China's Outbound Tourism on the Rebound: What to Expect for 2024

With over a year passed since China resumed outbound travel, the anticipation builds: Could 2024 mark the triumphant return of Chinese tourists?

China's outbound travel continues to resurge and shows strong retail growth

Since January 8th, 2023, China’s outbound tourism has been steadily recovering as COVID-related travel restrictions were lifted. While it may take some time for outbound travel-related policies, visa and passport issuances, and flight capacities to fully resume, the travel volume of Chinese tourists has already rebounded to match the levels observed in the second half of 2019, as reported by Qunar.com. Moreover, there has been significant growth in demand for travel-related content on China’s digital platforms like Douyin.

As China’s outbound travel continues to rebound, the country's retail spending has also shown robust growth. In November 2023, total retail sales of consumer goods reached RMB 4.25 trillion (USD 5,935.75 billion), marking a year-on-year growth of 10.1% . This surge signals a positive trend in consumer confidence and increased spending, both domestically and internationally.

In this newly released whitepaper, “2024 Chinese Outbound Travelers Whitepaper”, iClick collaborated with industry leaders such as Qunar and Ocean Engine, along with a market research firm, to provide comprehensive insights for brands and marketers. These insights provide a deeper understanding of China’s outbound travel sector and the latest consumption trends, empowering marketers to make strategic decisions.

The four key post-pandemic trends of Chinese travelers

1. Rising demand for long-haul travel: In the post-pandemic era, Chinese travelers are seeking more meaningful and immersive experiences. There has been a significant increase of 42.8% in long-haul outbound tours in 2023 compared to 2019 levels, indicating a desire to explore destinations beyond East- and Southeast Asia.
2. Extended stays and increased spending: There's a notable trend towards longer trips, with a 73.2% surge in trips lasting over six days in 2023 in comparison to 2019. Additionally, Chinese tourists are allocating more financial resources per trip, with a 14.0% rise in spending exceeding RMB 5,000 (USD 701.03) per trip, reflecting a willingness to enhance travel experiences through higher-quality accommodations and activities.
3. Flexible planning and experiential travel: A shift in planning behavior is evident, with 60.0% of travelers adopting a more spontaneous approach to travel. There's also a growing preference for experiential trips that allow immersion in local cultures, indicating a desire for authentic and engaging travel experiences that go beyond surface-level attractions.
4. Shift in luxury retail spending: Before the 2019 pandemic, about 70% of luxury spending by Chinese consumers happened outside Mainland China. However, there's been a notable shift towards domestic luxury shopping, with an expected two-thirds of luxury purchases occurring within China's borders by 2027. The Hainan free trade port, especially, is gaining traction among local luxury shoppers, boosting the growth of the domestic luxury market.

Connecting with Chinese travelers in the growing digital ecosystem

Chinese travelers are increasingly relying on digital platforms for every stage of their journey, including pre-trip preparations, the in-trip experience, and post-trip reflections. Douyin alone boasts over 450 million travel enthusiasts, showing a 23.0% year-on-year growth in the fourth quarter of 2023. This growth has attracted various tourism enterprises and influencers to establish their presence on the platform. Xiaohongshu has also seen a surge in travel-related content, impacting Chinese travelers' decision-making processes. Additionally, more players in the travel retail industry, including online agencies, hotels, and duty-free operators, are utilizing WeChat Mini programs to reach a broader audience.

Online travel agencies (OTAs) like Ctrip, Qunar.com, and Tongcheng are also of great importance in shaping Chinese outbound travelers' experiences. They serve as comprehensive platforms for researching, planning, and booking flights, accommodations, tours, and activities. OTAs offer diverse options for comparing prices, amenities, and reviews, making travel accessible to a wide audience, especially those from non-Tier 1 cities. Leveraging technologies like artificial intelligence (AI), OTAs continuously improve user experience. Through partnerships with airlines, hotels, and tourism operators, they provide exclusive deals and discounts, significantly influencing the travel retail industry.

In addition, the prevalence of digital payment platforms has significantly transformed the outbound travel experience for Chinese travelers. With options like Alipay and WeChat Pay widely accepted globally, Chinese outbound travelers can make seamless transactions for accommodation, transportation, dining, and shopping without the need for cash or currency exchange. Therefore, brands need to understand these digital platforms that potentially offer significant opportunities for engagement and promotion in China’s travel sector.

Future of tourism: Technology-enhanced travel experience

The rise of "smart tourism" and the integration of virtual reality (VR), augmented reality (AR), and AI technologies are transforming the travel industry in China. It has become increasingly commonplace for amusement parks, museums, and tourist attractions to implement AR navigation and immersive experiences to enhance visitor engagement. Online travel agencies are also introducing AI-based travel assistants to improve user experience and efficiency. Therefore, AI-powered features for travel planning, including recommendations, price comparisons, and personalized suggestions, are becoming ever more vital for enhancing the travel experience.

Implications for marketers and brands targeting Chinese travel consumers

1. Embrace digital channels: Showcase your brand and engage Chinese travelers on their preferred digital platforms, from social media to online travel agencies and short-video platforms. With Chinese travelers relying heavily on digital platforms for travel decisions, it's crucial for brands to establish a strong presence across these channels.
2. Prioritize personalization: As Chinese travelers increasingly seek longer, deeper, and more flexible travel experiences, marketers and brands need to align with the individual preferences and desires of travelers, offering bespoke experiences that resonate on a personal level.
3. Utilize innovative technologies: Embrace the latest technologies like AI and AR to create immersive, interactive experiences that captivate and engage travelers, enhancing your brand's appeal and standing out in a crowded marketplace of China’s outbound tourism sector.
4. Stay agile and responsive: Stay informed about outbound travel policy changes in China to anticipate shifts in traveler behavior and adjust your marketing strategies. Being agile and responsive to updates helps you capitalize on opportunities and stay competitive in the Chinese travel retail market, keeping your brand relevant to Chinese travelers.

Download the full “2024 Chinese Outbound Travelers Whitepaper” to access more comprehensive insights, actionable strategies, and expert recommendations for capturing the attention and loyalty of Chinese travelers in the year ahead. Stay informed, stay ahead, and unlock the full potential of China's dynamic travel market.

Source:

• Qunar 2023 Travel Data Report
• Ocean Engine 2023 Travel Data Report
• The total retail sales of consumer goods increased by 10.1% in November 2023
• Big-Spending Chinese Shoppers Are Splurging on Luxury at Home, Not Abroad Anymore
• BoF Insights | Dynamic Journeys: China’s Luxury Shoppers at Home and Abroad