Editorial: Percentages, Products and Prayers for China

by Prof. Dr. Wolfgang Georg Arlt FRGS FRAS

One month ago, the last issue of COTRI Weekly for 2021 ended with the statement that hopefully the year 2022 will be a box of creamy chocolates.

In the meantime, COTRI ANALYTICS data for 2021 are in, showing that the number of Chinese outbound trips fell below the level of the beginning of the century. Last year, about 8.5 million Mainland Chinese crossed the border, almost seven million of them to Macau. This number is below the 10 million outbound trips in the year 2000 and represents just 5% of the data for the last year before the pandemic in 2019, when 170 million cross-border trips were made starting in Mainland China.

The day the last editorial of 2021 was written, was also the day the first Omicron case in China was reported. After two years of a ruthless Whack-a-mole policy of reacting with major lockdowns to every minor outbreak of CoViD-19, with the government proudly pointing to the fact that the number of victims of CoViD-19 was less than 1% of the similar number in the USA, Omicron has outwitted the Chinese government. 

The result of this policy is a population which, as it has been much less exposed than the rest of the world to the virus, about to fall victim to Omicron, which cannot be stopped from spreading with even the most rigorous lockdowns of major cities. The Chinese inactivated vaccines seem also, according to several studies, not to be as effective against the new mutation as mRNA vaccines. Even incarcerating the population of one major city after another without access even to supermarkets has not stopped the Omicron mutation arriving in Beijing a couple of weeks before the start of the Olympic Games and the Chinese New Year period.

Unfortunately, there is no sign that the government will change its policy, instead creating myths about viruses arriving by parcel post from abroad. The WHO recently announced that they expect 50% of all Europeans to get infected by Omicron in the coming months. If you use this percentage and a mortality rate of 1% for China, you arrive at seven million deaths. It can only be hoped that a new massive booster mRNA vaccination campaign and new effective treatments stopping infections from having lethal results will prevent China from becoming in 2022 the country with the highest number of CoViD-19 victims in the world. Your humble editor has seldom wished so much to be proven wrong.

What is the best way for the international tourism and hospitality industry to react to this highly uncertain development? Before Omicron, most experts inside and outside of China expected outbound tourism from China to resume in the second quarter of 2022. Given the development of the last weeks, the question might change from “When will the Chinese government re-open the borders?” to “When will the rest of the world let Chinese travellers enter again?. 

Most destinations and major service providers cut their marketing budgets for China last year, but continue to “keep in touch” with the market using WeChat posts and Mandarin language videos. The effect of these communication tools is unfortunately quite limited, with most messages reaching only thousands of Chinese users in an internet ecosystem which deals rather in million views.

Recommendation marketing, relying on WOM² (Word of Mouth and Word of Mouse) from satisfied customers is a more effective way of marketing in China, but does not work if there are no visitors who can share or livestream their positive experiences. 

So, if the visitors cannot come to you, you need to offer memories of past and dreams of future outbound trips in the form of regional authentic products, from wine to toys, from honey to hand-woven textiles. COTRI offers in cooperation with Chinese partners the sales App O+MALL, which concentrates on regional products in connection with touristic information about the region of origin. After the end of the pandemic, the O+MALL App will stay a very useful instrument to continue to sell unique products, but also to combine online and offline activities in China during consumer fairs, as well as for market research based on a clearly defined group of fans of the destination and its regional products.

More about the App can be found on the website www.china-outbound.com and on https://www.youtube.com/watch?v=BIoL9PG9rA4

As always, even with this heavy clouds hanging above the heads of the Chinese population, all good wishes from Prof. Dr. Wolfgang Georg Arlt and the entire COTRI WEEKLY team!

COTRI Intelligence

COTRI Intelligence is the indispensable source of weekly consulting, analysis, data and news for everybody seriously interested in the post-pandemic Chinese outbound tourism market and changing Chinese consumer preferences.  COTRI Intelligence is published by COTRI China Outbound Tourism Research Institute and edited by Prof. Dr. Wolfgang Georg Arlt FRGS FRAS. Regional partners and Content partners [...]

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