World Travel & Tourism Council è is one of the international reference organisations for the tourism sector.
Its 2018 report shows how tourism in 2017 accounts for 10.4% of global GDP and 9.9% of total employment (313 million jobs). Direct growth was 4.6%, a rate higher than that of the global economy for the seventh year in a row. The United States and China lead the ranking of the ten largest world tourism markets. Measured in terms of value (billions of US dollars), these are:
1 United States 1501.9
2 China 1349.3
3 Germany 395.2
4 Japan 331.2
5 United Kingdom 266.1
6 Italy 253,4
7 India 234.0
8 France 232,0
9 Spain 196.2
10 Mexico 185.4
The two ranking leaders total value well above the total of the eight followers. Given current trends, it can be expected that the gap between first and second place will narrow. Perhaps, in perspective, even a switching of position.
Special attention should be paid to Chinese tourism. In the first six months of 2018 alone, 71.31 million Chinese have travelled the world (+15% compared with 2017); 13% of these chose Europe as their destination, double the previous year (dati Chinese Tourism Academy figures).
With a partial calculation of the summer season, Italy has recorded an average growth of 87% compared with 2017. Considering the two-month period July-August 2018, Italy is also among the top ten countries (fourth position) in terms of levels of spending by Chinese consumers. According to CITS, the tourist flow from China to Italy will increase by 10%, year by year.
In order to grasp the opportunities, correct perception of the profile of the Chinese tourist is essential. This has radically changed in recent years.
We are referring to relate to basically young travellers: those born in the 1980s will represent 45%, while a further 11% will be represented by travellers born in the 1990s. Well-to-do, willing to spend considerably, to the point that Goldman Sachs estimates the spending of Chinese tourists abroad at US$ 450 billion by 2025.
Usually inclined to the quality tour and looking for fun, good food and luxury products. According to a Boston Consulting Group-Tencent report, the latter will mark an annual growth rate on the Chinese market of 6% by 2024; local consumers will account for 40% of global sales and 75% of entire sector growth.
Finally, Chinese tourism is characterised by habits that greatly influence the way people travel. Among these, above all, the consolidated and purported "normality" of mobile payment, which is not exactly "normal" for us.
La cashless society
China is in fact evolving into a cashless society, which will tend to lead to the extinction of cash. Electronic payments are increasingly replacing even those with a credit card.
Tencent, the technology holding company that controls WeChat, declares one million transactions per minute on WeChat Pay. In 2021, according to eMarketer estimates, well over half of "mobile" payers on the planet will be Chinese.
Two parties, but the third does not gain
The increase in "mobile" payments has resulted in the loss of the primacy in electronic payments held by UnionPay, the only credit card issuer authorised in the People's Republic of China. In the first half of 2017, UnionPay accounted for only 17% of the third-party payment sector in China, behind AliPay at 39% and WeChat Pay at 27%. ( Analysys International figures)
These two parties split 92% of the mobile payment. Today, Alipay leads the ranking, but WeChat Pay's growth potential is probably higher due to the very nature of technology. Wechat is, in fact, a true digital ecosystem. The payment system is just a subset of the services that accompany an endless number of Chinese - and not only Chinese - in daily life. The habit of using WeChat (over one billion users) is progressively affirming itself as an essential element of continuity for tourists travelling around the world.
These indicators reveal a reality very different from payment systems in Europe - although they are evolving strongly - where payment using a smartphone is not a habit. The first cause is the spread of new contactless cards, use of which for transactions has increased by 97% in Europe in one year.
In Italy, growth in digital payments suffers from deep roots in a cash culture. It is estimated that, between 2008 and 2017, the cash in circulation in Italy increased from 128 to 197 billion euro. The result is an equally strong propensity to this type of payment (86%) which makes it the third-last state in Europe for cashless payments (14%) ahead only of Spain (13%) and Greece (12%).
In the Italian national context, Contactless Payment records a significant +150% compared with 2016 for 400 million transactions and a value of 18 billion euro. In 2020, that value will fluctuate between 50 and 90 billion.
Mobile payment is growing, albeit timidly, also in Italy. Services based on current accounts and the arrival of Apple Pay have generated 70 million transactions (only 10 million in 2016), with around 500 thousand active users. Looking ahead to 2020, such transactions could be worth from 3.2 to 6.5 billion euro. (Figures from the Mobile Payment & Commerce Observatory of Milan Polytechnic).
Will it be enough? With this tourism, the new normality of mobile payment is not an option, but an urgency for Italian commerce.