New outbreaks in China are keeping many families at home for the Chinese New Year holidays, dampening hopes of a travel rebound. To understand how the traditional peak travel season might have looked if not for the new threats, ForwardKeys and Dragon Trail Interactive team up to examine flight booking trends and travel marketing campaigns in the vast country.
There were high hopes for travel during this typically popular period, especially after a strong travel recovery in the domestic sector by the end of 3Q2020. But local Covid-19 outbreaks have resulted in official policies throughout the country requiring people not to leave the areas where they live, and as such travel bookings have dropped dramatically.
The outlook is quickly deteriorating for Chinese New Year domestic travel.
Nan Dai, China market expert at ForwardKeys, noted that the number of tickets issued to travel within China for the Chinese New Year monitored throughout December 2020 was down 57.3 per cent from the same period in 2019.
As of January 28, issued tickets plunged 75.9%.
Travel agencies have been restricted from selling group tours or packages to high- or medium-risk areas, and some tourist attractions have closed.
Sienna Parulis-Cook, associate director of communications at Dragon Trail Interactive, added that as of January 18, air and rail departures from Beijing over the Spring Festival period were already down by 43 per cent compared to 2020, and 69 per cent compared to 2019.
The National Railway Group has shared dismal results: tickets for the three days from January 28-30 were only a quarter of what they were in 2020, and tickets for January 31 were down by 75 per cent.
What could have happened?
Looking at WeChat marketing for international hotel brands (as tracked weekly by Dragon Trail Interactive) over the past two months, the main promotional theme was “Sun or Snow.” This means the very extensive promotion of wintery, ski-oriented destinations in north-eastern China, as well as the tropical island climate and tax-free shopping in the south, in Hainan.
This was demonstrated by the issued tickets leading up to the Chinese New Year, before the new strains of Covid-19 appeared and drew travel restrictions between provinces.
“Travel to southern parts of China with warmer weather and fewer new cases witnessed the most advanced bookings. Guangdong tops the list and Hainan jumps to the second place with 33 per cent recovery in ticket volume as of 14 January,” said Dai.
The team at Dragon Trail monitored online a host of activities by five-star hotels promoting the south or north. Marriott published an article on WeChat in January recommending the Harbin Ice and Snow Festival, skiing in Changbaishan and Chongli, and winter beauty in Changchun. A recent report by travel website Qyer.com listed Changbaishan, a mountainous area in Jilin Province, as 2020’s eighth fastest-growing travel destination in China.
Shangri-la also promoted hotels in Harbin in December, while Ibis promoted Changchun and Harbin. At the same time, Hilton publicised its extensive selection of properties throughout China, as well as dreamy holidays in Sanya, Hainan.
The international hotel brand to promote this “Sun or Snow” concept most heavily for winter tourism was IHG Hotels & Resorts. In December, it published posts offering a choice between a tropical winter break in Hainan, and snowy travel in the north of China. On January 4, it again integrated this concept into an interactive post showing how much better 2021 would be compared to 2020. Through illustrations, it shows consumers stuck at home in 2020 but out surfing or learning to ski in 2021.
The optimism was unfortunately premature.
The Great Spring festival staycation
There is still some push for Hainan travel – on February 1, the Sanya government announced that travellers from low-risk areas with a green Hainan health QR code will be able to skip the PCR test before coming to the island.
At the end of January, Marriott was still promoting little family reunions in Hainan, and Shangri-la Sanya rolled out Chinese New Year family packages while stressing its high hygiene standards.
However, travel from other provinces seems increasingly unlikely, despite the desire to do so. The most up-voted comments on an Agoda Chinese New Year promotion for Sanya published on a WeChat travel blog in mid-January included: “Schools, work units, and organisations are all forbidding travel outside the city – who would dare to go?” and “It’s so cheap! But we’re not allowed to leave our area.”
Parulis-Cook predicts that staycation will lead the Chinese New Year travel trend in 2021.
“As of January 22, the Trip.com Group reported that Spring Festival staycation bookings were up 260 per cent, with searches for local travel up by 40 per cent. 80 per cent of their users will stay local over Chinese New Year, they said, with increases all over the country,” she shared.
At the same time, OTA Tongcheng reported that cancellations had become more common, with a trend to stay local, stay isolated, and do slow travel in the area. They also identified a trend of staycations in hotels, with customers booking family suites and high-tech offerings like e-sports rooms or audio-visual rooms popular. They reported that in the previous 10 days, searches for local travel products had increased eight-fold, with a six-fold growth in searches for local accommodation plus sightseeing packages.
Dai added: “Indeed, this is the holiday period when families most often travel together. Our issued tickets back this further by showing that on February 13, passengers travelling in family size (two to five people per booking) represents around 60 per cent of all departures, and the share of passengers travelling alone represents only 10 per cent, down by 20 per cent from the day before the holiday.”
Hotels have had to be quick to adapt their marketing. As late as January 19, IHG was still promoting skiing holidays in Jilin and Hebei. By January 27, the messaging had changed. “Not going home for Spring Festival? You can still have a great celebration where you are,” read the WeChat article’s headline, with suggestions for short, local trips to quiet places should travel plans be cancelled.
The summer outlook
“One thing we have learned from this pandemic is that the Chinese travel market is resilient and that the domestic travel market will be the first to bounce back when it can,” said Dai.
Looking at 2H2020 to predict the future potential for domestic travel in China in terms of issued air tickets, the most resilient destination provinces (or destinations with the fastest recovery rates) were Tibet, Hainan and Chongqing.
“Nostalgic travel is having a comeback. Strolling in ancient laneways, eating traditional cuisine typical to a region is really in among the younger generation at the moment,” added Dai. Another trend to keep in mind is Red Tourism, particularly for the older generation as the Chinese Communist Party celebrates its 100th birthday this year.
Chinese New Year travel has not stopped this year; it has had to take a different turn. It is clear that pent-up demand exists, and many await the moment when the dormant Dragon awakens to shake up the travel industry again.
“The Chinese government has more experience in dealing with the outbreak situation now and people have started to administer the vaccine… I believe when the winter’s gone, the outlook for Chinese domestic travel in summer is still looking optimistic,” Dai concluded.