4 Important Chinese Customer Segments Every Business Should Consider

As any business owner knows, it is vital to understand your customers’ needs and wants to grow your business. The benefits of defining your customer segments will allow you to get the competitive edge over your competitor:

Attract them with targeted communication and special offers
Engage with them by catering to their particular needs and wants
Delight them with personalised service based on their preferences

When looking at the Chinese customer segment, we need to think more than just the tourist segment.
We have defined these into 4 parts:

  • Tour groups
  • Visiting family and friends
  • Independent travellers
  • Students and residents

Tour groups

Traditionally, Chinese tour groups have been the largest segment to visit Australia. While the percentage of this significant segment group may be declining, the overall Chinese tourist market is rapidly growing in Australia.

With only 6% of the Chinese population having passports and a number of people travelling outside of China for the very first time, many of the tour group segment will be on their first international trip.

With this segment group, we typically find:

  • Tour group members have paid for most of their journey before leaving China.
  • The tour has pre-planned itineraries of retail outlet, tourist experiences, restaurants and accommodation that the group will experience.

Occasionally, tour group members have time to roam an area – and if they feel comfortable enough to interact with local business, chances are they will purchase products and services. In particular, retailers selling baby products, baby food, skincare products, and vitamin health products are often full of Chinese tour group members buying their goods.

Visiting family and friends

Independent travellers

The independent traveller segment is the fastest-growing segment of Chinese travellers to western countries. When we review this group, the typical attributes are:

  • Younger, sometimes described as Millennials
  • Often ‘cashed-up’
  • Very technologically-savvy
  • Many seek out destinations with fewer people and tourists
  • They value unique experiences that reflect their identity as successful Chinese professionals and business people going out to see the world – and they want to tell their network back home all about it on social media.

A proportion of the independent customer segment is older high-end travellers who are either successful business owners or in some cases, pre-retirees. With this particular segment group, we find that they might:

  • Travel for two or three weeks at a time
  • Visit wineries or rural areas
  • And are prepared to invest in luxury – or as they say in China, a ‘seven-star experience’.

Students and residents

The student customer segment is an interesting one to explore as they can cover two segment groups:

  • Student: Purchases include day-to-day items such as food, transportation, tourist experiences and entertainment.
  • Visiting family and friends: In many cases, they become the tour guide while their visitors are here in Australia. So while you may not think that a student is in your demographic, it is best to keep this in mind when preparing your marketing and communication.

China is forecast to be the fastest-growing source of international students studying abroad, with more than 170,000 Chinese university students currently studying full-time in Australia.

When we consider the lifecycle of a student, we need to take into account:

  • Chinese students can attend full-time university in Australia for up to 6 years – those that come for an undergraduate or bachelor’s degree often then undertake a two-year master’s degree

On average, an international student living in Australia will spend in excess of $50,000 per annum, or $1,000 per week, on accommodation, food and other services.

The other portion of this segment to consider is residents. The last census showed there are almost 700,000 Australian residents that were born in China. These permanent residents have a significant lifetime value potential for businesses that can attract, engage and delight them and deliver ongoing value through the products and services they provide.