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Global Marketing of China Tourism

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Chapter 1
Global Tourism Marketing
Opportunities and Trends
What are the marketing opportunities
available to China’s destination
management organizations (DMOs) in the
future? What are the trends in international
tourist markets and in the marketing aimed
at them? Part 1 of this book answers these
questions in the context of attracting more
international visitors to China. The
following topics are covered in this
introductory part of the book:
• Recent trends in world tourism
• Trends in international tourist arrivals to
China
• Market trends
• What is destination management?
Recent Trends in World Tourism
World tourism rebounded in 2010 from the average annual growth rate for 1995-2020
effects of the global economic and
financial crisis of 2008 and 2009.
According to IPK International’s World
Travel Monitor ®, outbound trips were up
7% in 2010. The UN World Tourism
Organization (UNWTO) reported a similar
upward trend in 2010. The UNWTO World
Tourism Barometer in February 2011
reported a 6.7% increase in international
tourist arrivals in 2010 over 2009. Total
international tourist arrivals in 2010 were
935 million, the highest annual level ever.
The Asia and Pacific region accounted for
22% of the world’s international tourist
arrivals in 2010 according to UNWTO.
There were 204 million international tourist
arrivals in Asia and the Pacific in 2010, up
13% over 2009, and the highest ever
volume in history.
World tourism is expected to continue to
grow at a healthy rate from 2011 to 2020.
UNWTO has predicted that the growth in
international tourist arrivals in 2011 will be
from 4% to 5%.
UNWTO’s Tourism 2020 Vision predicts
that international tourism arrivals will climb
to 1.6 billion in 2020. The average annual
growth rate in international tourist arrivals
from 1995 to 2020 was forecast by UNWO
at 4.1%. For East Asia and the Pacific, the
is estimated to be 6.5%.
Trends in International Tourist Arrivals
to China
Trends in Total Arrivals
The number of foreign tourist arrivals to
Mainland China in 2010 was 26,126,900.
This was a 19.1% increase over 2009. The
number of foreigners staying overnight in
2010 was 21,276,400; up 20.2% over
2009. These figures do not include
compatriots from Hong Kong, Macau, and
Taiwan.
1
Trends in International Tourism Arrivals to China
The general trend in foreign tourist
arrivals to China from 2000 to 2010 has
been one of significant growth; however,
declines were experienced in 2003, 2008,
and 2009.
Source: CNTA
Countries of Origin of Foreign Tourists to
China
Korea and Japan are the two most
significant countries of origin of foreign
tourists to Mainland China. Together they
accounted for 44% of all foreign tourist
arrivals in 2010. Russia and the USA
were in third (13%) and fourth (12%)
spots. Malaysia and Singapore were
ranked in fifth and sixth, at 7% and 6%
respectively.
The remaining countries in the top 10
sources of tourist arrivals in 2010 were
Vietnam, Philippines, Mongolia, and
Canada.
Australia ranked in 11th position and the
European countries of Germany, UK, and
France were in 13th, 14th, and 17th spots
respectively.
Source: CNTA
Other countries with significant tourist
arrivals to China are Thailand, Indonesia,
India, and Myanmar. Overall, the majority
of the foreign tourist arrivals to Mainland
China at present are from other parts of
Asia. Long-haul tourists from outside of
Asia to China represent a sizeable
proportion of all inbound foreign tourists,
but are still significantly outnumbered by
tourists from other Asian countries. For
example, in 2009 the top 9 inbound long-
haul country markets (USA, Australia,
Canada, UK, Germany, France, Italy,
Netherlands, and Sweden) represented just
21.7% of all foreign tourist arrivals to
Mainland China.
2
Trends in International Tourism Arrivals to China
Forecasts of Future Tourist Arrivals to
China

The prospects for further and continuing

growth in foreign tourist arrivals to China
are excellent. China is perceived by most
foreigners to be a fascinating
international tourism destination with rich
history, cultural, and natural resources. In
a worldwide context, China is also
thought to be a relatively safe and secure
place for foreign travelers. Source: UNWTO

First-ranked in world by 2015

Mainland China received 55,664,500

overnight “inbound tourists” in 2010. This
was composed of 21,276,400 foreign
tourists and 34,388,100 compatriots from
Hong Kong, Macau, and Taiwan. China
climbed from the 11th rank to the 4th rank
in inbound tourist arrivals between 1990
and 2009. It surpassed the UK, Italy, and
other major international tourist
destinations in achieving this. In 2010, Sources: WorldHum; China Daily; The
Telegraph; People’s Daily; Global Economic
China was in 3rd rank having overtaken Intersection; Thaindian News; Xinhuanet; Nexus
Spain. Holidays

It is expected that China will surpass the
USA before 2015 and then be in the 2nd
rank. In fact, the UNWTO predicts that
China will also have more inbound
tourists than France in 2015 and
therefore will be first ranked in the world.
UNWTO projects that China will have 130
million inbound tourists by 2020.
So the prospects for inbound tourism in
Mainland China are excellent. There will be
great opportunities for many DMOs to
attract more international tourists in the next
five years. The DMOs with the most
professional marketing practices are likely
to be the most successful.

3
Market Trends
A DMO must dig deeper to
develop a more detailed
understanding of markets
Source: Shutterstock
Most DMOs in China are not
engaging in sufficient market
analysis
Statistics on tourist arrivals are not
enough when a DMO is engaged in a
highly competitive international
marketplace. A DMO must dig deeper to
develop a more detailed understanding of
markets. DMOs need to take a look
“behind the statistics” to know how and
why international tourists are changing.
Winning marketing strategies frequently
are a result of using good market
research results in an appropriate and
creative way. It is especially important for
all DMOs to know the latest trends in
markets according to the following
characteristics:
• Demographics
• Countries of origin
• Trip purposes
• Trip planning and travel arrangements
• Psychographics and lifestyles
• Special interests
• Technology uses
Unfortunately, most Chinese DMOs are
not engaging in this level of international
market analysis at the current time.
Perhaps this is because the domestic
market is expanding so quickly and
DMOs do not need feel the need to invest
in market research on international
markets that still represent a small
proportion of total tourism demand.
However, as international tourist levels
continue to grow, this research will
become more valuable since competition
among destinations will intensify.
4
Market Trends: Demographics
Aging but engaging: Older age groups are more willing to travel
than previous generations and are
The Baby Boomers interested in active and adventurous travel
experiences.
The populations in most Western and
some Asian-Pacific countries like Japan
and South Korea are aging. The largest
group of older consumers is known as
the “Baby Boomers” and these people
were born between 1946 and 1964.
There are now approximately 450 million
Baby Boomers in the world. By 2020, 700
million people worldwide will be over 65
(Deloitte Touche Tohmatsu).

Source: ElderTreks

ElderTreks (Small Group Exotic Adventures

for Travelers 50 Plus) is a good example of
a tourism company that has done a great
Source: Canadian Travel Commission
job in attracting the adventurous Baby
Boomers. The company, based in Canada,
In 2009, 42.2% of the foreign tourist
was established in 1987 and offers active
arrivals to Mainland China were aged 45
holiday tours in 80-plus exotic destinations
years and over. Approximately, 36.3% of
around the world, including eight tours to
all the arrivals were in the Baby Boomer
Mainland China.
category. As this is a growth market,
China’s DMOs need to pay greater
attention to these people in the future.

5
Market Trends: Demographics
An extra-special market:
GenX
Source: Shutterstock
Source: Virginia Tourism Corporation
Generation X (GenXers) are people in the
age group that followed the Baby
Boomers. They were born from 1965 to
around 1979 and are also sometimes
called the Baby Busters. They are the
second-largest demographic travel market
after the Baby Boomers for the Asia-
Pacific region, including China.
GenXers are known to be very
independent thinkers and more
adventurous and tougher to please than
the Baby Boomers when traveling.
GenXers make extensive use of the
Internet to find travel information and
make bookings. They especially like using
the social media including Facebook,
Twitter, and various other blogs. Being in
the age range from 30 to 45, GenXers
often have children and travel as families.
A good example of marketing to
Generation X is provided in the “LOVE
campaign” being used by the Virginia
Tourism Corporation (VTC) in the USA.
VTC has very successfully used the
slogan of “Virginia is for Lovers” since
1970; aiming mainly at the Baby
Boomers. The “LOVE campaign” is
focused on GenXers, as VTC has found
from its research that they are more
adventurous and spend more money in
Virginia than the Baby Boomers. The
DMOs’ market research showed that
those traveling with children in Virginia
spent 50 percent more than those visiting
without children.
6
Market Trends: Demographics
Y travel? Generating travel
from the Internet generation
Source: Shutterstock
Source: CABI
Generation Y are those born from
around 1980 to 2000; they are also
sometimes called the Echo Boomers,
Net Generation or the Millennials. This
generation really likes international
travel. For example, a survey by STA
Travel in Australia found that 70% of
Generation Y Australians had already
spent significant time overseas and 65%
intended to travel outside of Australia in
the future.
A survey of international leisure tourists
conducted in Shanghai by Belle Tourism
International Consulting in 2009-2010
found that 30.9% of the tourists (aged 18
and over) were between the ages of 18
and 29. These Generation Y tourists
were the third largest group, after those
45 and over (37.2%; Baby Boomers) and
those from 35-44 (31.9%; Generation X).
Generation Y are especially well known
for their high propensity of taking “gap
years.” This means that they take a year
off for traveling and most often this
involves international travel. Gap years
are usually taken after graduating from
university and before commencing full-
time employment. They are also taken
during work careers; for example, when
transitioning between jobs or employers.
This is an important market for Chinese
DMOs, as these younger people travel
extensively within destinations as their
trip lengths tend to be longer than Baby
Boomers and GenXers.
7
Market Trends: Demographics
“Breakationing” due to time
poverty: Short breaks gain in
popularity
Source: Visit Wales
Source: Virgin Blue Airlines
Source: Bloomington Convention & Visitors
Bureau
With the pressures of modern society and
work, many people have the money to
travel but they do not have enough free
time to take the long vacations that
previous generations did. These people
can be called “cash-rich, but time-poor.”
The recently difficult economic times in
many developed countries have
accentuated this phenomenon, which has
resulted in more frequent and shorter-
duration trips being taken by these busy
people.
This is not a particularly positive trend for
long-haul destinations; but benefits
destinations and countries within a
specific country or region (e.g., within
UK/Europe or South Korea/Asia). For
destinations within China, it will mean that
more travelers from countries such as
Japan, South Korea, and Singapore will
be interested in visiting on weekends and
for trips of three or four nights.
The types of trips made by these
travelers are called “short breaks” or
“breakations” (mixture of breaks and
vacations). For example, the Wales
website shown opposite is a good
example of short-break and weekend trip
marketing in the UK. Breakations with
Virgin Blue is a case from the airline
industry in Australia and the Pacific.
Breakaway Bloomington Indiana is a third
example showing how a destination in the
USA has positioned itself as an ideal
place for short trips and vacations.
8
Market Trends: Countries of Origin
Building with BRICs: Taking
advantage of the travel boom
Source: Shutterstock
The acronym of BRIC refers to Brazil,
Russia, India, and China. They are the
world’s four fastest-growing country
economies. Goldman Sachs, the investment
company, claims to have originated the
BRIC concept. As China shares borders with
both Russia and India, these are obviously
countries of origin with great relevance.
The four BRIC countries are expected to
have above-average growth in outbound
tourism in the next 10-20 years, so they
require special attention among DMOs that
decide to target them. According to Goldman
Sachs, outbound travel from the BRICs will
grow at twice the average rate, and the
market expansion will be especially high for
China and India. The company attributes this
expected growth to huge increases in the
middle classes in the BRIC countries.
Russia is already the third largest
inbound foreign market for China and
can be expected to grow further.
According to a 2009 report, The Russian
Outbound Travel Market, China was the
top destination for outbound trips from
the Commonwealth of Independent
States (CIS). However a report based on
the Russian Federation rated China
behind Ukraine and Turkey in 2008.
India ranked in 17th position in 2009 with
just under 450,000 tourist arrivals to
Mainland China. The top five outbound
travel destinations for Indian travelers
are Singapore, Kuwait, Bahrain,
Malaysia, and the USA. There is very
significant potential to expand the
inbound tourist market from India to
China in the near future.
China is very far away from Brazil so it is
not a surprise that it is still a minor
source market. The top five outbound
destinations for Brazilians are the USA,
Argentina, Uruguay, Chile, and Italy.
Overall, Russia is the largest outbound
market (20.9 million); compared to India
(7.8 million) and Brazil (4.5 million) in
2008 according to Tourism Decision
Metrics. The same company predicts
outbound tourist volumes to grow by
15%, 30%, and 35% by 2014
respectively for Russia, India, and Brazil.
It will, therefore, be very worthwhile for
China’s DMOs to pay greater attention to
these markets in the upcoming years.
9
Market Trends: Trip Purposes
Multi-purpose tourism: The following two articles from the USA
and New Zealand discuss this trend of
Blended travel on the rise
adding vacations and family travel to
business trips. “Add a Vacation to a
Most destination marketers neatly divide
Business Trip” was a Special Advertising
the tourist market into leisure/pleasure and
Section in Business Week magazine.
business/MICE segments. However, this
apportionment of the market is not totally
accurate and the distinctions between the
two segments are becoming increasingly
blurred.

Increasingly, consumers are pursuing

multiple trip purposes and are especially
combining business and leisure on trips.
Again, time poverty is a factor influencing
this trend.

Some have started to refer to these trips

with multiple purposes as “blended travel.”
A survey conducted by Meredith
Corporation in the USA in 2010 found that
77% of business travelers took a family
member or significant other along with
them on their last business trip. Some 47%
did this most of the time.
Source: Business Week
“Add family to the trip” indicates that many
workers in New Zealand are reluctant to
take long breaks from work, so combining
business with pleasure is a good
alternative.

Research has shown that long-haul

destinations experience higher levels of
multi-purpose travel trips. This is
particularly important for destinations in
China when considering inbound business
tourism from Europe, North America,
Australia, New Zealand, and other long-
haul origin countries. China is a highly
desirable travel destination, so foreign
tourists on business trips may seriously
consider bringing family members or
friends along with them. Source: New Zealand Herald

10
Market Trends: Trip Planning and Travel Arrangements
Going it alone: The
increasing popularity of
independent travel

During the past 20 years there has been a

significant increase in the popularity of
independent travel. Sometimes this is
referred to as “free independent travel” or
FIT for short. Actually there are two
somewhat different meanings to the term
independent travel. The first is where a
person travels alone without any
companions; the second is where the
person travels with others but is not part of
an organized group tour with a fixed
Source: Shutterstock (backpacker)
itinerary.
For the second definition of independent
Let’s start with the first definition of travel, 66.5% of all the international
independent travel; i.e., people traveling pleasure tourists to Shanghai were not
alone to China without travel companions. part of an organized tour group (including
Research conducted in 2009-2010 in the 19% traveling alone). For the
Shanghai by Belle Tourism International international business tourists, this figure
showed that 19% of all international was 92.9%.
pleasure tourists to Shanghai were
traveling alone. Some 37.7% of For China’s DMOs, it is important to know
international business/MICE tourists that independent travelers do not use tour
traveled alone. companies, and they may also not work
with traditional travel agencies. Instead,
Solo independent travelers tend to be they rely heavily on information from the
younger and some are what are commonly Web, including social media, and
referred to as “backpackers.” These may independent travel guidebooks such as
be “gap year” travelers from Generation Y, Lonely Planet and Rough Guide. To
as was discussed earlier. However, older communicate with independent travelers,
singles may also be traveling alone and the key information channels that must be
can even be from among the Baby used are the Internet and guidebooks;
Boomers. independent travelers will not be as
effectively reached through the travel
trade.

11
Market Trends: Psychographics and Lifestyles
Getting and staying
healthier: Eating well and
getting fitter when traveling

Consumers are increasingly concerned

about health and wellness and this affects
both their everyday lives and also how
they travel. While traveling, some want to
maintain their fitness levels or just stay
active; and to ensure they keep with their
dietary regimens. Others desire to use
travel to improve their well-being or
lifestyle habits.

This trend has had numerous impacts on

tourism and destinations including the
increasing popularity of spas, medical and
fitness resorts; more active vacation and Source: Shutterstock (vegetarian items)
holiday products including soft- and hard-
adventure; health-oriented menus
including vegetarian meal options; and
greater preference levels for green travel
destinations.

Destinations in China have many

advantages to offer health-conscious and
active travelers. These include Chinese
teas and the great diversity of healthy
foods including many fresh vegetables,
fruits, and fish. The huge variety of
landforms and landscapes offer the
potential for all sorts of outdoor and
recreational activities. Traditional Chinese
medicine and the religious cultures of
Buddhism, Taoism, and Confucianism Source: Shutterstock (active vacations)
provide many important guidelines and
practices for better mental and physical
health as well as for lifestyles and diets.

12
Market Trends: Psychographics and Lifestyles
Decompressing in style: The
spectacular growth of hotel
and day spas

The stress in consumers’ daily lives is

creating a need for pampering and spas
are a way to escape pressures and get
re-energized. Moreover, people of both
genders are seeking different ways of
looking and feeling younger.

According to the International Spa

Association (IPSA), the top 10 reasons for
visiting a spa are:

1. Relieve stress and feel relaxed Source: Shutterstock

2. Pampering and self-indulgence
3. Feel better about myself In addition, China has a long tradition of
4. Redeem gift certificate massage and other related treatments that
5. Improve mental health are associated with Chinese traditional
6. Improve physical health medicine. Exercise regimens such as tai
7. Improve appearance chi from China have also gained great
8. Enjoy a special occasion popularity in foreign countries.
9. Regulate body weight
10. Prescribed by a medical doctor There will be greater potential in the future
for destinations in China to market their
Spas have been popular at least since the spas and related cultures to international
Roman times, but today’s spas have tourists. At the moment, most international
much greater variety and sophistication. tourists are attracted by the culture, history,
IPSA estimates that the number of spas in and natural attractions of China; or visit for
the USA has grown by 261% from 5,700 business purposes. However, there is also
in 1998 to 20,600 in 2009. a great opportunity to attract foreigners that
want to enhance their beauty or mental and
Today’s spas can be divided into two physical well-being, and China is very well
main groups; beauty, healthcare and equipped to serve these tourist motivations
retreat spas; and natural hot springs spas. and needs.
A growing number of both categories of
spas can be found in Mainland China.

13
Market Trends: Psychographics and Lifestyles
Greening with meaning: The
green traveler market is
getting larger

Consumers are showing increasing

concern for the environment and this is
extending into the travel trips that they
take. As a result, the demand for nature- Source: Instituto Costarricense de Turismo
based and ecotourism destinations and
packages is growing.

People who place a special emphasis on

eco-friendly destinations and practices are
sometimes called “green travelers.” The
Green Traveler Study 2010 conducted by
CMI Green Community Marketing, Inc. in
the USA found that green travelers have
Source: Belize Tourism Board
the following characteristics:

• 40% look for a 3rd party certification

that a destination is “environmentally
friendly” (e.g., Green Globe)
• Peer influence has the greatest impact
on travel by eco-conscious consumers,
not advertising
• They feel that Costa Rica is truly a
destination with a green identity

There are many destinations in China that

can take advantage of this trend and tap
into the green traveler market. They can
follow the footsteps of destinations such as
Costa Rica, Belize, and Australia (pictured
opposite) that have had outstanding
success with ecotourism and other types
of nature-based tourism.

Source: Ecotourism Association of Australia

14
Market Trends: Psychographics and Lifestyles
Getting gayer in travel: The The GLBT market is not being particularly
targeted by any destinations in China, so
importance of GLBT tourists
there is great potential for one or more
DMOs to be pioneers and attract these
The gay, lesbian, bisexual, and
tourists. These efforts will undoubtedly pay
transgender (GLBT) is now a mainstream
rich benefits as GLBTs have above-
segment of tourism. Many major tourist
average intentions to travel abroad.
destinations consider GLBTs to be an
important market with great potential. For
example, according to Roy Morgan
Research of Sydney, “the gay and lesbian
market is recognized throughout the
tourism industry as an important niche
segment, representing differences in
holiday behavior, attitudes and yield
opportunities when compared with the
Australian population average.”

Source: San Francisco Travel

Source: Shutterstock
Some destinations are very popular with
GLBT tourists and it is not surprising that
they also do a great job of marketing to
this market segment. They include San
Francisco, New York, and Montreal in
North America; Amsterdam in Europe;
and Sydney in Australia. The San
Francisco GLBT website page has the
Source: Amsterdam Tourism and Convention
welcoming heading of “The gate is always Board
open for you” (referencing the famous
Golden Gate); while Amsterdam has a
“Gay and lesbian stay and play” page.

15
Market Trends: Special Interests
Finding their niche: The
expansion of special-interest
travel (SIT) markets

Special-interest (SIT) or niche travel has

been one of the hottest trends in tourism
in recent times. The main reason behind
this trend has been that consumers’
interests today have become much more
diverse than before.
Source: SpecialtyTravel.com
Some of the SIT segments that have
emerged include the following: The InfoHub Specialty Travel Guide claims
to be the largest Internet portal on specialty
• Adventure travel travel with more than 20,000 items
• Cruise travel included.
• Casino gaming
• Culinary/gastronomic tourism
• Cultural tourism
• Dark tourism
• Ecotourism and nature-based tourism
• Health/wellness tourism
• Heritage/historic tourism
• Industrial tourism
• Religious tourism
• Voluntourism
• Wine tourism

There are many other SIT activities and Source: InfoHub.com

segments and two excellent sources of
information on these are
SpecialtyTravel.com and InfoHub.com.
SpecialtyTravel.com (The Specialty
Travel Index) has information on more
than 330 travel interests/activities
worldwide.
China has enormous future potential to
develop special-interest travel for
international tourists; but as yet not enough
has been done to develop and market SIT
products within Mainland China.

16
Market Trends: Technology Uses
Looking and booking: The
Internet has become the
most important venue
Internet marketing is part of the application of
information communications technology (ICT)
and has several elements that include
websites, e-mail, and social media.

There were 1.97 billion Internet users in

the world in June 2010 (Miniwatts
Marketing Group). Asia is the biggest
regional market with 825 million users.
However, Internet penetration is highest
in North America, Oceania/Australia,
and Europe.

Based upon surveys conducted by Belle

Tourism International Consulting with
international visitors to China, websites
and the Internet are the most important
information source for planning trips to
China:
• Websites and the Internet: #1 rank
• Guidebooks: #2 rank
• Friends and relatives: #3 rank
• Travel agencies: #4 rank
• Tour operators: #5 rank
• Blogs of other people: #6 rank
• Magazine articles: #7 rank
• Newspaper articles: #8 rank
• Marketing materials from tourism
bureau: #9 rank
• Advertising by tourism organizations:
#10 rank
Source: Shutterstock (multiple functions of
websites)
Because international tourists are
increasingly using the Internet and smart
phones to get travel and tourism information
and to make bookings, every DMO needs to
develop an integrated e-business strategy.
For DMOs in China this means having
effective websites in multiple languages;
initiating multi-lingual e-mail marketing
communication programs; making extensive
use of social media websites and other
discussion groups; providing applications
(apps) and other information services
through smart phones; and implementing
other ICT elements.

Therefore, in terms of reaching and

communicating with potential
international tourists to China, the
Internet is now the most important
Source: Shutterstock (e-mail marketing)
channel for DMOs in China to use.

17
Market Trends: Technology Uses
Meet you online: Social
networking is connecting
the world

There is no doubt that social networking

on the Internet has drawn in millions of
people around the world. This has had a
huge impact on the volume and types of
information available about tourism
destinations. Additionally, it has
significantly affected how DMOs are
marketing to international tourists.

Through blogs and micro-blogs,

consumers themselves have become
travel writers and critics. For many
people, blogging is not only a way to
communicate with others; but it has also Source: Shutterstock (social networks connecting
become a pastime or hobby. For DMOs, people worldwide)
blogs are a good source of information
about tourists’ satisfaction and
experiences in their destinations.

Social media or social network

marketing now is a vital part of
destination marketing and almost all
international DMOs are heavily engaged
in this information and promotion
channel. However, it is obvious that
China’s DMOs have yet to become fully
active in social media marketing and lag
at least 5 to 10 years behind their
international counterparts in this
respect. This is a situation that needs to
be quickly remedied for China’s DMOs Source: Shutterstock (activities on the social
to realize their full international tourism media)
potential.

18
What is Destination Management?
Destination management is the
coordination and integration of all of the
elements of the destination mix in a
particular geographic area based upon a
defined tourism strategy and plan. The
destination mix elements are the
attractions and events, facilities (hotels,
restaurants, etc.), transportation,
infrastructure, and hospitality resources
(Mill and Morrison, 2009). In addition,
destination management encompasses
the image-making, branding, and
marketing and communications of all that
the place has to offer to tourists.
Destination management organizations
(DMOs) have the overall responsibility for
the coordination and integration of the
destination mix elements, and for
destination marketing. Scattered
throughout the world and spanning many
different organizational sizes and types,
DMOs have existed for at least the 100
years. Many DMOs are government
departments, while others are quasi-
governmental. DMO structures vary
according to local practices and
governmental systems.
The destination mix and the destination
product are similar concepts. Every
destination has four destination product
components (see the diagram, Destination
Mix and Destination Product).
• Physical products: These include
physical items such as attractions,
facilities, transportation, and
infrastructure. The attractions play the
pivotal role in drawing tourists to the
destination. There must be convenient
transportation access to the
destination and good infrastructure
(e.g., electrical power, sewerage,
telephone communications, etc.) to
support safe and enjoyable travel
within the destination. There must be
adequate hotel and restaurants to
cater to the needs of tourists.
• People: Local people provide the
hospitality resources as the hosts and
providers of personal services. Local
cultures and lifestyles are also often
very appealing to tourists. Community
residents should be made aware of
the benefits of tourism.
• Packages: All destinations have a set
of packages and programs that can be
purchased and used by tourists.
Packages are assembled by travel
agencies, tour operators and others,
and combine many elements of the
total travel experience. They are
organized either by themes or route
itineraries, and often are based upon
industry partnerships. Packages can
be purchased through traditional retail
channels including at travel agencies,
or be bought online.
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What is Destination Management?
• Programs: Events, festivals, and
activities are arranged or programmed
for tourists. Well-designed and well-
promoted festivals and events draw
tourists to destinations, so they share
this role with attractions. Programs of
activities are also prearranged for
tourists with specific interests.
Destination Consultancy Group (DCG), a
US-based tourism consulting company,
identifies the roles of the DMO in
destination management as leadership
and coordination; research and planning;
product development; marketing and
promotion; partnerships and team-building;
and community relations (see the diagram,
Roles of the DMO in Destination
Management).
Leadership and Coordination: The DMO
has a leadership role in tourism within the
destination; it sets the overall direction for
tourism in the future. There are many
others involved in tourism in the
destination, so the DMO also acts as a
coordinator of the efforts of everyone on
the destination team. Some of the specific
tasks required in leadership and
coordination are as follows:
• Preparing vision and mission
statements for the DMO
• Writing an organizational strategic plan
and a business plan for the DMO
• Making summaries of the destination
marketing plan and DMO business plan
available to stakeholders
• Providing an Annual Report to
stakeholders
• Continually measuring and reporting
upon the DMO’s effectiveness,
particularly in product development and
marketing
Planning and Research: The DMO has a
key role in preparing tourism policies,
plans and strategies for the destination. It
conducts research on existing and
potential target markets to guide future
marketing and product development
decisions. The DMO tracks the programs
of its main competitors and continually
seeks out best practice case studies to
improve product development and
marketing. The specific planning and
research tasks include:
• Writing of an overall tourism policy for
the destination
• Preparing a tourism strategy and plan
• Assembling a destination situation
analysis
• Conducting a visitor profile study within
the destination, including the
measurement of tourist satisfaction
levels
• Engaging in continual competitive
analysis
• Using case study research to get new
and creative ideas for future product
development and marketing
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What is Destination Management?
Product Development: The DMO has the
overall responsibility for the sustainable
development of the tourism product
including physical products, people,
packages, and programs. It takes
inventory of the current destination
offerings and assists with continuous
product quality improvements. Additionally,
the DMO identifies new tourism product
development opportunities and provides
assistance in realizing these projects and
programs. The product development tasks
are comprised of:
• Identifying new product development
opportunities and seeking investors
and operators when required
• Preparing a multi-year events strategy
and action plan
• Packaging the destination’s tourism
experiences and assisting others to do
so
• Designing and maintaining a system of
quality assurance standards
• Developing and offering service
training programs to upgrade the
professionalism in tourism
Marketing and Promotion: The DMO
develops the overall marketing strategy
and prepares long-term and short-term
marketing plans for tourism. It identifies
the priority target markets and selects the
most effective image or identity for the
destination, culminating in the
implementation of an effective branding
approach. The DMO uses the integrated
marketing communications method
combining online and traditional
promotions to inform and persuade tourists
to come to the destination. The destination
marketing tasks include the following:
• Setting tourism marketing goals and
objectives
• Selecting priority target markets
• Developing an approach to
communicating the destination’s tourism
image
• Designing a destination branding
system
• Preparing a strategic marketing plan
and an annual marketing plan
• Using integrated marketing
communications (IMC) to attract tourists
21
What is Destination Management?
Partnership and Team Building: The DMO
puts together an effective destination team and
builds alliances to achieve the destination’s
product development and marketing goals.
Some of the partnerships are established within
the destination, while others are with external
parties including travel agencies, tour operators,
transportation providers, MICE planners, and
others. Tasks involved in partnerships and
team-building are:
• Actively seeking new partnerships that add
to the destination product or enhance
destination marketing
• Building local and non-local teams for
specific marketing and product development
purposes and programs
Community Relations: The DMO acts as the
main champion and advocate for tourism within
the destination by raising the awareness and
profile of tourism locally to support the
achievement of its product development and
marketing goals. Additionally, the DMO may
consult with community residents when making
important decisions that will affect their lifestyles
and living standards. The DMO’s community
relations tasks can include the following:
• Communicating to local community
residents about the DMO’s activities,
performance, and successes
• Conducting resident surveys
about attitudes towards tourism
• Developing and maintaining a
community awareness program
on tourism
Planning is generally very well done
in China and there is also a strong
emphasis within Chinese DMOs on
product development. The DMOs in
China are also definitely playing a
leadership role in tourism and appear
to be able to coordinate tourism quite
effectively.
However, China’s tourism
administrations and bureaus are not
performing all of the roles of
destination management to the same
extent or with the same effectiveness
as DMOs outside of China. This is
especially true with research,
marketing and promotion, and
community relations; and significant
improvements are needed in these
three roles and their related tasks.
It also needs to be said that this
model of destination management
was developed outside of China and
does not reflect the cultural and
governmental differences within
China. Any model like this will have to
be adapted to meet the unique
conditions in China.
22
 The Future Opportunities and
Trends Facing China’s DMOs

Continuing growth in inbound

tourist arrivals at a rate well above
the world average
China to become the #1
destination for inbound tourists by
approximately 2015
Changes in the relative
proportions of tourists by country
of origin are expected (e.g.,
relative decline of Japan; relative
increase in India and Russia)
Growing importance of
Generations X and Y as inbound
demographic markets; while Baby
Boomer demand still expands
More blended travel purpose trips
Increase in the relative importance
of independent travel versus group
Source: Destination Marketing Association tours arranged by tour companies
International
and travel agencies
More green travelers and GLBTs
wanting to travel to Mainland
China
More international tourists looking
for special-interest travel
experiences in China
Expanding popularity of websites
and social networks as a source of
information for international
tourists
China’s DMOs need to give more
priority to Internet marketing and
Source: Shutterstock ICT generally
Destination management
professionalism to become more
sophisticated around the world

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