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KIM Jin-Hyuk

Attracting Chinese Tourists

KIM Jin-Hyuk

Feb. 22, 2011

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One of the biggest tourist magnets in Korea these days is the main entry of Ehwa Women's University in central Seoul. There you will likely see as many as 2,000 or more Chinese visitors having their picture taken in a day.

The reason is not because of artistic merit. Rather pronunciation of the university's name sounds similar to the Chinese word li-fa(利發), which means "making money." Furthermore, since the university is known as the best women's university in Korea, a myth has spread among Chinese tourists that taking photos in front of the school's gate will bring them luck in getting their daughters married to rich men.

Last year, nearly 2 million tourists arrived, many of them from China. That has given increased attention on Chinese tourists, who have become a swelling presence in global tourism. Sheer numbers tell the story: some 50 million Chinese travel abroad each year, about the size of Korea's population, from only around 3 million 20 years ago. The World Tourism Organization predicts the annual number of Chinese outbound tourists will top 100 million by 2020.

Most importantly, Chinese tourists are enthusiastic shoppers with hefty wallets and a taste for luxury brands. In 2009 alone, Chinese tourists spent about 50 trillion won abroad. That equaled the amount that Koreans spent at domestic department stores and big discount stores in a year.

Chinese tourists' love for shopping is summed up in the term "Peking Pound," which was coined by the British media to describe the pounds Chinese spent at luxury boutiques in Britain during the Christmas season last year. They accounted for about one-third of the sales of Burberry boutiques in Britain, according to the media. In fact, the amount Chinese tourists spend on shopping sprees ranks fourth in the world, following Germany, the US and Britain.

To tap the spending power of the massive Chinese tourist population, nations are rolling out the welcome mat and even changing their regulations. Before, Korea issued multiple-entry visas only to important figures of China, but it is now issuing them to select people in the middle class such as teachers and graduates of prominent universities.

In Singapore, gambling was strictly forbidden under Prime Minister Lee Kuan Yew. But the island country is now competing with Macau to attract more Chinese tourists and has licensed two large upscale casinos, Marina Bay Sands and Resorts World Sentosa.

Companies also are taking swift steps to cater to Chinese customers, especially in retail services. BIC Camera, one of Japan's leading electronics discount retailers, has given a handbook containing essential Chinese expressions to all of its employees. Those who deal directly with shoppers are required to memorize the expressions.

In the cosmetics industry, Shiseido introduced a clever marketing strategy aimed at Chinese customers both in Japan and China. After they make purchases in Japan they are eligible for a free bag as a gift when they drop by a Shiseido store back in China. This promotion campaign proved extremely popular during the Chinese Lunar New Year holiday.

So, how well is Korea doing in pulling in Chinese tourists? For now only 3-4% of Chinese outbound tourists visit Korea. If the number is pushed up to 5%, as many as 5 million will come to Korea and if it is further raised to 10%, Korea would be host to 10 million visitors with considerable buying power.

To reach its potential with Chinese tourists, a change in mindset is the top priority. We should not be dismissive or selective and view Chinese tourists as valued guests.

Furthermore, we tend to think of the service industry as a domestic-oriented one, but when factoring in 5 million foreign visitors, it is not. That is why we need companies' marketing and aggressive strategies to lure them.

We need the kind of products that tourists can buy and enjoy only in Korea. Do you know what the most popular Japanese goods are among Chinese tourists to Japan? Nail clippers with magnifiers and ceramic knives, and Burberry blue label, which is sold exclusively in Japan.

Gaining insights from Japan's case, how about launching package tour products that combine Korean cuisine and shopping? Or how about publicizing the works of Korean artists and commercializing them?

Moreover, Korea boasts many skilled aesthetic surgery clinics, including the world's best hair transplant surgeons. Medical tour products, which combine medicine and tourism need to be developed strategically.

As suggested by the picture taking at Ewha Women's University, another good way of creating distinct branding aimed at foreign tourists is to develop sites that offer tourists memorable experiences and a good story.

Souvenir shops in Bali, Indonesia have been transformed over the last few years. Before, their main item was Hindu God sculptures, but they have been replaced with Buddha sculptures. This is what Chinese tourists want. It may sound like an exaggeration, but the shops of Bali have changed the face of God for Chinese tourists. Of course we don't necessarily need to change the face of God. But I think it is time for us to change our own faces towards Chinese tourists.

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