China’s affluent tourists and the great Thai opportunity

Post-pandemic Thailand is in the throes of a popularity boom. Bangkok took the title of the world’s most visited city last year, beating the likes of Paris, New York and London. Culturally, Thai-pop is following in the footsteps of K-pop, and Thai actors are becoming regulars on the front row of Paris and Milan’s biggest runway shows. “So many luxurious hotels and high-end restaurants recently opened in Bangkok, and I think it’s considered the most happening place in Asia now,” says 41-year-old Shanghai-based Ye Wen, who visited the city recently. “Aside from hospitality, the city’s premium shopping malls make for a great shopping experience, plus the visa-free policy is great for us to travel freely.” Nearly 2.5 million Chinese tourists visited Thailand in the first four months of this year, according to data from Chinese travel agency Trip.com cited by digital marketing agency Hylink, making the Chinese the country’s biggest tourism contingent. Luxury hotels in Thailand are expanding their services to cater specifically to Chinese tourists. The Park Hyatt Bangkok, The Mandarin Oriental Bangkok and Banyan Tree Phuket have introduced personalized services, including Chinese-speaking staff and curated travel experiences: all efforts that have enhanced the country’s appeal as a destination for affluent Chinese travelers. “In terms of Chinese demand, I think we are still expecting more; we are expecting to go back to our pre-Covid days. This hotel used to have about 20% of clients from China, and we are not there yet. If I look at Q1 in 2023, there was very strong revenge travel from the Chinese here,” says Edouard Demptos, General Manager of Grand Hyatt Erawan Bangkok. Moreover, Thailand’s strategic location and favorable visa policies further boost its attractiveness. A bilateral visa-free travel agreement with China make it a convenient choice for spontaneous luxury vacations. From January 1 to May 5 2024, 12,588,825 foreign tourists visited Thailand, generating approximately 605.201 billion Thai Baht ($16.5 billion) in revenue. The top five countries by cumulative tourist entries during this period were China (2,461,620 people), followed by Malaysia, Russia, South Korea and India, according to Hylink and Trip.com High-end transformation New luxury stores and malls are opening all over the center of Thailand’s capital. Glossy Louis Vuitton ads line billboards on the highway from Bangkok’s Suvarnabhumi Airport to downtown. The “Land of Smiles” has also become the land of opportunity for global luxury brands looking for growth. But alongside catering to well-heeled locals, monied tourists, many of them from Mainland China, as well as Hong Kong, Malaysia, South Korea, Japan and Russia, are flocking to the nation to spend, eat and shop. Shanghai-based Ye stayed at the Sukhothai Bangkok Hotel and Como Metropolitan in Sathorn during his last Bangkok trip, partly for their central locations with easy riverside access. He and his partner dined at 100 Mahaseth and Issaya Siamese Club and went to the Bamboo Bar at the Mandarin Oriental Bangkok, BKK Social Club (at the Four Seasons) and Vesper for cocktails – all found through the Michelin guide and friends’ recommendations. Bangkok’s hospitality ecosystem and facilities have been a consistent draw for Chinese tourists, but today its growing luxury options have also become a hit with more affluent visitors. Luxury hotels like The Park Hyatt, The Grand Hyatt, The Mandarin Oriental and luxury wellness hub Rakxa are seeing big demand this summer. Thailand’s luxury market has grown to now overshadow even Singapore’s, and is projected to grow at a compound annual growth rate of 5.62 percent from about $4.64 billion in 2023 through 2028, as Angelito Perez Tan, Jr., co-founder and CEO of RTG Group Asia told Jing Daily in December last year. This upward trajectory is boosted by hip new venues sprouting across Bangkok and other popular destinations like Chiang Mai, Hua Hin and Phuket – and according to Demptos, “it’s all down to the creativity of the Thais.” “What we see now at The Grand Hyatt is a lot of Chinese millennials and Gen Zers, and lots of instantaneous and spontaneous bookings. You can see it’s really leisure driven, going in and out of hotels, going to dine, to shop, exploring new cafes,” he adds. And as China's older and health-conscious travellers become more prominent, destinations offering a blend of comfort, novelty, and wellness are likely to see increased interest from this lucrative market, reports China Trading Desk's latest Outbound Traveller Survey. “Both high-end retail and hospitality have seriously leveled up from 10 years ago; there’s much more choice today,” Park Hyatt’s General Manager Mark de Leeuwerk says. “It’s a bit more sophisticated – a lot more freestanding, high-quality restaurants and international concepts.” A quick glance at the Michelin Guide will reveal ample representation from Bangkok, for example. “We offer a new level of luxury experiences to culinary connoisseurs,” De Leeuwek adds. “For example, our Embassy Room is the only dining destination in Bangkok offering authentic yet refined Catalan fare, and was included in the Michelin guides, while our Penthouse Bar + Grill is a four-floor establishment, inspired by the classic bars and restaurants of New York, located on top of the hotel.” New values, new experiences, new generations Hylink reveals that data from Chinese online travel booking agency Fliggy shows that over 80% of this year’s May Day holiday visitors were independent. As more Chinese travelers are going with the flow, emboldened and more informed via apps like Xiaohongshu, visitors like Ye are discovering hidden spots and what’s on trend. “My way of traveling really depends on different destinations. A vibrant city destination like Bangkok offers endless options for food and drinks, so my last trip’s priority was gastronomy,” the trilingual Ye says. “I combined interesting high-end restaurant concepts with the amazing street food experiences that the city is famous for, along with Asia’s best cocktail bars to check out … I’ll do more research these days to ensure a more local, authentic travel experience.” “The new generation of Chinese guests are more culturally minded and adventurous,” adds Demptos. “This generation is less into the mainstream and more into exploring. They want to be different, they want to explore new things, and they want some curated experiences, related to wellness, wellbeing and community, and crafted products, local bars and restaurants.” At The Grand Hyatt, curated experiences like regional Thai cooking classes or cultural immersion trips to the ancient sites of Ayutthaya (either private or group) are offered. Demptos adds that the hotel is “putting together new classes for learning Muay Thai and Thai massage – experiences we wouldn’t have thought too much about 10 years ago.” Brands aiming to capture the Chinese luxury travel market must understand evolving traveler motivations and aspirations. With China’s rising incomes and urbanization driving a new wave of affluent tourists, there’s significant growth potential in luxury travel. As Chinese luxury travelers look for more personalization and experiences beyond the mainstream, so too have luxury hotels adapted. “Only a few years ago did we appoint a chief concierge because of the increase in leisure travel ... There’s demand for experiences, personalized tailored itinerary, things that not every guidebook has. It’s not necessarily more adventurous, but going a little bit deeper. People are more interested in the cultural side that is specific to Bangkok,” says Park Hyatt’s De Leeuwerk. Targeting these cultural sides, a more diverse and exciting F&B offering and understanding the psychographic nuances of these affluent Chinese travelers will unlock substantial opportunities in a competitive marketplace. Successful brands in hospitality, F&B and retail will focus on sustainability, wellness, and unique experiences, fostering deeper connections and brand loyalty. Embracing a holistic approach, prioritizing authenticity, and leveraging collaboration are key strategies, as is employing Chinese socials like Xiaohongshu and WeChat.

China’s affluent tourists and the great Thai opportunity

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Published July 01, 2024

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China’s affluent tourists and the great Thai opportunity