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Sunday, May 19, 2024

Asian Giants Poised to Transform Global Accommodation!

In the year 2000, about 3% of China’s population was classified as middle class. By 2018, more than half of the country—or around 700 million people—had entered the middle-income bracket. If we fast forward to 2033, roughly double the number of Chinese households are expected to be able to afford international travel, compared to today.

Similarly, India, now the world’s largest country by population at 1.4+ billion, has a middle class that’s around 31% of its population. This is projected to grow to 38% by 2031 and, by 2033, it’s believed that more than three times the number of Indian households will be able to afford international travel, versus today.

Is the positive impact that Chinese and Indian travellers will have on accommodation over the next 10 years being underestimated? Based not only on their projected population growth and appetite for travel, but the way their behaviours are pushing for industry evolution, too, I’d say so.

Take Thailand, for instance. At the end of January, the country granted permanent visa exemptions for Chinese travellers, enabling freer movement and generating considerable traveller interest. Hours after the announcement of the visa-free agreement, Chinese online travel agency Trip.com saw a surge in keyword searches related to “Thailand” in their booking platform. Airports of Thailand (AoT) also expects the arrival of 8 million travellers from China this year, following the announcement.

Likewise, when the Thai government announced a temporary visa exemption scheme for Indian travellers in October of last year, travel booking website Agoda reported a spike in searches by Indian travellers related to Thailand, underscoring the country’s significance as one of Thailand’s major source markets.

While the short-term benefits of these changes are largely front of mind, deeper analysis highlights just how vital these two countries could become, not only for Thailand, but for accommodation providers globally, as demographics shift.

SiteMinder’s Changing Traveller Report 2023which surveyed 10,000+ travellers worldwide, including 1600 collectively from China and India, uncovered that 77% of Chinese travellers and 78% from India intended to travel ‘more’ or ‘much more’ in the next 12 months, compared to the year prior – a proportion well above the global average of 57%.

And, while this points to a welcome surge in check-ins, it’s the behavioural findings that highlight just how impactful this new wave of travellers could actually be in time.

Understanding how Chinese and Indian travellers will positively push the industry

All travellers are, of course, unique. There’s such contrast between individuals and subcultures in every country. However, one goal of SiteMinder’s Changing Traveller Report 2023 was to discover the core, recurring characteristics of guests from some of the top travel markets around the world and, from there, enable accommodation providers to better serve them.

Digging further into the data, I’ve uncovered five big ways that Chinese and Indian travellers are likely to push the industry to positively evolve over the next decade, as their numbers build. These will by no means be the only ways, however they provide data-based insight for hoteliers as they prepare for their future state.

  1. Transformative technology uptake will accelerate hotel tech adoption

SiteMinder’s survey shows that Chinese and Indian travellers are placed squarely at the forefront of technology use globally. To provide examples, Chinese travellers are the most likely to say that a chatbot is of top importance to a property’s website, growing by 150% year-on-year, while Indian travellers see a property’s website being mobile-friendly as more important than anyone else. Eighty-eight and 84% respectively say they are ‘likely’ or ‘very likely’ to use AI to generate an accommodation recommendation (compared to 52% on average), while 92% and 87% are open to using AR and VR to explore and experience their accommodation (versus 67% worldwide).Importantly, both groups of travellers crave a more tech-enabled experience, on site and online. About half in both cases would prefer to be communicated with via a device when at a property, and over 9-in-10 agree that their booking experience and stay could be better if accommodation businesses were more tech-savvy.

  1. Attitudes to website abandonment will force investment

Indian travellers are voting with their cursors. At just under 70%, they are the most likely globally to not proceed with an accommodation booking because of a bad digital experience. While less, roughly half of the Chinese travellers have also abandoned an accommodation booking online, with a website’s load time and a perceived lack of security in both cases the biggest concerns.

  1. An openness to upsells will encourage more to explore revenue boosting tools

At 52% and 51% respectively, Chinese and Indian travellers want to receive personalised offers more than any other group around the world. Chinese travellers are the most likely to book an airport transfer, while Indian travellers are the most likely to book a spa treatment. In both cases, over 90% would be happy to spend more money during their next stay, beyond the cost of their room.

  1. Their likelihood to work remotely will ensure bleisure remains front of mind

A large percentage of Chinese and Indian travellers remain committed to working during their next holiday, despite the reduction of bleisure travellers globally year-on-year. Sixty percent of Indian travellers plan to work during their next stay—24% above average, and more than any traveller globally—while almost half of the Chinese travellers intend to work during their next trip.

  1. The desire for unique experiences will push more to position their accommodation as the destination

Finally, the data indicates that unique accommodation experiences are more important to Chinese and Indian travellers than other groups. For Chinese travellers, the uniqueness of a property is a top reason that around half will consider returning, which is double the global average. In fact, as the search for something ‘distinct’ grows, ‘value for money’ has become less important, year-on-year. Among Indian travellers, 2-in-3 say that a ‘great experience’ (e.g. via food and beverage, a spa or an event) is more important now compared to last year. With Indian travellers planning to spend more time on site than any other group globally, their need for unique moments is set to remain elevated.

Over the next 10 years, there will be an explosion of change for the global accommodation industry to navigate, with twice the number of Chinese travellers and three times the number of Indian travellers able to travel beyond their shores by 2033. Let that sink in. As hoteliers fully awaken to this opportunity, it will not only be an increase in check-in volumes that they can expect, but travellers who via their behaviours and preferences stand poised to transform the industry, for the better.

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