Is the United States doing everything it can to attract Chinese outbound travelers? U.S. Travel Association President and CEO Roger Dow knows the most effective strategies better than anyone, and shares his forecasts for the next waves of incoming foreign tourists.
The big opportunity in the U.S. is the second visit.
At what point did the U.S. Travel Association identify China as an important target market?
The dialogue began with the State Department around 2006 and we launched the China – U.S. Tourism Leadership Summit. The conversation became very serious by 2008. When Tom Nides came in as the United States Deputy Secretary of State for Management and Resources in 2011, he also made this topic a priority.
What immediate changes needed to happen to encourage inbound tourism from China?
Back then, the wait time for a Chinese citizen to even get a U.S. visa interview was upwards of 135 days. The initial changes were simple, but necessary to get the backlog down: longer office hours; opening on evenings and weekends; doing consulate interviews for six hours instead of three.
The big change took place in November 2014, when we introduced the 10-year tourist and business visa, both for Chinese citizens traveling to the United States and for Americans traveling to China. Prior to that, businessmen who came to the U.S. every year — attending the same trade shows and conventions — would have to go to the embassy for a visa every time.
What have been some of the biggest results?
We’re seeing massive numbers. In 2000, there were 249,000 visitors to the U.S. from China; in 2008, there were 500,000 visitors; in 2014, there was 2.2 million. That’s a 777 percent increase.
The most important thing is the Chinese visitor spends $7,200 per visit, while most other overseas visitors spend an average of $4,500 per trip.
What sort of figures is USTA now forecasting?
China is a monster. The Commerce Department is projecting 4.91 million Chinese visitors by 2019. If that happens — and it will — China will surpass the UK and Japan as our number-one overseas market.
The 10-year visa now means there could be as many as 7.5 million Chinese visitors to the U.S. by 2021. That translates into an estimated $85 billion to the economy.
What is the bottom line for destinations and hotels that are seeking Chinese tourists?
The people who understand the Chinese visitor will get a greater share.
Language is a very big problem. The people who take the time to have Chinese-language menus, Chinese breakfast items, and have Mandarin speakers in hotels are getting a greater share.
Chinese visitors are creatures of habit and they go to the same place over and over. They will also share by word of mouth that they stayed at a Mandarin Oriental in the U.S. and they were very comfortable, which then attracts other Chinese guests.
The big opportunity in the U.S. is the second visit.
First-time Chinese visitors almost always go to Los Angeles, San Francisco, Las Vegas or New York. On the second visit, they may spend only 3-4 days in those cities and another 10 days traveling elsewhere.
Chinese travelers are extremely interested in culture, history, and experiencing authentic America. That’s why national parks have tremendous draw.
Since we’re now seeing more independent and small-group travel, rather than the larger tour groups, has that impacted where Chinese travelers go?
The organized tours would traditionally go to the big cities because that’s where the money is. Now with individual travelers or smaller groups, they may be visiting friends or family in destinations like Chicago or Texas.
College students are also driving up tremendous volumes of tourism, as parents are coming two to three times a year to visit their kids. In fact, Boston has a disproportionate number of Chinese visitors because of the numbers of universities located there.
What advice do you have for destinations that want to capitalize on shopping?
Of course, shopping is number one for Chinese travelers. We’ve heard from ministers of tourism from 31 provinces that there isn’t enough time built into programs for shopping.
It happens naturally. The luxury brands like Louis Vuitton and Givenchy understand the market extremely well. It’s no accident that you see all these high-end brands in the outlet malls — they’re putting them there because of the Chinese travelers.
One piece of advice I gave in New York was for shops to open two hours early or two hours late for Chinese tour groups. They would make a fortune by offering exclusive, after-hours access, with Mandarin-speaking clerks to assist them.
In terms of other, locally produced goods, Chinese travelers are becoming more interested in upscale wine. Oregon, for example, is doing a tremendous amount of promotion of their wines in China.
With all currently eyes on China, are we overlooking any other potential source markets?
Indian travel to the U.S. has grown 251 percent since 2000. South Korea has grown 119 percent, but that’s a deceiving figure. They entered the visa waiver program in 2008 and tourism exploded by 64 percent – from 744,000 in 2009 to 1.22 million in 2010.
It seems like South Korea rarely enters the conversation when we talk about tourism to the U.S.
That has to do with the overall size of the market, compared to China and India. It’s been a sneaky thing unless you live on the West Coast, where you see South Korean tourism in spades.
Overall, in the next 10 or 15 years, the big source markets for the U.S. will include: China, India, South Korea, Taiwan, Brazil and Argentina. We will also see growth coming out of the Gulf nations, particularly as we see increased routes from airlines such as Emirates, Qatar and Etihad coming from that region.
- How has the profile of the outbound Chinese traveler changed? Watch our video with the director of COTRI.
- Learn 5 tips on attracting Chinese outbound travelers.
- Will education change how (and where) the Chinese travel?