How China’s 100 million tourists are reshaping marketing strategies

Michael Kors_Chinese Traveler_Featured Image

Chinese tourists make more than 100 million overseas trips a year, but marketing to this lucrative group starts long before they leave China.

Clever brands are engaging sophisticated activations through popular social app WeChat in the average four to six-week research period prior to travel and then retargeting travelers once they arrive at their international destinations.

Marketing to this unique consumer group is not new – but the changing characteristics of the Chinese traveler is. It is now essential that a marketing plan incorporates a personalized digital strategy customized to the young, digitally savvy and independent Chinese traveler.

“Brands don’t seem to understand the shift from an older organized tour traveler to a new world independent Chinese traveler,” says Darren Jacobs, head of Europe, iClick Interactive Asia.

“These are two very different groups and marketing strategies,” says Jacobs.

Chinese travelers made 120 million trips abroad in 2015, spending US$105 billion, according to a February report from HSBC. It predicts these tourists will make more than 240 million outbound trips within the next decade.

Half of these Chinese outbound travelers are aged 15 to 29 years old, according to January data from market research group GfK.

Two thirds (66%) of this group belongs to the high-income bracket, and their financial standing is expected to increase as their careers advance. The majority hold white collar executive or professional jobs, the annual study found.

In a nutshell, according to the GfK report, this group of consumers are:

  • more ‘hedonistic’ in their willingness to spend money to indulge and pamper themselves
  • slightly less price sensitive
  • looking for meaningful, adventurous and exciting experiences
  • are technologically savvy with almost everyone owning a smartphone
  • highly involved in sharing experiences on social media platforms

The next group (37%) are aged 30 to 44 and 10% are 45 to 59.

There are two pivotal times to engage the Chinese traveler:

1. Pre-travel

Previously, marketers might have waited for the Chinese customer to come to the market. Today it’s all about reaching them before they leave China.

The four to six weeks before the trip is seen as a key time to engage them as they research, plan and book their trips.

In the lead up to the Chinese New Year in February, for example, iClick Interactive worked with Michael Kors to help it promote a collection of Lunar New Year of the Monkey products to potential outbound Chinese consumers traveling to the UK, France and Italy.

The demographic focus was on Chinese users who showed travel intention and interest in travel, fashion and beauty. These users were targeted across screens: PC and mobile. Native ad and display ads were employed across Chinese social media channels, WeChat, QQ and Qzone.

Here are the cross-channel activations of native ads in user news, blog and Moments feeds on WeChat and on desktop.

Michael Kors_Pre-Travel_Mobile activations_600

These two screen shots show how a banner ad is programmatically placed on mobile, based on first and third party data from Tencent (parent company of WeChat, QQ and Qzone) using iClick Interactive’s MoSocial product.

Michael Kors_Pre-Travel_Desktop activations_600

Above is the activation on desktop.

2. In-market

Once the traveler arrives in London or Paris or Rome, it’s all about continuing that messaging in-market.

Here, geo-targeting is employed to reach users through their WeChat, QQ or Qzone accounts. Here’s how the next steps work:

  1. Data is used to locate the consumer via WeChat by IP targeting them
  2. Messaging is aimed at triggering a reminder to visit a Michael Kors store

Here’s what the in-market activation on mobile looks like. (In the second image, the message reads: “Are you in London? Come and visit our store for some Lunar New Year must haves.”)

Michael Kors_In-market_Mobile activations_600

Reaching the Chinese traveler requires a major shift in marketing strategy

No longer are brands marketing only within their home markets, but aggressively within China. The greatest shift for marketers targeting Chinese travelers is reaching them before they travel.

Darren Jacobs offers the following key points:

  1. Understand the audience and their behavior – make sure you are targeting them on the relevant channels. (For example, young consumers are on WeChat.)
  2. Know your audience from a data point of view so there is no wastage
  3. Target them at the right time (pre-travel and in-market)
  4. Serve the right messaging to the right audience
  5. Ensure messaging is seasonally in line – for example Chinese new year promotions
  6. Confirm the right messages for the right cross-screen channels. For example, content for mobile must be clear, concise and not wordy – and go to a mobile landing page. For desktop, more detailed content can be served.

We have previously covered the capabilities of QR codes when marketing to Chinese consumers.

The Cambridge Satchel Company is one British brand leading the way in its online and offline engagement with Chinese travelers – both during their travels and upon their return to China – by having QR code signage in its London stores.

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Now that WeChat Wallet is taking off, alongside existing market player, Alipay, payment will be the next area where international brands may consider homegrown Chinese mobile commerce options to facilitate the outbound Chinese traveler.

For the Chinese consumer, digital is key, says Nick Debnam, partner, KPMG, China. Debnam says that in the past some luxury brands had the attitude that “we are luxury – we don’t do online” but no one would think that now.

As more and more Chinese consumers research products from overseas, a globally aligned branding strategy is essential, he adds.

Brands coming into China and positioning themselves as very high-end, can face consumer backlash and brand devaluation if products are discovered in home markets that don’t match that perception.

“Chinese consumers can now see where and how things are being sold overseas and this can undermine whole marketing strategies in China,” he says.

*Featured image Flickr

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