We Share the State of Affairs
In 2003, with the exception of the Global Financial Crisis of 2009, the United States began enjoying strong and steady growth in both inbound international visitation and spending. In the last decade, the number of inbound travelers has doubled from roughly four million to 7 million, while spending has increased by 50% in the same time period, up to $251.4 billion. International travelers vacation for significantly longer periods of time. According to the World Travel & Tourism Council, travel and tourism accounted for 8.1% of America’s total GDP at $1,509.2 billion, with the industry directly and indirectly supporting over 14 million jobs. However, after years of double-digit growth, the growth in annual spending is decelerating, from 14% in 2008, to 7% in 2012, and to 2% in 2017, while annual visitation to the U.S. began to decline in 2015 – and has yet to stop. According to Bloomberg, America is one of two out of the top dozen global destinations to see a decline in international visitors in the last three years, while at the same time our market share has dropped in nine of our ten top source markets.
Here at PGAV, sudden changes in established trends always catch our eye, and cause us to inquire, “why” and “what should we do about it?”
Over the last several years, from the US Council of Mayors to the American Alliance of Museums to the Southeast Tourism Society and beyond, we’ve heard impassioned requests for insights into what international visitors think and what they’re doing when they enter The Melting Pot; and to date, we couldn’t find a precedent. Therefore, we’ve once again collaborated with our longtime partner H2R Market Research to survey 985 travelers who have visited America, are considering visiting our country, or who live here to explore inbound travelers’ behavior, motivations for visitations, barriers, and feedback on visiting the United States. Leveraging a professionally managed email panel and online survey methodology, 75% international visitors and 25% Americans were screened to ensure they were attraction visitors, household decision makers, and have visited America or have considered doing so. We selected the five greatest feeder markets to the United States – Canada, Mexico, Japan, China, and the United Kingdom – together representing 65% of total inbound travel. The insights gained from our panelists paint a picture of opportunity for tourism professionals to better understand these guests, and create more fulfilling and enriching experiences for them. International visitors to America may be many things; but if they are one thing, they are welcome!
The Drive to Travel
When considering visiting somewhere in America, international travelers have an unsurprising list of top priorities, such as somewhere safe, wholesome, welcoming of other cultures, and a diversity of things to see and do in close proximity. Interestingly enough though, out of 15 different tested options, two of the lowest priorities are offering language interpreters/translation services and a destination that offers culturally-sensitive amenities. While both considerations certainly still influence decision-making, perhaps visitors are inherently looking for something that stretches their comfort zones and isn’t so culturally familiar. It’s exciting to explore a different, new land.
In the next five years, don’t be surprised to see the highest concentration of international guests at theme parks (66%), historic landmarks and places (68%), and shopping (72%) – as those are the three activities most likely to be pursued by these travelers. In fact, these three activities appear in the top five intended activities across all five countries. Conversely, international guests are least likely to want to visit professional sporting events (37%), universities (21%), and business conferences (17%). Mexico (63%) and China (66%) both exhibit the highest intent to visit American attractions in the next five years, while our other three respondent countries hover around 40%; Japan 41%, United Kingdom 38%, and Canada 35%.
For those international visitors who have already visited America, leisure – such as a getaway, reunion, or vacation – came in as the top motivator at 65%, distantly followed up by visiting friends and relatives living in the US (15%) or visiting a specific attraction (7%). Of important note is that Chinese travelers are 12% points more likely than the average to visit America for leisure, while Mexican travelers are 12% points less likely.
Emotionally-speaking, these visitors had three clear elements that inspired them to travel in America:
- Having a variety of things to see and do
- Trying something they couldn’t do on a daily basis
- Finding somewhere they could all have fun together.
Authentically American
Just as culture is to an organization, authenticity is one of the most valuable and inimitable assets a brand can have. Authenticity is strongly associated with honesty, truth, and integrity – all essential elements of any relationship. In the Real Potential edition of Destinology, we explored Americans’ perceptions of authenticity. Most notably, 80% of attraction visitors like to visit places that are authentic – spots where something real happened in history, natural places untouched by human hands, and unique things that couldn’t be done elsewhere. Natural attractions like the Grand Canyon and living history museums like Colonial Williamsburg ranked highest.
Attributes of Authenticity
- Unique: Original, artistic, inventive, spontaneous
- Real: Historical, Natural, Landmarks
- Human: Genuine, Trustworthy, Caring
- Non-Commercial: Simple, not fake/glitzy, not “out to make a buck.”
- Social/Emotional: Bonding, Feeling closer to family/friends
A visit to the United States is inherently authentically American – catching a game at Wrigley Park, grabbing lunch at In-N-Out, or strolling Central Park – all of these are American experiences simply based on the sights, sounds, and people who populate these spaces. The most “authentically American” experiences for our international respondents can be categorized as Food (24%), Locations and Landmarks (21%), and Leisure (18%).
For the foodies of today, tasty treats often come top-of-mind when traveling the world – how ingredients are sourced, stored, prepared, and served tells so much about people’s community, family, values, economy, and culture. Smells of savory bao conjure warm feelings of street stalls in Shanghai, while grabbing a cob of corn covered in mayonnaise and chili pepper can make most bellies grumble and long for Dios Muertos. Unsurprisingly, technology ranked as the lowest “authentically American” asset, most likely since so much of our hardware is imported, as well as transportation – hypothetically because these other countries also have similar taxis, buses, streetcars, trains, and planes, so ours don’t stick out as clearly American. These insights may explain why campaigns like Brand USA’s “Ask a Local” have been so popular.
Closing the Coastal Gap
When considering visiting the United States, we asked our respondents the open-ended question of what places, attractions, activities, or events were they interested in visiting. “Disney” was top of mind for 27% of them, followed by New York City (19%) and Las Vegas (12%). We then gave our overseas friends a list of 54 attractions and asked them which ones would be most likely to inspire a trip to America. Those that topped the list were dominated by massive entertainment icons and landmark wonders, such as Disney World, Disneyland, the Grand Canyon, New York City Icons, and Niagara Falls. 30 of the 54 destinations were selected by 3% or fewer of our respondents as places likely to inspire a US visit.
We followed up with our respondents who had taken a recent trip to America, and asked them where they had traveled. A similar pattern evolved to those considering traveling to the States – once people hit their point of entry, they tend not to go much further. Los Angeles, New York City, Orlando, Las Vegas, San Francisco, and Anaheim all topped the list, universally recognized as concentrated hubs of attractions and environments catering to tourists. What do all these top-visited or top-intended destinations have in common?
They’re not far from the coast.
This trend is absolutely not unique to the States, and is actually rather easily explained. These coastal and border towns developed over centuries as ports of entry, and therefore have centuries of architectural and historic attractions, complemented by mature and robust tourism industries able to support large flows of visitors.
The challenge for many tourism practitioners in America, therefore, is how to pull these visitors deeper into the heart of the country. Since the majority of these heartland destinations rank rather low on the motivation and experienced list for these travelers, the key is to intertwine them as essential, do-not-miss opportunities with the nearest, major, coastal port of entry and interest. This may involve collaboration with major attractions in these regions, offering discounts for international visitors, short-distance travel cooperation, and emphasizing some of the top priorities/interests of international travelers in global and port-of-entry marketing efforts.
65% of international guests find “authentically American” experiences alluring; and no matter where a destination is, it can certainly promote and provide the food and leisure experiences these travelers are seeking.
Yes, We Accept WeChat Pay
The U.S. Travel Association notes that Chinese visitors spend about $6,000 each on every visit to America, as opposed to the average $4,000 from visitors from other countries – and their top activity is shopping.
“Luxury brand purchases are surging in part because American stores carry a broader range of products than their counterparts in China,” said Julia Zhu, Consulting Director for Frost & Sullivan. Because of China’s taxes, luxury products are about a third cheaper in the United States.
So what are tourism practitioners like you doing to welcome China’s big shoppers? Los Angeles’s Tourism Office has opened a handful of offices across China, which actively market on Chinese social media platforms and search engines such as Weibo, WeChat, and Baidu. The city also implemented its China-Ready program, which helps educate operators, provides language and cultural assistance, and gives marketing advice. Universal Studios now offers a park tour in Mandarin, while the Getty provides Chinese audio guides, maps, and markets on Weibo and WeChat as well. Caesar’s Palace in Las Vegas set up WeChat pay, a popular Chinese mobile payment system similar to Apple Pay. Tiffany & Co., which made almost a quarter of its United States revenue last year from foreign tourists, has added Mandarin-speaking sales staff to its major stores, as has Burberry, where more than half of sales at its flagship stores are to tourists. Montblanc sells Year of the Dragon pens and has staff members who speak Mandarin and Cantonese, while also printing Chinese-language brochures about its products and selling wallets sized for Chinese currency.
Adapting retail experiences to suit international travelers’ shopping preferences, interests, and comforts simply makes smart business sense. For more tips on welcoming guests from abroad, read the Business Development Bank of Canada’s “Six Easy Strategies to Attract More Foreign Visitors to Your Tourism Business.”
Barriers to Entry
First impressions can be difficult to perform well, and America as a destination isn’t immune to that challenge. 40% of first-time visitors to America would recommend the attraction(s) they visited to family and friends, while 20% are not likely to recommend – yielding a Net Promoter Score (NPS) of 20%. For those international travelers who’ve visited the States before though, the NPS rises strongly to 31%. For comparison, American residents give American attractions an NPS of 48%.
For those international travelers who noted that they were unlikely to visit America in the next five years, open-ended responses revealed that the top reason they wanted to visit other destinations (20%) – it is a big, beautiful world with lots to see and do, after all! Additionally, respondents noted that they had yet to save up the money needed for such a trip (18%), they simply weren’t interested in visiting America (11%), and that the current political climate of the United States made them uncomfortable (9%).
Giving these travelers a bank of options, affordability came in as the primary barrier, a confirmation of the desire to visit elsewhere in the world, the lack of family or business in the States, or that it’s simply not easily accessible. Correlation analysis additionally supported a desire for global variety; or simply put… “been there, done that.”
However, we know that one of America’s greatest tourism strengths is its variety. The natural beauty of the Cascade Mountain Range is entirely different from the steep slopes of the Rockies; the city lights of New York twinkle so differently than those of San Francisco; and the food, cultures, accents, and music varies widely from the bayous of Louisiana to the rolling green hills of Wisconsin. Cross-attraction, organization, and regional collaboration, encourage international guests to return and explore different unique parts of the country. It’s not a finite piece of the pie – there’s enough authentic America to go around.
