Air New Zealand’s Stephen Jones is taking projections of a million plus annual Chinese visitors in his stride, reports Fran O’Sullivan.

Stephen Jones is upbeat about the unparalleled rate of growth out of the Chinese tourism market.

"The million comes from the Chinese president saying they want to quadruple the number of Chinese outbound," says Jones, who is Air NZ's Chief Strategy, Networks & Alliances Officer. " If you take that multiplier and bring it to New Zealand, it does lead you to some quite astonishing numbers."

In 2015, some 355,904 Chinese visitors came to New Zealand. As Jones relates, that is "effectively triple" the 122,000 visitor arrivals in 2010.

"The rate of growth (up 34.4 per cent on 2014) is unparalleled to any of our markets we have seen previously."

Advertisement

And it places the national flag carrier in a strong position to capitalise on the desire of increasing numbers of China's middle class to "see the world".

Air NZ is three months into its codeshare arrangement with one of China's 'Big Three' airlines.

"It's fantastic to have cemented our partnership with Air China that now sees us accessing Beijing directly," says Jones. "We are seeing tremendous growth across all the China ports - Shanghai, Beijing and Hong Kong - which is also important for growth out of Southern China."

Jones says the move is consistent with its approaches elsewhere. "Air New Zealand can use its strength and presence here in NZ," he explains." But as soon as we step offshore we just move further and further away from that point of advantage.

"Air China is a Star Alliance partner of ours and they have been wonderful to work with ... no matter how much effort we put into building our own presence in China it is never going to provide the same leverage as Air China's network, its sales force and frequent flyer scheme.

"We've already - in the period that they have been operating - taken in 28,000 passengers after three months."

Air NZ will bed down its Beijing route and is working with its codeshare partner to establish another daily flight out of Shanghai which would double the existing frequency.

On the radar is a proposal to connect more passengers from China to New Zealand and then on to South America. Jones says that the connecting times are "not great". "Once you move past once daily to double daily you can put that second bank of flights at times that would connect better with the Americas."

While China Eastern has now joined China Southern on the NZ-China route, Jones says Air NZ sees their participation as growing the market rather than posing a competitive threat.

"We've gone as a country from 14 flights a week to around 35 flights a week in the peak," he says.

"For us that has led to increased performance. We've got better loads, we've got good yields. It really is about raising the awareness of New Zealand and tapping into a a huge market for visitors. So far, it has been really positive, actually."

Air China has a global procurement system but it currently doesn't include New Zealand suppliers.

"As we have hosted them down here they have appreciated NZ food and wine and it's an active conversation with them about how they might put that on their flights," says Jones.

"It will not only give Chinese visitors an early taste of New Zealand but it will also be more familiar for New Zealanders flying to China.

The airline is successfully targeting the FIT (free independent traveller) market.

StatisticsNZ figures show that annual Chinese visitor expenditure has increased four-fold from $400 million in 2010 to $1.67 billion in 2015.

Chinese visitor average spend per day has also been trending higher from $234 in 2010 to $464 in 2015, while Japanese average spend has fallen from $400 to $132 over that same period.

Optimism about the market's potential was on display in China a fortnight ago, when Auckland Airport CEO Adrian Littlewood met with Jia Tiesheng, Air China's vice-chairman (commercial committee), to sign an agreement aimed at boosting tourist numbers to New Zealand in the winter months.

The agreement is part of a joint venture programme by the airport and the Ministry of Business, Innovation and Employment - "Four seasons, Five senses" - promoting tourism opportunities outside the peak visiting month of February and Chinese New Year.

Littlewood told the Herald that snow sports are a "fairly new emerging market in China".

With China set to host the 2022 Winter Olympics, interest in snow sports was growing.

Tourism is now the country's number one export earner, overtaking dairy where earnings have taken a punishing through the lengthy commodities slump.

The tourism sector has set a target to reach $41 billion in total revenue by 2025, up from the $29.8 billion netted in 2015.

With just under a decade to go, it is obvious that the galloping numbers of tourism arrivals out of China will play a large part in hitting the target.

The 2025 strategy focuses on high value Chinese visitors - among other key targets like international students, cruise visits, business events and emerging markets.

StatisticsNZ figures show that of the 355,904 Chinese visitors recorded in 2015, 272,464 were here on holiday; 40,512 were visiting friends and relatives; 13,232 were on business; 7616 for educational purposes and 1808 travelled down to New Zealand for conferences or conventions.

Add to this a new category - incentive or reward travel - which is used by companies to incentivise and retain high-performing teams.

During his recent visit to China, Prime Minister John Key announced that Tourism NZ had succeeded in a bid to bring 10,000 top-selling Amway China employees to travel south to enjoy a five-day visit to Queenstown. Amway China has 7000 sales-people and more than 190,000 contractors.

The 10,000 who will come to Queenstown in waves of 500 from Autumn 2018 will also attend training seminars while here.

The Amway deal is expected to pump at least $50 million into the Queenstown Lakes district, giving an important revenue boost in the shoulder season. But the all-expenses paid trip will also expose them to Queenstown's beauty and what New Zealand is about.

"That was an absolute milestone for the country in terms of our ability to work together," says Jones.

"Quite staggering. And it really just gives an insight into the scale of what is possible.

"If we do this properly those people will go back as advocates and go out there with a whole new product to sell which is New Zealand."