Outbound Rebound 2023,
Report by FINN Partners and Consumer Search Group (Part 2)
Upscale and luxury accommodations are more preferred and hotel brands have an increasing influence over destination choices.
While convenience, personalized service and culinary offerings in hotel accommodation are key, wealthy Chinese travelers also want a place they can socialize and get a good night’s sleep.
Going luxe: affluent Chinese travelers are opting to splurge on accommodation.
A majority of travelers still prefer hotels and resorts for convenience and familiarity, rather than the non-traditional types of accommodation with strong experiential components. In 2023, one in two travelers plan to stay in upscale and luxury hotels.
On average, special-themed hotels saw a four-percentage point jump in preference, with the growth more evident among the 21-25 age group and travelers from Tier-3 cities.
It is worth noting that the rise of glamping in the domestic market does not translate to an increase in the popularity of camping and campervans in the context of overseas travel. Private islands, boats and temples also score less than 10%.
Brand love: hotel brands are influencing destination choices.
Majority of respondents decide on a destination first before making hotel choices. But this decision process is declining across various age groups. In 2019, 86% of affluent Chinese travelers chose a destination first before selecting the hotel or resort. Today, that number is down to 77%.
Instead, a brand’s portfolio is becoming a deciding factor among savvy travelers, as 16% choose to plan their vacations around locations where their favourite hotel brand has a property, versus 11% in 2019. This is particularly evident in the 21-25 year-old age bracket (26% versus 16% on average). In contrast, it is the older, affluent travelers in Hong Kong (aged 36 years and above) who tend to be loyal to a hotel brand.
Also notable is the increase in travelers whose destination choice is solely based on the location of a specific hotel or resort. Up from 3% in 2019, 8% of travelers now make decisions in this manner. This is more evident among those from Tier-1 and Tier-3 cities (a 5% and 6% increase, respectively, versus 2019).
Personal feedback and word-of mouth sway booking decisions.
Unlike price and budget-sensitive Hong Kong travelers, where 41% of respondents choose hotels based on budget, Chinese travelers place more emphasis on past experience, star-rating or reviews, and word-of-mouth.
Hence, positive guest experience alone carries great potential for repeat and new business. Interestingly, for affluent Chinese travelers, budget and promotional offers are among the least important factors in choosing a hotel.
Star-rating and personal interest are especially important to those over 36 years old and those from Tier-3 cities.
Convenience, service and food choice matter.
From a list of 49 items or criteria, respondents chose hotel services and amenities that were most important to them. The choices included location, rooms, service, facilities, dining and kids’ club. The factors deemed most important by affluent Chinese travelers emphasize the importance of convenience and accessibility, personalized and efficient service, and culinary experience.
Convenience is the top factor that drives accommodation selection. For city hotels, it is about easy access to attractions, entertainment, and shopping, while resort guests look for proximity to the beach and other activities. Free shuttle service to attractions is a strong influencing factor in hotel choices.
Round-the-clock butler, room service and business center are also important as these give assurance that their needs can be attended to at any given time.
Culinary options are also important for wealthy Chinese travelers as they tend to have meals in the hotel before and after they come back from sightseeing or shopping.
Growing preference in properties where there is a sense of conviviality, impeccable hospitality, and aesthetics.
Consumers are shifting their preference towards community minded and design-centric hotel properties. This is a trend that has been gaining momentum in the boutique hotel segment.
While 85% of affluent Chinese travel with companions, majority of respondents want to stay in hotels and resorts where they can have an opportunity to socialize and meet new people. This friendly and welcoming atmosphere is an aspect that travelers want in the staff.
As Chinese travelers become increasingly discerning, hotel design will become a feast for the senses and a defining factor of luxury.
Conviviality in a property: A hotel/resort where I could socialize and meet new people 58%; A hotel/resort that is known for its welcoming and friendly staff 58%; A hotel/resort that would keep my travel companions happy 48%; A hotel/resort that is known for its excellent service 48%; A hotel/resort with distinctive design and decoration 46%.
Creature comforts and relaxation are vital in a hotel room.
Be it customized pillow choices or luxurious beddings, sleep amenities are most important, especially among the 36+ age group. This is consistent with the prevalence of poor sleep quality among the population.
Across the board, the affluent Chinese travelers prefer rooms with a view — whether it be the natural scenery or a garden. Complimentary mini-bar amenities and a bathroom with spa features are also important attributes.
Most important attributes of hotel rooms/ suites: Luxury sleep amenities 40%; Picturesque view 36%; Complimentary minibar 35%; Spa-inspired bathroom 34%; Private garden / balcony 32%; Computer / video games 30%; Private swimming pool 29%; Special floors (e.g., woman floor, quiet zone) 27%; Dedicated work area (large desk, lighting, fast internet) 27%.
Dining options matter.
Wealthy Chinese travelers tend to eat meals in the hotel before they head out for sightseeing, shopping, or other activities. Most also eat supper in the hotel after a whole day out. Hence, variety of cuisine and even flavours from home are listed as important preferences.
Respondents are split among what is important for them as far as hotel culinary options are concerned. Aside from variety of menu offerings, healthy meal options, 24-hour room service, and a bespoke, fine dining experience are also important to affluent Chinese travelers.
Interestingly, bars with extended opening hours do not matter as much, with only 29% of respondents saying this was an important attribute.
Most important attributes of hotel restaurants: A variety of cuisine options 45%; 24-hour room service 44%; Healthy meal options 44%; Local cuisine restaurant 43%; Fine-dining restaurant 43%; Outdoor dining 40%; Bars / restaurants with extended opening hours 29%.
From Planning to Booking
Practical information and insiders’ insights and tips shape travel decisions. Video content and imagery strongly influence consumer choices. While most book directly on brands’ official websites, travel agents play an increasingly crucial role in planning and booking.
Planning: Decisions are mostly made alone. 83% plan well in advance. 77% decide on the destination first, then hotel. 26% Gen Z more likely to decide on the hotel/ resort first, before the destination.
Single decision maker for the traveling group.
91% of affluent Chinese make leisure travel decisions on their own. But 86% of them plan to travel with at least one companion, mostly with their spouse/ partner (66%).
In cases where there are joint decisions, these are made together with the spouse / partner (89%) or children (53%).
Information Gathering: Internet 82%; Social media 73%; Advertisement 62%; Word-of-mouth 59%; Travel agents 51%.
Travel decisions based on research from official sources and personal feedback.
Travel decisions are guided by research. Typically, affluent Chinese travelers do research from official sources, features from travel bloggers, writers or influencers on recommended itineraries, tips and insights. Images from go-to, credible sources also play a role in drumming-up interest in a destination or attraction.
As “reviews” play an important role in Chinese consumerism, personal travel blogs are indeed an important source of information. Meanwhile, video-based platform Douyin has surpassed WeChat and Red as the most popular information channels, once again highlighting the growing popularity of using videos to promote travel products.
Travel information of interest: Practical facts about the travel destinations such as seasons, climate, culture, etc. 51%; Recommended itineraries, places to visit etc. 46%; Personal travel diaries with personal insights, suggestions, and in-the-know travel tips etc. 43%; Travel regulations on official channels 38%; Destination entry requirements detailed by travel bloggers 33%; Travel brochures with beautiful images and descriptions 31%; Destination fun facts 26%.
Preferred information channels: Douyin 66%; WeChat 63%; Weibo 55%; Little Red Book 55%; Bilibili 46%.
Booking: 76% book within 3 weeks; 47% book within 1-2 weeks; 21% Gen Z book less than 1 week.
The top 3 online booking platforms for international travel: Trip.com 89%; tuiniu.com 57%; booking.com 32%. 65% book directly on brands’ website.
Offline channels are still crucial, albeit less than online channels. Travel agents (online & offline) are also key booking channels.
While, direct bookings are preferred, travel agents remain important in finalizing travel plans.
In contrast to domestic travel where online travel agents are considered the main one-stop-shop platforms for planning and booking, travelers tend to book directly through the websites of travel brands for international trips.
But both online and offline travel agents influence planning (73%) and booking (43%) – emphasizing the need for reliable agents who can help navigate nuances such as connectivity to get to destinations, travel requirements and other factors.
Noteworthily, more than 70% of travelers still book offline, indicating that offline channels are still crucial even in the digital-first market.
With more plans to fly first class, COVID safety measures and service matter more than price. Travelers prefer loyalty programs that grant them personalized service and priority access.
First class = safer seats.
More affluent Chinese said they prefer flying first class, with a marked increase versus 2019. This increase is particularly evident among the 36+ age segment and those in Tier-3 cities.
Only 22% of affluent Chinese said they would fly economy class.
As a point of comparison, less Hong Kongers said they would fly first class, reflective of the cautious sentiment towards economic prospects and relative maturity as international travelers. 44% of Hong Kongers said they would fly economy.
Affluent Chinese travelers are not price-sensitive.
Factors impacting choice of airlines: COVID safety measures 39%; Service 37%; Inflight dining 35%; Flight schedule 32%; Cancellation terms 28%; Inflight entertainment 27%; Pricing 24%; Carbon emission 8%; Loyalty program 5%.
Travel by train remains steady. As road trips have become popular, demand for car rental is expected to rise.
Meanwhile, cruise ships remain a steady preference in leisure travel: Train 15% (-1%), Cruise Ships 12% (+1%), Rental Car 14% (+4%).
Loyalty memberships are a badge of honor.
The motivation behind loyalty memberships is the exclusive privileges – personalized service, priority access and VIP amenities. Travelers are less keen on rewards and special discounts.
Loyalty program ownership: Hotels 64%; Airlines 57%; Vacation clubs 48%; Food and beverage 42%; Travel agents 36%.
Motivation to sign up: Personalized services 60%; Priority access to newly launched facilities and services 58%; Privileges (e.g., priority service, free upgrade) 55%; Rewards47%; Promotion/ special offers 42%; Partner network 10%.
Most attractive membership benefits and rewards: Benefits can be used in city of residence (e.g. gyms and lounges) 33%; Hotel accommodation 32%; Travel services or experience (e.g. spa, car rental, event tickets) 32%; Limousine service 30%; Birthday and anniversary gifts 30%; Souvenirs or products 28%; Dining experience 27%; Shopping vouchers 25%; Upgrade 24%.