Flush With Cash, Chinese Tourists Will Boost Spending In Fashion Capitals
(MENAFN- Caribbean News Global) By pymnts
Chinese tourists'“revenge travel” will benefit high-end brands housed in the luxury capitals of the world. Call it, perhaps, a wave of“destination spending” that will fill the coffers of firms that have already been top of mind on the mainland.
Chinese authorities have largely relaxed quarantines and travel restrictions and have been reissuing passports. And as for the travel“snapback,” the surge is already showing up in data from the likes of trip.com , which said at the end of last year that outbound bookings were soaring by triple-digit percentage points. The company noted that on the morning of December 27, it saw“a staggering 254 percent increase in mainland China's outbound flight bookings compared to a day earlier.”
Drilling down a bit into the data, the demand to get out and about stretched across a range of corridors, extending into Asia and beyond. Trip.com said that Singapore was the fastest-growing of all the destinations, with flight bookings leaping six-fold, followed by an average 400 percent jump in airline ticket orders. Bookings for long-haul flights to the United Kingdom, the United States and Australia also increased.
Nowhere near pre-pandemic levels
We're a long way from pre-pandemic levels, where the china outbound tourism research institute estimated that there were 170 million outbound trips from the mainland in 2019, and where widely cited figures from the united nations world tourism organization pegged spending by tourists that year at $255 billion on 154.6 million trips abroad. The number plunged to as low as about 25.6 million in 2021, per statista .
The triple-digit surges are hopeful signs for the brands that derive a significant percentage of top-line contribution from Chinese tourists' spend. Pre-pandemic, chinese consumers purchased about one-third of the world's luxury goods, as Bain & Co. estimated. That number might grow to as much as 40 percent by the end of the decade, the consultancy estimated, in data reported by Jing Daily. For companies like hermès , which has in recent quarters seen sales in asia grow by double digits, and lvmh , where asia-derived sales have been improving at single-digit rates, the natural extension would be that the spending would continue as Chinese tourists flock abroad.
There's some evidence that the spending dry powder is there as travel resumes, and for Chinese consumers to open their wallets online and on-site in London, Hong Kong and the US household savings were up 13 percent through the first nine months of last year, amid the lingering impact of COVID restrictions. Across the globe – and most immediately in the UK, the US and Asia's own luxury capitals – the flagship retailers will await“revenge” tourism and spending with open arms.
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