In an effort to further diversify the Weibo ecosystem or perhaps an attempt to stem the flow of user share to WeChat which has amassed over 500 million users in a few short years, Sina is introducing tipping and paid subscription functions in Weibo to provide new mechanisms for their users to monetize their content.
The tipping function, called Da-Shang in Chinese, is still in its public testing stage since August. If a reader enjoys a Weibo post, he/she has the option to tip the author by whichever amount she sees fit by clicking the tipping button. The transaction is completed using online payment system Alipay.
The concept of tipping is not new. Watching a street performer and tipping him on the way out is a common behavior practiced across many cultures. This online tipping for a virtual performance provides an additional monetization mechanism for personal media within the ‘fan economics’ framework. The current Weibo platform provides opportunities for users to make money via ad placements and product sales posts.
So far Sina is limiting the eligibility of this functionality to verified personal accounts with less than 5 million followers and fewer than an average of 3 million views a month. The move is apparently to prevent the ‘Big V’ accounts (verified accounts with huge followings) from completely taking over the market opportunity and create some protected space for medium to small accounts to establish roots.
Whether tipping will turn out to be a killer function remains to be seen. Early results revealed that, not surprisingly, well known personalities are the first ones to take advantage of the new function. One of the top 10 contenders in a 2013 male singer contest posted a download link to his new song and reportedly collected RMB 100,000 in less than three hours and completed 8,000 paid transactions on the first day. The average tip received was RMB 17.6, nine times the owner suggested price of RMB 2.
Another stock advisor account with a mere fan base of 3,400 showed off his record single tip of RMB 6,000. The tipping amounts vary substantially from 2,000, 600, 100, 50 to as low as 8, with the vast majority less than RMB 20, says the account owner.
The early results from Weibo’s paid subscription service, also test launched at the same time as Weibo tipping, are also quite interesting. One domestic stock advisor with an annual subscription price of RMB 2,400 claimed to receive over RMB 100,000. A similar account providing stock advisory service for the US stock market charging RMB 5,888 a year claimed to receive RMB 80,000 at the time of the report.
Sina’s latest move is perceived by some as an attempt to slow or reverse the massive shift of user activity from Weibo to WeChat. Whether this would convince the opinion leaders and social media personalities to keep Weibo as the social media platform of choice remains to be seen. As it is common for users to have both Weibo and WeChat accounts, it is expected that the same content would appear on both channels owned by the same person. It is questionable whether tipping would become a mainstream behavior when Weibo is not the exclusive channel where the content can be read.
For most users and enterprises, Weibo and WeChat serve different purposes with content marketing being one area where the two channels overlap. It is unlikely one would choose one platform to the exclusion of the other. The maturing of WeChat will provide both challenges and opportunities for businesses trying to reach out to their customers in an increasingly fragmented social media environment.
The latest edition of the Chinese International Travel Monitor (CITM) report commissioned by Hotels.com TM contains a wealth of information on the traveling and accommodation booking habits of the Chinese outbound travelers.
Conducted during Apr/May 2014 with more than 3000 mainland Chinese residents who had paid for accommodation on an international trip as well as over 3000 of their hotel partners, the 60-page report provides valuable insights into not only the overall market but also various sub-segments, and is well worth a read in its entirety ( full report here ) especially for those who are in the trade. For those who are time challenged, here is a Readers Digest version for your light read.
- The rising affluence of the growing Chinese middle class will continue to drive towards higher aggregate number of outbound travelers for years to come. There is also growing confidence among these travelers, particularly the young, who have already experienced international travel and are more eager to venture beyond the tried-and-true destinations.
- There are clear indications that Chinese travelers are moving towards independent travel (FIT) and away from group travel, particularly among the young. This is confirmed by two thirds of those surveyed who say they now prefer to travel independently and collaborated by 60% of hoteliers who experienced a boost in independent travelers in the past two years .
- Chinese travelers are increasingly going online, particularly via mobile devices, to research and book their travels and then share their experiences via social media. Hoteliers are well advised to have a clear and executable online strategy to stay competitive in this market.
Below are some stats to set the numerical context for the analysis.
- 97 million Chinese traveled overseas in 2013. The number in the first three months of 2014 was up about 17%, leaving little doubt that the total yearly figure will surpass 100 million this year, according to Tourism Administration of China.
- Chinese tourists spent US$ 129 billion in total in 2013, pulling significantly ahead of second place United States, according to UNWTO.
- 618 million internet users in 2013 amounting to 45.8% overall penetration rate, 500 million of whom access the internet via mobile devices and 90% have at least one social media account, according to China Internet Network Information.
- No more than one in five citizens have passports, hence, the potential for future growth.
Chinese traveler profile
Below is an overall Chinese traveler profile.
- Mean average daily spend per day when traveling abroad, excluding accommodation: US$ 1086
- 97% travel for leisure; 49% for business/education
- 58% stay 2-3 nights, 28% 1 night and 11% 4-6 nights according to hotelier reports.
- 67% prefer to travel independently, as confirmed by hoteliers surveyed indicating a low of 65% (Europe) to a high of 77% (Asia Pacific) of their Chinese guests now travel independently .
How Chinese travelers conduct hotel research
When traveling abroad, Chinese travelers are known to conduct thorough research prior to choosing their destinations, consulting almost five sources of information to help them converge on a final decision. Below is a breakdown of where they gather their research information.
Not only do Chinese travelers conduct their research online, an increasing number of them are doing their booking online as well. Again, the smart phone and its mobile apps are quickly becoming the dominant gateway to the internet.
- 53% now book their hotels online either on a desktop or via a mobile app, either directly with the hotel or via an online travel company.
- 17% book their hotel using mobile apps, an almost 300% increase from 2013. The percentage is even higher (22%) among those under 35 of age.
- Booking through a travel agent has fallen slightly to 34% (20% for under-35s)
- Only 12% book using a hotel telephone.
Below shows a breakdown of the types of accommodation booked by Chinese travelers based on Hotels.com’s worldwide booking data. Rounding out the top three are 3-star hotels (29%), 4-star hotels (28%) and 5-star hotels (17%).
How foods influence their decisions
It is common knowledge that foods play a very important part of their culture for Chinese living at or traveling away from home, as evidenced in the survey results.
- 95% have a meal at the hotel restaurant on their trip. Both travelers and hoteliers agree that restaurants are where most money is spent.
- 73% rate the provision of Chinese specific foods as among the most important service offered at a hotel, with 37% voting for room service options and 33% for Chinese breakfast. Note also there is also a strong desire to experience local cuisine among the respondents.
- Dining is rated the second most important activity when traveling abroad.
Important hotel amenities
The hotel amenities most important to Chinese travelers are room service options (57%), followed by onsite restaurant (55%). Not so much for bars (8%), however.
Important Chinese specific products or services
The majority of the respondents say they are fairly open-minded when it comes to hotels not catering to their specific needs. However, their specific preferences are very much defined where there are choices. Below lists the top 10 most important Chinese specific products or services while staying at a hotel on an international trip, and also how these products or services stack up against their expectations.
Below are the top five Chinese specific products or services most requested by Chinese travelers on an international trip.
Products or services most requested by Chinese hotel guests
Where Chinese travelers pay the most for accommodations
The following lists the top 10 average hotel prices paid by Chinese travelers in 2013 based on Hotels.com’s Chinese website.
Top average hotel prices paid by Chinese travelers by country
Where Chinese are top spenders on accommodations
Based on Hotels.com 2013 internal data, Chinese international travelers were the 7th highest spending nationality on hotel rooms with an average rate of US $169 per room night. They were the top spenders in Australia, Japan, the Netherlands and New Zealand.
Below is the list of countries where Chinese travelers were among the top 10 spenders on accommodations in 2013.
|Countries where Chinese are top 10 spenders on accommodations|
The critical role of internet
A recurring theme of this CITM report is how critical a role internet plays in guiding a Chinese traveler’s decision on choosing accommodations prior to traveling abroad and sharing his/her experiences during and after the trip. In particular, the roles of social media and mobile phones before and after the trip cannot be underestimated. A few highlights:
- 48% research done using online accommodation/travel websites and 47% using online review sites. These two sources are the most relied upon during the selection phase.
- 36% use online booking method to reserve a hotel, 17% through a mobile app.
- 59% rate free WiFi in the hotel as very important; 19% feel that need is not met.
- 91% of Chinese netizens have at least one social media account.
- 84% of them share their experiences on social media during and after their international trip (93% among the young).
- 31% of those aged 35 and under share their experiences on travel review sites.
The chart below breaks down how Chinese travelers share their trip experiences.
How Chinese travelers share their trip experiences
Independent traveler profile
One key message from the CITM report is the growing importance of the independent travelers (FIT). The report removes any lingering doubt about the significance or maturity of this segment. The favorable attributes of this segment effectively preordains that going after this segment will be the most critical battleground for the hoteliers.
- 67% of respondents say they prefer to make their own international travel arrangements. The preference is even more so for younger travelers (81%).
- FIT travelers have a much higher daily spend (US $1288) compared to group tour travelers ($US 679)
- They take longer trips (1.5 vs 1.3 week) than group tour travelers.
- Their trip decisions are influenced by: 19% online review sites, 15% friends and families, 15% online accommodation sites.
There are also different nuances amongst other segments covered by the report, including the under-35s, business travelers, female travelers and shoppers, a topic which will be covered in more detail in future articles. Stay tuned.
As businesses in the travel industry have closed their books for 2013 and start to make plans for 2014, industry analysts and pundits alike are pondering over the year that has just transpired, particularly as it relates to the Chinese outbound travel market. For sure, 2013 has been a notable year again for the Chinese overseas travelers. But, more importantly, what lies ahead for this tsunami of travelers in 2014, and, as usual, the perpetual question – is the trend going to last?
While the official statistics for the entire year are still being tallied up, the numbers based on the first three quarters of last year are pointing to the expected growth trend. The total outbound overseas Chinese travelers are projected to grow by 18% over the year before to 98 million, according to a recent report released by the China Tourism Academy. The same report projected the total dollar amount spent at US$118 billion, smashing yet another previous record of $102 billion established in 2012 which propelled China to the top spot, edging out Germany and U.S. (see $102 Billion – China takes global outbound tourist spenders top spot ).
The continued outpour of Chinese overseas travelers is not a unique trend within the Chinese travel theme. Domestically, the Chinese had also been on the move. An estimated 3.3 billion tourists traveled and spent $430 billion within China’s borders in the past year. Little wonder every step along the Great Wall was filled with people and highways turning into kilometers of parking lots during peak tourist seasons inside the country.
As for the upcoming year, the China Tourism Academy, among other industry experts, is predicting another year of growth in the mid-teens (16% – 18%) for the Chinese outbound market. The prediction would put the total number of outbound travelers to solidly beyond the 100-million milestone.
While no drastic change of course is expected in 2014, barring any black swan event knocking over the apple cart otherwise known as the New Normal global economy, our crystal ball is offering the following five evolutions to watch out for.
1. Continued expansion of the free independent travelers (FIT)
The first prediction is an easy one. As more and more Chinese having already traveled overseas return for more trips, these repeat travelers are more confident than ever and willing to venture beyond what they had experienced in their first trips. If the evolution of the Japanese tourists in the ‘80s and that of the Koreans in the ‘90s are any indication, the size of the independent Chinese travelers will continue to expand. The only difference with the Chinese is the time scale (much more compressed) and magnitude of the numbers involved relative to the two other Asian groups before them.
Another factor causing this trend to accelerate is the new travel regulations which came into effect last year. The law forbids the sale of below-cost tour packages – a common practice by many domestic travel agencies who herd their group tourists through designated shopping outlets from which they earn commission to offset the cost of the trips. The side effect of this new regulation is reflation of package tour prices, in the process eroding the perceived economic advantage of package tours and further tilting the price-value equation in favor of FIT packages.
2. Going deeper and narrower
Whereas the bragging rights for the travelers back a few years ago used to be doing selfies in front of iconic symbols such as the Eiffel Tower or Coliseum, what is cool now might be having themselves and a group of buddies being helicoptered to the top of a pristine mountain to have lunch on a glacier, or a luxury boat and cycling tour along the Rhine where they stay in castles and vineyards along the route.
What this means is that the pace of their trips will slow down. Instead of five cities in seven days, the number of destinations might narrow to one or two, allowing them to smell the flowers, so to speak, along the way. Complementing the must-see’s at destinations, more and more time will be spent on theme based activities which better reflect an individual’s tastes and desires for certain types of immersive experience. Multi-day cycling tours, museum tours, hikes along famous trails and other participatory itineraries will become increasingly popular and sought after.
3. Spreading beyond tier-one destinations
As a group, the ‘been-there-done-that’ repeat overseas tourists are younger, better educated, more affluent, and are eager to venture beyond the standard tourist traps at tier-one destinations. The direct beneficiaries of this emerging trend are the tier-two and tier-three countries and destinations which have been so far left out by the first wave of Chinese tourists.
By definition, non-tier-one destinations are lesser known as less information about them is available. Such is especially true for the amount of information in Chinese. Therefore, the first challenge for these destinations is to raise their profiles so that they are part of the Chinese travelers’ vocabulary and appear as markers on their travel maps.
Along with prediction #2, these two trends will point to further diversification and fragmentation of the travel segment, and which leads us to our next prediction.
4. Intensified competition among destinations
The expanding FIT travel segment, increased sophistication and maturity of the repeat travelers, and continued diversification of vertical travel themes all mean that destination marketing organizations (DMOs) will need to innovate in order to capitalize on these emerging trends. Amongst the DMOs and industry participants, the next battle will be waged trying to win the hearts and minds of the FIT travelers, the prize of which will be better margins over those from packaged tours as well as economic benefits distributed more evenly across regions.
As most commonly known in the high tech industry, being early and on the bleeding edge of innovation can be detrimental to one’s wallet. On the other hand, being late to the game often means fighting over crumbs amongst many other me-too’s.
Destinations late in catching the initial Chinese trend will be fighting in an increasingly competitive landscape trying to position themselves for the next wave of FIT tourists. Some of them might still be weighing the pros and cons of the first wave of Chinese tourists arriving in tour buses on margin-challenged tour packages and wonder if the market is sustainable or worth going after. In the meantime their more innovative and forward looking counterparts are busy marketing themselves to the next wave of FIT travelers whose experience and preference for luxury occupy significant weights in their travel budget calculus.
2014 will witness further widening of the gaps between the have and have-not destinations and individual operators.
5. Increased sophistication of social media marketing
It is well known that the rate of internet user participation is high in China and social media plays an important role when Chinese travelers do their travel research. If these two factoids fail to convince you, the fact that a staggering 91% of Chinese respondents indicated they interacted with social media on their travels, according to a study by hospitality company Accor Hotels, should remove any lingering doubts that social media should be a vital part of your Chinese marketing strategy.
2013 is also the year when WeChat matured from puberty into an 800 pound gorilla. With 500 million users and 90%+ Chinese mobile users having this app installed on their smart phones (incidently, China outsold the U.S. in smart phones last year; another first), WeChat has gone beyond its messaging root and morphed into a full blown one-to-one social network, mobile payment system, social CRM and online-to-offline platform.
The jury is still out on exactly how dominant WeChat will be and exactly what roles it will play, as the platform and its ecosystem of apps are still evolving and mutating at a breakneck pace. The fact that WeChat will be a dominant gateway to mobile internet and a major social media force, however, is now clear and undisputed.
Microblogging, or Weibo, on the other hand, will see its growth moderated, now that it has to share the social media space with WeChat. Does it mean Weibo will fall out of favor any time soon? Not likely. Taper? Maybe.
The question of WeChat replacing Weibo is not quite a valid one as the different nature of the two platforms means that they are designed for different purposes. In fact, social media strategies using both platforms in an integrated and orchestrated manner has been a hot topic in 2013 and will continue to be one this year.
So your organization is putting together a concerted effort to attract those inbound Chinese travelers who have been pouring out of that country and have managed to overtake the Americans for top spot in the total amount of dollars spent abroad in 2012, and you have decided that having a Chinese Weibo account (microblogging account, a cross between Facebook and Twitter) is a good way to reach out to these potential travelers.
If you have outsourced the Weibo management service to a third party, you would find the following two pieces of advice useful – even if they won’t turn your Weibo into a white hot account with a 7-digit following, at least it would help you avoid a PR disaster or becoming a chuckle du jour.
To illustrate what I mean, take the following real life posts from an official DMO Weibo account. The actual account and the texts are blurred out of respect for the destination bureau.
The image to the left is a re-post about a recent auto accident which happened in the city. Apparently a driver on the overpass lost control of her car. It jumped the barrier, went through the guard rail and landed on the highway of traffic below, resulting in some serious traffic jam from midday to midnight on that day. Not sure if anyone died as a result.
And the message of the post: watch out for falling objects from above while driving in this town.
OK, next one – same Weibo account, different day.
This one was also a re-post about the not so wonderful effects of global warming, such as the rising of the sea level. The original post describes a website with an interactive map which allows one to play with the sea level to find out how much an area gets affected and covered by the rising water. The rhetorical question was, how much would our wonderful destination city still remain dry if the water level goes up by four meters? The answer was, surprise surprise, not too freaking much (as in sweet friendly all). The author rubbed it in with a “pretty scary” comment and threw in a bawling emoticon for good measure.
I didn’t make this up folks. Sensational posts? Maybe. Inspirational to a prospective visitor? Well…. you decide.
Which brings us to the couple of takeaways from this article.
Pick the right service provider if you have to outsource the Weibo account
This advice sounds a little obvious but it takes on an added degree of importance because of the language aspect.
It is not unusual for most organizations to lack in-house resources who take care of social media marketing, let alone in a foreign language. In addition, it is also not uncommon that the company you outsource the management of your Weibo account to also outsources your account to yet another third party.
In our experience in dealing with social media writers and language translators here and abroad, unless you are dealing with the end persons directly or have all the kinks ironed out with your third party service providers, you would have to be prepared to deal with inconsistent quality and surprises from time to time.
Whereas a questionable post in English might get picked up fairly quickly by you, your fellow workers or your friends, a same post in Chinese might go undetected for a long time as most people in your office can’t read it. The last thing you want is for the feedback to be coming from the customers or, worse yet, no feedback at all. By the way, the above posts are still published and alive out there.
Make sure you do your due diligence on the outsourcing company and understand how they will ensure quality. If you know or suspect they are the middleman, make sure you will be able to maintain a direct and responsive channel with the gatekeeper. Having the gatekeeper in the same time zone and understand your business culture would allow for speedier access and more effective interactions should problems arise.
Remember, know your pilot. Otherwise you are flying completely blind.
Make sure you have a coherent content strategy
The failure of #2 is often a key contributing factor of #1.
Judging by the Facebook posts and Tweets out there in the English speaking world, it is evident that a lot of businesses are struggling to maintain a steady stream of interesting and engaging content to post day in and day out. It is pretty damn hard to write something interesting when there is a lack of content from which to source.
Now you can imagine the guy or gal who was in charge of your Weibo account. He had no content to source from. He needed to talk to you but you were already in bed, and, in any case, you spoke Greek as far as he was concerned. In his desperation to come up with something, anything, he did a keyword search on the city and grabbed the first two results which happened to be highway hell and high water. So hell and high water it was.
So regardless of whether your content consists of texts, images, videos, something that parallels Facebook/Twitter posts, articles from journalists, bloggers or third party grass-root writers, having a rough editorial calendar ahead of time detailing the frequency of posts, the types and how they are sourced would make sure that the posts are relevant and timely and the content pipeline is not subjected to bouts of feast or famine.