Recently, the Ministry of Culture and Tourism projected that domestic tourism in China is expected to reach 4.29 billion trips and generate spending of 4.32 trillion yuan in the first three quarters of this year. These figures reflect year-over-year growth of 16.8% and 17.1%, respectively, bringing us close to pre-pandemic levels in 2019. However, while the overall number of tourists and spending is on the rise nationwide, some popular tourist destinations are experiencing a peculiar phenomenon where they attract large crowds but struggle with low revenue, leading to claims that this indicates a downgrade in consumer spending. Is that really the case?
On closer examination, this assertion appears to be somewhat misleading. When analyzing the elements of tourism spending, people are willing to invest several days and thousands of yuan in “accommodations, meals, and transportation” during their travels. Given the mindset of “since I’m already here,” they generally don’t hesitate to spend more on “entertainment, shopping, and experiences.” The issue of high visitor numbers but low spending at certain scenic spots may not stem from tourists being unwilling to spend; rather, it suggests that these locations fail to offer products and experiences worth paying for. From this perspective, the financial struggles of some popular spots are not necessarily a result of consumer downgrade but indicative of supply-related issues.
Firstly, there is an imbalance in development between large and small attractions. In recent years, while alternative forms of tourism, such as rural and small-town trips, have gained popularity, traditional large scenic areas and cities continue to be the main attractions. Many lesser-known “hidden gems” still face infrastructure limitations that hinder access and overall visitor experience. Secondly, there is an insufficient transition from old to new. As consumer preferences in cultural and tourism sectors evolve, people have increasingly moved beyond simple sightseeing and photo-taking, actively seeking smart tourism, immersive experiences, complementary performances, and cultural products. In this environment, it’s unsurprising that some popular sites rely heavily on ticket sales, leading to low revenue or even losses.
Looking at the broader cultural tourism market, the phenomenon of crowded yet underperforming tourist spots reflects an increasing demand for upgraded tourism experiences rather than a decline in consumer spending. If these destinations want to capitalize on visitor spending, they need to focus on improving their offerings. Drawing tourists in is merely the “baseline” for tourism supply, resulting in only modest profit; retaining visitors to encourage spending is where the real value lies.
In recent years, many popular destinations have gained traction due to their unique resources, rich cultural atmospheres, and even innovative lighting designs. However, many visitors merely take photos and check in on social media without fully engaging with the offerings. For these destinations to maintain their appeal, they need to continuously invest in both their infrastructure and service quality. Adequate physical facilities should address basic needs like parking, dining, and restrooms while also enhancing newer infrastructure like charging stations and reliable internet access. On the service side, it’s essential not to rely solely on ticketing, guided tours, and basic food offerings; there needs to be a continuous improvement in service content and quality to cater to personalized desires in the digital age.
The right combination of appealing attractions and new business models can significantly boost tourism consumption, but these new models must also evolve. In previous years, unique accommodations, cultural products, and educational experiences were novel; now, they have become commonplace. To continuously invigorate consumer spending, the Ministry of Culture and Tourism has proposed implementing an upgrade plan for new business models, focusing on the rapid development of online broadcasting, immersive experiences, cruise tourism, and RV camping, among other initiatives. These efforts will provide tourists with a richer array of spending options while simultaneously creating more opportunities for tourism enterprises.
