Who is driving the tourist boom in B.C.? Tourists from Asia are important to our bottom line

 

 

BY PAUL LUKE, THE PROVINCE AUGUST 12, 2013

 

 

Stephen Pearce is the vice president leisure travel and digital marketing for Tourism Vancouver. He is pictured at Canada Place in Vancouver, BC Wednesday, August 7, 2013.

Photograph by: Jason Payne , PNG

On a gorgeous summer morning, the North Shore mountains marched through blue skies to Vancouver’s harbour and seduced a traveller named Yang Xu.

Xu, who hails from the Eastern Chinese city of Hefei, is the future of Vancouver’s tourism industry.

Xu is an almost perfect visitor. At 29, he has travelled widely and rates Vancouver his second favourite North American city, behind Boston but ahead of Los Angeles.

Minutes before being interviewed, Xu texted Chinese friends in California, urging them to visit the Lower Mainland.

“I said that if you have a chance you should come here because it’s beautiful,” he says.

As a university researcher, Xu still lacks the spare cash to patronize Vancouver stores. Serious shopping will have to wait until he makes a return visit to the city.

Other Asian visitors have far more financial firepower. As Vancouver’s tourism season peaks this month, Asia is poised to overtake Europe as the city’s largest source of visitors.

Their growing presence is seen and felt across the Lower Mainland, from tour buses at Canada Place to luxury stores downtown to duty free shops at Vancouver airport.

Having reshaped the region’s real estate market and its universities, Asia is now transforming the face of Vancouver tourism.

Along the way, the delight visitors take in the region is changing the way residents see their own home, tourism officials say.

By 2025, the percentage of overnight visitors from Europe is expected to fall to four per cent from five per cent in 2000. But Asia-Pacific will grow to 11 per cent from nine per cent during this period.

“Within the Asia-Pacific region, China will lead the way, surpassing the U.K. as Vancouver’s second largest international market by 2014,” says Stephen Pearce, vice-president of leisure travel and digital marketing with Tourism Vancouver.

“Australia is also expected to generate strong demand.”

The U.S., though shrinking, remains the largest source of visitors to B.C.

It’s not just the potential numbers of visitors that have B.C. tourism officials courting Asia. Asian visitors are the biggest spenders.

In 2012, South Korean visitors to Vancouver were the top spenders, parting with an average of $1,327.79 per person per trip, according to Statistics Canada. They were followed by Japanese visitors at $1,039.55 per visit, Hong Kong tourists at $925.12, mainland Chinese at $913.61 and Mexicans at $853.36.

Canadians, at $330.94 per visit, are relatively frugal — partly because many stay with friends and relatives, Pearce says.

The swelling middle classes of Mexico and Brazil are expected to visit Vancouver in growing numbers in coming years. But Tourism Vancouver, like rival marketing groups around the world, is working hard to appeal to mainland Chinese.

That might have something to do with the fact China is now the world’s top tourist factory. Thanks to growing disposable earnings, liberalized travel policies and a strengthening currency, Chinese tourists spent $102 billion US on travel in 2012.

That vaulted them past Germany and the U.S. to become international tourism’s biggest spenders.

The aim of marketers like Tourism Vancouver is to boost “yield.” In other words, encourage travellers to spend more and stay longer.

“That means, for example in China, that our focus and attention is on high-end, affluent Chinese who are travelling as part of a small, independent group or for (business) incentive purposes,” Pearce says.

By the end of next year, overnight visits to Vancouver by mainland Chinese will have more than tripled to 179,529 from 57,089 in 2001, according to Tourism Vancouver projections.

A key part of Vancouver’s appeal to Chinese visitors is its ease of access. Vancouver airport has more direct flights from China and Hong Kong than any other North American airport, including much larger facilities in Los Angeles and Chicago.

Last month, China Eastern Airlines announced it was doubling the number of its flights between Vancouver and Shanghai to twice daily.

Vancouver’s accommodation, food services, and transportation are the biggest beneficiaries of foreign travel, generating 72 per cent of tourism gross domestic product for the whole province.

But retail, which generates a smaller share of B.C. tourism GDP at 10 per cent, is the fastest growing segment — soaring 37.8 per cent between 2000 and 2011, according to B.C. Stats.

Asian tourists, especially visitors from China, have a taste for luxury. Mainland Chinese shoppers at one Vancouver luxury fashion retailer — which declined to comment for this story — are said by observers to account for 40 per cent of its sales.

“We are seeing a higher percentage of expenditures being committed to shopping and this is driven by markets such as China, Brazil and Mexico, which tend to be gift-giving cultures,” Pearce says.

“Retailers that understand the needs and customs of the markets they are serving see real payback.”

For the 10 duty free shops at YVR airport run by World Duty Free Group, that means serving customers in their own language and stocking hard-to-find products, says Craig Duncan, World Duty’s vice-president of sales and operations at YVR.

Collectively, the shops’ staff speak 25 languages, with Mandarin, Cantonese, Japanese and Korean among those most heavily used.

Asians are sophisticated shoppers, Duncan says. To satisfy their desires, the duty free stores stock authentically Canadian goods such as ice wine or luxury items difficult to find elsewhere.

“They know fashion better than Europeans,” Duncan says.

“They know where to buy and how to buy.”

Chinese, whether from Hong Kong or the mainland, are big spenders, Duncan confirms.

They’re the ones snapping up $45,000 Bulgari necklaces and $35,000 bottles of 70-year-old Glenlivet scotch.

Several months ago, a Chinese customer bought $70,000 worth of goods in one high-end spree — a single-transaction record for YVR’s duty free shops.

Older tourists are expected to form an increasingly large part of the spectrum of visitors to Vancouver. The challenge facing local tourism officials is that older people often travel less, and stick closer to home when they do, Pearce says.

Vancouver’s tourism industry must find ways to meet the needs of the aging populations of Europe, Japan, Taiwan, Korea — and eventually China, Pearce says.

A pressing task is to create services to accommodate the visually impaired or those with mobility challenges, he says.

But Vancouver’s closeness to nature is a natural advantage when it comes to gratifying aging visitors’ desire to enhance the quality and extend the length of their lives, he says.

Pearce says Chinese acquaintances tell him they regard the city as a place to rest and recharge before plunging back into the maelstrom of Beijing or Shanghai to make a living.

“Health, wellness and rejuvenation are becoming increasingly important themes,” he says.

“Visitors to Vancouver are looking for opportunities to step out of a chaotic world into a lifestyle that rejuvenates both the body and the spirit.”

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B.C. TOURISM BY THE NUMBERS

Summer is the highest of highs for tourism in Vancouver, accounting for about 40 per cent of overnight visits.

The U.S. will remain the largest source of people visiting Vancouver, but it’s a shrinking giant. Canada’s southern neighbour is expected to account for less than 19 per cent of overnight visits by 2025, down from 27 per cent in 2000.

In 2011, gross domestic product in B.C.’s tourism sector was $6.5 billion, accounting for four per cent of provincial GDP, B.C. Stats says.

Tourism employs about 127,000 people in B.C., or about one out of every 15 employed in the province.

Retail, the fastest growing part of B.C. tourism, accounts for abut 10 per cent of ?economic activity in the sector. Accommodation/food services and transportation each generate 36 per cent of activity.

Travel + Leisure magazine ranked Vancouver ninth in its 2013 list of Top 10 cities in Canada and the U.S.

Chinese visitors’ overall spending in Canada rose 18 per cent to $481 million in 2010 from $315 million in 2010. That’s the fastest growth rate among 10 nations, according to the Canadian Tourism Commission.

Mature travel destinations such as Canada are losing ground to up-and-comers such as Turkey, Malaysia and China. Canada has fallen from being the world’s No. 10 top destination for international tourists in 1990 to No. 18 in 2011, the CTC says.

In May, Canada saw a year-over-year rise in overnight visitor arrivals from Brazil, Japan, Mexico and South Korea. “This was not enough to offset a 7.1-per-cent decline in arrivals from India, which continues to be under pressure due to a lack of direct air capacity to Canada,” the CTC says.

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MORE VISITORS EXPORING CITY COMMUNITIES

Rita Kumar wanted to see Vancouver from the inside out on her third trip to the city.

Kumar, who lives in Orange County, Calif., decided to experience the city the way the locals do — on the neighbourhood level.

She and her 19-year-old daughter and 12-year-old son spent a summer day wandering around places such as Commercial Drive, Yaletown and Granville Island.

“Each neighbourhood has its own vibe,” she says. “Granville Island was a little bit touristy but very nice.”

Kumar is one of the many tourists to the Lower Mainland who wish to participate in the inner life of the region’s communities rather than glide across their surfaces. For them, the city’s festivals, markets and ethnic communities are jewels adorning Vancouver’s face.

They give Vancouver, depending on a visitor’s culture, its soul, sense of place, terroir, zeitgeist, spiritus mundi.

One of the keys to building a vibrant tourist industry is to establish a high quality of community life, Link B.C. general manager Morgan Westcott says.

And community resources are in turn nurtured by the influx of tourist dollars, Westcott says.

“If you put a lot of work into developing your own backyard, that’s very attractive to visitors,” she says.

“A lot of the festivals and farmers markets and little cafés don’t set themselves a mandate to be tourist attractions but visitors are drawn to them.”

By themselves, Vancouver residents could not afford to support the quality and variety of leisure resources to which they’ve grown accustomed, says Tammy Towill, an instructor in the school of outdoor tourism and recreation at Capilano University.

What about the poverty and homelessness of Vancouver’s Downtown Eastside? Are tourists also drawn to that?

Some are. These are people moved by an altruistic desire to see and understand the struggling sides every city has, Towill says. Poverty tourism — sometimes called “poorism” — has long been a popular way for well-heeled gawkers to see the slums of Rio de Janeiro or Mumbai.

But at its best, it can attract concerned visitors who wish to help, Towill says.

“That type of tourism I see as being a benefit to all parties,” she says.

Tourists do something more than inject badly needed dollars into the local economy: They restore a sense of passion among city residents for the charms of their own home, says Stephen Pearce, a vice-president with Tourism Vancouver.

“The fact that visitors enjoy the city puts an extra zest in the step of the folks who call it home,” Pearce says.

“That means residents have to be both stewards and advocates for the very experiences that we get to share with our visitors.”

On a recent flight from Prince George to Vancouver, Towill’s own sense of local wonder at B.C.’s geography was rekindled by the torrent of praise bursting from an astounded tourist from Phoenix, Ariz.

“The general chaos and routine of daily life takes over and you sometimes forget to look up,” she says. “It’s great to be able to see things through the eyes of someone who’s seeing it for the first time.”