The world’s biggest tourism spenders since 2012, outbound Chinese travelers are poised to become an even more powerful force within the next half-decade. Despite fears that an economic slowdown, currency devaluation, and stock market fluctuations will crimp Chinese travelers’ demand for international travel (and shopping), a new report indicates that we’ve only seen the tip of the iceberg.
Published this week by Fung Business Intelligence Centre (FBIC) Global Retail & Technology and China Luxury Advisors, the new report, “Global Chinese Shoppers: The $200 Billion Opportunity,” projects that total spending by outbound Chinese tourist-shoppers will jump 23 percent to surpass $200 billion this year, and more than double within the next five years to $422 billion.
Fueled by a still-growing middle class, strong demand for international education and overseas real estate, and easier and longer tourist visas, the rate at which Chinese travelers have ventured abroad continues to increase. This year, Chinese tourists will take an estimated 234 million overseas trips, with ever more heading to Europe and the United States.
The report analyzes a proprietary survey of more than 1,000 Chinese netizens regarding their travel and spending for the year ending May 21, 2015, combining that data with economic and tourism growth projections.
Among the interesting findings is that Hong Kong—which many articles have declared “over” among Chinese tourists—remains the most popular destination among respondents. Nearly 13 percent of those surveyed said they visited the city in the year up to late May 2015, while 7 percent went to Europe, and 3 percent traveled to the United States.
While abroad, virtually every traveler (99 percent) said they made a retail purchase, with the average total expenditure coming to $1,678.
However, the farther they traveled, the more they spent. Chinese travelers spent an average of $2,555 on trips to the United States, nearly neck and neck with Europe ($2,548). Among the products they purchased abroad, clothing, footwear, and accessories were the most popular category (56 percent of respondents), while 52 percent purchased fragrances and beauty products.
Not all shopping tours are created equal, however—the places these individuals traveled indicated what they were most interested in buying. Those who visited Hong Kong and Japan were more likely to purchase electronics, while those in South Korea spent heavily on clothing and beauty products. Chinese visitors to Thailand spent the most on food products, while those in Europe bought across all categories, but tobacco and alcohol in particular.
In addition, the study found that average income indicates the countries that Chinese outbound tourists were most likely to visit. More affluent survey respondents (with monthly per capita incomes of US$2,443 and higher) favored Japan and Thailand, while those in the $1,304-2,442 bracket were most likely to travel to Hong Kong or Taiwan. One commonality across all income brackets is that everyone seems to enjoy South Korea—which should come as no surprise to retailers, duty-free shops, and malls from Jeju to Seoul.