America comes out on top of a fascinating study on China’s tourists compiled by Asia-focused investment bank CLSA, which interviewed panels of mainland tourists over the past year to draw the key conclusion that the United States is the most desirable destination for Chinese tourists, with Australia and France also ranking highly.
The report also points to a series of beneficiaries– among them hotel chains, airlines and retailers - in locations like the U.S., Australia and Japan which are set to draw in large numbers of free spending tourists from China, set to be the world’s top source of tourists for some time to come. CLSA forecasts 200 million Chinese outbound tourists per year by 2020. Faced with pollution, congestion and food safety crises at home, the Chinese middle classes want to head overseas to the US but also to other destinations that topped the CLSA poll: South Korea, Japan, Thailand, Europe, and Australia.
There’s an identifiable list of airports, airlines and hotel chains, department stores which are going to benefit from the surge of Chinese tourists. And these should be tapped as new sources of concentrated sales for seafood. Most of these beneficiaries are regional but also international hospitality brands: for instance fast-growing Air Asia is carrying ever larger numbers of Chinese tourists to Thailand and other Southeast Asian destinations which Chinese tourists tend to choose on their first forays overseas.
Western hotel chains are going to benefit. With Chinese consumers well used to loyalty programs have become loyal to hotel chains which have been particularly active and expansionary in the country: loyalty cards for the InterContinental and Hilton chains for instance have become badges of honour for social-climbing Chinese on their vacations.
Likewise, airports: stores and hospitality providers of Bangkok and Seoul, Sydney and Tokyo airports are all well particularly well placed to benefit from Chinese tourism, according to CLSA. These are good places surely to showcase a seafood product.
On the seas too there are other go-to international names which could be avenues for seafood sales to middle class China. China’s cruise passengers more than tripled from 2012’s 217,000 to 697,000 in 2014, according to the Cruise Line International Association (CLIA). The key players are multinationals: Royal Caribbean International, Costa and Star operating out of Shanghai, Sanya and Tianjin ports.
Resorts –some of them run by recognisable western names- are also popping up in China. New regional tourism attractions and the onset of easier car rentals and advertising via popular reality-TV shows like Running Man (the Chinese version) are frequently shot at amusement and theme parks like Chimelong Tourist Resort and Beijing WTown and the soon to open Disneyland Shanghai. The Disneyland chain of resorts in Hong Kong and Japan (built in part with the expectation of Chinese tourists) have been receiving Chinese tourists in greater numbers for the past decade.
There are clear trends here which will dictate future ways to access to China’s consumers of seafood through third party suppliers. “The Chinese population is getting richer and aspirations are rising for more adventurous and exotic locations, driven by growing social media pressures,” notes CLSA. This may be an Asia-wide phenomenon but China is the main show in town because of its scale and the impact of economic growth on Chinese purchasing power. Average disposable per capita income in 2014 at USD 4,715 is behind only oil-rich Malaysia – and a long way ahead of India at USD 1,380 and Vietnam (USD 1,357) - in the emerging economies of Asia.
Just as the rise in value of their RMB currency gave the Chinese more spending power so too the devaluation of regional currencies like the yen and Australian dollar has lured millions of Chinese tourists. Even with the recent devaluation of the Chinese currency there has been a remarkable rise in its power in the past decade. In 2006 a dollar bought RMB8 – today it gets you less than RMB6.50.
This trend has been studied by destinations in the wider region like Australia which, coming off a mega-boom in commodities, has started to compete in earnest for Chinese tourists by lowering the value of the Australian dollar and making it easier for Chinese tourists to get visas. The CLSA and Australian government data already show China emerging as the top source of tourists into Sydney Airport.
But across the region governments are tailoring to the tastes of Chinese tourists. The Grand Ho Tram casino resort near Saigon has emerged as a destination of choice for Chinese gamblers. Japan changed its laws to allow the construction of casinos which are set to open their doors in the coming decade. Singapore already made that move a decade ago and now has several mega casinos catering almost exclusively to the high-rolling Chinese gambler.
Russia has gotten in on the act with four zones – conveniently located in Siberia, near the Chinese border – for casino resorts. One of them, Tigre de Cristal, was opened late last year near Vladivostok by Macau casino executive Lawrence Ho.
No longer content with the malls and casinos of Hong Kong and Macau, Chinese tourists are potentially a new force as important as the domestic Chinese consumer classes pursued by exporters of seafood. The rise of Chinese tourists is benefitting a select list of services providers which in turn could be avenues for targeted seafood sales. Seafood executives should take note.
