[Viewpoint] Promoting a Chinese tourist invasion

One of the biggest tourist magnets in Korea these days is the main entrance of Ehwa Womans University in central Seoul. There you will likely see as many as 2,000 Chinese visitors having their picture taken each day.

The reason is not because of artistic merit. Rather, pronunciation of the university’s name sounds similar to the Chinese word li-fa, which means “making money.” Furthermore, since the university is known as the best women’s university in Korea, a myth has spread among Chinese tourists that taking photos in front of the school’s gate will bring them luck in getting their daughters married to rich men.

Last year, nearly 2 million tourists arrived in Korea, many of them from China. That has given increased attention to Chinese tourists. Sheer numbers tell the story: some 50 million Chinese travel abroad each year, about the size of Korea’s population, from only around 3 million 20 years ago. The World Tourism Organization predicts the annual number of Chinese tourists will top 100 million by 2020.

Most important, Chinese tourists are enthusiastic shoppers with hefty wallets and a taste for luxury brands. In 2009 alone, Chinese tourists spent about 50 trillion won ($44.6 billion) abroad. That equaled the amount that Koreans spent at domestic department stores and big discount stores in a year.

Chinese tourists’ love for shopping is summed up in the term “Peking Pound,” which was coined by the British media to describe the pounds the Chinese spent at luxury boutiques in Britain during the Christmas season last year. They accounted for about a third of the sales at Burberry boutiques in Britain. In fact, the amount Chinese tourists spend on shopping sprees ranks fourth in the world, following Germany, the U.S. and Britain.

To tap the spending power of the massive Chinese tourist population, nations are rolling out the welcome mat and even changing their regulations. Previously, Korea issued multiple-entry visas only to important figures of China, but it now issues them to a selective group of middle-class professionals, including teachers and graduates from prominent universities.

In Singapore, gambling was strictly forbidden under Prime Minister Lee Kuan Yew. But the island country is now competing with Macau to attract more Chinese tourists and has licensed two large upscale casinos, Marina Bay Sands and Resorts World Sentosa.

Retailers are taking swift steps to cater to Chinese customers. BIC Camera, one of Japan’s leading electronics discount retailers, has produced a handbook containing essential Chinese expressions for its employees.

In the cosmetics industry, Shiseido introduced a clever marketing strategy aimed at Chinese customers both in Japan and China. After they make purchases in Japan they are eligible for a free bag as a gift when they drop by a Shiseido store back in China. This promotion campaign proved extremely popular during the Chinese Lunar New Year holiday.

So, how well is Korea doing in pulling in Chinese tourists? For now, only 3 percent to 4 percent of Chinese tourists visit Korea. If the number is pushed up to 5 percent, as many as 5 million will come to Korea.

To reach its potential with Chinese tourists, a change in mind-set is the top priority. We should not be dismissive or selective and instead view Chinese tourists as valued guests. Furthermore, we tend to think of the service industry as a domestic-oriented one, but when factoring in 5 million foreign visitors, it is not. That is why we need corporate marketing and aggressive strategies to lure them.

We need the kind of products that tourists can buy and enjoy only in Korea. Do you know what the most popular Japanese goods are among Chinese tourists to Japan? Nail clippers with magnifiers and ceramic knives, and Burberry blue label clothing, which is sold exclusively in Japan.

Gaining insight from Japan’s case, how about launching package tours that combine Korean cuisine and shopping? Or how about publicizing the works of Korean artists? Moreover, Korea boasts many skilled aesthetic surgery clinics, including the world’s best hair transplant surgeons. Medical tours need to be developed strategically.

As suggested by the picture taking at Ewha Womans University, another good way of creating distinct branding aimed at foreign tourists is to develop sites that offer tourists memorable experiences and a good story. Souvenir shops in Bali have been transformed over the last few years. Previously, their main item was Hindu sculptures, but they have been replaced with Buddha sculptures. This is what Chinese tourists want. The shops of Bali have changed the face of God for Chinese tourists. I think it is time for us to change our own faces toward Chinese tourists.

*The writer is a research fellow at Samsung Economic Research Institute.

By Kim Jin-hyuk