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.
As schoolchildren across the UK settle into classroom teaching for the first time since spring, and undergraduates ready themselves for a return to campus, there’s a large group of prospective tourists flying into the UK to start at or return to their universities at the end of September. Chinese students in higher education outside China are rich and influential and they’re looking for places to visit – and there’s over 100,000 of them in the UK.
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?
How many Chinese students are there in the UK?
In 2018-9 a record number of Chinese students studied in the UK, with the Higher Education Statistics Agency recording that the number of Chinese students rose above 120,000 for the first time. And there’s been a steady and significant increase in their numbers over recent years; in the 5 years to 2018-9 the number of Chinese students in the UK increased by 34%.
But will Chinese students come to the UK for their studies during the time of Covid-19?
Any worries that Chinese students may not return to the UK for the start of the 2020-1 academic year seem unfounded. While the US is suffering from its current political tensions with China as well as a negative perception of its handling of the coronavirus pandemic, the UK continues to be regarded favourably, not least thanks to its handling of the IELTS (International English Language Testing System) challenge earlier this year. The cancellation of the IELTS tests put in doubt access by Chinese students to under- and post-graduate study in English-speaking countries including the UK, USA and Australia. But UK universities reacted quickly and showed great flexibility in recognising the results of other English language tests in order to maintain the access of Chinese students to higher education here.
Plus, UK universities are going to extraordinary lengths to ensure that hygiene and safety measures are in place on campus, and that travel to the UK is seen to be safe. Queen’s University Belfast, which has around 1,200 Chinese students, has even been planning a to charter a jet to fly its new and returning students to Northern Ireland from China.
Why promote your tourism product to Chinese students in the UK?
So there are over 120,00 Chinese studying in the UK (2018-9 figures), but why should you promote your tourism 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.
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 Christmas and Easter
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.
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:
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.
‘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.
A third option is the ‘School immersion’ tour, where the student has a curriculum based experience within a foreign school or university.
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).
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.