This article was published earlier in our weekly newsletter. Sign up through our “Newsletter Sign Up” box on the right.
As Prince William wrapped up his historic China tour this week, it was clear that diplomacy was just one item on the agenda—the other was selling the UK to China’s increasingly wealthy and well-traveled consumers.
In addition to photo ops and handshakes with top officials on the first UK royal visit to China in almost 30 years, the Duke of Cambridge spent a significant portion of his time promoting British brands and tourism to the Chinese audience. William stopped by the GREAT Festival of Creativity in Shanghai, which featured brands from the fashion, luxury, automotive, and technology industries, among them (now Indian-owned) Jaguar Land Rover, Diageo, (now Hong Kong-owned) Gieves & Hawkes, Roger W Smith, and Pringle of Scotland.
The event was sponsored by the GREAT Britain campaign, which also heavily promotes Chinese tourism to the UK through advertisements and frequent events in China.
The UK expects significant long-tail Chinese revenue from its promotional efforts. The GREAT Festival coincided with the ongoing UK-China Year of Cultural Exchange, which includes economic collaborations estimated to add £150 million (US$229 million) to the UK economy from tourism and commerce. The agreement includes more direct flights between the UK and China as well as a new online shop on China’s Tmall for British parcel service the Royal Mail.
Luxury brands and retail organizations are also very much active in these promotional efforts. Last fall, a delegation of British luxury brands hailing from the London Luxury Quarter in posh Mayfair teamed up with VisitBritain and British Airways to host “London Luxury. By Appointment” showcases in Shanghai and Chengdu.
Many British businesses argue that promotional efforts like these are only half the battle, however. As the UK government works to attract more Chinese money by spending a hefty marketing budget on “Brand Britain,” tourism-related companies—especially luxury retailers and hospitality providers—are calling for more policy changes to make the visa process easier for Chinese tourists. Last week, the chairman of the British Hospitality Association told Financial Times that the British government needs to create a less expensive and easier visa application process to attract Chinese tourists, about which luxury retailers have been vocal for years now.
That said, the UK has already made high-profile efforts to ease visa restrictions. For example, a new policy enacted last summer allowed tour operators to use a single application form to process UK and Schengen visas. Although many businesses think the government is not doing nearly enough, something is clearly being done right: Barclays predicts that spending by Chinese visitors in the UK is set to increase by 84 percent by 2017, and over the same period Chinese tourists are expected to become the nation’s fifth-largest foreign spending group.