White Papers
Where Do Chinese Millionaires Go On Holiday?
Summer is upon us and holidays are being booked. Private bankers may be wondering which international holiday destination will have them rubbing shoulders with China's cash-rich glitterati.
The answer, according to a new survey by Hurun Report, is Europe's billionaire playground, the South of France.
Among foreign destinations, France is followed by the US and Australia – though the wealthier the individual, the greater their preference for the US and the Maldives, according to the The Chinese Luxury Traveler White Paper 2012, published by the Hurun Research Institute in association with the International Luxury Travel Market Asia.
Interest in Dubai is also growing, particularly among China’s super-rich. Twelve per cent of Chinese luxury travelers own a vacation house in Australia, which is a slight increase from that of last year. Japan and Switzerland also ranked highly.
The research stemmed from face-to-face interview with over 150 millionaires during April to May 2012, as well as the questionnaire investigation to see their travelling and going abroad situation. Most of them comes from Shanghai and Beijing, 80 per cent of them are male and 37 years old in average.
Data collection also included B2B data from ILTM by investigating domestic travel agencies and international hotel, as well as the data of Global Blue tourism consumption.
A buzzing trade
The Chinese luxury travel market is flourishing with the number of Chinese out-bound tourists set to reach 77 million, a staggering increase of 12 per cent year on year, according to the National Tourism Administration.
The report also showed that the average Chinese luxury traveler travels in an average group of 9 persons, and travels for 8 days, spending no more than three nights in the same hotel.
And they are the world's best shoppers. Chinese tourists spend an average of €813 per trip solely on tax free shopping, putting them streets ahead of Russian tourists. This is up 44 per cent in the last two years, while the average spend on shopping by global travelers has remained relatively stable, increasing only 12.5 per cent within the last two years. Chinese travelers account for a fifth of all tax free shopping purchases made within Global Blue, an increase of 18 per cent compared to that of last year.
Amongst hotel brands, Shangri-La tops the list, followed closely by Hilton in second place. Ritz-Carlton has risen to third. When choosing a hotel, nearly 60 per cent of Chinese luxury travelers regard the reputation of the hotel to be most important, followed closely by its geographical location.
Fifty-five per cent of Chinese luxury travelers choose their travel destination themselves and leave bookings to travel agencies, family members or personal secretaries.
Shanghainese luxury travelers have a better understanding of international travel compared Beijing counterparts, said the report.
Domestic luxury
Chinese luxury travelers took an average of 20 days holiday in 2012, an increase of 5 days from that of last year. The frequency of travelling abroad remains stable. The Chinese luxury traveler will go abroad an average of 3.2 times a year in 2012, whilst for the super-rich the figure is more than 4 times per annum. The main reasons for going abroad are holidays and business; among the super-rich overseas business trips are more common than overseas holidays.
Sanya (Hainan Island), Hong Kong and Yunnan are the top three destinations in China, while Tibet rose to 4th place from 6th place last year. In addition, nearly two thirds of Chinese luxury travelers own a vacation house, of which 27 per cent are in Sanya and 11 per cent in Hong Kong.
But if private bankers do want to go on holiday with their wealthy Chinese clients, it may actually be easier than they realise. According to the survey, 60 per cent of Chinese HNW individuals expect travel advice from their private banker. Bahamas it is then!
