:00:07. > :00:09.One in ten tourists worldwide are Chinese.
:00:10. > :00:11.That number is set to double by 2020.
:00:12. > :00:16.How are Chinese travellers transforming
:00:17. > :00:18.the global tourism industry? Here in Hainan, I am Linda Yueh
:00:19. > :00:44.and we're Talking Business. A warm welcome to the programme.
:00:45. > :00:49.The rapid growth of Chinese tourists is transforming the global industry.
:00:50. > :00:56.We hear from CEOs of global hotel chains, plus the head of China's
:00:57. > :00:59.largest online travel site. And former basketball star Yao Ming
:01:00. > :01:04.tells us what he thinks of sustainable development.
:01:05. > :01:06.But first, I went around Hainan, known as China's Hawaii, to find
:01:07. > :01:18.out how tourism has changed. Braving the crowds.
:01:19. > :01:25.The Hawaii Hainan's beaches are teaming with tourists.
:01:26. > :01:30.Can it last? TRANSLATION:
:01:31. > :01:33.They have been everywhere domestically.
:01:34. > :01:36.So new places, like Dubai, are very popular.
:01:37. > :01:40.They've already been to Hong Kong, Macau, Japan and Korea, so they are
:01:41. > :01:41.interested in new destinations. People from Hainan want to
:01:42. > :01:47.travel internationally. And they have.
:01:48. > :01:52.Nearly 100 million overseas trips were taken
:01:53. > :01:55.by Chinese tourists last year. By 2020, the number
:01:56. > :02:01.of trips is also expected to nearly double, to 200 million per year.
:02:02. > :02:06.They spent more than any other travellers, about $1 billion.
:02:07. > :02:11.And this figure is expected to triple.
:02:12. > :02:14.This explosive growth in tourism has happened quickly.
:02:15. > :02:19.20 years ago, this kind of place would be where
:02:20. > :02:21.you would find Chinese tourists. That is because the government
:02:22. > :02:27.tightly controlled the movement of its people overseas.
:02:28. > :02:30.But now, it's all changed. That means that other countries
:02:31. > :02:35.and their businesses are keen to compete with China to cash in
:02:36. > :02:37.on the tourist dollars. The Chinese like Cambridge,
:02:38. > :02:42.they like Oxford. They are interested in Bath.
:02:43. > :02:45.They are interested in our history. We have to make sure that travel
:02:46. > :02:48.agents can explain that in a compelling and exciting way,
:02:49. > :02:54.particularly because the volumes, we hope, are going to triple by 2020.
:02:55. > :03:00.A Chinese love story, retold in a Broadway style.
:03:01. > :03:07.This is China's attempt to appeal to travellers.
:03:08. > :03:08.But will the fairy tale ending be enough to keep
:03:09. > :03:17.the audience coming back for more? How are the taste is of Chinese
:03:18. > :03:18.tourists changing? And what are
:03:19. > :03:33.their favourite destinations? I caught up with CC Zhuang, the head
:03:34. > :03:41.of cumin, China's largest travel site. Chinese travellers are more
:03:42. > :03:49.interested in going overseas. We see tremendous growth in overseas
:03:50. > :03:53.travel, especially coming from the second`tier cities. The smaller
:03:54. > :04:01.cities, not Beijing or Shanghai, but some of the smaller places? Yes,
:04:02. > :04:05.places like Chengdu. So I think it will be one of the trends over the
:04:06. > :04:09.next few years, particularly the focus in south`east Asia, Australia,
:04:10. > :04:14.Japan and South Korea, which are in a similar time zone. More than
:04:15. > :04:20.Europe or the US? Yes, much more than Europe and the US. They still
:04:21. > :04:26.have much more time lapse, more people flying as a group. It is much
:04:27. > :04:32.less frequent travellers. For a similar time zone, Australia, New
:04:33. > :04:35.Zealand, we see very high growth in independent travellers. They can
:04:36. > :04:45.just book for themselves and just go. Europe predominantly is catering
:04:46. > :04:49.to Chinese rather than international travellers, going to your website.
:04:50. > :04:53.You become the biggest in China already. Are there plans to change
:04:54. > :04:57.the site so you can attract more global visitors? Global visitors is
:04:58. > :05:01.certainly one of our long`term targets. But I think in the
:05:02. > :05:07.short`term and mid`term, we are still going to focus on Chinese
:05:08. > :05:15.travellers. I think I can see that the travel technology is undergoing
:05:16. > :05:19.significant disruptive changes. When people talk about travel, it is only
:05:20. > :05:23.about flight booking, hotel booking. But that is only part of the travel
:05:24. > :05:30.experience. That is a reservation before the trip. You can do that
:05:31. > :05:37.with a PC, only before you get in the taxi and go to the airport. At
:05:38. > :05:41.the terminals, the Company can no longer engage you. At the mobile
:05:42. > :05:46.penetration, you will be able to contact consumers through the life
:05:47. > :05:52.cycle of the trip, in terms of taxi calling, grounding, destination
:05:53. > :05:56.services, restaurants, bars, destination theme parks. So, a lot
:05:57. > :06:01.more service, we can provide for consumers. If you look at it this
:06:02. > :06:07.way, imagine, ten years down the road, every person travelling is
:06:08. > :06:15.somebody wanting to execute this experience. We have wisdom, mobile,
:06:16. > :06:19.we know where the consumers eating, what he is doing, what his schedule
:06:20. > :06:24.is. The conditions change, the weather changes, you know, a special
:06:25. > :06:29.event happens, we can inform consumers through mobile
:06:30. > :06:33.applications. If there is some payment, they can always go through
:06:34. > :06:37.our payment centre in China. We can do all of the customer protection
:06:38. > :06:42.for them. It's an exciting world. Imagine, you are helping millions of
:06:43. > :06:48.Chinese people learn and unfamiliar land. They are doing some itinerary
:06:49. > :06:54.arrangement to enjoy the time. So, I think there are some evenings we can
:06:55. > :06:59.do for Chinese users. For the next ten years, we are going to focus in
:07:00. > :07:03.China to help consumers to really enjoy their travels overseas, and
:07:04. > :07:09.domestic. A little bit more about your business, you founded the
:07:10. > :07:16.company, but you decided to sell majority stake to the big Chinese
:07:17. > :07:20.search engine. Talk me through that, getting a shareholder, going public,
:07:21. > :07:29.those kinds of things that you have done, that you are thinking about.
:07:30. > :07:33.From a personal point of view, you're going to grow up, at a
:07:34. > :07:42.certain point you go to face some competition. If you are facing some
:07:43. > :07:47.very strong competitors, you're going to get some thing called a
:07:48. > :07:53.prisoner's dilemma. If you are in a prisoner's dilemma, the best ways to
:07:54. > :07:56.find out how to get out. Just a simple competition is no longer help
:07:57. > :08:06.for each party. I think with a battle situation, travel is such a
:08:07. > :08:15.large category, the battle is done, China is interested. They have been
:08:16. > :08:24.in the market aggressively. As a smaller company, we are about five
:08:25. > :08:30.or eight years behind Baidu. I think we have to figure out a strategy to
:08:31. > :08:39.get out of the prisoner's dilemma and try to maximise the future. It
:08:40. > :08:45.turned out to be a good strategy. As of today, we are the leading travel
:08:46. > :08:52.search engine in China. Moving forward, I think we can do more
:08:53. > :08:55.things with our partners. Finally, what is the single biggest
:08:56. > :09:02.requirement for Chinese tourists is going overseas? Food. Food,
:09:03. > :09:07.restaurants. Chinese? Chinese, particularly. Not Chinese food, that
:09:08. > :09:12.you have to provide at least half Chinese food. I noticed there are
:09:13. > :09:18.some restaurants trending in the Western world. It's called
:09:19. > :09:22.half`half. They have some Chinese food and some local food. The
:09:23. > :09:30.Chinese stomach is probably the most stubborn thing in the world. I think
:09:31. > :09:37.travel providers have to refine their recipes. That was CC Zhuang.
:09:38. > :09:43.For Chinese tourists, visas are a perennial issue, particularly when
:09:44. > :09:47.travelling to the US and Europe. But the chief executive of Hilton Hotels
:09:48. > :09:53.says the industry is pushing for change. You look at the US as a
:09:54. > :09:59.great example. Just a year ago, a little over a year ago, the average
:10:00. > :10:03.wait time was 60`90 days to get a visa. I don't know about you, but
:10:04. > :10:07.it's a long time. It costs you thousands of dollars in off`air, you
:10:08. > :10:10.have to stay in a hotel just to get a visa, then you have to wait 90
:10:11. > :10:15.days, if you are lucky enough, you get one. Most people are going to
:10:16. > :10:19.say, I'll try another option, that's just too hard. We worked hard with
:10:20. > :10:26.the US State Department to increase staffing at consulates in China. As
:10:27. > :10:32.a result, over the last year or two, the wait times are now under one
:10:33. > :10:37.week. So, what do you see? A huge increase in Chinese travellers. Our
:10:38. > :10:40.hotels alone, last year, we saw over a 50% increase in Chinese travel
:10:41. > :10:46.just because of the wait times. There is more to do there. The
:10:47. > :10:50.demand is increasing. 100 million is going to 200 million. We have to
:10:51. > :10:53.continue, not just in the US but in Europe and other destinations around
:10:54. > :10:57.the world, we have to continue to be smart about the use of technology
:10:58. > :11:03.for issuing a visas, increasing the number of consulates, increasing
:11:04. > :11:10.staffing levels to continue to meet demand. But I think we are making
:11:11. > :11:16.terrific progress. How our global hotel is responding to the growth of
:11:17. > :11:19.Chinese tourists is? And what are the changes mean for China's
:11:20. > :11:24.domestic market? I caught up with the chief executive of
:11:25. > :11:32.Intercontinental Hotels, to find out how they are catering to Chinese
:11:33. > :11:37.taste is. In some ways, tourists and people that stay in hotels want the
:11:38. > :11:40.same things. The basics of safety, security and consistency. That is
:11:41. > :11:43.one of the reasons why you are seeing the global brands, not just
:11:44. > :11:47.us, but the global brands taking a bigger share of the market. So,
:11:48. > :11:54.there is a bit about giving good hospitality services. I think with
:11:55. > :11:58.the Chinese, it is a relatively new phenomenon, as the middle`class
:11:59. > :12:03.rose. They are quite particular about some things they want when
:12:04. > :12:07.they travel. We have a China Ready programme. Being the biggest global
:12:08. > :12:12.operator in China, we are very well placed for Chinese customers who
:12:13. > :12:15.know our brand. A lot of them feel they want their local brands, they
:12:16. > :12:19.want Chinese food, they want to be treated appropriately. Mandarin
:12:20. > :12:24.speakers, some of those basics. It's not that dissimilar to many other
:12:25. > :12:30.travellers. I think it's about the fast growth and making sure that you
:12:31. > :12:37.are delivering and experience to the brand they are used to in the
:12:38. > :12:41.country they come from. China, internal tourism has grown a great
:12:42. > :12:48.deal. It How do has. You think it has changed and will change? The
:12:49. > :12:53.outbound is it a big number, the internal numbers are enormous.
:12:54. > :12:57.Again, what we find, interestingly, is that, particularly the growing
:12:58. > :13:01.middle`classes, they absolutely want that consistency of this
:13:02. > :13:07.international brand. We have 200 hotels in China. 200 in the
:13:08. > :13:12.pipeline. Second biggest market... After the US? We have been here 30
:13:13. > :13:18.years now. We launched a new Chinese brand which is understanding that
:13:19. > :13:22.there those international qualities are important and consistency is
:13:23. > :13:27.important. Chinese people want Chinese food and a Chinese
:13:28. > :13:31.experience. It's more than localised brands, it's about downstanding what
:13:32. > :13:34.the consumer wants. There is this always impression that global brands
:13:35. > :13:39.do very well in China, including yours, against a Chinese`owned
:13:40. > :13:45.managed hotels? If you look at consumers. We did a a survey. We
:13:46. > :13:51.called our trends report in January, consumers who we spoke to around the
:13:52. > :13:58.world, China, UK, Germany, India, US, they want definitely want the
:13:59. > :14:03.security of this global brand. It stands for a trust, a trust mark.
:14:04. > :14:09.They want localisation as well. They want a brand that is global, local
:14:10. > :14:13.toll their market. The food is appropriate, setting is appropriate.
:14:14. > :14:19.They want the personal touch, which is not about the right flavour of M
:14:20. > :14:24.M's or apples in your room, it's about feeling personal. Which is why
:14:25. > :14:29.this need we saw through our research of what Chinese customers
:14:30. > :14:33.want led to the launch of the brand. It's about incite into the
:14:34. > :14:37.customers. Some want local global brands, many don't. I think you have
:14:38. > :14:41.to listen to your consumer as a global organisation. One of the
:14:42. > :14:45.things about China many things about China, of course, one of the things
:14:46. > :14:49.about China for global businesses is that it's a very difficult market.
:14:50. > :14:55.How have you found it? You have been in China for so long, in terms of
:14:56. > :14:58.competing in that market? Is regulation, changes in terms of
:14:59. > :15:05.policies? I mean, it is difficult, but I think as a global business our
:15:06. > :15:19.whole business model is partnership. We have 4,700 hotels our main brand,
:15:20. > :15:23.we own seven out of 4,700. It's about partnership. We choose
:15:24. > :15:27.carefully who we work with. Work with the right local partners who
:15:28. > :15:30.own the market. In China, yes, it's a different system. The government
:15:31. > :15:35.has been very clear. Travel and tourism is one of the five pillars
:15:36. > :15:38.of economic growth. They have put resources, put finance behind it.
:15:39. > :15:43.They encouraged it. They recognise you cannot grow an economy, you
:15:44. > :15:48.can't urbanise an economy without that. That has been helpful to our
:15:49. > :15:53.industry. Government has been clear about what it wants. We have gone
:15:54. > :15:57.along with that. What do you see is the fastest growing market for
:15:58. > :16:01.tourism in the world? For tourism? Our business, if you look globally,
:16:02. > :16:05.half business, half tourism in that sense. So there is no question I
:16:06. > :16:10.think probably China is right up there. Both business and tourism?
:16:11. > :16:14.Both business and tourism. The China outbound into other parts of Asia is
:16:15. > :16:18.very big. Also, look at the Maldives now, it has become a China
:16:19. > :16:21.destination, which it wasn't before. It's understanding the travel flows
:16:22. > :16:27.and those needs. China is at the heart now of our business and will
:16:28. > :16:34.be for many years to come I think. That was Richard Solomans. How have
:16:35. > :16:40.holidays changed for Yao Ming and his family? Since retiring from the
:16:41. > :16:44.MBA he has joined a body advising the Chinese government and still
:16:45. > :16:53.commands millions of dollars worth of endorsement deals. I had a chance
:16:54. > :16:59.to sit down with a Chinese star. The last 15, 20 years China become a
:17:00. > :17:08.rising power. People become richer than before. After that, you know,
:17:09. > :17:16.including me, want to see the world. The world, everywhere on this
:17:17. > :17:21.planet. I heard recently the number is somewhere around 100 million
:17:22. > :17:31.people cross the border from China last year to visit another country,
:17:32. > :17:36.another area as a tourist. I think it becomes a culture in China. I
:17:37. > :17:43.remember when I was young, when holiday came we would say ` let's
:17:44. > :17:49.visit another uncle's family, let's visit another family members family
:17:50. > :17:54.and visit our cousins. Now, it's, which city is our next stop. That is
:17:55. > :17:59.how it has changed for Chinese It's a people. Change, I think, that has
:18:00. > :18:03.been fairly recent, isn't it? Because people think of, sort of,
:18:04. > :18:07.the fast growth in China, I think that when you are living here and
:18:08. > :18:13.you see the middle`class develop, I think the pace of change is really
:18:14. > :18:18.quite extraordinary? Talking of the middle`class, like you say, that is
:18:19. > :18:26.a major power for any country. Any country. The number, the numbers are
:18:27. > :18:32.very big, particularly in China, 1.3 billion population here. The
:18:33. > :18:38.middle`class can be one billion, one day. What kind of a business
:18:39. > :18:47.opportunity can create off and also can bring the benefit to all those
:18:48. > :18:50.tourism cities such as here or maybe around ice Asia or even in the
:18:51. > :18:56.world. I think that's a very bright future. I wanted to ask you a little
:18:57. > :19:01.bit about sports men and women in China who are becoming global
:19:02. > :19:07.figures in tennis, in track and field, of course, you know, you are
:19:08. > :19:12.the famous son. How has that changed? Do you expect more Chinese
:19:13. > :19:28.athletes to become global figures? Let me explain a little bit. In the
:19:29. > :19:34.past, some sports stars have been heroes for us. I remember the names
:19:35. > :19:40.when they won Gold for Team China we were all very excited about it. We
:19:41. > :19:57.almost like worshipped them right there. I mean, but back to old days,
:19:58. > :20:05.I must say (inaudible) they will be labelled as a national hero. They
:20:06. > :20:12.are living a very sportsman, they are living in a small box of a life,
:20:13. > :20:17.training, training and living in a small area. Their folks are there.
:20:18. > :20:24.They are very little to touch outside. Today I would say our
:20:25. > :20:30.generation is more has had more character. I'm sorry, I should not
:20:31. > :20:53.use that word "character." Personalities. Our talking and our
:20:54. > :20:57.acting is more like ourself. Not because we change, we have more
:20:58. > :21:03.flexibility to do what we like. What do we like to do. What we like to
:21:04. > :21:09.say. I believe that path will never change. Speaking of the country, do
:21:10. > :21:17.you have concerns about China, as it changes so rapidly and dramatically?
:21:18. > :21:32.Yes, I worry. Like you said, I'm worrying about that, but I'm glad to
:21:33. > :21:39.see that kind of topic is on a panel, or the national meetings,
:21:40. > :21:49.they all have an agenda, a topic about how can we (inaudible) country
:21:50. > :21:58.sustainable. We cannot build anything we want everywhere. We have
:21:59. > :22:02.to think about 50 years from now. 1 00 years from now. It's taking time,
:22:03. > :22:07.but I'm glad that already people are but I'm glad that already people are
:22:08. > :22:13.already starting to think about it. That was Yao Ming, like his family
:22:14. > :22:18.millions of Chinese travel abroad. For an industry it means adapting to
:22:19. > :22:23.Chinese tastes, particularly the need for Chinese food. But it also
:22:24. > :22:28.raises challenges for China to keep tourism dollars at home. That is all
:22:29. > :22:37.we have time for. Check out our website and me on Twitter. Join us
:22:38. > :22:43.next time for more Talking Business with me, Linda Yueh.
:22:44. > :22:49.Good evening. Most of us saw rain at some stage during the day. Some of
:22:50. > :22:53.that rain was quite heavy and thundery. That band of rain will
:22:54. > :22:55.clear away from the far north of the United Kingdom, leaving behind a lot
:22:56. > :22:57.of dry weather. There