Consider the facts:
- Chinese consumers are demanding acceptance of their card type in the US.
- Today, Chinese tourists come to the US and primarily pay cash. Although nearly 90% of the ATMs in the USA accept UnionPay cards to provide cash, these ATM transactions carry FX premiums and additional cross-border transaction fees that discourage spending.1
- Chinese tourists spending with a co-branded UnionPay/Visa/MasterCard card pay an extra 3% currency conversion fee.
- THERE’S NO CURRENCY CONVERSION FEE WHEN YOU ACCEPT UnionPay THROUGH Travel Payments Direct. THAT’S A HUGE INCENTIVE FOR CHINESE TOURISTS.
- With Travel Payments Direct’s Cardholder Awareness programs you can instantly become a preferred merchant
- Europe is ahead of the US in accepting UnionPay. Harrods Department Store in London installed 75 UnionPay terminals for their Chinese customers and has since reported a 40% increase in sales to Chinese customers.2
The number of Chinese visitors coming to the United States will more than triple by 2020, according to a new report from brokerage CLSA. The new wave will include a confident, more travel-savvy Chinese tourist that is willing to bridge out from traditional vacation spots like Hong Kong and Macau.
“It’s all about bragging rights for Chinese tourists these days,” said Aaron Fischer, an analyst at CLSA.
Chinese travelers have built a global reputation as big spenders. Lines of shoppers from Mainland China are a regular sight outside luxury stores in Paris and Hong Kong, a trend that could spread.
Shopping is at the top of the agenda for Chinese that visit the U.S., with 87% of visitors splashing some cash at retail outlets in 2012. CLSA said the Chinese spend an average of $4,400 per trip on everything from high-end hotels to cosmetics, making them the second-biggest spenders after visitors from India.
CLSA said that companies like Tiffany (TIF), Estee Lauder (EL, Fortune 500) and Coach (COH) could benefit the most, as they have excellent brand recognition in China and offer cheaper prices in U.S. stores.
In addition to shopping, the new wave of Chinese tourists have another set of priorities that will make Las Vegas casino owners drool.
Mainland tourists are showing a greater interest in fine dining and gambling than others overseas visitors, and a growing appetite for concerts and shows, the CLSA report said.
With Las Vegas still struggling in the wake of a regional housing bust, casinos there have begun pulling out the stops to attract Chinese gamblers, introducing special food menus and concerts with Chinese speaking pop stars. The Palazzo is even now hosting a show called “Panda!” that features the China National Acrobatic Troupe.
Still, catering to a three-fold increase in the number of Chinese tourists is no easy task. The language barrier is one problem; CLSA called a series of high-end hotels in New York and found only two had Mandarin speakers on site.
Chinese travelers have also developed a less than flattering reputation in some parts of world, thanks to a mix of cultural differences and, occasionally, bad behavior. In one high-profile case, an ancient Egyptian temple was vandalized by a young Chinese tourist.
China’s National Tourism Administration has attempted to address some of these problems, and last year published a series of guidelines directed at the country’s travelers.
Specific guidelines instructed tourists not to deface relics and to show courtesy and respect for other people’s rights.
1. UnionPay Co Ltd. “Nearly 90% of ATMs in the USA can Accept CUP Card.” June, 2012. < http://en.unionpay.com/news/newsroom/file_4847780.html >
2. “Chinese tourists bring £200m windfall for London retailers.” Daily Telegraph, 24 May, 2011.
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