CHINA. After suffering some setbacks in inbound tourism from Chinese travellers – who were deterred by a series of terrorist attacks – France is set to bounce back strongly in the next four months according to seat-booking data from analyst ForwardKeys.

The new information – released last week at the World Bridge Tourism Conference in London – shows that the biggest year-on-year growth of Chinese travellers in the period 1 November 2017 to 28 February 2018 will be to Thailand (+47%), Vietnam (+40%) and France (+31%). Other markets such as Singapore (+28%), Japan (+27%) and Canada (+23%) will also see high numbers of arrivals.

Chinese arrivals to key Asian markets and France is looking good for the coming months

The gains will be welcome news for duty free and travel retailers in these markets as they try to maximise Christmas and seasonal sales, as well as capture spending during Chinese New Year next February.

The Chinese “can make or break a destination”

Laurens van den Oever, Chief Marketing Officer at ForwardKeys – which analyses around 17 million flight-booking transactions a day – said at the conference: “Chinese travellers are not just any traveller – they are the driving force and growth engine of many regions. They can make or break a destination.”

He cited data before and after the THAAD missile crisis between China and South Korea which showed +5% growth for ASEAN markets prior to the crisis. After it began, Chinese travel itineraries changed and moved from South Korea – which has seen dramatic duty free and travel retail sales declines – to the rest of the ASEAN countries with overall growth up by +16%. However, some individual markets such as Vietnam are up by as much as +50%.

South Korea has dropped the Chinese baton but other ASEAN markets have picked up post-THAAD

At the event – supported by the European Union and organised by the European Travel Commission and ETOA, the European Tourism Association – van den Oever offered even better news for travel retail operators in general: “Bookings for outbound travel during Chinese New Year, in February 2018, are currently +40% ahead of where they were at the same time last year,” he said.

Sensitive to bad news

However, he warned: “At the moment, we are seeing very strong growth in outbound tourism from China and there are no signs of that trend slowing. What we do see, however, is that Chinese tourists are hyper-sensitive to bad news – if a destination’s image becomes tarnished they are swift to go elsewhere.”

On Chinese outbound spending, van den Oever commented: “We have already reached US$261 billion, some 7.3 times the spending in 2003, and by 2025 it is estimated that 44% of spending on global luxury goods will be done by the Chinese.”

Chinese outbound spending and luxury spending continues to increase

Management consultancy, McKinsey, estimates that Chinese spending on luxury goods will grow at +9% per annum from 2016-2025, whereas the average for the rest of the world will be +3%.