The Rise of Individual Chinese Tourists

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Could the days of the Chinese traveling en masse be numbered?

European luxury brands learned quickly the power of the Chinese tour group, says The Wall Street Journal. Over time, vacationers have helped to soothe the damage of the recession in the euro zone, reshape the business operations of brands, and fill the counters at a number of shopping locations. Now, however, brands are once again forced to re-evaluate their strategies in light of new statistics: the Boston Consulting Group reports that purchases by individual Chinese tourists abroad will overtake that of tour groups by 2020.

“Most of these tourists have already bought the handbags and other luxuries by now,” said Conor Yang, CFO of online Chinese travel agency Tuniu, which offers small guided  visits abroad in addition to the traditional large bus trips. “They want more.” The tourists are echoing this idea. Wu Mengbei, a marketing manager for a bank who is in her thirties, said, “On my first couple of trips to Europe I did a lot of shopping, but it’s not so much a priority now.”

Now that the majority of Chinese tourists have had at least one massive shopping expedition abroad, they are looking to move on to having experiences: going to museums, seeing the sights.

The Chinese are expected to be the driving force in global tourism for a long time. So how will the landscape shift for merchants?  ”Lots of brands think that they have great business with Chinese tourists,” said Manelik Sfez, head of corporate marketing for Global Blue, “But what they may find is that they have great business with tour guides.”

Now, it will take more than offering commissions to tour guides and hiring Mandarin-speaking employees to lure in business, industry insiders posit. Department stores like Printemps and Galeries Lafayettes, which were designed to be one-stop shops, will have to rethink their strategies.

Those involved in the day-to-day operations of designer brands, however, are not so worried. “The [luxury] houses are used to giving a very personalized service. It’s not a question of specific preparation for the Chinese,” said Elisabeth Ponsolle des Portes, whose association represents brands like brands including Chanel, Cartier, Louis Vuitton and Yves Saint Laurent.

Last year, China spent $102 billion on outbound travel, a 40 percent jump from 2011 that put it comfortably ahead of Germany and the United States, according to the United Nations World Tourism Organization. Global Blue reports that overall spending in Europe by Chinese shoppers rose 18 percent in the first quarter from a year earlier, a sharp deceleration in growth from the previous year’s 45 percent.

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