Record growth, opening to the world, an explosion of young generations and the leisure culture... all factors align for a boom in outbound tourism from South Korea that has already begun. And yet this market remains in the shadow of the Chinese giant with its immense potential. Although it has its own particularities, South Koreans are often clumsily lumped with other
The famous term “Bric” for Brazil, Russia, India, China, which refers to a vast source of clientele that are emerging in tourism, should soon include at least two more letters in reference to two nationalities that are gaining ground: an M for Mexicans and a K for Koreans. It must be added that the vast potential of the latter is, wrongly, overshadowed by the manna represented by its Chinese neighbors. Long considered a hermetic country, characterized by a population not very inclined to wards adventuring outside its boundaries, South Korea has nonetheless made a grand entry onto the world tourism map. It’s a fact: Korean society is changing and is increasingly attracted to relaxation and discovery. Today, some observers no longer balk at talking about the “Korean miracle” while mentioning “cohorts of tourists” who leave the “land of morning calm” for a few weeks each year. In just a few years, tourism there has gone from being an anecdotal phenomenon to becoming a very promising market. Of course, we must remember the painful crisis of 97-98. The economic reform that followed changed things considerably and also led to a spectacular increase in buying power, as well as authorities’ raised awareness of the benefits of tourism, be it outbound or inbound. As a result, encouraged by the general atmosphere and major advertising campaigns, more than 10 million South Koreans traveled abroad in 2005. Growth thus reached 14.3% over 2004 and doubled in five years! This was record growth for this country of 48 million inhabitants that succeeded in surmounting serious economic difficulties and then the SARS crisis in 2003. It now represents the numberthree Asian outbound market after China (20 million) and Japan (17 million).A classic mistake made by operators at inbound countries lies in erroneously assimilating Korean visitors and Japanese clientele. While they have certain characteristics in common with tourists from the archipelago, Koreans have their own particularities and their own sensibility. To start: language, which is often neglected in brochures and reception cards to the benefit of Chinese and Japanese. Yet, succeeding in capturing this market that holds great promise requires first and foremost approaching it for what it is: its own, separate entity, young and avid for new experiences within a reassuring setting. A few efforts made today to understand this country will pave the way to more significant volumes of clientele tomorrow.The country’s economic vitality (11th worldwide in terms of GNP ahead of Brazil and Australia) is very favorable to growth in the leisure sector. It is not by chance that 60% of travel outside the country in 2005 was driven by leisure tourism. The recent law proclaiming a five-day, 40-hour (rather than 44) workweek should further stimulate this sector. Nonetheless, only in 2011 will all South Korean employees enjoy two days off each week… until then only a fraction of the population benefits from the law. This deadline holds much promise for destination countries as it will go hand in hand with more extensive leisure activities, and thus a heretofore unseen outbound travel rate.But who will benefit from this boom? Historically popular destinations for Korean tourists -China, Japan and North America in the lead- will reap a large share of the profits that all these changes will produce, even if the United States slowed things down with its increasingly difficult visa procedures since September 11. In 2005, China and Japan alone hosted more than half of Korea’s outbound travelers. More than 4 million South Koreans flocked to China, making them the best represented nationality among foreign tourists visiting the Middle Empire. In fact, the entire region is opening to tourism, but the WTO determined that 78% of international travel in Asia was continental. And Koreans are no exception to the rule: Thailand, the Philippines and Hong Kong are often favored over more distant beach or urban resorts.And yet, regions that were once ignored by Korean tourists have now undertaken a veritable race to seduce this new clientele. This is particularly true in Europe, where Korean arrivals rose by more than 20% in 2006. Certainly the Fifa World Cup played no small role in this, although it is not the only cause. The middle classes want something new. The subscription potential of local television must not be under-estimated either as they are extremely popular and broadcast throughout Asia. Romantic television series such as “Lovers in Paris” in 2004, “Only You”, which is set in Venice, and “Lovers in Prague” last year renewed the glamour of these front-line destinations. But Germany and England shared the largest piece of the cake, with 142,000 and 112,000 arrivals respectively last year. It may be observed that the growth in stays in France is slightly higher than the average on the continent: for these shopping fanatics, the appeal and the prestige of French brands is a powerful tool.In terms of accommodations, businessmen stay mostly at 3 and 4*, while young people and students tend to stay at 2 and 3* hotels, and senior citizens and families are mostly midrange clientele. After years of group tourism, which is well established in Asia’s tourism culture, individual clientele is developing significantly, particularly with respect to families and “office ladies”. Likewise, group travel throughout Europe goes increasingly hand in hand with single-destination products, suggesting more modern behavior. Koreans are increasingly allowing themselves to be tempted by packages involving sightseeing tourism, nature and stays in cities and at vacation resorts. At the destination discovering local cultures is a major activity that should be highlighted in brochures.The travel season in Korea is July and August when there is the highest number of departures. In order to reach this clientele, Internet is the vector of choice. The web plays an important role in the lives of Koreans, and thus their consumer behavior. Most homes have a computer and 100% of connections are high-speed, making Korea the number-one country belonging to the OECD in this regard. Online sales have thus grown by more than 15% each year. Within this domain, reservations for travel represent the second strongest buying position in the “land of morning calm” (12% of purchases are made online and 69% are the result of research for ideas and information on the Web).Thus, clientele are young and modern: in 2005 more than half of leisure clientele were under 40, and nearly 30% under 30. Inversely, the over 60s represented only 9.3% of arrivals. This hardly comes as a surprise since we know that the Republic of Korea is one of the most “happening” countries in the zone. This cultural phenomenon partly determines the behavior of citizens when they travel. Window shopping is thus a major part of their activities during their stay. Young people even prefer to cut their spending on accommodations in order to have more money to spend in boutiques. Thus, they are very fond of outlets, factory stores whose concept was imported from the United States and which are well received by Korean consumers. In France, they are among the top clients at stores in Marne la Vallée, or Mac Arthur Glen at Troyes.More generally, all spending abroad is up: in 2004 Korean tourists spent 9.5 billion dollars worldwide. This sum reached 12 billion dollars in 2005. In France, they spent 160 euros per day in 2004, and 200 euros in 2005... Koreans are increasingly rapid to pull out their wallets as their travel experience grows. Moreover, cuisine is an integral part of the travel experience. They grow frustrated when Asian cuisine is lacking for too long. They are curious about foreign gastronomy and want to discover it, but only as long as it remains a choice and not an obligation for lack of something else... And more than other Asian clientele, they appreciate fast service, which indicates efficiency and quality.A classic mistake made by operators at inbound countries lies in erroneously assimilating Korean visitors and Japanese clientele. While they have certain characteristics in common with tourists from the archipelago, Koreans have their own particularities and their own sensibility. To start: language, which is often neglected in brochures and reception cards to the benefit of Chinese and Japanese. Yet, succeeding in capturing this market that holds great promise requires first and foremost approaching it for what it is: its own, separate entity, young and avid for new experiences within a reassuring setting. A few efforts made today to understand this country will pave the way to more significant volumes of clientele tomorrow.
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