Chinese Tourism Fever
Outbound Chinese tourists converge at the exit-entry frontier inspection section of Qingdao Airport on the eve of the 2014 May 1 holiday.
Promising Hotel Industry
China’s hospitality industry faces stiff headwinds as Chinese economy is under downward pressure. The government has increased scrutiny on official expenditures, in particular receptions and travel, as part of its anti-corruption campaigns. These disadvantages however do not stop transnational hotel groups’ expansions in China.
“China has huge potential to develop its hospitality industry,” said Arne Sorenson, president and CEO of Marriott International Inc. Marriott expects to more than double in size in Asia through 2016, reaching a total of 330 hotels. Nearly half of them will be opened in China, with priority on the country’s second- and third-tier cities. This year Marriott will open new hotels in cities like Haikou of Hainan Province, Harbin of Heilongjiang Province and Zhengzhou of Henan Province. According to Arne Sorenson, affected by the government’s frugality policies, sectors like high-end catering, tobacco and wine are declining. However, China’s consumers, with stronger demands for tourism, are filling up this gap. Prospects for the hotel industry therefore remain bright.
“There is no change in our strategy in China, and we are very confident about the prospects for China’s hotel industry,” said Wolfgang Boettcher, Starwood Hainan Area Managing Director. Starwood Hotels and Resorts runs about 130 hotels in China, with another 118 hotels in the pipeline.
“Everybody is talking about China,” said Richard Solomons, CEO of InterContinental Hotels Group (IGH). “China is IHG’s second largest market after the United States. The growth in China is amazing, as more and more Chinese people begin travelling.”
Focus on Quality
One effect of tourism development is that traditional group tours are losing ground to customized tours. Chinese tourists are becoming more sophisticated, and look forward to richer experiences and higher-quality services.
According to Clement Kwok, managing director and CEO of Hong Kong and Shanghai Hotels, Chinese consumers have changed their consumption habits and refined their tastes after greater exposure to the bigger world. Chinese tourists, who used to focus on material consumption, now pay more attention to cultural experience. High quality travel will play an important role in the sustainable development of China’s tourism market. Mr. Kwok hence concluded that China is not only a perfect market to promote high-end products, but also an ideal place to allow these products to evolve.
