When Sli Siar opened its Beijing offices in 2006, the deep-pile rugs, stained glass windows and single malt Irish whiskey were all intended to convey an impression of old wealth and the finer things in life to would-be Chinese clients.
Sli Siar, which means "Journey West" in Gaelic, was an Irish boutique travel agency-cum-consultancy offering to whisk China’s rich to the emerald isle’s limestone-walled castles, rolling coastal golf courses and illustrious bloodstock farms. The firm was trying to jump on the coattails of luxury brands in China, with good reason. Recent data by the US-based research body the Luxury Institute identifies China as luxury brands’ leading market for short-term sales growth.
It seemed like a great idea: tailored trips to an idyllic island escape where China’s corporate and government elites could revive themselves on good country living. And there was a sweetener. Sli Siar, founded by renowned software entrepreneur Chris Horn, could also set up meetings with the companies credited with Ireland’s remarkable success in software and biotechnology, both holy grails for China’s innovation-seeking economy, allowing visitors to at least claim they were combining business with pleasure on their receipts.
Alas, Sli Siar didn’t work. It turned out there weren’t many takers for nights in castles and master tastings of fine Irish whiskey, said a former employee of the firm, which itself declined to comment. The company was too ambitious and quickly burned through its start-up capital without sending more than a handful of travelers to Ireland. "Finding the right target was hard," the former employee said.
Sli Siar has since relocated to more modest lodgings and downgraded itself to a regular business consultancy advising Chinese and foreign firms on the bread-and-butter issues of trade and joint ventures.
Try, try again
Nevertheless, Sli Siar’s failure has not discouraged other attempts. UK-based tourism consultancy Exclusivity, for example, wants to bring moneyed Chinese visitors to the bucolic English region of Yorkshire. Tasked by the government-run Welcome to Yorkshire tourism board to bring in big spenders, Exclusivity has been flying in Chinese travel writers to get copy into the Beijing editions of glossies Tatler and Vogue.
Exclusivity Managing Director Angela Seager outlined a typical itinerary: Visitors take a helicopter from London’s Heathrow airport to a country mansion where they’ll shoot pheasants, eat banquets prepared by Michelin-star chefs and then visit a sports car factory. The host of the car factory visits, Leeds-based LNT Group, hopes to sell its limited-issue Ginetta cars in China.
Britain is the fifth-most popular destination overall for Chinese outbound tourists. Welcome to Yorkshire estimates the region hosted 11,000 Chinese visitors last year. "But we want to increase the numbers at the top end of the market," said Seager, who is keen to sell Yorkshire sites linked to legendary King Arthur, such as Richmond Castle, to Chinese travelers.
Unfortunately, the UK and Ireland are not within the EU’s free-movement Schengen visa zone, which means visitors need separate visas for the UK, Ireland and the rest of the EU. "Not being able to move about the EU on one visa is a big turn-off to the Chinese," said Roy Graff, head of China Contact, a consultancy specializing in outbound Chinese tourism.
Graff also said that foreign tourism destinations use marketing campaigns that don’t click with Chinese targets. "Ireland and Yorkshire both lack blockbuster attractions like the pyramids or the Eiffel Tower, which matter to Chinese, no matter how wealthy they are. So you’ve got to work hard to sell the destination in China on one key attraction, and that takes time."
Overall tourist numbers out of China are expected to dip further in 2009, said Graff. Tourist numbers into the US from Asia dropped 15% for the first five months of 2009, according to the US Department of Commerce. Graff believes the figures suggest that China’s tourists – wealthy included – are staying closer to home. "This doubles the challenge to anyone targeting China’s high-end outbound market."
The decline might also be related to Beijing’s recent restrictions on official travel to locations without mines or oil wells. Given that so many well-heeled Chinese business travelers are ostensibly visiting on behalf of state-owned firms, this significantly dampens demand.
Still, targeting the wealthy makes sense in a recession. Globally the ultra-rich are still spending, said Kristen Schmitt, head of marketing at MINT, a concierge service that counts Chinese nationals among its US$50,000-a-year membership holders. Most affluent travelers prefer "experiences" to big-ticket items like yachts. Trips that include meetings with famous people or pampered volunteering are popular.
Chinese ultra-rich, however, are more nouveau riche than old money. While they are happy to buy designer watches and leather bags, these people are a harder target for Western tourist marketers. At present, most demand from wealthy Chinese is for destinations rather than "experiences," preferably with ample shopping and familiar food.
Japan may have the best crack at this slice of the upper-crust Chinese market. It’s giving fast-track visas for Chinese with more than US$40,000 in their bank accounts. Most wealthy Chinese visitors come for shopping, said Japan National Tourist Organization spokesman Tomoe Suzuki. "They also climb Mount Fuji."
China’s wealthy are indeed beginning to range further afield, but perhaps they need more time to appreciate the Western travel experience.