Carol Tsang hails from Hong Kong, where she has worked in the hospitality marketing business for the last decade. Her company, Quintessential Marketing, focuses on helping vacation resorts cash in on the boom in Chinese outbound tourism. China Economic Review spoke with Tsang about the burgeoning market for “intelligent luxury” travel among Chinese tourists.
Q: What are your business goals?
A: My vision is to develop a sustainable tourism business for luxury products in Hong Kong and China. I don’t mean just selling really expensive hotels to Chinese tourists, I want to introduce an intelligent luxury vacation experience. We only pitch resort chains or hotels in big cities if they have the same vision as ours. I’ve turned down requests for proposals from some big hotels. They might be beautiful resorts, but their primary aim is to increase guest volumes from the Chinese market.
Q: You’ve recently partnered with the Constance Hotel Group in Seychelles. What is their strategy?
A: They see a lot of opportunities from outbound tourists from Hong Kong and China – especially since the European market, which has traditionally been Constance’s major source of revenue, has been declining. Market diversity is critical, in their point of view. After a year of planning, they hired my company to target China and Hong Kong outbound tourists – especially top-end clientele.
Q: Some resort managers seem to be quite worried about the impact of large Chinese tour groups.
A: There will be a period of culture shock between clientele and resorts. One problem is that during some seasons we have a lot more Chinese visitors than at other times. There are complaints about them being noisy and so on. But it’s not just the Chinese; if you have a lot of tour groups, you have the same problem in the resort. One of the ways to ensure that clientele from China match the resort is to avoid launching any promotional rates. Some other destinations – including even five-star hotels – give 40-60% discounts with everything included. That’s not smart. For six months, you’ll be full of Chinese guests, but after that, nobody will come.
Q: How do travel agents play a role in this?
A: I think the problem is that a lot of resorts tend to offer too many contracted rates to different tour operators in China, and this results in a price war. China is an unsophisticated market. There may be a lot of individuals working under a company that holds the travel agency license, but they are actually operating individually. We use only a few tour operators, each targeting different clientele: families, honeymooners, married couples and so on. We make our partnerships sustainable by ensuring profit margins.
Q: The stereotype of Chinese tourists is that they don’t go abroad to explore and learn new things, but prefer to buy a new handbag. How is that changing?
A: Nowadays, mainland travelers are already ahead of Hong Kong in terms of the value and experiences that they are expecting. They are quite adventurous now. They’re focusing more on the overall value of different resorts, travel products or destinations they are going to. It’s no longer about price alone.
Q: And what about luxury resorts in particular?
A: We’ve been receiving bookings from Chinese tourists traveling in small groups. For Seychelles, a small group is a family, or two or three families, six or seven people in total. The maximum we get is five rooms rented to Chinese guests, out of 267. These people, 80% of them, fly here in first or business class. They might be entrepreneurs or senior executives in the top management layer of multinational companies in China. They want more out of their vacation, and they want to avoid being stuck in the same place as masses of Chinese tourists.