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Five things you need to know about China’s new affluent outbound travellers

February 25, 2020 | Blogs

As China’s economy continues to grow, and incomes of the country’s middle and upper-middle classes continue to rise, more Chinese people are travelling abroad. Recent data compiled by the World Economic Forum, UNWTO (United Nations World Tourism Organisation) and COTRI (China Outbound Tourism Research Institute) showed that Chinese tourists made 149.7 million overseas trips in 2018—spending over USD $250 billion during these trips—making China the world’s most powerful tourism market. So, who are these new Chinese affluent travellers and what are their spending habits? Here are 5 things you need to know about them:

1.      China’s new affluent outbound tourists primarily hail from major cities like Beijing, Shanghai and Guangzhou—with the largest disposable income per person in the country—but also from second and third-tier cities. Chinese affluent travellers from big cities, especially women and Millennials, favour a new type of outbound tourism referred to as Free Independent Travel (FIT), while others still prefer organized tours.

2.      Travelling abroad to shop is particularly important for wealthy Chinese consumers. According to a 2018 Nielsen report, they book overseas trips mainly for leisure. They spend on average 25% of their total overseas travel budget on shopping, followed by accommodations (19%) and dining (16%). Other major expenses include local transportation, tourist attractions, recreation and communications. Regardless of where they’re from in China—or the country they’re visiting—they tend to always spend the largest portion of total travel expenses on shopping. According to Nielsen, Chinese tourists spent an average of USD $762 per person on shopping during their most recent trip overseas, while non-Chinese tourists spent an average of USD $486 per person.

3.      Affluent Chinese tourists travelling overseas value unique experiences over everything else and are eager to explore the latest trends. Price is not a determining factor when choosing how to spend their money while vacationing abroad. Beauty and uniqueness of the attractions, high-end shopping and other luxury experiences are a priority while visiting a new country. A recent Ipsos Analysis shows that close to 50% of mainland China’s luxury shoppers are under 30, and that Chinese Millennials and Gen Z will drive luxury consumption in the next 10 years.

4.      The payment method, however, is a decisive factor for these travellers. The Nielsen report also shows that 65% of outbound Chinese tourists paid using mobile payments on their most recent overseas trips. They expect to see signs for popular digital payment solutions like Alipay and WeChat Pay, and to use these apps like they do at home. They’re accustomed to digital wallets—which also let them convert RMB into Canadian dollars and keep track of their expenses during their trip—enabling them to enjoy a stress-free vacation.

5.      China’s new affluent overseas tourists are also digital-savvy travellers. Super-apps like Alipay and WeChat Pay play a big role during their trip, but also before, as they rely on reviews, suggestions from online influencers and other content published on these platforms, to research and decide on a destination, and to plan their trips.

Chinese tourism to Canada continues to grow: 757,000 Chinese tourists visited the county in 2018, and it’s clear that this powerful tourism market represents a huge opportunity for mobile payments in Canada.

OTT Pay—the authorized partner of Alipay and WeChat Pay in Canada—has already partnered with Tourism Toronto, Tourisme Montréal, Esso, luxury bands like Ethan Allen, as well as small business owners, to help them connect and engage with affluent Chinese travellers. Let us help you attract more Chinese visitors to your business through digital payment platforms. Email us today at info@ottpay.com or give us a call at 1-800-688-9838.