A lot can happen in a few weeks in China. Since our last update in mid-December, China has dropped all remnants of its ‘Covid Zero’ policy, seeing the virus sweep across the country.
By the dawn of the New Year, Covid had already peaked in its big cities. As an example of how quickly the virus has spread, Henan Province has seen 89 percent of its 100 million population infected. China’s countryside is yet to feel the worst of Covid. When migrant workers return home for the Chinese New Year later this month – many for the first time in three years – they are expected to bring another wave of infections. But it is highly likely that China will be through the worst of the virus before the second quarter of this year.
For a large portion of Chinese consumers, there is a sense of relief and certainty that their lives will soon be back to ‘normal’. Consumers have a feeling that they have survived the ‘three-year pandemic’ and are ready to look forward. This was reflected by the massive crowds across China who rejoiced on New Year’s Eve – not just the seeing in 2023, but celebrating the end of the three year Covid era. In his 2023 New Year address, President Xi acknowledged the uphill battle that China is still fighting against Covid, but noted, “the light of hope is right in front of us.”
The biggest impact for many of us will be from China’s prompt opening to the world last Sunday. The Economist expects the reopening will be “the biggest economic event of 2023.” On December 26, when Beijing announced that travellers will no longer have to quarantine and passport and visa issuance will resume, searches for overseas destinations shot up by 1,000 percent on Trip.com, hitting a three-year high. Booking for outbound flights from mainland China jumped 254 percent from a day earlier. Airlines still need to restore many of the routes, but the only way is up.
Destinations, operators and related travel businesses will be the most obvious beneficiaries of the reopening. For those businesses, the definition of being ‘China-ready’ will not be what it was in the heady days of pre-Covid. China Skinny recently worked with a destination who aimed to be optimised for Chinese travellers when they returned. Our consumer research and data analysis indicated very different preferences, behaviours and expectations from overseas travellers in 2019. Among many of the findings was Chinese travellers’ move away from cheaper hotels. As much as it is about wanting to enjoy the finer things in life when abroad, it was also that budget lodgings are less likely to be clean and sanitized. This trend is also reflected domestically as China’s big hotel chains shutter their lower cost offerings.
In relation to the higher-end needs from travellers, more are seeking personalised travel specific to their requirements. One of the big swings from pre-Covid travel is the large share of travellers wanting to get out amongst nature. This echoes the camping trend which has exploded in China since 2020. Independent driving holidays were also high on the list, supported by ballooning numbers of driving licenses. Those are just a few of the insights tourism businesses should consider when optimising their products and services for the coming wave of Chinese travellers.
For brands not directly engaged in tourism, or education, there is good reason to be celebrating China’s reopening. Our pre-Covid studies found travelling Chinese increased exposure to the culture and lifestyles behind your products, and sometimes even to the goods themselves. This drives affinities and sales both directly and indirectly. In addition, it has just got a lot easier to get over to China to engage with your staff, partners and customers, or have them visit you.
Source: China Skinny
(Source: China Skinny)