July 23, 2012
Intercontinental, Four Seasons, The Peninsula and Ritz-Carlton are among the top 10 most-searched for brands by Chinese travelers, with most destination searches at the domestic level, according to a new report by Digital Luxury Group.
The World Luxury Index China: Hotels report shows that United States-based brands reign in China with six in the top 15 spots on the most-searched for list. The report also unveiled that 86 percent of luxury travel-related searches were for domestic locations, while 14 percent were for international destinations.
“A multitude of trends have led to the results seen in this report,” said Tamar Koifman, head of marketing at the Digital Luxury Group, Geneva, Switzerland. “From relaxed visa restrictions, to higher disposable income, Chinese citizens are travelling more, both domestically and internationally.
“In previous World Luxury Index reports, European brands often lead as the most-searched brands, particularly in BRIC markets,” she said. “However, in the case of hotels, it is the U.S. brands that have done the best job of making themselves relevant to Chinese travelers.
“There are a few important basics in ensuring that luxury hotel Web sites are search-friendly for the Chinese market that includes having a presence in the Chinese language, ensuring that the site has reasonable load times if not hosted in China, and using text and keywords that align with the way Chinese search for hotels.”
World Luxury Index China: Hotels is a ranking and analysis of the most-searched for global luxury hotel brands by Chinese travelers. The report was released in partnership with Luxury Concierge China and Luxury Society.
Travel over the top
The top 15 most-searched for hotel brands in China include Sheraton, Hilton, Shangri-La, Intercontinental, Westin, Four Seasons, The Peninsula, Kempinski, Nikko, Ritz-Carlton, Hyatt Regency, Banyan Tree, Le Meridien, Renaissance and Sofitel.
Travel brands that had a presence early on in the Chinese market are piquing consumers’ interest the most.
For instance, Sheraton was the first western hotel brand to establish a property in China in 1985. The World Luxury Index China report uncovered that it was the subject of 13.58 percent of luxury hotel searches in China.
Sheraton is part of Starwood Hotels & Resorts, which also owns St. Regis and The Luxury Collection hotel brands.
The report took a closer look at the timing of Internet searches and found that there was a significant increase in mid-January through mid-February, which is the same time as the Chinese New Year. Luxury brands that want to take aim at affluent Chinese travelers may want to plan packages and marketing efforts at this time.
In addition, hotel brand rank altered in different domestic city populations.
For instance, The Peninsula followed by Hilton and Nikko Hotels are the most-searched for brands in Shanghai.
The Peninsula, Shanghai
Nikko Hotels, Sheraton and Hilton are the most-searched for in Beijing and Hilton, Intercontinental and Sheraton are the top searches in Chongqing.
Furthermore, Banyan Tree and Shangri-La had the most spa-related searches. Chinese travelers seem to be looking for conveniently located spas and resorts.
In fact, 40 percent of spa searches were for Banyan Tree Hotels & Resorts, which has four hotels in mainland China and is expected to open 13 additional properties.
Overall, the report found that there is no clear leader in the luxury travel sector in the Chinese market.
The disposable income of Chinese travelers is rising while travel restrictions are disappearing, so that Chinese travelers have more power in the travel market. There is still room for brands to make an impact, per Digital Luxury.
“China is now the third-largest travel spender, so reports helping us understand those consumers are important,” said Chris Ramey, president of Affluent Insights, Miami.“Historically, travel has always been important to Asians and that does not seem to be abating.
“There is a continuum from subtle to show-off,” he said. “The affluent in mature markets lean toward sophisticated brands, whereas those in emerging markets often like to show-off their new found wealth or, in this case, new-found middle class.
“Travel trends often mirror consumer sentiment and wealth, and since there is a newfound freedom in China, traveling is an integral part of their lifestyle."
Affluent travelers in China are searching more for domestic destinations than international cities.
While they are still searching for major cities Shanghai and Beijing, they are also searching for travel options in Chongqing, Tianjin, Sanya, Guangzhou, Hangzhou, Dameisha, Shenzhen and Dalian.
Chongqing and Tianjin are gateways to western and northern China, respectively. Sanya, Dameisha and Dalian are popular for their weather, nature and cuisine, per Digital Luxury.
The most-searched for international destinations include Hong Kong, Bali, Singapore, Dubai, New York, Phuket, Maldives, Bangkok, London and Paris.
Hong Kong and Singapore are likely popular due to the absence of the language barrier and the direct flights available.
Also, China is set to become New York’s largest inbound tourist market.
Ritz-Carlton, New York, Battery Park
Dubai is the most popular destination in the Middle East for affluent Chinese tourists.
“The Chinese market is currently experiencing an oversupply of rooms due to market volatility,” Mr. Ramey said. “However, according to Barclays, there are approximately 1 million rooms in China compared to approximately 5 million rooms in the U.S., so there is plenty of room to grow and for the market to evolve.
“There are over 120 cities with a population over 1 million, so it will be difficult and expensive for any one brand to dominate the Chinese market,” he said. "Influencing the Chinese does not stop when they leave the country.
“Being top-of-mind benefits the brands with properties outside China.”
Tricia Carr, editorial assistant on Luxury Daily, New York