HONG KONG — The good news is that the Chinese are traveling more than ever before. The bad news is that they are spending less on shopping.
That’s the conclusion of a newly published report from consulting firm Oliver Wyman, which surveyed 2,000 Chinese travelers. The report, titled “Prepare for Turbulence: The Chinese Traveler of Today and Tomorrow” found that overall, shopping has dropped from the second-biggest motivation for traveling to third, behind sightseeing and recreation and entertainment, in 2016. The decline was mainly driven by decreased shopping for resale, what’s known as the practice of “daigou.”
Chinese travelers are expected to make 150 million trips this year, and average trip spend is still on the rise, growing from 19,365 renminbi in 2015 to 20,317 renminbi last year. But shopping spend declined in both absolute and relative terms to 33 percent of total trip expenses in 2016, down from 41 percent in the prior year.
“Chinese travelers continue to shift their spending towards more meaningful experiences, such as exquisite dining, extraordinary cultural journeys and even adventurous sports,” said Hunter Williams, a partner at Oliver Wyman, who wrote the report. “At the same time, cross-border e-commerce has grown rapidly, overseas travel has democratized and there is greater availability of products at home, meaning there is less need for buying overseas for resale.”
“For example, retail spend as proportion of overall trip spend in the United Kingdom went down from 42 percent to 33 percent despite the weakness of the pound following Brexit,” the report said. “A particular fall was seen in daigou spend, which dropped from 1,800 to 1,000 renminbi per person from 2015 to 2016. Similarly, retail spend in the United States dropped from 41 percent to 28 percent with only 5 percent of respondents ranking shopping as number-one reason to go to the country.”
Travelers who ranked shopping as the main reason to travel were generally from lower income brackets than those who put it second or third.
Another emerging trend is domestic travel. Oliver Wyman data showed that twice as many trips were made domestically last year compared to 2015, with more than 90 percent of respondents making at least one domestic tourism trip in the past 12 months.
Oliver Wyman believes a shrinking shopping expenditure is likely to continue for the foreseeable future, stating that “a greater proportion of spend will be allocated to accommodation, dining and entertainment, while shopping spend as a percentage of overall travel spend is likely to continue to decline moving forward.”