CHINA MISSION 2013 Talking Points

KEY MESSAGES

AT-A-GLANCE

  • Travel & tourism is a major ECONOMIC ENGINE in California
  • $106 billion annual spending
  • Supports nearly 1 million jobs
  • Trickle-down effect positively impacts numerous business sectors
  • California is a GLOBAL DESTINATION
  • #1 destination for Chinese travelers
  • More than the product – it’s the attitude, the spirit, the people
  • The “California Dream” is universal – innovation & infinite opportunity
  • California’s COMMITMENT to the China market is PAYING OFF
  • $1.98 billion (projected) spent by Chinese visitors in 2012
  • Chinese visitors stay longer (average 13.8 days) and spend more - $2900 per visitor
  • California’s tourism industry has been working together to get “China Ready”
  • The Chinese consumer wishes to fulfill their CALIFORNIA DREAMS
  • California is a dream destination – heightened by awareness from film & television
  • Deep-rooted & innate desire to visit California’s icons
  • Anything is possible in California
  • Our newly-appointed Chinese celebrity TOURISM AMBASSADOR Miss Gao Yuanyuan is helping Visit California effectively connect with Chinese consumers
  • Famous model & actress
  • Powerful online influence – 20 million Weibo fans
  • New California video content featuring Miss Gao Yuanyuan
  • California is rolling out the RED CARPET for Chinese visitors
  • California is very welcoming & friendly
  • Services tailored just for Chinese visitors – hotels, attractions & stores
  • The CALIFORNIA BRAND HAS GONE GLOBAL  this includes thedevelopment of exciting new global multi-media content and creative assets, recognizing that with technology and mobile we can reach international consumers in new powerful ways.
  • California remains the #1 destination for Chinese travelers to the USA.
  • California has 46% market share of China travel to the USA.
  • 2012 arrival and spend data confirmed that China is now California’s number one overseas visitor market an estimated 677,000 (+31% year over year) Chinese visitors spent a projected$1.98 billion in state.
  • Visitation from China is forecasted to grown an additional +52% between 2012 and 2015.
  • 2013 forecast:+14%increase in visitation.
  • Over the past 12 months, we have witnessed astounding growth and hit historic milestones in the China market:
  • China became California’s top overseas market one year ahead of forecasts.
  • Visit California launched our first direct-to-consumer advertising campaign in the market
  • We plan to triple our investment in 2014 –$4.5 million
  • Visit California’s multi-year, multi-platform marketing campaign centers around Chinese celebrity tourism ambassador, Ms. Gao Yuanyuan, who stars in new web videos and digital content designed to educate the Chinese consumer on the abundance of vacation experiences awaiting in California.
  • Themed videos featuring Ms. Gao encourage consumers to fulfill their dreams in California and utilize social media engagement triggers like quizzes and sharing features to drive online conversation.
  • On October 25, Visit California will launch the second phase of a $1 million advertising campaign introduced during the April 2013 Governor’s Mission.
  • The “Mega Happy New Year in California” campaign will drive increased demand for California holidays over the popular Lunar New Year vacation period.
  • In 2014, Visit California plans to invest $4.5 million in marketing to the Chinese consumer.
  • China’s growing middle class, strong interest in California experiences and geographic proximity—combined with the improved accessibility of travel to the U.S. since the Memorandum of Understanding signed between the U.S. and China in 2007—presents a promising and sizable opportunity for California’s travel industry.
  • The improving visa application process as well as the increase in air service to the Golden State makes California even more accessible to Chinese travelers, and we look forward to welcoming growing numbers of visitors from China.
  • As of October 2013, there are305monthly non-stop flights to California from China, accounting for 99,911monthly seats.
  • Visit California offers many content-rich tools and resources in the DIGITAL SPACE for consumers, media and travel trade  including 13 localized consumer websites, an iPad app, online Media Center and travel trade portal with training programs in 10 languages.
  • During the October 2013 sales mission, Visit California will be introducing the Chinese (Mandarin) language version of the Travel Trade Portal.

CHINA MARKET PROFILE

According to 2012 Data:

  • Main purpose of trip: 34% vacation/holiday, 19% visiting friends/relatives, 22% independent business, 13% convention/trade show, 8% education, 4% other
  • 54% were first time travelers to US
  • Averagelength of stay:13.8 nights (of 30.9 night in US as a whole), up from 10.6 nights in 2011. They visited an average of 2.2 states, though nearly 1/3 visited 3 or more state.
  • Top activities: Shopping (89%), Sightseeing (84%), Fine dining (48%), National parks/monuments (41%), Theme parks (40%), Small towns/countryside (40%)
  • Shopping accounted for 40% of all spending in the US (overseas visitors to California overall spent 23% of total on shopping)
  • Travel partners: 51% traveled alone, 20% with spouse or partner, 13% with family/relatives, 12% with business associates, 8% with friends
  • Average travel party size: 2.1 (90% adults only)
  • Chinese visitors stay longer and spend more than the overall average of overseas visitors to the Golden State.
  • There is a deep-rooted and innate desire in China to visit California’s icons including Hollywood, the major theme parks, National Parks, Highway 1 and Route 66, among others.
  • Shopping is a very popular activity for Chinese travelers, who can take advantage of a strong exchange rate whether shopping for luxury goods on Rodeo Drive in Beverly Hills or seeking bargains in the many premium outlet malls.
  • RETAIL SPENDING 2012: $1.6 billion in California - Jewelry #1 at $298 million

General Market Profile & Characteristics:

  • By 2015, more than 100 million Chinese are expected to travel outside the country. This staggering number represents just 7% of China’s population, highlighting the tremendous potential for continued growth of China’s outbound travel market.
  • After President Barack Obama’s pledge to increase the number of visas issued to Chinese, the U.S. Department of Commerce reported that more than 1.09 million Chinese visited the United States in 2011 and 1.47 million in 2012, a two year increase of 84% from 2010.
  • Statistics from the National Tourism Administration show that Chinese residents made 83.18 million trips overseas in 2012. China outbound travel scale increases 20% every year.
  • China is leading the top ten countries and regions with the fastest growth of outbound travel expenditure, according to the recent data from the World Tourism Organization. Chinese overseas tourism expenditures are projected to have reached $85 billion in 2012 (+23%) and to reach $190 billion in 2015.
  • China will become the No. 1 global outbound tourism source market in 2013, with 90 million border-crossings estimated, overtaking Germany and the USA both in terms of numbers of travels and expenditure. According to China Outbound Tourism Research Institute together with Rossetto Solutions
  • Chinese focus on: safety, popularity and organized routes.
  • Statistics show that mid-priced (3 stars or 4 stars) hotel accommodations are preferred by Chinese group tourists.
  • Chinese travelers prefer luxury travel and an extensive shopping experience or landmark sightseeing rather than vacationing at one sole destination.
  • Although the number of independent Chinese travelers surged over the past decade, roughly 60-70% of Chinese travel in groups.
  • The national tourism administration reported 4 million Chinese traveled overseas during 2013 Chinese New Year Holidays, increasing by 14%, hit a new record.
  • According to the World Luxury Association, 75 % of Chinese tourists purchase more than 3 luxury goods items during their trip. Luxury goods are almost 60% more expensive within China. Watches and jewelry were among the most favorite items for Chinese shoppers, followed by fashion and lifestyle items.
  • 111 million or 19.8% of Chinese netizens booked air tickets, hotels, train tickets and travel packages online in 2012.
  • According to Ctrip.com, the online agent served over 1 million FIT Chinese guests in 2012. The ratio of group travel via FIT is 7:3. Beijing and Shanghai are the top FIT markets, following by the cities of Guangzhou, Shenzhen, Hangzhou, Nanjing, Chengdu.

VISIT CALIFORNIA MILESTONES IN CHINA: A LOOK BACK

  • Visit California saw great potential to enter the market and was among the first U.S. state tourism boards to open an office.
  • In 2008, Visit California traveled to China with then Governor Schwarzenegger on a trade and tourism mission.
  • We signed an MOU with Beijing, Shanghai and Guangzhou Tourism Boards and celebrated the opening of Visit California’s China office.
  • We launched Travel Trade & PR Activities with the opening of the Visit California offices in Beijing and Shanghai.
  • In 2009, our 1st Visit California destination guide and website in Chinese were both launched.
  • While we continued to build our foundation in China, the national government in the U.S. was working to improve the visa application process to improve accessibility for Chinese travelers.
  • In 2012, Visit California launched our China Ready Program to optimize Chinese visitors’ California experience by working with the tourism industry in California and Chinese travel trade.
  • In 2012, China became California’s #1 overseas visitor market.
  • In 2013, Visit California launched direct-to-consumer brand marketing and named model-actress Ms. Gao Yuanyuan as the state’s first celebrity tourism ambassador from mainland China.
  • In 2013, Visit California also introduced the newly localized Travel Trade Portal online resource customized for Chinese travel professionals.

NEW “MEGA HAPPY NEW YEAR” CAMPAIGN

  • 2014 will mark the 5th year that sizable tour groups have descended upon California for multi-day tours during the Lunar New Year period, the longest and most treasured holiday season for Chinese families.
  • The volume of these seasonal packages on offer has increased notably, as has the length of stay in California.
  • Visit California’s targeted campaign will buoy the efforts of the travel trade and harness Ms. Gao’s popularity to deliver the message that California is the best destination to spend the Chinese New Year season.
  • This year, 26 Chinese tour operators are offering “Mega Happy New Year” California packages.
  • Visit California’s paid digital media and viral social campaign willdrive traffic to the tour operator sites for booking.
  • The campaign features a map-based game, “Gao Takes you to California,” that invites consumers to participate in a Dutch Auction for a chance to purchase a deeply discounted Lunar New Year tour package over the course of five weeks (October 25-November 30).
  • Target audience of the campaign is families in primary markets: Beijing, Shanghai & Guangzhou

CHINA READY

  • In 2012, Visit California launched the “China Ready” educational initiative to prepare the state’s tourism industry to better serve Chinese travelers, establish a standard level of service and ultimately maintain California’s competitive edge.
  • The three-pronged approach includes (1) sharing educational resources with the tourism industry in California and (2) receptive operators as well as (3) training Chinese travel trade on the state’s travel product through seminars, online tools and familiarization tours.
  • To-date, we have held a handful of China Ready workshops in California and dedicated an entire ½-day pre-conference session at our annual Outlook Forum conference to China Ready – it was at capacity, a testament to the strong interest in the China market.
  • As the primary U.S. gateway for this exciting market, we have an incredible opportunity to capitalize on the improving visa application process and increase in air service to the Golden State by making California a more welcoming and desirable place for Chinese visitors.
  • With China Ready, we as a statewide industry are showing our commitment to building a lasting, ongoing relationship with Chinese travelers.
  • It is critical to make sure Chinese travelers perceive California as very welcoming & friendly – our industry can do that by creating services tailored just for Chinese visitors, which is being done at California hotels, attractions & stores – whether that’s offering Chinese meal options or Mandarin-speaking concierges.
  • From major attractions like Disneyland and Universal Studios Hollywood to popular destinations like Orange County/Anaheim, Los Angeles, Beverly Hills and San Francisco, our industry has made great strides in becoming China Ready and rolling out the red carpet for these visitors.
  • Of course, there is still work to be done and we are learning daily, but we have a solid foundation in place thanks to our China Ready program and the work we have done in market through travel trade, media relations and now consumer advertising.
  • We will continue to work with the travel trade to develop California itineraries and deepen their knowledge of our travel product, so they can sell California to their clients as California Experts. The travel trade is very influential.

TRAVEL TRADE TOOLS

  • The Visit California Travel Trade Portal (TTP) has received an exciting new look, along with improved functionality and resources available to the travel trade.
  • Trade Tools including downloadable maps, images and videos have been refreshed to give you access to the best digital assets California has to offer.
  • Travel trade will now have expanded access to our image library. We’ve curated a selection of more than 100 images depicting California’s 12 tourism regions, iconic attractions and classic experiences.
  • In-Market Trade Programming highlighting past and upcoming Visit California Sales Missions, tradeshows and agent trainings will be featured along with sales information from our California partners.

LOOKING AHEAD: 2013-2015

  • Travel is projected to continue to grow in 2013 as consumers are choosing to spend their discretionary funds on emotionally fulfilling experiences.
  • OVERSEAS VISITS are expected to increase +5.2%, Mexican visits up +4.6% and Canadian visits up +4.6%.
  • California’s proximity and relatively high exposure to key PAN PACIFIC markets should allow California to continue to realize great returns.
  • We expect leisure trips from all international markets to continue to increase into 2015.
  • International visitation to California is projected to grow by 16% between 2012 and 2015.