

58 2015 packages are now being sold. To get started reach out to for full package opportunities. THANK YOU.

China Market Entry Program Suite of promotional activities designed to maximize the promotional opportunities in this rapidly emerging market.

59 China Market Entry Program Suite of promotional activities designed to maximize the promotional opportunities in this rapidly emerging market. Includes dedicated resources for: Initial Consultation Travel Trade Development Public Relations Sales Calls Participation in Events, Missions, etc. Trade / Media Coop Opportunities Media Coop Opportunities GoUSA.cn participation Social Channel Campaigns

60 Thank You! Jay Gray Travel Industry on Twitter TheBrandUSA.com Consumer on Twitter Facebook.com/DiscoverAmerica DiscoverAmerica.com

Group Tour & International Marketing Update. Welcome!

Group Tour & International Marketing Update Welcome! Where We ve Been: North America America Bus Association (ABA) January 10-13, 2015 National Travel Association (NTA) January 18-22, 2015 Heartland Travel