12 months on from the lockdown of Wuhan, we ask ‘When will Chinese tourists be back in Britain?’

This article, written by China Travel Outbound’s Managing Director, Helena Beard, appeared on the UK travel trade website, Travelmole, in January 2021.

China has successfully controlled the spread and impact of Covid-19 despite being the first country to have been affected 12 months ago. The number of recorded infections stands at just over 88,000 cases and 4,635 deaths have been recorded; incredible figures considering the population of China is more than 1.4 billion. As small outbreaks occur, entire cities are periodically locked down and the level of compliance is extremely high. Day to day life is much more normal now in China. But when can we expect to see these valuable, high spending tourists back in the UK?

The UK and the Chinese media – how is Britain perceived?

The UK hit the headlines in China at the beginning of the pandemic. While our government  discussed herd immunity, Asia scratched its collective head in confusion as to why the UK was not being locked down immediately. Our colleagues in China urged us to take the virus more seriously than our leaders, to get fit, lose weight and stock up on disposable masks, way before any of these messages hit our own news bulletins. There was then a long period where Chinese news was dominated by the situation in the USA and other countries. However, recently, the UK has been back as a ’hot topic’ on Chinese social media, Weibo, due to the new variant of the virus. 

On the plus side, the fact that the Oxford vaccine was developed here reinforces Britain’s position as the leading academic centre of the world, which will be positive for Brand Britain both in terms of international education and tourism from countries which value such things (particularly the Asian countries). Also, the emergence of various strains of the virus in other corners of the world eg South Africa and Brazil (and there are bound to be more), will lessen the significance of this individual variant and its prevalence in Britain. The news about vaccinations and the (hopefully) swift vaccinating of the British citizens provides great hope for the travel industry going forward.

However, that is not to belittle the seriousness of the current situation in the UK and the Chinese are very much aware that our country’s ‘performance’ vs Covid-19 in terms of infection rate and deaths is very poor. Whilst this continues to be the case, it is unlikely that the authorities will allow travel to and from the UK. There is currently a ban in place with no defined date when it will be lifted. This week, of course, the UK too has its own bans being implemented.

More generally, the international travel market from China is temporarily and effectively closed to all but the ‘exceptions’. Outbound tour operators are still closed and most staff have been redeployed to work in the domestic travel market (which is booming due to the pent up demand for travel). In many ways, this is good news. Those staff will return to international travel when it re-opens and, hopefully, there are not too many trade contacts who will be entirely lost to the industry.

Vaccinations in China

Beijing has begun its vaccination programme, aiming to have vaccinated all 21million+ citizens of Beijing by the end of March. Priority is being offered to students and business people who need to travel for study and work. This is a clear indication that the government of China values highly international trade and education. It has been reported that vaccinations are planned to reach 50 million people across 75 Chinese cities by Chinese New Year in mid February.

When will the Chinese start to return to the UK?

The short answer is that they will return when it is safe to do so. We do not believe that the image of Britain has been significantly damaged in China by its response to Covid-19 nor by Brexit and we are confident that there is still a high aspiration amongst Chinese people to visit the UK for all the reasons they have always longed to visit and study here (heritage, the royal family, culture, nature, education, home of the English language). But the Chinese government will decide when it is safe for people to come and that will depend entirely on how the virus is controlled, the roll out of the vaccination programme and the emergence of any new variants.

If all goes well, we can reasonably expect to see some FIT travellers returning to the UK this summer and students returning to universities in September. I think it is less likely that we will see a return of Chinese school children this summer on study tours as parents are likely to be more cautious. It is entirely possible that, during the Autumn and Winter season of 2021/22, the Asian market’s dislike of the cold British weather may be trumped by their desire to travel, creating an extraordinary peak season for this market.

It should be noted that there are other unknowns to consider. In a move that I fail to understand, VAT reclaim for international visitors to Britain was abolished on 31 Dec 20. This will doubtless make the UK somewhat less attractive than its European counterparts for all international tourists with an interest in shopping, but not least the Chinese. Perhaps this could be off set by any fall in sterling, but we don’t know how the pound is going to respond to Brexit in the longer term. And the political relationship between the UK and China is yet to play out following the US electoral result, the situation in Hong Kong, the UK’s stance regarding the treatment of Uyghur muslims, and any trade disputes.

Don’t ignore the Chinese student market

What does seem safe to say is that the USA’s relationship with China is worse than the UK’s. There is also a big issue of anti-Chinese sentiment and concerns over racist attacks in Australia. So international students, given the choice, are likely to choose Britain over America and Australia this year. In fact, 2020 (pre covid) research by New Oriental showed for the first time that the UK had moved into the top popularity spot as the most desirable destination for Chinese students, above the USA. In 2019, around 120,000 students came the Britain to study and their disposable income is five times that of a British student, so this is a segment with huge potential for UK tourism.

Read more about Chinese students and how to target them here.

Is it worth spending any money in China at the moment?

The short answer is yes, it is worth spending money on staying front of mind, on brand building, on placing reassuring messages that your attraction or destination is taking Covid seriously and is a safe and secure environment, and in maintaining relationships and loyalty with consumers, fans, followers, media and trade partners. It is not worth spending money on activity expecting to generate a short term return on investment.

We manage a number of Chinese social media accounts for our clients and these have been maintained throughout the pandemic. Despite the uncertainty, followers on Weibo for our larger accounts are still building at approximately 50% of 2019 levels. However, views are 5% up. But the most remarkable difference has been seen in engagements, where people have the time to get more involved in content and comment, like and share posts. Engagements in 2020 were a massive 45% up year on year on our travel Weibo accounts.  We are also seeing very good responses to the promotions we have been running with partners such as VisitBritain and Edinburgh Tourism Action Group.

This level of engagement and the clear desire to continue dreaming about travel, is why international destinations have continued to spend heavily on their Chinese social media accounts throughout the pandemic. Loyalty to China is also an extremely important factor in future success.

How many will come?

In terms of visitor figures, the Chinese market itself is likely to be smaller than 2019 for at least a couple of years. However, this is likely to be true of all international markets. Where the Chinese market will differ is that the ‘value’ of the market is likely to be higher, in terms of spend per visitor and environmental impact. China is one of the very few countries in the world whose economy is growing as we head into 2021. According to The Centre for Economics and Business Research, (CEBR) the Chinese economy will grow by 5.7% for the next five years. People in China still have money and they still want to travel. Fewer are likely to come, but they will travel to more diverse regions, travel differently and spend more money. They are going to be extremely valuable tourists for the UK. Students will also have spent a year learning online and saving their money. They are already an affluent segment. Next year, that affluence is likely to be even more marked.

I believe that one impact of Covid is that it has returned the tourism industry to a level playing field ie. there are opportunities for attractions, destinations, hotels which have not traditionally attracted the Chinese market to now position themselves as perfect for this market in a post Covid world. The rule book has been rewritten. It is not a foregone conclusion that, just because an attraction or hotel had a huge share of this market pre-covid, it will hold onto that share post-covid. The competition for this valuable market will be immense once it starts up again.

Marketing Britain to China

Travel and tourism businesses also need to consider another factor at play; the activities and plans of their national tourist boards. VisitBritain currently has no plans for a major advertising campaign in China for this year, nor is there a plan at this stage around the usual trade activities such as Destination Britain China. The focus for now is on the European markets, presumably to offset the impact of Brexit on Brand Britain and, perhaps understandably, to target what is seen as the ‘lower hanging fruit’ in terms of short term visitor numbers from neighbouring countries. This year, UK destinations, attractions and retailers in the Chinese market can not rely on VisitBritain’s activity to pull them through. If China was an important market to you pre-Covid, it is likely you will want to recover it post-Covid. It would be foolhardy to risk allowing the Chinese to forget you.

Chinese students in the UK: why YOU need to market to them

A record high of over 120,000 Chinese students studied in the UK in 2018-9, and they now make up the biggest single nationality amongst foreign students here. Chinese students benefit from generous allowances and are keen to enjoy the best of their host country. They’re especially eager to visit new places and they’re getting their inspiration not from UK media but from Chinese social channels.

International students have also been identified by China as a priority segment for receiving vaccines which, hopefully, will enable them to return to international universities in 2021.

So let’s look a closer look at Chinese students in higher education in the UK; who are they, and why should you be promoting your product to them?

Chinese students have lots of money to spend

Wealthy Chinese students studying abroad have annual allowances in the tens of thousands of pounds, making them a massive target for brands. Stories of Chinese students chartering private ‘planes to travel to and from university abound, and some calculations put Chinese students’ average disposable income at around £28,000.

And at a time when high-end retail is suffering, Chinese students continue to provide a rich source of shoppers for luxury outlets and gift shops at visitor attractions.

And they’re not just in London

Three out of the top ten universities by share of Chinese students are in the North, with the University of Liverpool alone hosting nearly 5,000 Chinese students in total. Nearby the University of Manchester hosts a similar number while the University of Sheffield welcomes around 3,700. Meanwhile Cardiff University is home to 3,500 Chinese students. With a national spread, all but the most remote of tourism providers can benefit in investing in activities to attract this cohort.

Chinese students like to travel 

China Travel Outbound’s research with Wonderful Copenhagen carried out in early 2020 found that more than a third of surveyed Chinese students in the UK had already been on a city break while studying here. And 25% planned to take another international city break during their time here. In fact, the average number of overseas city breaks already taken was three, with an average length of stay of 6.2 nights. 

And they will actively be looking for places to visit over Easter and the summer holidays

Limited flight capacity between the UK and China, and the possible requirement of quarantine on return to their home country, will encourage Chinese students to remain in Europe over the university holidays. So they’ll actively be looking for places to visit.

Chinese students are great advocates for your product

Studies show that Chinese students overseas continue to use Chinese social media such as Weibo, WeChat and Little Red Book rather than migrating to Instagram and Twitter. Our research with Wonderful Copenhagen found that fewer than 1 in 5 students used Instagram and fewer than 1 in 20 used Facebook. And the nature of the Chinese digital landscape and online connectedness of Chinese students and Gen Z means that those visiting are great advocates for your product, with influence far beyond these shores to their fellow netizens at home.

Chinese students can help you maintain a presence in Chinese digital channels when Chinese outbound tourists, including China’s Key Opinion Leaders, are in short supply, and help influence destination choice when outbound travel from China fully starts up again.

Chinese students often stay in the UK after graduating

Since the UK brought back the two-year post-study work visa in 2019, graduating overseas students have been allowed to stay in the UK for to work, or look for work, in any career or position of their choice for two years after completing their studies. With the chance to work overseas a big draw in studying in the UK, your chances of repeat visits, especially with visiting friends and family, make Chinese students an even more profitable prospect.

And the UK is now the number one choice for Chinese students who would like to study overseas

A July ’20 study by New Oriental Education, one of China’s largest educational firms, found that 47% of Chinese students would choose the UK to study abroad, with 37% choosing the US. This is the first time that the UK has overtaken the US as the top destination for Chinese students in this survey.

With China the single largest country of origin for international students worldwide, with over 600,00 Chinese studying overseas in 2018, the prospects for UK tourism to benefit from the patronage of Chinese students has never been brighter.

Contact us now for a no obligation chat about how we can help you attract Chinese students to your destination, visitor attraction or retail outlet today.

How can you reach this valuable audience?

We have a full range of services available to target Chinese students in the UK.

Chinese Tourism Leaders’ (Virtual) Forum 2020

On 21 October, we were delighted to share insight into the Chinese travel market with senior representatives from the UK’s leading destination organisations, transport operators, tour operators and visitor attractions at the fourth annual Chinese Tourism Leaders’ event. Hosted by China Travel Outbound and Capela China, settling around Zoom wasn’t quite the same as enjoying Peking Duck in Chinatown but it was a fantastic success nevertheless.

Vivienne Song, China Director for China Travel Outbound, and Helena Beard, Managing Director in the UK, shared the latest information on the Chinese travel market. We heard that life in China is back to normal with the only Covid-19 changes relating to mask-wearing and Track and Trace requirements. China’s domestic travel market has been the first in the world to recover, with flight bookings down only -2% in August, and 75% of China’s travel agents back at work. Post-Covid-19 revenge travel took hold for Golden Week with 637 million trips being made, and strengthening trends include small tailormade tours, self-drive, rail, and luxury and personalised service. A lust for open spaces, remote islands, and direct contact with local cultures will be an emerging trend once the market returns to our shores.

We were delighted to be joined by Richard Nicholls, Head of Research and Forecasting for VisitBritain, who talked us through recent changes to VisitBritain China stats. For several years now there have been significant anomalies between VisitBritain figures for Chinese inbound tourists to the UK, and data from other sources such as number of visas issued. This issue has been discussed at length by the Chinese Tourism Leaders’ group in the past so the audience was very happy to hear that this has now been resolved.  The updated stats show a very substantial increase in Chinese inbound tourist visits to the UK with the revised total more than doubling to 860,000 in 2018. 2019 saw 883,000 Chinese inbound visits to the UK. In fact China’s £1.7bn spend in 2019 makes it the second largest inbound market by expenditure.

The timing for the return of the market was also discussed, with expectation that the first significant influx of Chinese tourists will be seen in Summer 2021. More accurate predications will be possible following Chinese New Year in February 21 when we will see how and where the Chinese government lifts restrictions on international travel. Helena Beard highlighted to the audience that the more immediate opportunity lies with international students and announced that a new student-focused product would be launched by the agency next month to service this market.

We also heard from Clive Doble of Value Retail, Bicester Village, who talked about the abolition of tax-free shopping for international visitors to the UK from 1st January ’21. This policy would make it about 20% more expensive for Chinese travellers to visit the UK and shop here. It would have a detrimental impact on international visitor figures and come as a huge blow to the inbound tourism sector which is already one of the sectors impacted most severely by COVID-19.  Joss Croft, CEO of UKinbound, reassured the forum that intense lobbying continues to try to reverse this decision.

The Chinese Tourism Leaders’ group was created by specialist agencies China Travel Outbound and Capela China to share insights and best practice between the destinations, visitor attractions, transport companies and tourism brands who are at the forefront of Chinese inbound tourism to the UK.

The Chinese Global Study Tour Phenomenon

What is a global study tour, who goes on them, and why are they so vital to the future of UK inbound Tourism?

As the world emerges from the coronavirus crisis, competition to reach the top of the desirable destination list amongst Chinese outbound tourists is going to be fierce. This autumn, the whole world will be fighting for its share of this huge and lucrative market, encouraging the Chinese to return for Golden Week, Chinese New Year, the May National Holiday and, of course, Summer 2021. 

The UK will be part of this race and I am sure we will do well, with our fantastic tourism products and strong China Welcome. However, there is one very important sector where we have very real potential to excel and surpass the competition if we just pay attention and understand the opportunity, and that is the global study tour market.

What is the global study tour market?

A global study tour is a trip abroad made by a school-aged child for the purpose of learning. There are four main categories of global study tour:

  1. The most common type of global study tour involves a group of children visiting a foreign country to learn something (usually the language) with some elements of sightseeing as part of the itinerary.
  2. ‘Camp education’ is common in the States, where students stay in a camp and confine their activities to the camp and its surrounding areas. The content is around education, with most courses offering a theme; sport, art, science, technology are all popular. Many of the summer schools favoured by high-achieving students applying to America’s best universities offer campsite programmes.
  3. A third option is the ‘School immersion’ tour, where the student has a curriculum based experience within a foreign school or university.
  4. The fourth type is aimed at students with a clear ambition to study abroad in the future. This type of study tour aims at enhancing the actual university application and is intended to give the student the best chance of success.

How big is the market and how much is worth?

Like all Chinese travel sectors, it’s big and it’s growing. According to iResearch data in 2018, the number of people who participated in a global study tour was 1.05 million, with an estimated forecast growth rate in the global study tour / camp education market of around 20%. Of course, the coronavirus will interrupt this growth in 2020. The per customer transaction ranges from around £2,300 up to £5,800 and the estimated size of the global study tour and global camp education market in China is around RMB 94.6 billion (£10.5 billion).

Size of Chinese global study tour market
Image : iResearch

Image: iResearch

The market is still relatively immature. The penetration of the study tour industry is reported to be low at around 16%, and distribution is still fragmented, with a large number of tour operators having small shares of the market. For example, New Oriental, one of the leading players in this field, has only a 1-2% market share and most of the companies in the sector are SMEs with revenues below RMB 10 million (iResearch, 2018).

The biggest growth is forecast to be seen in the primary school sector.

The expectation is that although the biggest sector of students undertaking global study tours is currently those at secondary school age, the biggest growth is forecast to be seen in the primary school sector. This reflects the population development of young children since the lifting of the one child policy in China.

Why are global study tours so popular in China?

The Chinese middle classes are looking beyond day to day work and family life, and seeking richer cultural experiences, self-improvement, culture, entertainment and, very importantly, education. Travel is an investment in the future of their children and is often undertaken as a way to educate further, and to check out possible options for future overseas high school and/or university education. Travel broadens the mind, but it also offers the practical purpose of competitive advantage on a university application form. And all this in the context of the child who is still unlikely to have many siblings and certainly no cousins to compete with for the discretionary spend of the doting grandparent. What better way to spend your money than investing in your grandchild’s education?

What is the opportunity for the UK?

The most popular places to travel to for global study tours are United Kingdom, USA, Japan, Australia, France, Singapore, Canada, New Zealand, Thailand and Switzerland (Tuniu.com, 2019 Summer Global Study Tour Trends Report). According to C Trip, South East Asia is seeing strong and rapid growth over the last two years which Zhao Yao, C Trip’s Study Tour director attributes to low prices and a proliferation of European and American teachers working in South East Asia, offering great value access to language education. South East Asia also offers the benefit of volunteer work, especially on environmental projects.

One of the most popular reasons for embarking on a global study tour is to prepare the child for a future at an overseas university…”

One of the most popular reasons for embarking on a global study tour is to prepare the child for a future at an overseas university and, it remains the case that the USA, the UK and Australia lead the way in welcoming Chinese students at their universities. And this is the real opportunity for the United Kingdom. 

According to The Guardian, in 2019, applications from Chinese students to study at UK universities increased by 30% year on year, and Chinese students are now the largest group of international students in the UK’s universities. But the opportunity is bigger still and, like many things in China, it comes down to politics.

The trade war with the USA and the poor relationship with President Trump are driving Chinese tourists and students away from America. At the same time, China’s relations with Australia are also deteriorating, with arguments over trade tariffs and anger from Beijing over Australia’s call for an independent investigation into the origination and handling of the coronavirus by China. 

Chinese people are hugely influenced by politics and the direction of their President. Any further breakdown in Sino-American and Sino-Australian relations leaves a path open for the United Kingdom to welcome more and more Chinese study groups and students to our shores.

What are the challenges?

So what does the UK need to do to maximise on this opportunity? Our team in Beijing has been speaking to two of the major players in this market and you can read the full interviews here. In summary, the agents are willing to hear from the UK and believe in the destination. They identify the most important priorities are to increase the options for study beyond the pure language courses, to focus on the promotion of our cultural heritage in order to compete with more famous attractions of the USA, to expand our promotion of the regions, universities and cities beyond London, to find ways to compete on price with the States, and to improve communication of product, benefits and tours to the Chinese travel trade, through marketing, sales missions, roadshows and trade communication.  It is also important for our top museums and attractions to create bespoke tours and products which can be offered flexibly as part of the study tours, and that they have Mandarin speaking staff who are able to deliver educational tours to the children on-site. If our attractions can make it easier for the Chinese tour operators to work with them during the summer months, and can deliver a really world-class service to these study tour groups, the demand from the Chinese travel trade is real and valuable. 

It is clear that the United Kingdom has some way to go in terms of product development and communication of our study tour offering, but the opportunity is real and ours for the taking. I hope the pause that has resulted from the Coronavirus crisis will offer our museums and attractions an opportunity to redevelop their offering, communicate with the Chinese specialist operators, and prepare for the inevitable surge in interest for Chinese study tours arriving next summer. It is an opportunity they would be foolish to ignore.