How Australia can capitalise on Chinese tourism

Chinese tourism around the world is experiencing a boom: the numbers of tourists are increasing and the types of tourism diversifying. But Australia will need a more culturally sensitive approach than the catchy advertising of old to capitalise on this emerging market.

Australia is competing for this market. It’s not the only country that is trying to benefit from Chinese tourism; in fact Australia is only attracting 1.5% of Chinese outbound travel (rank 15 in the world). However, China is now Australia’s largest visitor market.

The increase in Chinese tourists is set to continue. Arrivals in 2015 grew by 22% compared with 2014, and in Queensland the growth rate was even higher at 30%. In 2015, the amount that Chinese tourists spent in Australia amounted to A$6.2 billion, 21% of all money spent by overseas travellers, an average of $6,489 per person).

It is not surprising that Government is investing to maximise the economic benefits from this market – especially against the background of a declining resources sector.

How Chinese tourism is changing

A recent Goldman Sachs report on the Chinese tourist boom finds that Chinese outbound tourism has risen from only 10 million in 2000 to over 120 million travellers in 2015. This is expected to growth to 220 million by 2025 (although this includes visits to Macau and Hong Kong).

Expenditure by tourists will grow from US$290 billion to $450 billion in 2025. At present only 4% of Chinese own a passport, predicted to grow to 12% within the next 10 years.

The Chinese traveller is evolving. Until recently most used travel packages, but over the past few years they are becoming more experienced independent travellers. This means that they want interesting and culturally appropriate experiences.

Chinese millennials, a young generation that is well-educated, speaks English and is highly connected through the internet, has attracted particular interest from the tourism industry. Chinese tourists use digital media to plan for their travel but they use different types compared to Australian tourists. Over 90% of Chinese internet users engage in social media, in particular WeChat and SinaWeibo. Weibo, for example, is used daily by over 50 million bloggers.

Australia cashing in

Australia needs to ensure that the “tourism experience” is what Chinese people want. Some other destinations offer better deals, such as the no-visa policy that the Maldives and Fiji have introduced. Open borders encourage more travel.

The tourism industry in partnership with government is busy addressing this. For example, tourism businesses are enhancing their knowledge of digital platforms, learning about Chinese social media channels, and creating Chinese language web pages. Tourism operators are also adjusting their experiences specifically for the Chinese market, to improve the food and dining experiences and to offer more in Mandarin and other Chinese languages.

Going further, there is the potential to attract more Chinese brands to Australia, including Chinese-owned hotel chains that offer very different experiences from traditional Western hotels, Chinese clothing brands, and entertainment experiences that are popular in China. This will improve the satisfaction of Chinese tourists.

But it’s not all a one way street. In order to share the benefits of Chinese tourism it has to be linked to other investment. Often Chinese visitors will holiday in Australia and on their trip look for information about an investment property or business or perhaps investigate schools or universities as places for their children to attend.

Australia can also benefit in terms of protecting its natural environment. One of the main attractions for Chinese tourists is the clean and green environment and native animals.

Chinese visitors could be actively engaged in nature conservation activities. As Chinese travellers become more independent, Australia has opportunities to entice a proportion of them “off the beaten track” to engage with local culture and the environment as well as contributing to economic activities outside the main tourist centres.

Now is the time to plan for how the vast Chinese market can generate the greatest overall value to Australia. This could be by targeting young millennials, luxury travellers, environmental or cultural special interest markets, or any other sub-group that generates benefits beyond the sheer numbers. Planning means we can target particular market segments to maximise the return for Australia.