[JD Says] Spending the Spring Festival Away from Home: Tourism behind “New Folk Trend”
As the Year of Rooster is approaching and many people are heading back home for the Spring Festival, “reunion travel” is becoming a new choice for more and more people.
According to the “2017 Spring Festival Tourism Consumption Trend Report” jointly released by Xinhua Net and LY.com, 30% of the long-distance travels made by respondents during the Spring Festival are domestic and outbound travels, a share second only to that of family reunion. Travelling has become a new trend for the Spring Festival, creating new destinations for people apart from their hometowns.
Where to travel? Tourist spots are changing dramatically.
Tourism is a typical experience-based industry where different tourist spots provide different experiences. Since modern tourism took its shape in China, tourists’ main destinations have been traditional tourist attractions, namely famous natural scenery spots and historical sites. But now, as people’s consumption demand becomes higher, tourists are shifting their attention from natural sceneries to quality tourist products that provide new experience and good services. Therefore, apart from sightseeing, new tourist products including a thorough tour in one city with loose itineraries, leisure travels centered on relaxation, fun travels focused on cultural and leisure experience, etc. are emerging.
Against the backdrop of tourism consumption upgrade, experience services are being improved in every scenic spot. It was one of the hot trends in Chinese tourism industry in 2016 to integrate tourism with culture, intellectual property and industry development by developing tourism intellectual property, creating cultural themes and building theme tourist towns.
Therefore, it is important for investors intending to invest in tourism to go in line with the trend and meet tourists’ different demands by helping tourist attractions establish more entertainment and service facilities and improve their services. In 2016, under the guidance and support of Sichuan Finance Department and Sichuan Tourism Department, the Finance Department, together with JD Capital and New Hope Group, jointly established the Sichuan Tourism Innovative Development Equity Investment Fund.
The Fund will focus on developing key scenic spots, creating new operational types of tourism, as well as extending the tourism industrial chain in Sichuan and around the country through joint venture, investment holding, M&A and asset securitization. The major areas of investment include the upgrade of scenic spots that are already in operation; M&A integration of tourism assets; private placement and M&A of listed tourist companies; competent growing companies in the field of new operational types and derivative industries of tourism; and public-private partnership (PPP) tourism projects. etc.
In the future, the tourism industry will focus more on improving service, industrial integration and innovation of tourism products.
Leisurely travel starts from service facilities upgrade
The upgrade of scenic spots also involves the upgrade of service facilities including fire-fighting equipment, facilities for the disabled, transport facilities and amenities.
Among all kinds of facilities, tourist cableway is one of the most important links in the upgrade of scenic spots. Chinese tourist attractions have a large demand for cableways. On the one hand, compared with people in developed countries, the Chinese people enjoy fewer public holidays and usually travel on tight itineraries. Therefore, many prefer taking cableways than walking, particularly in mountainous sites. On the other hand, the number of elderly tourists are soaring as the Chinese population ages. Therefore, improving cableway facilities can significantly enhance services and experiences for targeted tourist groups.
It is an important part of JD Capital’s tourism investment plan to focus on cableway facility investment and operation management, so as to improve service facilities. In 2014, JD Capital took share of Sichuan Mining Machinery Group, a famous Chinese cableway manufacturer of almost 200 cableways both at home and abroad. Its products can be seen in many major scenic spots including Fragrant Hill in Beijing. Boasting great influence and a strong team, it is capable of ensuring product safety and meeting consumers’ different demand. In the meantime, JD Capital is also working on creating a better layout to promote cross-region integration of cableway operators. As an important partner of JD, Sichuan Mining can provide strong support for the operators and help with the virtuous interaction.
High-end customized services amidst industrial upgrade weight heavily in tourism operation
After years of industrial upgrade, the tourism services become comprehensive. From itinerary arrangement on a smart phone to customized itineraries made by travel agencies, from domestic customized theme travels to overseas high-end resort holidays, the tourism service industry is fast developing, capable of offering tourists with different demand various types of tourist products.
With the support of JD Capital and other investors, U-Tour, a leading Chinese overseas travel agency, bought out Club Med, a high-end global resort. This is an attempt made by Chinese enterprise to store high-end customized travel resources worldwide.
Cloud Med is an internationally famous tourism brand founded in 1950 and went public in the Paris Bourse in 1955. By 2014, Club Med had over 60 resort hotels across the world. Up to now, U-Tour has released dozens of tourist products for Club Med, among which the Maldives Club Med and other representative tourist products have become a hit of the season.
China is expected to become home to the largest middle-class group which, even according to conservative estimation, would reach 100 million. So, how to provide them with satisfactory tourist products is a question for leading overseas travel agencies to answer. Thanks to this M&A, more and more Chinese tourists will be able to enjoy services of Club Med at lower prices.
Now, for the tourism industry of China, as the international market opens for China, we will see more overseas M&A coming. For Chinese tourists, in the near future, we can enjoy quality travels that better suit our demands. This also shows that “industry plus capital” has become a key force changing people’s lives.