International luxury hotel chains are rapidly expanding in China anticipating tourism revoke after COVID.
Luxury hotels want to take advantage of the increased number of tourists in China in 2023
Despite being the main competitor of the USA, China is still in the middle of a social and economic transformation due to the fastest-growing middle class. The rise of a new middle class with enormous purchasing power has involved the brands’ expansion into the Chinese market, which wants to satisfy the purchasing desires of those potential consumers. Nowadays the number of middle-class people is 500 million but in 2024 it is expected to increase to 1.75 billion.
Companies don’t want to lose their chance in 2023, therefore, international luxury hotel chains are making more efforts to take advantage of a growing Chinese middle class with luxury desires.
How to win back Chinese tourists in 2023?
1. Restore your Mandarin website and make sure it works smoothly in China
2. Check your account on Ctrip or Qunar, make promotions
3. Offer discounts on your WeChat and Red accounts for old subscribers and their invitees
4. Develop a special program to invite your Chinese guests
Hotel chains are expanding all over China
Specifically, hotel chains are expanding their business towards second and third-tier cities in China to catch this population. That’s why, hotels like JW Marriot, Ritz-Carlton, Sofitel or Wanda are already building new locations or have expansion projects in those cities.
For instance, the Marriot hotel chain, to offer a luxury experience to its guests, has restored a hotel of 454 rooms in Chongqing which opened its doors in December.
Most of the openings will be in second and third-tier cities such as Chongqing, Chengdu, Tianjin, Ningbo, Yiwu, Changzhou or Zhuzhou, as reported by Simon Cooper, president and managing director of Marriott International Asia. These cities have been chosen due to their rapid economic development.
IHG surpassed the milestone of opening its 600th hotel in Greater China, up from 500 in only one and a half years, and has stayed committed to a long-term “in China for China” strategy despite the pandemic’s comeback across the nation. IHG has already established a solid domestic company with 618 hotels and 474 more under construction, giving it a footprint of over 1,000 hotels and a presence in more than 200 locations.
Sofitel, another hotel chain, has already built eight hotels in China, which will open in 2024 while Starwood Hotels & Resorts, an international luxury company, also planning to double the number of hotels it operates in China in the next two years.
There are more luxury hotels such as Tree Hotel and Resorts which want to be part of this economic change. That’s why this brand will open hotels in Yangshuo and Huangshan during the next year.
In addition, business travel is rising steeply which also increases hotel revenues. During the last year, work-related travel spending in China was around $224 billion.
Over the last few years, Chinese domestic tourism has grown and this fact has boosted the demand for five-star hotels in second and third-tier cities. Hotel industry revenues in China have grown up to 9.3% annually and this year is estimated revenue of $47.7 billion.
International hotel chains have increased their number of properties to satisfy the luxury desires of the new middle class. Nonetheless, building hotels is not enough to attract Chinese consumers, that’s why it is essential to develop marketing strategies to reach out to those potential guests.
If you want to take advantage of this growing Chinese middle class, don’t hesitate to contact us, we can help you to promote your brand.
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