China Travel Blog Interview - Chinese Traveling Abroad

The number of Chinese traveling abroad is increasing every year. Curious about the world beyond the border, Chinese tour groups are now a common sight in Asia and Western touristy spots. The Chinese government even issued guidelines for Chinese travelers on how to behave.

Recently I noticed that Roy Graff (I met him several times in Shanghai before) had started a blog about the China Travel Industry. He is the owner of CContact, a market entry specialists company focused on China.

Roy has been working in the tourism sector for more than 12 years including 1 year in Taiwan and 3 years in China.

In the interview we talk about the kind of Chinese travelers that go abroad, the value of travel statistics and the cultural differences foreign operators have to take into account when selling packages to overseas destinations.

Roy’s career in the tourism industry started in 1995, when he went to study in Taipei as well as working part time as the representative of the Israeli Tourist Office. That’s also where the interview begins.

What was your job as a representative?

My job was promoting tourism from Taiwan to Israel(obviously not masses of people)
My promotion work led to a 10-fold increase from 600 to 6000 people within the year.
Which is good if you consider Taiwanese had no idea of Israel at all.
Being able to speak Chinese was an advantage. I was able to give interviews on radio, TV and magazines about Israel and deal with travel agents directly. There was no budget from the government so we had to be very inventive.

And when did you jump the Taiwan Strait? What made you?

I went back to London to graduate and then took a job with a tour operator in London, dealing with Chinese groups in Europe.

I did return to Taiwan for 1 summer later to work for a travel agent, but after a few years in London, my work moved on to sales areas without a China link.

I wanted to get back to China but at the time, I felt it was important to gain other skills in the industry, such as sales, marketing, distribution etc. The company I worked for, GTA (Gullivers Travel Associates), had an office in Taipei, which is how I got the job in London.

In 2001 I approached the directors and suggested that they send me to China to develop their business there. It took them a year to plan it, as they had not hired a foreigner in China until then. In the beginning of 2002 I went to Shanghai, after a couple of months traveling in India.

At the time they were a private company so it was easy to deal directly with the directors, even though it had almost 2000 employees. I was initially tasked with developing the independent travel division and all online booking systems.
GTA works as a wholesaler, selling travel products to travel agents.

I spent 2 years in Shanghai and then moved to Beijing as GTA obtained a travel license in Beijing and was launching a WOFE (Wholly Owned Foreign Enterprise) there and set up the head quarters for the division in Beijing to look after all of the China offices.

I then launched Octopus travel towards the end of 2004. So I had the twin titles of E-commerce director and country manager Octopustravel.com

Already more than a year ago, or is it 2, you went back to London, starting up your own company, Ccontact.

Almost 2 years ago, Feb 2005, I returned to London. GTA was sold to Cendant, and they froze all investment in China and elsewhere.

I left - also for personal reasons, the birth of our baby. I think I was tired of big corporations at the time and also wanted to have the flexibility to spend time with my family, so working as a consultant appealed and I realized that not many people in Europe understand China and know how to work with Chinese on tourism business.
It was an opportunity to develop a niche.

The company you started is named Ccontact and your title is market entry specialist for the Chinese tourism industry.

What is a market entry specialist for the Chinese tourism industry exactly and what does he do on a daily basis?

It changes every day, I offer a service of consultation, training and marketing services in China for our clients. Depending on the project, it can be anything from translation of tourism brochures or setting up an exhibition stand at a China travel trade fair, to setting up a rep office for the client or selling the products and services to travel agents in China.

I have organized workshops, forums and seminars on China’s outbound tourism market in Europe and consulted tourism boards such as Visit London on their China strategy. There is no routine really, except the book keeping.

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You focus on outbound Chinese travelers if I’m correct. What is the current market like?

I focus on the outbound as this is the demand currently. I would like to develop more inbound travel as well. The market is growing rapidly, however we are not talking about huge numbers in Europe now.
Although the Chinese tend to concentrate in particular spots so it can seem like there are loads. For example, Paris, Milan, Rome, Cologne, London.

In total, about 31 million Chinese went abroad, 85% of that was to Hong Kong and Macau.

Inbound travel to China, the number of tourists going to China, is pretty high I thought?

It’s about 80 million but they count Hong Kong and Taiwan people in that, and all border crossings by land. All statistics also include workers, so all the day trips Hong Kong - Shenzhen are in there. Statistics cannot really tell us the real numbers of pure tourists.

You help foreign travel operators sell their products here in China. What are the biggest challenges /hurdles here?

First the hurdle is to educate the Western tour operators or tourism boards about the market and to manage expectations and invest appropriately.

What is their biggest gap in education?

It’s all big - culture, language, distance. China has been hyped and people think that simply going there once or having a website will get them a chunk of the market.

I actually have to educate my potential clients on why they need my services, so it’s not easy. Once they are on-board, helping them to tailor the products to the Chinese market and promote it in China is the easy part - easy for me as I have done it for 3 years hands-on. But of course, it takes time, so companies cannot expect a return on their investment in the first year- building a reputation in China is a process.

What is the first thing you teach them?

To have patience. I try to explain how the market works and give some case studies of successful entrants.

What are the main mistakes foreign travel operators make in attracting/ doing business in. Is it the packages, the program or, asked in a different way, what do Chinese travelers look for at the moment when they venture abroad?

Mistakes can be failure to appreciate Chinese are very nervous on their visit abroad, not matching the guide to the group well and leaving itineraries with free time - Chinese do not like to have free time as they feel it is not value for money.

There are many small things that can enhance the experience. Like with any market, cultural sensitivity is important but China is still an unknown to most people in Europe and North America. And because of the language barrier, it is not as easy to understand the culture as with other countries

Meaning the guide has to be Chinese or …?

The guide needs to speak Chinese, but sometimes that is not enough. For example a Taiwanese guide for a mainland Chinese group, or a Cantonese guide.

Those are subtle things but for an outsider hard to think of as they probably think a Chinese is a Chinese.

I have a couple more questions about Chinese travelers. What kind of Chinese travelers go abroad at the moment?

Since the ADS (Approved Destination Status, designates countries that have complied with certain Chinese requirements to facilitate group travel to foreign countries.) policy came into force, you get all kinds of people - families, pensioners, friends, students, still, the male business man is dominant but the market is now very segmented. Different destinations also feature different types of people.

There are no reliable statistics so the knowledge comes from observations and talking to operators in different countries.

Can you give an example of the latter?

The UK attracts many Chinese students and so their parents tend to inspect the schools and also to visit them, and that is a chance to do some sightseeing as well. Germany has many trade fairs so mostly business people in small groups start their tour there and then visit other places in Europe.

What do Chinese travelers like to do/see? What is a typical travel package for a Chinese traveler?
and related in what stage are Chinese travelers? Is it the first wave that wants to see as many countries as possible?

The market is coming in waves. The first wave of visitors saw many countries in a short time and now is returning for a more in-depth visit. Mostly those from Guangdong, Beijing and Shanghai.

Then the second wave from other cities started following a similar pattern. Logically they start from places near China and then venture further a field. Typically they want to see cities, popular attractions and are not as interested in the country side and quiet locations.

Are there any demographics, age, income etc about the Chinese traveler and what are popular countries they like to travel to?

Of course those that travel abroad are from the higher income bracket. The demographics are explained in my book, “China Outbound Travel Handbook” and more in-depth for academics in Prof. Wolfgang Arlt’s work, “China Outbound Tourism”.

Popular destinations in Asia are Hong Kong, Thailand, Singapore, in Europe, Germany, Italy, France

Are the US & Canada popular?

They would be if getting visa was easier. As it is, it’s difficult to get into.

How much do Chinese travelers spend abroad? I read, “The average expense by Chinese tourists in Europe and North America is among the highest, standing at about 2,300 Euros per person per week.” Is this in or excluding the travel fare? Or is it what they spend additionally?

They spend on average 300 euro a day including tour fare but they spend it more on shopping and save on accommodation

What do you see as the next trend in Chinese travel?

I think that more countries will start attracting individual Chinese rather than groups and Asia could be ‘flooded’ with Chinese travelers doing it their way, not going in an organized tour group. More people will choose to stay more time in a single country or go on ‘theme’ tours, such as cultural Europe, sports activities etc.

Are visa policies still one of the bigger hurdles for travel and are there any western countries that make it easier?

It’s certainly a major obstacle, The US takes all 10 digit finer prints from each person. The UK will switch to biometric visas from next year.

I thought so, it seems they are all afraid the travelers will stay.

Yes

You have published the “China Outbound Travel Handbook”. Can you tell me about it?

I co-wrote it with a Chinese guy who had been manager of the outbound department of CYTS (China Youth Travel Service) for 10 years. It is intended for travel professionals who want to gain a basic understanding of the sector.

Is it updated every year?

The handbook was published in 2005, now there is a 2006 version with updated statistics. It is really a simple guide to the sector, not too many confusing statistics, more an entry level user guide but enough to understand how to approach the market. We also have databases of travel agents in China but we do not publish that since it has to be updated constantly.

We offer the service of sending out promotions and product news to the Chinese travel industry on behalf of our clients, that way the database is always up to date.

I also noticed you started to keep a blog these days. What is it about?

The blog, China Travel Industry News, serves as a central place for news and developments on China’s tourism industry. I use it to collect news items from all over the web in one place so people do not have to search for it all over. I also give my own opinions and comments about China related trade events and government policies.

It seems like a good niche blog. Do you get feedback on it?

I do not receive many comments - I think people just take the information, many subscribe to a monthly newsletter so they get a digest each month with added interviews and editorials.

…. and being a blogger yourself now, what are your favorite websites/blogs about China?

I wish I had the time to read all of them. I like AccessAsia (a newsletter) and I get stuff off Danwei once in a while.
It is more convenient when the info gets to my inbox rather than searching for it on line.

The last question, is there anything I forgot to ask and you like to mention?

Yes, I am planning to offer ‘webinars’ online using Skype conferencing, to hold China tourism workshops in the New Year. Anyone who is interested can see the details on the CContact home page from January.

Ok, we’ll add that:)

Thanks a lot for your time Roy and for your answers.