By Peggy Li

According to China’s Ministry of Culture and Tourism, annual domestic trips remain at roughly 50 % of pre-pandemic levels, amounting to 8.7 billion domestic trips over the past 3 years. During this time, as McKinsey points out, “the domestic market matured, and travellers became more sophisticated as they tried new leisure experiences such as beach resorts, skiing trips, and staycations in home cities.”

A great example - Xiamen is a port city on China’s southeast coast. During the May Day holiday of 2023, Xiamen welcomed a total of 3.3 million tourists, a year-on-year increase of 58 %, surpassing pre-Covid levels. Tourists who take overnight trips to Xiamen are mainly 20-39 years old, reflecting the city’s appeal to young and middle-aged demographics. 

China is expected to further open up to travel, both inbound and outbound, in the second half of 2023. This could offer dynamic opportunities for the travel sector, in particular with significant touristic attractions such as Milan and Italian Cuisine. Made in Italy still have a prestige status among Chinese consumers, with the middle class being the targeted audience. 

Defining China’s “middle class”

The middle class in China, or alternatively middle-income groups, has been defined in a number of different ways over the years. The most common definition currently seen in China is the scope set by the National Bureau of Statistics (NBS), which defines the “middle-income group” as a typical three-person household that earns between RMB 100,000 to RMB 500,000 (approx. US$14,844 to US$74,221 in 2022) per year. Using the above definition has stated that China’s middle-income group surpassed 400 million people in 2017, or 140 million households. Each household will take no less than 4 domestic short vacations (weekend trips) and 1 overseas vacation (1 week to 10 days). 

Average spend per trip of a family of 3 at US$ 6,000, so the potential spend is over US$ billions, with consideration of travel shopping spend at an average of US$1,500. Among the goods Chinese tourists spend in Italy are not only luxury fashion, food items such as ham, wine, and cheeses as well as kitchenware are among the popular choice of souvenirs. 

HORCA industry has a direct impact on the choice of items and by developing Chinese labeling and marketing strategy. This will enhance the flow of sales and offer a great market penetration barometer of the product to assess the export potential of the product to China market.

With the next wave of Chinese outbound travel to happen during “The Golden Week” is the China National Day celebration on 1st October 2023. Now is the time to get the thinking cap on to strategize and attract the attention to spend.