1、A business of Marsh McLennan4 things you should know about the RETURN of Chinese TravelersOliver Wymans perspectiveJuly 2023A business of Marsh McLennan2 Oliver WymanWHEN CAN WE EXPECT THE RETURN OF THE US$245 BN SPENT ON 155MN OUTBOUND TRIPS BY CHINESE TRAVELERS?Number of trips by Chinese travelers

2、,2017 2019MNSource:National Bureau of Statistics of China,World Travel and Tourism Council,Oliver Wyman analysis5,00113120175,53915020186,0061552019+15%+4%OutboundDomesticUSD 245 BNChinese outbound tourism expenditure in 20193 Oliver WymanCOVID-19 related border control policyINTERNATIONAL TRAVEL OF

3、 CHINESE TRAVELERS GRADUALLY RECOVERS,LED BY MACAU AT 70%AFTER 6 MONTHS OF REOPENINGTravel recovery rate by destination%,2023 YTD Chinese traveler count vs.2019 YTD level(Jan Jul)02550751002020Full year2021Full year2022 Jan2022 July2023 Jan2023 Jun2019levelvs.2019 same period1.Jun 2023 dataSource:Go

4、vernment statistics,Oliver Wyman analysisMacau(74%)Australia(65%)Hong Kong,China(54%)1Singapore(59%)Thailand(37%)1Korea(35%)1Japan(24%)1Taiwan(6%)14 Oliver WymanOLIVER WYMAN SURVEYED AFFLUENT CHINESE TRAVELERS IN JUNE 2023 TOUNDERSTAND THEIR PLANS FOR 2023 AND BEYONDOnline survey conducted in Mainla

5、nd China during June 17-25,20233,495 survey respondents of which,1,000 respondents have:Travelled internationally or planning to travel internationally in 2023 for leisure 18-year-old or above,covering Gen Z to Baby Boomers Minimal monthly household income of RMB 30,000 65%spent at least RMB 10,000

6、in 2022 on personal luxury products(leather goods,fashion,jewelries and watches,beauty)Oliver Wymans Chinese traveler survey 2023 edition4 THINGS YOU SHOULDKNOW ABOUT THE COMEBACKOF CHINESE TRAVELERSOliver Wymans perspectiveJuly 20235 Oliver Wyman4 THINGS YOU SHOULD KNOW ABOUT THE RETURN OF THE CHIN

7、ESE TRAVELERSNew intl travelers aim at South Korea,Hong Kong SAR,and SingaporeFull recovery is unlikely to take place until 2024 H2 at best 2023 is all about revisits,with experienced travelers back to Hong Kong SAR and Western EuropeInternational luxury shopping is back,but not for Gen ZGen Z new w

8、orkforce are fueling foodie trips as they travel for the experience and care less about shoppingEspecially new luxury shoppers prefer domestic shopping over international shoppingChinese Travelers will be fully back 2024H2 at best2023 is about revisiting familiar destinations1sttime intl travelers s

9、eek something differentLuxury shoppers are back,but not spending as muchWell-off New Tier 1 city retirees emerge in shopping tourism with a generous budget ready to spend on shoppingTravel is expected to reach 60%of pre-COVID level in 2023CHINESE TRAVELERS WILL BE FULLY BACK 2024H2 AT BEST7 Oliver W

10、ymanONLY AROUND 60%OF EXPERIENCED AFFLUENT TRAVELERS PLAN TO RESUMEINTL TRAVELLING IN 2023,WHILE 30%WILL WAIT FOR AT LEAST ANOTHER 2 YEARSExpected international travel timeline%of respondents162%10%9%4%23%29%6%57%Pre-COVIDintl travelersNew intl travelers202320242025-262027+1.Minimal monthly househol

11、d income of RMB 30,000Question:When do you plan to travel?Why do you not plan to travel?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis8 Oliver WymanDOMESTIC TRAVEL IS SEEN AS A GREAT ALTERNATIVE AFTER ALMOST THREE YEARS OF BORDER CLOSUREReasons for deferred travelling p

12、lan%of respondentsPre-COVID intl travelersNew intl travelers73322283475328358Domestic travel is sufficientInternational travel is too costlyHealth risksNo valid passport/visaLimited flight scheduleQuestion:Why do you not plan to travel in 2023?Source:Oliver Wymans Chinese traveler survey(Jun 2023),O

13、liver Wyman analysis24%of Pre-COVID travelers are wary of flight cost,while 48%of Non-intl travelersare concerned about the general affordability of an intl trip9 Oliver WymanFULL RECOVERY OF CHINESE OUTBOUND LEISURE TRAVEL IS NOT EXPECTEDUNTIL THE SECOND HALF OF 2024 AT BESTEstimated Chinese Intl l

14、eisure traveler recovery 2023-2026%of 2019 travel level Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Pre-COVIDIntl TravelersPost-COVIDNew Intl Travelers2019 level244879104120138Question:Where have you travelled to internationally for leisure before COVID?Where did you go for leisure travel in 2023?Do you plan to

15、 travel to these destinations in 2023?When do you plan to travel?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis20232024202520262023 IS ABOUT REVISITING FAMILIAR DESTINATIONS11 Oliver WymanHONG KONG REMAINS THE TOP CHOICE FOR AFFLUENT CHINESE TRAVELERS IN 2023;WESTERN EU

16、ROPE IS THE 2NDMOST POPULAR DESTINATIONTravel destinations visited in or planned for 2023%of international travelers,monthly household income of RMB 30K+23%16%15%14%13%12%12%10%9%7%7%6%4%4%3%Hong Kong,ChinaWestern Europe(excl.UK)JapanSouth KoreaMacau,ChinaSingaporeThailandNorth AmericaAustralia/New

17、ZealandTaiwan,ChinaUKMalaysiaUnited Arab EmiratesIndonesiaVietnamQuestion:Where did you go for leisure travel in 2023?Do you plan to travel to these destinations in 2023?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis12 Oliver WymanEXPERIENCED AFFLUENT INTL TRAVELERS ARE

18、 FIRST HEADING BACK TO FAMILIAR PLACESRe-visitors vs.new visitor by destinationsCompleted trips or planned trips for 2023,%of travelers17%11%10%12%10%11%9%8%7%5%5%5%4%3%32%37%27%20%21%17%23%19%20%17%17%14%16%12%Hong Kong,ChinaWestern Europe(excl.UK)JapanKoreaMacau,ChinaSingaporeThailandNorth America

19、Australia/New ZealandTaiwan,ChinaUKMalaysiaUnited Arab EmiratesIndonesiaPeople who have never visitedPeople who visited beforeQuestion:Where have you travelled to internationally for leisure before COVID?Where did you go for leisure travel in 2023?Do you plan to travel to these destinations in 2023?

20、Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysisAmong travelers who have outbound travel plans this year,almost 40%of those who visited Europe before plan to revisit this year13 Oliver WymanTop destinations%of intl CN travelersTime of visit1Rank among affluent travelersTo

21、p purposeof visiting2023 H12023 H2(planned)ExperiencedNewHong Kong SAR23%10%18%Shopping Western Europe16%6%11%ShoppingJapan15%6%10%ShoppingSouth Korea14%6%9%ShoppingSingapore12%5%8%ShoppingThailand12%6%8%Food&shoppingWE EXPECT THE TOP DESTINATIONS TO SEE A MUCH STRONGER REBOUND IN2023H2,WITH SHOPPIN

22、G AT THE VERY CORE OF OUTBOUND TRIPS2023 top destinations and key traveler profile International travelers with monthly household income of RMB 30K+1.Sum exceeds that of total%international travelers due to revisitsQuestion:Where did you go to for your last trip?Where are you planning to travel to f

23、or your upcoming trip?What do you look for look for the most when travelling internationally again?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis12321314 Oliver WymanJAPAN AND KOREA WILL GET A STRONGER REBOUND IN H2 NOW THE BAN ONGROUP TOURS IS LIFTED,ESPECIALLY WITH AN

24、 INCREASING INTEREST IN GROUP TOURSMode of outbound travel of past trips in 2019 vs.planned trips in 2023%of trips,affluent Chinese travelersTravel agencies and business relying on conducted group tours(e.g.duty-free stores,group meal operators)will benefit from the growing interests of group tours

25、and the lifting of group tour banOn August 10,2023,the Chinese Government lifted the COVID-era ban on organized group tours on 78 countries,including:South Korea Japan Germany UK US AustraliaNotes:February 2023:Ban lifted for 20 countries including Thailand,Singapore,Switzerland,New ZealandMarch 202

26、3:Ban lifted for 40 new countries including France,Italy,Spain,Greece,Vietnam63634554294739493737554671536151Conducted toursIndividual travelBaby BoomersGen XMillennialsGen Z20192023201920232019202320192023Question:Regarding your 2019 trip,did you travel with a conducted tour group?For your planned

27、travel in 2023,are you planning to travel with a conducted tour group?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis1STTIME INTL TRAVELERSSEEK SOMETHING DIFFERENT16 Oliver WymanTWO KEY SEGMENTS REPRESENT 50%OF THE NEW AFFLUENT INTL TRAVELERS IN 2023Gen Z New Workforce30

28、%of new travelersNew Tier 1 city retirees15%of new travelers17 Oliver WymanGEN Z NEW WORKFORCE REPRESENT 30%OF THE NEW AFFLUENT TRAVELERS AND HAVE A UNIQUE WAY OF TRAVELING1.Compared to 16%among experienced Intl travelersSource:Douyin,LittleRedBook,News articles,Weibo,Oliver Wymans Chinese traveler

29、survey(Jun 2023),Oliver Wyman analysis2023 trend:Military-style travelLow-budget action-packed travel over short period of time with little/no restGen Z new workforce30%of new travelers1Working fulltime with stable income95%are unmarried,and 63%are single68%has spent 10K RMB on luxury products in 20

30、22Top destinationsHong Kong SAR,Macau SAR,Japan,KoreaTravel planTravel on a tighter budget than most affluent travelersTheir travel shopping budget is-33%lower than experienced Gen Z travelersInquisitive about food,unique places and experiences33-hour Beijing trip24-hour Seoul trip48-hour Kansai Jap

31、an trip18 Oliver WymanACTION-PACKED LOW-BUDGET SHORT TRIPS ARE INCREASINGLY POPULAR AMONG GEN ZA 12-hour Military-Style Travel in Hong Kong11:30 AMTravel to Mongkok12:20 PMLocal food in Mongkok1:41 PMEgg tart at local bakery2:00 pmPhoto at Victoria Harbour2:30pmIce-cream by the Pier2:55 PMStar Ferry

32、 to Central3:12 PMWalking to Queens Road10:00pmDeparting from HK3:44 PMTaking the mid-levels escalator24:02 PMVisiting Tai Kwun34:41 PMTaking the bus to Sai Ying Pun5:33 PMArriving in Causeway Bay6:23 PMArriving inTin Hau6:30PMWalking to Victoria Park46:58 PMLocal food in Causeway Bay8:30 PMSightsee

33、ing at Avenue of Stars1.A famous large residential/commercial building for Hong Kong ethnic minorities;2.Longest outdoor covered escalator system in the world;3.A conserved heritage building complex for heritage,arts and dining;4.Second largest public park in Hong KongSource:LittleRedBook,Oliver Wym

34、ans Chinese traveler survey(Jun 2023),Oliver Wyman analysis1:50 pmPhoto at Chungking Mansions19:17 AMArriving in HK10:10 AMVisiting Palace Museum7:45 PMCrossing back the harbour5:45pmPhoto atTimes Square Mall19 Oliver WymanNEW TIER 1 CITY RETIREES REPRESENT 15%OF THE NEW TRAVELERS,THEY HAVE A HIGH T

35、RAVEL BUDGET AND TRAVEL IN ASIA FOR SHOPPING IN 2023New Tier 1 City Retirees top purposes of international travel%of respondents,Top 3 choices61574646393614ShoppingExploring the local cultureExploring the sceneryTasting the foodNew experiencesVisiting unique placesActivities and sports1.Compared to

36、5%among experienced Intl travelers.2.New Tier 1 city are 15 commercial hub cities short of becoming tier 1cities,notable cities include Chengdu,Hangzhou,Chongqing,Wuhan,Xian,and SuzhouSource:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysisNew Tier 1 city retirees15%of new travel

37、ers1Retired and have independent childrenLiving in New Tier 1 cities254%has spent 10K RMB on luxury products in 2022Top destinationsKorea,Japan,Macau SAR,Hong Kong SARTravel planTravelling on abundant budget(+32%higher than average new travelers)+67%higher budget of shopping than experienced Baby Bo

38、omersChoose to shop abroad for better brand choices and comprehensive collectionsLUXURY SHOPPERS ARE BACK,BUT KEEP MAJORITY OF SPENDING AT HOME21 Oliver WymanSHOPPING ROSE TO THE TOP AS THE KEY PURPOSE OF TRAVEL,AND FOOD EXPERIENCE IS NOW THE SECOND MOST IMPORTANT REASON TO TRAVELTop purposes of int

39、ernational leisure travel by age group%of respondents,Top 3 choicesQuestion:What were your key reasons to travel internationally for leisure before COVID?What do you look for the most when travelling internationally again?How much did you spend on the past trip across these categories(2016-2019)?Wha

40、t is your budget for your next travel(2023)?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis39%40%44%46%57%61%13%Exploring the sceneryExploring the local cultureEnjoying nice foodShoppingParticipating in events or sportsTrying out new experiencesVisiting unique places21%3

41、3%36%41%53%58%59%Exploring the sceneryExploring the local cultureEnjoying nice foodShoppingParticipating in events or sportsTrying out new experiencesVisiting unique placesPre-pandemic(2019)Post-pandemic(2023)22 Oliver WymanSHOPPING IS RECOGNIZED AS THE TOP PURPOSE OF TRAVELING ACROSS AGE GROUPS,WIT

42、H THE EXCEPTION OF GEN ZTop purposes of post-pandemic international leisure travel by age group%of respondents,Top 3 choicesQuestion:What do you look for look for the most when travelling internationally again?Source:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysis32%33%41%44%45

43、%50%55%Exploring the sceneryExploring the local cultureEnjoying nice foodShoppingParticipating in events or sportsTrying out new experiencesVisiting unique places22%33%35%35%55%59%60%32%34%38%56%62%66%14%20%33%39%44%50%52%62%Baby boomersGen XMillennialsGen Z23 Oliver WymanLuxury shoppers who HAVE sh

44、opped abroad previously and(will)travel internationally in 2023Luxury shoppers who have NEVER shopped abroad and(will)travel internationally in 2023OVERSEAS LUXURY SPENDING WILL LIKELY NOT RECOVER TO PRE-COVID LEVEL,WITH 20%OF CHINESES LUXURY SPENDING EXPECTED TO BE SPENT ABROAD IN 2023Estimated sha

45、re of luxury spending,abroad vs.domestic,2023%of total luxury spendingQuestion:How much do you expect to spend on luxury items this year?How much of your total luxury spending do you expect to spend internationally this year?Will you consider shopping luxury overseas in the foreseeable future?Source

46、:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysisOnly 33%of new luxury shoppers consider exploring international luxury shopping in the future,vs 85%of the experienced international luxury shoppers38%11%62%89%DomesticAbroadOn average,20%of luxury spending is expected to happen a

47、broad in 202324 Oliver WymanBRANDS WILL NEED MORE THAN PRODUCT AVAILABILITY TO(RE)ATTRACT LUXURY SHOPPERS OFFSHORE Top reasons for luxury shoppers preferring domestic luxury shopping%of respondents who prefer domestic shopping in the futureQuestion:Why do you prefer luxury shopping domestically over

48、 internationally?Please select your top 3 reasonsSource:Oliver Wymans Chinese traveler survey(Jun 2023),Oliver Wyman analysisOnshore collectionis comprehensive enoughPreferred brands arealreadyavailable in ChinaPrefer buying luxury when they want,not only during travel#1#2#355%36%36%25 Oliver WymanL

49、UXURY SHOPPERS WHO ONLY SHOPPED IN CHINA HAVE A MUCH HIGHER EXPECTATION ON OVERSEAS CUSTOMER SERVICES VS THOSE WITH EXPERIENCE OVERSEASPerceived benefits of luxury shopping during international travel%of luxury shoppers with/without pre-COVID travel experienceQuestion:Why do you prefer luxury shoppi

50、ng internationally over domestically?Source:Oliver Wymans Chinese traveler survey(Jun 2023),The New Faces of Chinese Luxury Shoppers(2021),Oliver Wyman analysisTraveled only after COVIDTraveled before COVID53484740305328604730More attractive pricesBetter customer serviceBetter brand availabilityBett

51、er product availabilityMore attractive store environment+20%ptsBrands would have to live up to the high expectation,or post-COVID new travelers will likely be disappointed26 Oliver WymanPERSONALIZED SERVICES CAN BE THE KEY TO WINNING OVER CHINESE LUXURY SHOPPERSTypes of exclusive benefits luxury spe

52、nders desire the most(N=3,000)%respondentsQuestion:What type of exclusive benefits do you desire the most?Source:Oliver Wymans Chinese luxury shopper survey(Oct 2021),Oliver Wyman analysis28211614128Relationship and day-to-daycommunication with sales assistants(SAs)Personalization servicesPrioritize

53、d services at storeFree gifts and celebrations during special datesVIP events(e.g.,fashion show,VIP-only sale)Pre-order of hot itemsLike everything else in China,guan xi is extremely important,if a customer likes you more than her SAs from other brands,she would buy more from you.Hermes SA(4 years w

54、ith the brand),ChengduIf you spend so much to buy from a luxury brand,of course you would want to feel important and special;as a good SA I need to remember everything about every single client their birthday,what they like/dislike,how many kids they have.Chanel SA(5 years with the brand),Shanghai27

55、 Oliver WymanCHINESE LUXURY SHOPPERS VERY FREQUENTLY COMMUNICATE WITH THEIR LOCAL SALES ASSISTANTS(SAS)Share of luxury spenders maintaining regular contact1with SAs from their most purchased brands(N=3,000)%of respondentsFrequency of contact with SAs from their most purchased brands(N=2,273)%of resp

56、ondents37%29%24%29%29%28%11%14%Gen ZAbove 25years oldAt least oncea weekOnce every2 weeksOnce a monthOnce every3 months78%76%22%24%Gen ZAbove 25years oldMaintain regularcontact with SADo not maintainregular contactwith SABRAND SA ISPARTOF CHINESELUXURY SPENDERS EVERYDAY SOCIALLIFE 1.At lease once ev

57、ery quarterSource:Oliver Wymans Chinese luxury shopper survey(Oct 2021),Oliver Wyman analysisMany of my customers say they talk to me more frequently than their mother!Dior SA(3 years with the brand),ShanghaiI spend 70%of my work time on maintaining contacts with my customers they want to feel impor

58、tant and expect me to reach out to them at least 1-2 times a month;I also need to respond very quickly to their messages.Hermes SA(5 years with the brand),Shanghai QUALIFICATIONS,ASSUMPTIONS,AND LIMITING CONDITIONSThis report is for the exclusive use of the Oliver Wyman client named herein.This repo

59、rt is not intended for general circulation or publication,nor is it to be reproduced,quoted,or distributed for any purpose without the prior written permission of Oliver Wyman.There are no third-party beneficiaries with respect to this report,and Oliver Wyman does not accept any liability to any thi

60、rd party.Information furnished by others,upon which all or portions of this report are based,is believed to be reliable but has not been independently verified,unless otherwise expressly indicated.Public information and industry and statistical data are from sources we deem to be reliable;however,we

61、 make no representation as to the accuracy or completeness of such information.The findings contained in this report may contain predictions based on current data and historical trends.Any such predictions are subject to inherent risks and uncertainties.Oliver Wyman accepts no responsibility for act

62、ual results or future events.The opinions expressed in this report are valid only for the purpose stated herein and as of the date of this report.No obligation is assumed to revise this report to reflect changes,events,or conditions,which occur subsequent to the date hereof.All decisions in connecti

63、on with the implementation or use of advice or recommendations contained in this report are the sole responsibility of the client.This report does not represent investment advice nor does it provide an opinion regarding the fairness of any transaction to any and all parties.In addition,this report does not represent legal,medical,accounting,safety,or other specialized advice.For any such advice,Oliver Wyman recommends seeking and obtaining advice from a qualified professional.A business of Marsh McLennan