5 Aug 2016
Plying the China Cruise Trade
According to figures published by the China Cruise and Yacht Industry Association (CCYIA), the Chinese mainland's entry-exit cruise passenger throughput stood at 1.24 million in 2015, up 44 per cent year-on-year. The number is expected to reach 1.45 to 1.5 million in 2016. The Ministry of Transport is also projecting 4.5 million passengers by 2020, representing an average annual growth rate of 33 per cent, suggesting huge potential for growth.
The shift from sightseeing to vacation-oriented travel is a general trend within the tourism industry. Cruise vacations to Japan and South Korea have become particularly popular and are now an indispensable part of China's cruise economy. Cruise holiday operators have also been keen to woo tourists with lower prices and a number of add-on incentives.
According to information published on one mainland tourism website, cruises departing from China are mainly bound for Japan and South Korea, with Fukuoka, Jeju, Sapporo, Nagoya, Nagasaki, Okinawa and Kagoshima among the more popular destinations. In part, this reflects the success of Japan in attracting such visitors, including by waiving visa requirements for cruise-ship passengers.
With increasing numbers of cruise ships and growing competition in recent years, the once huge fees demanded by cruise operators have dropped noticeably. Short cruise holidays bound for Japan and South Korea, for instance, now start from about Rmb3,500. Cruise trips to other countries, on average, cost between Rmb5,000 and Rmb10,000 per person.
|Promoting Cruise Holiday Sales|
|Overall, three key factors are seen to drive the Chinese mainland cruise holiday sector:|
• Changes to China's demographics have generated a number opportunities for the development of the cruise industry. With typical cruise passengers tending to be middle-aged or elderly people, the growing number of such individuals has inevitably provided a boost to the cruise industry.
• With the rapid increase in the demand for more leisurely vacations and the growing popularity of parent-child TV programmes, family trips have never been more popular. The cruise industry is ideally positioned to take advantage of this shift in demand.
• As the cruise industry has a positive knock-on effect to a number of related industries, its development is expected to receive an increasingly high level of official support.
According to several industry insiders, cruise vacations are cheaper than many domestic short trips and do not involve the usual hassle associated with traveling. The overall appeal is that cruise ship passengers can enjoy a great value-for-money vacation, complete with good food, leisure, exercise, recreation, shows, sightseeing, shopping and other services. As in many other areas of commerce, the secret to success in the mainland’s cruise market lies in accurate targeting of potential passengers and keen pricing.
Understanding mainland consumer vacation preferences and customising services to their requirements have proved the catalysts for the explosive growth of the industry. Once happy to hop off a bus to take a few photos, today’s mainland tourist has different expectations, preferring a more leisurely and experiential holiday, which cruises provide.
Mainland travelers place higher priority on shopping and wining and dining than passengers from other countries and are more likely to take part in group recreational activities. They prefer to travel with friends and relatives and enjoy frequent dining and shopping. Virtually all the Chinese passengers tend to go ashore for sightseeing or shopping.
Some cruise lines have mandarin-speaking shop ambassadors who provide brand introductions to Chinese passengers. A number also have bilingual children's cruise ambassadors, who socialise with children and their families during dining hours and other activities. Certain ships have also started providing on-board dance lessons, which many Chinese passengers are said to welcome.
The quality of other cruise-related services is also improving. Many tour operators, for instance, even offer to collect passengers from their homes.
While the mainland cruise market has seen rapid growth, its potential remains huge. Zheng Weihang, Executive Vice-President and Secretary General of the CCYIA, believes that inland city residents still know little about cruise vacations nor are there many cruise packages suited to their needs.
Efforts, however, are being made to address this. According to one mainland tourism website, more than 10 cruise vacation roadshows have targeted inland cities. In 2016, this has seen promotional events held in Changsha, Xian, Sichuan, Xinjiang, Chongqing, Xiamen, Guangzhou and Kunming.
"We should not simply regard selling cruise products as selling tickets,” said Mr Zheng. “At present, China's tourism industry lacks systematic planning with regard to the service standards, professional qualifications, pricing and product content of cruise vacations."
Mr Zheng noted that the Travel Industry Council of Hong Kong has trained many cruise vacation tour leaders. Taiwan's International Cruise Council has introduced a similar policy since launching last year. The mainland is notably lagging in this respect. "Cruise lines and the CCYIA should work together to provide systematic training for sales personnel and tour leaders," said Mr Zheng.
The Hong Kong Government is actively promoting cruise tourism in the hopes of attracting more tourists from around the world. It plans to make good use of the city's ideal location and Victoria Harbour in particular, as well as its two cruise terminals — the Kai Tak Cruise Terminal and the Ocean Terminal in Tsim Sha Tsui – to establish Hong Kong as a leading regional cruise hub and turn the cruise industry into a new growth area for Hong Kong's tourism sector.
Orchid Yu, a Hong Kong Tourism Board's (HKTB) representative in Guangzhou, said Hong Kong this year is promoting multi-destination itineraries in partnership with various bureaus of the China Maritime Silk Road Tourism Promotion Alliance and is looking to promote Maritime Silk Road tours in conjunction with the Asia Cruise Cooperation (ACC).
Five Asian cruise destinations – Hainan, Hong Kong, the Philippines, Taiwan and Xiamen – jointly launched the ACC in March. Ms Yu said that the HKTB wants to work closely with several mainland ports to help expand the Asian cruise market and develop new routes.
Relying on the resources of homeports, the cruise industry plans to establish a trans-regional, trans-sectoral, multi-domain and multi-channel industry chain. This will encompass shipbuilding, port services, logistics support, transportation, sightseeing, catering, shopping, banking and insurance. Its ability to harness the coordinated development of multiple sectors has seen the cruise industry hailed as the "golden ocean-going industry." Cruise terminal services are said to generate about 30 per cent of the revenue of the entire industry chain.
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