China Travel & Shopping
Lunar New Year and the US$55 billion domestic tourism boom
The Moodie Davitt Report content partner Jing Daily presents commentary on the ‘revenge travel and spending’ that occurred over the Lunar New Year period.
What happened: In the first six days of the Chinese New Year holiday, 308 million tourism trips in China were made, data from the Ministry of Culture and Tourism showed.
With revenge travel also came revenge spending; total revenue generated from domestic tourism during this year’s holiday stands at RMB375.8 billion (US$55.6 billion), a +30% year-on-year increase from 2022, and +73.1% higher than in 2019.
It was good news for luxury as key malls like Shanghai’s Plaza 66 saw long queues form outside Chanel, LV and Hermès. The LV store’s total revenue reportedly reached RMB10 million (US$1.48 million) a day during the festive season.
The Mainland is finally on the move again — these travel figures being the latest sign of China’s travel rebound after a hiatus of three years. Travel saw a +23.1% increase from the same period last year and is at 88.6% of 2019’s level, prior to the COVID-19 outbreak, reports Reuters.
The Jing Take: This data is encouraging for local and international brands operating in China and beyond. Domestic tourism and shopping are likely to experience a healthy boost this year, with a strong kick-off during the country’s most popular annual travel period.
Revenge travel for the Chinese has, however, been limited to internal and short-haul destinations so far. According to China’s official flight tracker, Hong Kong, Macau, Bangkok, Phuket, Taipei and Singapore make up the top five destinations outside the Mainland.
China’s revenge spending was particularly evident in popular destinations such as Sanya, which received a massive influx of tourists seeking sun, sea, and retail therapy. Duty free stores there saw business surge, with sales totaling RMB380.7 billion (US$56.4 billion) over the seven-day festival, up +20.69% from 2022’s and +329% from 2019’s Chinese New Year period, as reported by local news outlet Hainan Daily.
Shoppers queue outside the Louis Vuitton store at Shanghai’s Plaza 66 mall over the Lunar New Year. (Photo: Xiaohongshu)
Within China, Sichuan was the most popular domestic tourist destination, hosting 53.9 million visitors (up +24.7% year on year), while Yunnan, known for its nature and outdoors tourism, recorded the highest tourism revenue at US$5.7 billion (RMB38.4 billion), a whopping +249% annual increase. Spending on entertainment also climbed. Box office sales hit US$993.8 million, up +14% from 2019.
This is all very good news for the luxury, fashion, beauty, travel and leisure markets, of course. Higher hopes for China’s economic recovery and a positive consumer sentiment can only boost these global industries.
Since the drop of the severest pandemic restrictions on internal and international travel in early January 2023, this Chinese New Year has shown that the population is keen to spend and take in new experiences. Brands should be strategising on how to competitively engage with this reenergised market.
*Jing Daily is a content partner of The Moodie Davitt Report. Click here for the original article.
The Moodie Davitt eZine Issue 320 | 10 February 2023
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