Chinese MICE market trends – tips for Tier II

It’s evident – China’s MICE market is booming, quickly. Interestingly, it seems that the luxury MICE market is increasingly turning its face to Chinese business travelers and customizing services to fit Chinese traditions, habits and preferences instead of only targeting foreign audience.

For instance, last year the InterContinental Hotels Group (IHG) announced the launch of Hualuxe, an upscale brand aiming at opening hotels in more than 100 Chinese cities over the next two decades. How does Hualuxe differ from its Western-oriented sister brands then? Well, Hualuxe hotels follow the Chinese aesthetic traditions and design – garden views from every lobby and special tea rooms to name but a few. Also, attention is paid to catering and tastes that Chinese business people are familiar with. It is important to understand, why this is the case. Hence, read on.

When looking at Chinese business travelers’ niche, it is crucial to note that they (Chinese) are actually the hosts. No matter whether they are traveling themselves for MICE, but when doing business with foreigners in geographically Chinese territory, Chinese business men (and women) are willing to wear the gown of the host and introduce foreign guests to the treasures of Chinese culture. Why? If a partly Chinese and partly Western business delegation goes to Urumqi, which cultural environment gives confidence for the Chinese signing the deals 1) learning how to use knife and fork 2) teaching foreigners to use chopsticks? Obviously, the latter. Due to the rapid economic development and change of business context from a relatively isolated China into a massive and global focus of international trade, the cultural habits and traditions have not been able to adapt that quickly. Hence, when hotels plan their MICE activities in China, it is necessary to understand that Chinese business travelers, particularly in secondary cities, enter gradually to international spheres and thus they appreciate a hint of Chinese cultural heritage in MICE services. That is, China’s MICE market seems to internationalize step-by-step to II Tier cities outside Shanghai, Beijing and Guangzhou. So, in Tier II areas, there is true business opportunity for foreign hotel groups if they fine-tune and customize their luxury to fit Chinese taste – not too much, but just a little.

When it comes to Western travelers in China’s secondary cities, it is crucial to create a synergy network between different brands. This is similar to airline alliances and bonus systems. According to Björn Hanson, divisional dean of the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management at New York University, this is the new MICE trend. “The brands can build relationships by having hotels in the newest business destinations”, he says. For example, it means that American business travelers can earn Starwood Preferred Guest points in Qingdao by the end of 2014 no matter whether they chose Le Méridien, Sheraton or Westin brand in the region. Conclusively, a successful MICE strategy in China requires understanding the unique market characteristics and, to keep up with the competition, being the first to hear about latest trends.