Chinese travelers moving up the value chain

Increasing ratio in top hotels and premium tours, Liu Weifeng and Raymong Zhou report

Years ago there was a phrase in the international travel industry describing Chinese tourists - they "sleep cheap, shop expensive".

Even today, shopping still dominates their spending with 34.1 percent of the total while traveling, followed by transportation at 21.6 percent and hotels at 14 percent, according to a report released by the China Tourism Academy in April.

Though still comparatively low, Chinese spending on overseas hotels last year was 4 percentage points higher than that in 2011.

Statistics show that Chinese travelers are becoming more willing to stay in medium-priced star-rated hotels rather than low-budget accommodations.

In 2012, almost half of Chinese tourists stayed in two or three-star international hotel chains, up 10 percentage points over 2011. Some 15 percent were willing to pay for four-star-rated hotels or above, 7 percentage points higher than the year previous.

"The quality of accommodations is tipped as the next big thing," said an industry observer.

But the spending sprees of some Chinese consumers overseas have generated at times eye-popping news even by international standards.

In 2012, Chinese travelers made some 83 million outbound trips, an annual rise of 15 percent. A KPMG study puts the growth at 71 percent this year.

While overseas, they spent $85 billion, double the annual revenue of Exxon Mobil. And 72 percent of these travelers said that they bought luxury items on these trips.

Another report said that of all the luxury spending by Chinese consumers worldwide, a whopping 60 percent happens outside China.

A strong yuan and prohibitively high prices at home are cited as the driving forces for their binge buying overseas.

In the bigger picture, as China grows more affluent more people can afford to travel abroad and more people spend more. But as consumers they have special needs: They require quality services and are at the same time value conscious.

The design of a travel itinerary, attitude and professionalism among tour operators are rated as the decisive reasons in how rich Chinese book luxury travel, according to a report by the China Tourism Academy and leading domestic travel agency Ctrip.