We are all aware that China’s outbound tourism market leads the pack globally at USD260 billion, almost double that of the United States, which is in second place. The size and the potential of this market is undeniable. Marketing to this demographic is also unavoidable, so tapping into the pulse of this segment is important for business growth, especially since they will be the first to travel once the international borders are open.
Chinese travelers seek experiences that are unique to the locale and their own appetites, and also no longer only choose to stay in hotels, expanding accommodation options to places such as short-term rentals, homestays, inns and guesthouses. The post-90s-generation tourists, well-known for their eagerness to try new experiences, are more willing to try homestays.
Chinese travelers have unique characteristics that short-term property owners should be aware of in order to attract their bookings. Looking at data from our clients, Rentals United has found unique booking qualities pertaining to this group. For example, 60% of Chinese travelers make bookings within 30 days of the booking date.
According to Rentals United, Chinese travelers on average have a higher price per night spend. They average 167EUR per night, which is over 12% higher than the average. Equally, they are willing to invest in special long-haul trips where they don’t mind spending a bit more money.
The top countries where Chinese travelers book short-term rentals are the United States, Spain, Italy and the United Kingdom. And as the number of long-haul trips increases as borders open up, so will the length of each stay.
Chinese travelers are attracted to well-known places in Europe and the U.S. where they like to spend on shopping, sightseeing, enjoying nature and food and beverage.
In terms of the nature of travel, the types of Chinese travelers who are more drawn to short-term rentals over hotels are already on the experiential side of the spectrum and are seeking unique experiences and locations. They will likely be more travelled and are also likely to travel in couples or in families and thus will seek variety in accommodation options.
These travelers want to experience the famous iconic landmarks and also be the first (amongst their peer group) to have an off-the-beaten-track adventure (that they can share on social media).
The role of Trip.com in the post-pandemic era
Technology and peer reviews play a central role in how Chinese travelers make travel decisions. Chinese outbound travelers typically move through three stages when planning travel: inspiration, research and purchase. Inspiration comes from family and friends, or social media; while researching and purchasing decision-making are influenced by online travel websites. Friends, family and the traveler’s personal interest are the biggest determinants of the destination of choice.
Chinese travelers are becoming more open-minded in what they are looking for. Traditionally, they preferred to stay in hotels, but as the traveller persona has evolved, short-term rental accommodation has come to play a more central role in their travel decisions.
Chinese behemoth Trip.com is the biggest online travel agency in China and the most central and prominent source where Chinese travelers book their travels. With more than 1.2 million hotels and rental properties in 200 countries and regions, Trip.com has built an extensive network to give its customers a diverse choice of accommodation. Their far-reaching flight network has over two million individual flight routes connecting more than 5,000 cities around the globe.
As one of the world's leading and fastest-growing OTAs, Trip.com has millions of visitors every year. As the Chinese appetite for short-term rentals grows, the company is rapidly developing their inventory around the world. According to a report by the State Information Center, a State Council think tank, the market for home-sharing services is expanding rapidly in China – before the coronavirus epidemic, they estimated that the sector's revenue would reach 50 billion yuan ($7.5 billion) by 2020.
With the rapid development of the sharing economy, accommodation sharing has also taken off in China. Chinese consumers have started to pursue high-quality travel and local experiences, which has ignited the explosive growth of home-sharing service providers such as Airbnb, Tujia, Xiaozhu and Zhubaijia.
Statistics from Tujia showed party bookings for apartments with four to five bedrooms between July 2017 and June 2018 increased over 60% year-on-year, with major demand in first-tier cities in China like Beijing and Shanghai. This trend exemplifies the Chinese demand for short-term rentals which extends to long-haul travel globally as well.
Furthermore, Ctrip Group’s 2019 rebrand to Trip.com Group, its purchase of Skyscanner, combined with its joint venture with TripAdvisor has put the company in the center of the global marketplace. These strategies have primed the Trip.com Group to come head to head with the large global OTAs. What Ctrip offers, of course, which the others do not is the highly coveted group of Chinese travelers. For this, the accommodation sector has an important player to consider.
James Burrows is the co-founder and CEO of Rentals United.
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June 15, 2020 at 03:01PM
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Attracting Chinese travelers to the short-term rental market - PhocusWire
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