LATTE attended the annual ILTM Asia 2016 travel trade show in Shanghai from 30 May to 2 June.
The opening forum
ILTM Portfolio Director Alison Gilmore opened the 10th edition of the event with a forum on Monday 30 May, which focused on how digital technologies and the sharing economy are revolutionising the behaviour of today’s Asian luxury traveller.
Gilmore commented: “ILTM Asia is an event that has seen the beginnings of thousands of luxury travel adventures for thousands of luxury travellers from across Asia. Always on the cutting edge of the industry, it is right that during this landmark 10th year event, we celebrate 10 years of collaboration with a very special keynote speech on the growing power of the collaborative economy and the sweeping cultural and technological shifts informing Asia’s luxury travel landscape.”
Rupert Hoogewerf, Founder and CEO of the Hurun Report – and one of the leading minds on luxury travel in Asia – shared details of the “rich Chinese”, stating that 10 years ago there were 18 mainland billionaires, in US dollar terms, and now there are 470 (making up 20 per cent of the world’s billionaires). Despite the current downturn, Hoogewerf assured listeners that wealth is building and the luxury travel sector is still doing well. With Chinese luxury travellers known to be much younger than their European and US counterparts, he also addressed ‘Why China’s Gen Y is Driving Global Luxury’ and the serious effects of rapid wealth creation on the luxury market.
A panel discussion moderated by BBC World linkman Sharanjit Leyl, Wall Street Journal columnist Wei Gu and the CEO of Zanadu, Zan Wu followed. The panel identified that even though only 15 per cent of all Chinese have passports, these billionaires are usually educated overseas, and when travelling they follow art, auctions and other leisurely pursuits.
Next on the agenda was a dedicated presentation by entrepreneur, economist specialist and author of ‘What’s Mine Is Yours’, Rachel Botsman, who defined the theory of ‘collaborative consumption’ in 2010. Botsman defined collaborative consumption for the audience: “People are realising the power of technology to unlock the idling capacity and value of all kinds of assets, from skills to spaces to material possessions, in ways and on a scale never possible before.”
Botsman continued on to explain why the sharing economy is growing so fast and will cover some of the most revolutionary recent changes in customer behaviour: “The sharing economy allows us to build trust between strangers… it empowers people to rediscover a humanness that we’ve lost somewhere along the way… It places an emphasis on personal relationships versus empty transactions, taking us back to old marketplace values which have been reinvented for the Facebook age – it allows us to match wants and haves in a more democratic way.” Of course, just eight years later, with companies such as Airbnb and Uber a part of our everyday lives, the concept of a sharing economy is mainstream.
Stay tuned: Next week LATTE will be doing a “10 questions with… Rachel Botsman” feature, discussing the effects of the sharing economy on the travel trade industry, the importance of a digital presence and the future of luxury.
China in focus
In the main, it is no surprise that China dominated the opening forum. Projected outbound travel from China, 2016 over 2015, is, according to FT Confidential Research and HSB, going to rise 46.2 per cent to Thailand, 41.7 per cent to Japan, 25.3 per cent to Korea and 13.7 per cent to Singapore; among those going into decline are Hong Kong, down 6.9 per cent, Macau (1 per cent) and Taiwan (2 per cent).
The Chinese luxury consumer is now the absolute “Number One” consumer of luxury in the world, accounting for 35 per cent of all luxury retail spending, according to the Hurun Luxury Report 2015. In addition, more than two thirds of China’s “super travellers” arranged their leisure travel with a luxury travel agency.
According to the UNWTO World Barometer, the United States (US$ 178 billion), China (US$ 114 billion), Spain (US$ 57 billion) and France (US$ 46 billion) continue to be the top destinations both in international tourism receipts and tourist arrivals. China continues to lead global outbound travel after double-digit growth in tourism expenditure every year since 2004, benefiting Asian destinations such as Japan and Thailand as well as the United States and various European destinations. Spending by Chinese travellers increased 25 per cent in 2015 to reach US$ 292 billion, as total outbound travellers rose 10 per cent to 128 million.
With over 500 luxury travel buyers from 22 countries across the Asia Pacific meeting with over 500 global exhibitors, resulting in over 22,000 meetings, ILTM Asia, now in its 10th year, once again proved to be an informative, inspiring event.
180 industry media were present to capture the latest and most important announcements from the show.
ILTM Asia 2016 in photos: