Analysis of Chinese outbound travelers

Spending power

Chinese travelers are spending a higher share of their income on international travel and intend to spend even more in the next year despite a slowing down of the Chinese economy.  

This is a reflection of the growing importance of travel to Chinese travelers as a means of self expression and for relaxation. Travel is seen by Chinese travelers as an opportunity to enjoy themselves and make the most of their leisure. On average, Chinese travelers spent US$3,623 (¥24,945) in the last 12 months – more than a quarter of their income, and up from 24% compared to the previous year.  

The average amount spent per day also increased in the past year – up 8 per cent from US$414 (¥2,849) in 2016 to US$446 (¥3,074) in 2017. This is due to an increase in spending on local expenses from US$290 (¥1,999) to US$315 (¥2,170) (up 9%) and hotel expenses from US$123 (¥850) to US$131 (¥904) (up 6%).  

The proportion of income spent on international travel compared with the previous year increased the most for travelers born post 70s onwards, with younger post 90s millennials spending the highest proportion, at 35 per cent of their income. More than a third (34%) of these younger millennials do not have an income so are most likely using their parents’ money to travel. This is indicated by the fact that 35 per cent of post 90s without an income travel with their parents compared to 21 per cent who do have an income. Almost a third (32%) of those without an income also consider their parents to be a major influence on their travel decisions compared with only 25 per cent of those who do have an income.  

Proportion of income spent on international travel

Shopping no longer the main attraction

One of the biggest changes in this year’s survey is how Chinese travelers choose to spend their money. Most significantly, shopping is no longer the prime reason for traveling, dropped from 68 per cent travelers expressing an interest in 2016 to only 33 per cent doing so in 2017, indicating the increasing diversification of Chinese travel activity preferences.

Instead, travelers value leisure, experiences and, exploring local culture and heritage. Topping the spending list was dining at 55 per cent of daily local spend, followed by sightseeing, up 11 per cent to 53 per cent, then rest and relaxation at 41 per cent. Eco / green tours are a key growth area, with spending rising 12 per cent over the last year.

Leisure is the primary reason for all Chinese travelers who participated in the survey, especially for post 60s, many of whom are likely to be empty nesters traveling without children and post 90s millennials who are seeking new experiences.

Millennials are more likely to seek out culture and heritage and adventure tours. Those millennials who do choose these activities spend 10 per cent more on daily local expenses than non-millennials who don’t participate in these activities.

Travelers who choose more independent travel also spend more. This can be seen in the types of travelers who choose to visit South America and Central America. When asked their main reason for traveling, people who chose these destinations said travel was a necessary part of life and they traveled to learn and explore. They spent more time traveling each year than the average traveler (9 days versus 4.2 days) and were more likely to travel via theme tour, eco-tour, backpacking and private luxury tour. These travelers also spent 56 per cent more than the average spend for Chinese travelers, spending US$5,600 (¥38,555) compared with US$3,600 (¥24,785).

Looking ahead, Chinese travelers overall expect to spend more on dining and entertainment in the next 12 months. When asked their reasons for this they said they wanted to gain more enjoyment and a better experience from these activities.

Daily spend by Chinese travelers per day

Spending to increase next year

Chinese travelers intend to spend an average of 10 per cent more on international travel over the next 12 months, millennials looked to increase their spend the most, with around two thirds of post 80s and 90s saying they expect to spend more.

Dining and entertainment are the main winners for future spending. Half of all travelers intend to spend more on these two categories. Accommodation and transportation are also key areas for increases in spending, particularly with the post 70s and 80s travelers who are more likely to be traveling with children and want more comfort and safety for themselves and their families.

Expected changes in spending by categories

Travel spending projection

The post 60s and 90s travelers expressed similar motivations for spending more on accommodation, saying they want to enjoy their leisure and be well rested so they can enjoy their travel activities.

Payment methods

The preferred method of payment across age groups is UnionPay (62%), followed by Visa Card (39%), cash (36%), Alipay (31%), Mastercard (16%) and WeChat Pay (9%). Obviously there is overlap of payment methods with travelers using a number of different methods depending on available facilities. Alipay is also common among younger millennials.

As UnionPay and Alipay are not commonly accepted overseas, this is seen as the most important area for improvement for Chinese travelers.