International market segments

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1 International market segments ATE13 SPECIAL SERIES - CHINA (from primary cities) holiday market April 2013 The China (from primary cities) Holiday Market The World Tourism Organisation forecasts that by 2020 one hundred million Chinese tourists will embark on an overseas trip. Indeed, as proficiency in English grows across China and as young Chinese consumers increasingly become more knowledgeable about Western culture, the allure of visiting well known Western destinations and attractions is and will be high among those able to afford it. Visiting prestigious destinations and gaining new knowledge are two important motivators for international Chinese travel. The recent consumer demand research conducted on behalf of Tourism Australia, found that prospective Chinese long haul travellers ranked Australia very highly on some of the most important emotional factors associated with destination choice. These included aspects such as world class beauty and natural environments, spectacular coastal scenery, and native or cultural heritage. Currently, those in what many call the of Beijing, Shanghai and Guangdong, are more affluent and thus have a higher level of long haul travel experience than those in other Chinese ( Secondary ) cities. However with the expansion of economic development in China, there are new and growing pockets of wealth across the country that will enable more Chinese people from to travel outbound in the years to come. Destination NSW s China Tourism Strategy clearly identifies the staged approach being taken for the consumer marketing and trade development for the three primary city hubs of Beijing, Shanghai and Guangdong, and also the trade development for the growth and emerging city markets surrounding each of the three hubs. With more than ten million residents each, there is intense competition from around the world to attract travellers from the of Beijing, Shanghai and Guangdong. Australia is well placed to compete for this market given it was one of the first Western countries to be granted Approved Destination Status (ADS) by the Chinese Government in Destination NSW in partnership with Tourism Australia will continue its integrated trade and consumer marketing approach to grow the market from these cities. Both the Primary and Secondary Chinese holiday markets have a preference for group travel; though as the market matures, travel preferences will evolve to a more assisted independent travel style. The extent of how the tour is structured is determined largely by whether the visitors have been to the destination before. First time Primary city visitors prefer group travel with the option to have some free time away from the group. Repeat visitors from have a fairly equal preference for free time away from their group tour while other repeat visitors prefer to travel independently either with a Chinese speaking tour guide throughout the journey or to travel independently without any organised components. Figures for this factsheet are from Tourism Research Australia s International Visitor Survey for the year ended December For the purpose of this factsheet the China Primary cities holiday market has been defined as those visitors from China whose place of residence in China is Beijing, Shanghai or Guangdong and whose purpose of visit is for Holiday. The China * holiday market has been defined as those visitors whose place of residence in China is other than Beijing, Shanghai or Guangdong. In this factsheet, comparisons are made between Chinese holiday visitors from Primary and and also to the overall holiday market (i.e. all international holiday visitors).

2 The China (from primary cities) Holiday Market key statistics for the year ended December 2012 In 2012: 359,260 Chinese holiday visitors came to Australia 61% of all Chinese visitors; They stayed 2.9 million nights - 10% of all Chinese visitor nights. 144,500 Chinese holiday visitors from came to Australia 40% of all Chinese holiday visitors to Australia; They stayed 1.4 million nights 49% of all Chinese holiday visitor nights to Australia. Of the three, Shanghai was the largest contributor of holiday visitors to Australia, contributing 15% of China holiday visitors to Australia, followed by Beijing 14% and Guangdong 11%. In the last year, holiday visitation from Beijing and Guangdong grew at a faster pace than for Shanghai. For Australia as a whole, the China holiday market from in 2012 increased by 23% from 2011 which was more than the 2% increase achieved by the overall holiday market. The Chinese holiday market from Primary cities saw an increase of 44% in nights compared with 2011 again more than the 2% in increase in all holiday nights. NSW hosted overnight stays for just under two thirds (65%) of the China holiday market to Australia in From a nights perspective NSW achieved the biggest share (40%), Queensland a 27% share, while Victoria attracted 24% of nights. The China holiday market average length of stay in Australia was 9.9 nights, significantly less than the average length of stay for all holiday visitors to Australia (22.4 nights). This is due to the Chinese holiday market s preference for group travel, which is typified by a relatively short stay. The China Primary cities holiday market had an average length of stay of 6 nights in NSW less than the average length of stay for all holiday visitors to NSW (13 nights). Sydney was the top region for visitation by those from, and indeed the overall holiday. Those from Primary and had the same top five regions as the overall holiday, however higher proportions of the two Chinese markets visited these regions. For Sydney the visitation from each of these three markets was 64%, 62% and 50% respectively. Melbourne was the next most visited region 49%, 48% 28%, followed by the Gold Coast 38%, 43% and 20%, Tropical North Queensland 31%, 28% and 20% and Brisbane 23% for each of the Chinese markets and 16% for the overall holiday. The China (from primary cities) Holiday Market to NSW The China holiday was less likely than those from to arrive in Australia on a group tour (60% and 71% of visitors respectively), however far more likely than the holiday market overall to be on a group tour (60% VS.VS. 18%). While the China holiday visitors to NSW were a little less likely than those from to arrive in Australia with package arrangements (61% and 72% of visitors respectively), they were far more likely than the holiday market overall to use package arrangements (61% VS. 28%). 2

3 The China holiday was a little more likely to be on their first visit to Australia (75%) than those from the (71%), while somewhat more likely than the overall holiday (62%). The China holiday market who visited NSW in 2012 was most likely to be travelling as adult couples (27%). Unaccompanied travellers represented 23% of the market as was family group - parent(s) and children. Friends/and or relatives travelling together accounted for 20% of the market followed by business associates travelling together with or without spouses 6%. Travel party composition for those from was similar to the market however the latter were more likely to be travelling as business associates with or without spouses 14% VS. 6%. In comparison to the overall holiday, the China holiday market was far less likely to arrive in Australia as unaccompanied travellers (23% VS. 42%), just as likely to be adult couples (27% each) however more likely to be travelling as family groups (23% VS.13%). The China holiday market was more likely to be female than male (56% VS. 44%). Interestingly, females contributed over three quarters of the nights from this (77%) compared to males (23%). Females from this market had an average length of stay in NSW of 8.5 nights compared to males with just 3.2 nights. Females and males from this market had the same average length of stay for group tours (just over 2 nights each) however for those not on group tours, females had a much longer length of stay than males (18 nights VS. 4 nights). Females from this market who were not travelling on a group tour spent 66% of their nights in NSW in the homes of friends and relatives and 20% in rental accommodation. Only 11% of their nights in NSW were spent in hotel accommodation. The biggest age segment for the market was years (36%) followed by years (26%). Twenty one per cent were aged years while the 60 years+ was 17% of the market. Compared to the overall holiday, those from were older with 43% aged 45 years or over.. The biggest difference however was for the year age group 21% VS. 37% for the holiday market overall to NSW. Holiday visitors to NSW from the tended to be a little younger than those from ; this difference was driven by the lower proportion of those from that were in the years age group, 26% VS. 39% respectively. The China holiday in 2012 was more likely to stay in a hotel, resort, motel, motor inn accommodation (87%) than any other form of accommodation. Both those from the and Secondary cities were more likely to stay in this form of accommodation than the overall holiday 87%; 92% VS. 62% respectively. Compared to the overall holiday market, relatively few of those from stayed with friends and relatives 9% VS. 14%. When analysed as a percentage of nights spent in types of accommodation, staying with friends and relatives accounted for 46% of China holiday market nights while Hotel, resort, motel, motor inn accommodation was used for 38% of their nights in NSW. Due to their preference for group tours, those from were less likely to be staying with friends and relatives (21% of their nights) and more likely to stay in Hotel, resort, motel, motor inn accommodation (61% of their nights in NSW). Compared to the overall holiday the China holiday spent more nights in hotels (38% VS. 18%) and the home of friends and relative 46% VS. 18% than rented house 14% VS. 36%. In terms of the type of transport used between stopovers, air travel as a means of transport in NSW was the most used, 45% China holiday market VS. 35% for the overall holiday. Due the preference 3

4 for group tours it is not surprising that when compared to the overall holiday both the Primary and Secondary city holiday markets had a greater use of charter or tour bus (26% and 46% respectively VS. 12%) but less use of private or company car 11%, 5% VS. 16%. Both the Primary and Secondary city markets had very low use of rental cars 2% each VS. 7% for the overall holiday. Seventy one per cent of the China holiday visited the Blue Mountains in This market s trips to the Blue Mountains were primarily taken as a daytrip from Sydney. This is also true of the NSW holiday market in general; although the percentage was lower (63%). Wollongong/South Coast was the other place in NSW visited by the holiday market in 2012 (primarily for a daytrip) with slightly less visitation than those from and for the overall holiday (10% and 15% VS. 15% respectively). Port Stephens, the Hunter and Byron also attracted some visitation (10%, 10% and 8% respectively). Byron Bay is far more popular with the overall holiday with a visitation of 23% than the Primary and Secondary holiday markets. Compared to the holiday overall, the holiday market was more likely to visit the Sydney Opera House (93% VS. 85%) and the Sydney Harbour Bridge (88% VS. 78%). They were just as likely to visit Darling Harbour and Bondi however they were less likely to visit The Rocks, Manly and Kings Cross. Visiting the Royal Botanic Gardens was a stronger preference for both Primary and than the overall holiday, however Manly was less visited by the market compared to the overall holiday. Surprisingly there was little difference in visitation to Chinatown/Haymarket between those from Primary and VS. the overall holiday. This result can be explained by those Chinese on group tours being far less likely to visit Chinatown than those Chinese travelling independently. Attractions and tourist precincts in Sydney visited by the China holiday market in 2012 are compared to the holiday market and the overall holiday in the table below. Attraction/location Sydney Opera House 93% 98% 85% Sydney Harbour Bridge 88% 95% 78% Darling Harbour 75% 63% 73% The Rocks 34% 28% 53% Chinatown/Haymarket 50% 46% 51% Bondi 48% 50% 50% Royal Botanical Gardens 53% 55% 43% Manly 15% 6% 33% Kings Cross 16% 20% 31% Sydney Aquarium 27% 22% 24% Both the China holiday and the overall holiday had very high participation rates in activities which involved a social element (95% VS. 98% overall). The participation rates for Local attractions/tourist activities were also similar (89% VS. 86% overall) as was that for Outdoor/Nature (95% VS. 90%) and the activities involving arts/heritage (72% VS. 69%). Members of the Primary 4

5 cities holiday market were, however, a little less likely to engage in activities involving active outdoor/sports than the overall holiday market (35% VS. 41% overall). There were similar participation rates by the market and the overall holiday in Indigenous culture activities (25% VS. 24% overall) however there were no real differences in participation rates in the broad types of activities between those from the Primary cities and the. Types of activities participated in Social / Other 98% 97% 98% Outdoor / Nature 95% 97% 90% Local attractions / Tourist activities 89% 88% 86% Arts / Heritage 72% 72% 69% Active outdoor / sports 35% 34% 41% Indigenous culture activities 25% 22% 24% Social / Other 98% 97% 98% The China holiday had a clear preference for shopping for pleasure. They were also more likely to go to the beach and visit botanical or other public gardens when compared to the overall holiday. When compared to the holiday market the holiday market was more likely to go sightseeing/looking around, visit wildlife parks/zoos and visit museums or art galleries. They were less likely to visit history / heritage buildings, sites or monuments. The top ten activities undertaken by the China holiday market in 2012 are compared to the holiday market and the overall holiday in the table below. Activities Eat out / dine at a restaurant and/or café 75% 73% 88% Sightseeing/looking around 80% 73% 83% Go shopping for pleasure 90% 90% 80% Go to the beach (incl. swimming, surfing, diving) 88% 93% 78% Visit national parks / State parks 64% 64% 61% Go to markets 54% 53% 56% Visit wildlife parks / zoos / aquariums 51% 42% 53% Visit botanical or other public gardens 60% 65% 52% Visit history / heritage buildings, sites or monuments 46% 53% 48% Visit museums or art galleries 46% 39% 43% While the Internet was the top source of information used by both the market and the overall holiday for planning their trip to Australia, the former made less use of it, 43% VS. 55%. Of importance is 5

6 that travel agents are far more important to the market than the overall holiday. The main difference between Primary and was that the use of travel agents was even more important for those from. The top information sources used to plan their trip to Australia by the China holiday market in 2012 are compared to the holiday market and the overall holiday in the table below. Information sources used to plan trip to Australia Internet 43% 44% 55% Travel Agent 38% 47% 23% Friend or relative living in Australia 19% 16% 23% Travel book or guide 13% 6% 19% Friend or relative who has visited Australia 13% 13% 14% Previous visit(s) 9% 5% 12% No information obtained 7% 7% 9% Films or TV or Radio Program 5% 4% 3% Tour operator 2% 4% 2% Travel Article in Newspaper or Magazine 4% 3% 2% In terms of internet use in the trip planning phase, the holiday market was more likely to use the Internet to find out more about Australia after deciding to visit than the overall holiday (69% VS. 58%). Compared to the overall holiday market they were also more likely to use it to help decide whether or not to visit Australia and also to find a travel agent for Australia. The overall holiday being more independent in their travel style made greater use of the Internet for planning various aspects of their trip. The main differences between Primary and were that the latter made more use of the Internet to find out about Australia after deciding to visit, however due to their stronger preference for group tours they made less use of the Internet than those from for itinerary planning, airfares/schedules, accommodation and visas. The top reasons for using the Internet when planning their trip to Australia by the China holiday market in 2012 are compared to the holiday market and the overall holiday in the table on the next page. 6

7 Reasons for using the Internet when planning a trip to Australia To find out more about Australia after you decided to visit 69% 77% 58% To help plan your Australian trip itinerary 38% 29% 49% To look for airfares or air schedules for travel to Australia 35% 24% 47% To find out about accommodation in Australia 28% 18% 45% To find out about events or activities within Australia 24% 22% 35% To organise Visas and travel insurance relating to this trip to Australia 18% 12% 33% To help plan other transport options within Australia (e.g., car rental, public transport, etc.) 14% 11% 25% To look for airfares or air schedules for travel within Australia 16% 13% 23% To help decide whether or not to visit Australia 19% 18% 16% To find a travel agent for Australia 23% 18% 10% The top items booked on the Internet before the trip by the holiday market are compared to that of the holiday market and the overall holiday in the table below. Items booked on the Internet before the trip International airfare 81% 80% 73% Accommodation 62% 61% 59% Visa 14% 10% 29% Domestic airfare 33% 37% 26% Travel insurance 7% 3% 13% Vehicle rental 11% 11% 13% Organised tour 12% 5% 11% Entertainment activities or events 6% 6% 8% Bus or train transport 5% 5% 7% Australian travel package 4% 5% 3% The holiday market was far less likely to use the Internet during their trip in Australia 43% VS. 70% of the overall holiday. Those who accessed the Internet during their trip used three main devices; Smartphone (56%), Netbook/laptop (52%), ipad (30%) and PC in accommodation (17%). 7

8 Thirty one per cent said they used some type of mobile device such as a smart phone to access information during their trip in Australia. On the whole, each of the markets set out below, accessed information via their hand held devices for similar reasons, with the main exception being that those from Primary and had a greater use of language translations than the overall holiday. The top items accessed by hand held mobile devices during the trip by the China holiday market in 2012 are compared to the Secondary cities holiday market and the overall holiday in the table below. Types of information accessed using a Mobile device such as a smart phone during their trip in Australia Maps 66% 60% 64% Transport timetables 31% 31% 38% Destination guides 29% 26% 27% Restaurant guides 23% 24% 25% Attraction guides 17% 24% 23% None of these 20% 20% 21% Event guides 12% 15% 19% Language translations 28% 29% 15% Purchase transport 8% 9% 12% Purchase event tickets 5% 9% 10% Purchase tours 9% 5% 8% Thirty three per cent of those from used social media to share their trip experiences during the trip, which was less than the overall holiday (46%) however more than for those from (23%). Forty nine per cent of those from intended to use social media to share their trip experiences after trip, less than the overall holiday (58%) and a little less than those from (52%). More information For more information and statistics about international visitors to NSW see the NSW snapshots under Tourism - Research & Reports on the Destination NSW Corporate website at 8

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