Long overshadowed as an aspirational destination by neighboring France, Spain is finally coming into its own among experiential Chinese tourists. Although Spain’s 288,000 mainland Chinese visits last year were a drop in the bucket compared to France’s 2 million, Spain did see an impressive 14 percent leap year-on-year in 2014. More importantly for Spanish retailers, Chinese tourists have become the biggest foreign spenders in Spain, supplanting Russians for the first time ever last year and accounting for nearly one third of total tourist revenue.

This is obviously good news for luxury brands and retailers, but is Spain really ready for this rising tide of Chinese visitors? In recent years, many brands have added Mandarin-speaking staff to Madrid boutiques and “starter-level” measures like Chinese-language signage and printouts, and some museums and restaurants have added similar brochures to help guests navigate exhibitions and menus. Hotels, too, have gotten in on the game, adding Chinese TV stations and menu items like dim sum and congee that have become de facto among most major hotel chains worldwide.

Despite these strides, Spain has a long way to go before it can compete head-to-head with France or even Italy when it comes to attracting and catering to Chinese travelers. The Spanish government seems acutely aware of this, with prime minister Mariano Rajoy announcing plans to process visa applications within 48 hours last September, and more recently engaging in discussions with Asian airlines to attract more traffic to Madrid’s airport. However, it’s an uphill battle for Rajoy, as Air China is the only Chinese airline offering direct flights to Spain, and only seven times per week. This means Spain remains a relatively out-of-the-way destination compared to France (70 flights per week) or Germany (87). With most Chinese travelers still visiting several European countries as part of organized tour packages, getting to Spain is a time-consuming detour for all but the more motivated tourists.

In addition to a dearth of direct flights, visas remain a hurdle in China, with only three Spanish consulates in China able to issue tourist visas. Even more annoying, applicants in China are required to retrieve their visas in person, which may dissuade those from inland second- and third-tier cities. (For comparison, France offers home delivery of visas, and the US lets applicants pick them up at bank branches nationwide in China.)

However, there are signs that a growing number of Spanish destinations “get” the China market and — despite all of the challenges — are figuring out ways to engage and excite travelers. As has been the case in countries like France, South Korea, and the US, this charge is being largely led by major retailers. In Spain, department store chain El Corte Inglés has actively catered to the market by offering tailored services for Chinese visitors, among them a Chinese-language gift guide and high-end Chinese restaurant, and has worked with Chinese celebrities and online influencers to establish itself as a must-see in China.

Instead of waiting for the visa or direct flight situation to work out, retailers and tourist destinations themselves need to take the initiative to attract China’s growing legions of independent, younger travelers, who — if the offering is aspirational enough — will see the effort as reasonable if the experience pays off. It’s worked in France, it’s worked in the UK, and it’ll work in Spain.

For the better part of a decade, most major luxury brands have used the Lunar New Year holiday as an opportunity to engage Chinese consumers through localized, limited-edition items. However, owing to plummeting luxury consumption within mainland China — which has only been worsened by the ongoing anti-corruption crackdown — and a decidedly more low-key turn among a growing number of urban consumers, the red-and-gold dragon-themed Ferraris of 2012 are a far more difficult sell in 2015.

As CLA previously pointed out, this year more luxury brands have opted instead for subdued “red envelope” campaigns, and those that are creating limited-edition items are doing so in a more subtle way. Despite a well-publicized online backlash to its Chinese New Year scarf, Burberry showed admirable restraint in its tasteful sheep-themed “Lunar New Year” display at its Bond Street store, indicating that brands can be low-touch and effective in their holiday marketing.

However, it’s not just luxury brands that are getting in on the Chinese New Year action. Destination restaurants, too, have “gone for the gut” to attract China’s international tourist-shoppers in Europe and the US. (An easier sell, given the central importance of food in Chinese culture, particularly around the holidays.) An example is London’s Hakkasan — which operates branches in cities like New York, Dubai, and Las Vegas — which is currently running a Chinese New Year “Wishing Tree and Festive Feast.”

Comprising a nine-dish menu and “wishing tree” activity (in which guests are invited to write new year’s wishes on special ribbons that are hung throughout the restaurant), Hakkasan infuses Chinese cultural elements rather than awkwardly shoehorning them in. Sister restaurant HKK is also holding a 10-course “Culinary Journey Through China” this month, inspired by the cuisines of a range of Chinese provinces, which engage guests via professionally designed one-off menus they are encouraged to take home after the meal.

Like afternoon tea — which has become a major selling point among Chinese tourists at shopping and hotel destinations in Europe and the US — themed culinary efforts like those launched by Hakkasan and HKK reflect the kinds of tailored gestures that China’s affluent traveling consumer actually appreciates (and spends on). While everyone can see a flashy Year of the Dragon Ferrari, gold Year of the Rabbit Tiffany necklace, or Year of the Sheep Panerai, cuisine is both private and highly culturally resonant, giving upscale restaurants worldwide an edge amid China’s current “stealth wealth” climate.

For years, the stereotype of the traveling mainland Chinese consumer has been a group-tour attendee who spends next to nothing on two-to-three-star accommodations, eats at low-end Chinese buffets…and drops thousands at luxury boutiques around the world. Stories abound of frustrated luxury hotels in Manhattan watching as big-spending VIPs clear shelves on Fifth Avenue then promptly board buses back to budget hotels in New Jersey. As the New York Times wrote last fall:

Tour operators who specialize in bookings for Chinese say there are two main areas where Chinese tour operators look for hotel rooms in New Jersey, one around the Newark airport, the other along the New Jersey Turnpike around the exits for North Brunswick and Edison. They appeal to tour wholesalers booking groups that have spent a day in places like Washington or Philadelphia and plan to spend the next day in Manhattan.

This trend of Chinese tourists — whether ultra-rich or solidly lower-middle-class — scrimping on sleep and splurging on luxury has, perhaps rightfully, been bewildering for leading brands, retailers, and hoteliers. Despite large-scale marketing efforts in mainland China and highly publicized Chinese tea, breakfast, and slipper additions, anecdotal evidence among Manhattan luxury hotels suggests that Chinese guests continue to make up a relatively small portion of their business — and those who have been the most loyal customers remain business travelers rather than tourist-shoppers.

However, recent investments by Chinese companies indicate that these frustrations may be premature, and Chinese guests will, in time, see luxury hotel stays as equally important to the travel experience as their Western and Japanese counterparts.

Fueled by the loosening of government restrictions on Chinese companies investing abroad, a simmering trend of luxury hotels acquisitions by Chinese players has grown to a boil over the past year. In October of last year, China’s Anbang Insurance Group Co. announced that it would purchase New York’s iconic Waldorf-Astoria hotel for $1.95 billion, and high-profile real estate and entertainment juggernaut Dalian Wanda Group Co. paid $900 million last year for a skyscraper (which hosts a luxury hotel) in Chicago last year. In the last 12 months alone, other Chinese investors have spent heavily on high-end hotels in far-flung locales such as LA, Washington DC, and Sydney.

Most recently, China’s Sunshine Insurance Group agreed to pay a whopping $230 million for the Baccarat Hotel in New York — more than $2 million per room. This makes the Baccarat the most high-value hotel property ever, just edging out the $2.04 million paid in 2012 by the Sahara Group of India for the Plaza Hotel in New York.

As real estate broker JLL told the Wall Street Journal, it expects Chinese companies to spend more than $5 billion on overseas hotel investments this year, up from $920 million last year and $130 million in 2012. In addition to boosting and diversifying their overseas holdings — and the obvious prestige that comes from high-profile hotel and real estate acquisitions around the world — many of these companies are investing in what they expect to be a future influx of Chinese guests.

According to a 2014 Hotels.com study, Chinese tourists under the age of 35 are becoming more open to the idea of opting for luxury accommodations, as are individual travelers — who are gradually displacing the once-dominant group tourists in terms of volume, length of stay, and overall spending. Once these tourists “graduate up” to luxury accommodations, the logic goes, Chinese-owned high-end properties may feel they have a leg up on the Western competition. (Being able to better add the features Chinese tourists care about, and leverage vast networks within China — particularly in the case of Dalian Wanda.)

For their part, American and European chains continue to angle for Chinese travelers via localized efforts — to continued mixed results. As Mark Podolski, director of sales and marketing for Pacific Palms Resort in California told the LA Times, ”We try to pamper [Chinese guests] as much as we can,” adding that the hotel has added special Chinese-focused perks such as teakettles and slippers on the entire eighth floor. However, the question remains, “will they care?” Ultimately, it very well could be Chinese hotel owners with an international presence that provide the answer.

As luxury brands look to mitigate a significant slowdown in sales in mainland China, which registered negative growth last year for the first time ever, the country’s e-commerce market remains an attractive opportunity as well as an ongoing challenge. Often fearful of diluting brand value while still looking to boost return on investment in a tough but crucial market, brands must walk a delicate tightrope.

Despite any reservations about e-commerce in China — from the near-futility of fighting a vast gray market to the fact that Chinese consumers are relatively new to big-ticket online purchases — there’s no denying its importance. China is the world’s largest e-commerce market, and according to the Ministry of Industry and Information (MIIT), online transactions leapt some 20 percent year-on-year in 2014, reaching 12 trillion yuan (US$1.96 trillion).

Meanwhile, bricks-and-mortar retail remains a critical touchpoint for brands to reach and influence consumers, despite the fact that in-country sales are tepid, rental costs are high and rising, and staff retention rates are dismal. Consumers continue to do a significant amount of pre-purchase comparison shopping offline, particularly in the cosmetics segment. This adds another layer of difficulty to market entry for smaller Western brands, as those that have undertaken an e-commerce-only market entry strategy have yet to take off in a significant way.

This puts brands in a continued tough position: they need some form of offline touchpoint if they’re to achieve widespread success in China, yet many — if not most — bricks-and-mortar locations are likely to remain expensive showrooms, with the majority of affluent consumers continuing to make big-ticket purchases abroad for a litany of reasons.

Over the past year, most e-commerce efforts among major Western players has centered around Alibaba’s wildly popular Tmall, which in 2014 enticed big names like Burberry, L’Occitane, Rimowa, and Estée Lauder by offering to purge counterfeit and gray-market items. This carrot-and-stick approach clearly assuaged lingering brand concerns, as did the platform’s central position in the market. Since 2011, Tmall sales have increased more than tenfold, reaching $50.9 billion last year. And while Tmall alone is not the answer, when added to a comprehensive omnichannel strategy that includes overseas “China-Readiness” and offline engagement in mainland China and Hong Kong, it can help brands buy some time and make some much-needed domestic sales.

China Luxury Advisors and Covington invite you to a seminar and evening reception on the challenges of online versus bricks-and-mortar for luxury brands on February 5 in London. Panel speakers include principals from China Luxury Advisors, Bloomberg, Yoox, and Rapisardi Intellectual Property. Click here to RSVP.

With more Chinese tourists moving beyond group packages and developing their own itineraries, self-driving trips have become one of the hottest areas of growth. Among younger travelers and middle-class families in particular, renting cars to explore overseas locales at their own pace is fueling an increase in Chinese arrivals from LA to New York — and everywhere in between. This trend has been accelerated by recent developments such as easier and longer-term US visas, more self-driving offers by online tourism agencies in China, and the simple fact that more middle-class Chinese have their own cars back home and find it easy to hit the road in the US or Europe.

According to a recent survey by Mafengwo and the Chinese online car rental site zuzuche.com, the US is by far the most popular destination for self-driving trips among Chinese outbound tourists. More than 46 percent of respondents said they prefer the US for road trips, beating Germany (7.9 percent), Australia (7.6 percent), France (6 percent), and Thailand (5 percent).

The survey found that the majority of self-driving tourists are 25 to 44 years old, with more than 60 percent hailing from first-tier cities (Beijing, Shanghai, Guangzhou, Shenzhen). However, the report noted rapid growth among travelers from Zhejiang, Jiangsu, and Sichuan provinces. By China standards, these tourists are a relatively affluent bunch, with around 30 percent reporting annual incomes of 260,000-500,000 yuan ($41,550-79,970).

So what does this mean for the US? For one thing, it indicates an area of great opportunity for tour destinations, hotels, and resorts “off the beaten path” to reach out to these self-driving independent tourists. This outreach can be via online travel-booking sites, Chinese social media platforms and influencers, or US-based international Chinese students (who, as CLA has previously noted, often make extra cash by “chauffeuring” wealthy Chinese tourists around the country).

This trend also heralds new opportunities for RV brands, retailers, and rental companies to court the Chinese consumer. While the “RV lifestyle” remains highly niche within China, interest is growing, and many Chinese middle-class families are becoming interested in opting for a “hotel on wheels” where they can control the dining options and experience the US on their own terms. Ski resorts and hot springs also have an opportunity to increase outreach to self-driving tourists and encourage them to stop by on their cross-country adventures.

In recent years, many luxury brands, retailers, malls and department stores have seen a wave of Chinese tourist-shoppers unlike any before. Motivated by easier and longer visas, lower prices, the prestige of shopping abroad, and better service and selection, Chinese tourists have become a regular sight from Ginza to Beverly Hills, Bond Street to Madison Avenue.

But alongside the clear opportunity (and rising sales), many, if not most, brands have had to face a new challenge: the unique behavior and demands of these tourist-shoppers.

Having only joined the global travel club in a meaningful way over the past decade, mainland Chinese tourists range from seasoned, independent pros to newcomers on budget-priced group packages, straddling a wide educational and cultural spectrum. Now more than ever, it is critical for brands to be prepared, as Chinese tourism is here to stay. By 2020, the number of mainland Chinese traveling abroad each year will nearly double to 200 million.

Regardless of the inevitable headaches, the upshot for retailers is clear – Chinese tourists currently allocate around one-third of their total travel budget to shopping (triple that of the French). In 2014, Chinese outbound travelers spent an estimated $155 billion abroad, much of it on luxury goods, health and beauty products, and consumer electronics.

Being prepared to receive and serve Chinese tourist-shoppers doesn’t have to be a big production, and — despite the tone of some media coverage — Chinese tourists are far from a monolithic group. Each Chinese traveler is different, and serving them requires the same nuanced approach any luxury brand should be taking to every customer anyway.

One requirement that does apply to every Chinese tourist is patience. Sales staff should be prepared to explain aspects of the brand story and history to shoppers — in Mandarin when possible — and guide the shopper down the path to purchase without condescending. For brands lacking Mandarin speakers, it’s always helpful to create Chinese-language pamphlets or brochures and keep them on hand at all times.

Patience is also a virtue when dealing with more challenging Chinese tourists or tour guides, who may demand discounts or other perks. Calmly and patiently explaining your policies, and perhaps offering an alternative brand-appropriate incentive, is an effective way to defuse awkward situations and ensure a face-saving outcome.

Despite nightmare articles suggesting otherwise, Chinese tourists are gradually getting over their “growing pains” and becoming global travelers in much the same way as the Japanese, Korean, and even American tourists who preceded them. By remaining patient and understanding, brands can avoid tough situations and make a customer for life, whether that customer is a travel newcomer or sophisticate.

With Chinese New Year just around the corner, luxury brands have started rolling out limited-edition collections celebrating the Year of the Sheep. Aimed at Chinese shoppers worldwide, commemorative Chinese New Year collections (and store decorations) have become increasingly common in recent years, ranging from overt (the infamous Gold-and-Red Ferrari 458 in 2012) to subtle (Dunhill’s snake cufflinks in 2013).

This year, a wide range of brands, from Louis Vuitton, MCM, Piaget, and Estée Lauder to Chow Tai Fook, Swarovski, Vacheron Constantin, and Panerai have gotten in on the Sheep-themed action. Retailers, too, are joining in, with Year of the Sheep displays appearing from Fifth Avenue to Knightsbridge.

For brands looking to attract Chinese New Year tourist-shoppers, one of the most tried-and-true strategies is the customized Red Envelope (hongbao). Traditionally stuffed with cash and distributed among friends and family around the holiday, Red Envelopes have been used by brands, tourist destinations, and retailers to publicize gifts with purchase or “Spend X Get Y” promotions and engage outbound Chinese shoppers around the world.

Best practices for Red Envelopes include offering something with inherent value and appropriate flattery; making them bilingual; including promotion codes for customers to present at stores, to track spending; adding QR codes for WeChat accounts (when applicable); offering additional discount/promotion for those who bring friends and family; and using color schemes that include red and gold (auspicious colors in Chinese culture).

Although many brands and retailers hand out Red Envelopes to Chinese shoppers in-store, China Luxury Advisors recommends a more proactive approach, targeting Chinese tourist-shoppers through tour operators or guides, as well as US-based demographics such as international students.

To discuss Red Envelope opportunities for the Year of the Sheep 2015, contact Renee Hartmann at renee [at] chinaluxuryadvisors [dot] com.

2014 was an eventful one for watchers of the Chinese tourism industry. Despite the damper that the continued crackdown on corruption from the Chinese government placed on government travel and spending, growth in Chinese tourism remained stronger than ever. Chinese travelers took an estimated 115 million outbound trips in 2014, a more than 18 percent increase over 2013, when around 97 million trips were taken.

Last year also marked the much-anticipated Alibaba IPO, making China’s e-commerce powerhouse a household name in the US. The digital juggernaut also rolled out a suite of new products in the US market in 2014, among them the online storefront 11Main, and the cross-border payment and logistics solution Alipay ePass. With these developments, Alibaba has made progress in helping brands sell to Chinese consumers – whether they’re in China or the US – who are seeking authentic American products.

However, arguably the most significant event related to Chinese tourism in 2014 was a surprise announcement by President Obama during his November visit to the APEC Summit in Beijing. The new reciprocal visa agreement reached by the US and China extended business and tourist visas from one to 10 years, and student visas from one to five years. Data from the Chinese online travel site Ctrip.com indicated that applications for US visas shot up 50 percent shortly after the announcement.

The agreement was welcome news for the hospitality and retail industries in the US, both of which expect a continued influx of Chinese guests. According to a statement released this fall by the White House, “as a result of this arrangement, the United States hopes to welcome a growing share of eligible Chinese travelers, inject billions in the US economy and create enough demand to support hundreds of thousands of additional U.S. jobs.”

As 2015 kicks off, China Luxury Advisors predicts the following five Chinese tourism trends to gain pace in the United States:

5.) Chinese Tourism to the US Will Outpace Europe and Other Destinations.

Heartened by easier (and longer) visas, more Chinese outbound tourists will opt for trips to the US over popular destinations such as Paris or London. Already seen as an aspirational locale for shopping, education, and real estate, the US will be a major beneficiary as Chinese travelers take more than 200 million outbound voyages by 2020. By 2021, the US expects the number of Chinese tourist arrivals to more than triple to 7 million, contributing more than $85 billion per year to the economy.

4.) Chinese Investment in the United States Will Gain Pace.

Expect Chinese companies to buy at least one major Hollywood studio in 2015, and continue to make large-scale investments in other US companies and industries. Some of China’s wealthiest and most powerful businessmen – among them Alibaba’s Jack Ma and Dalian Wanda’s Wang Jianlin – have made clear their intentions to acquire US businesses, particularly in the cinema industry (with Wang of Dalian Wanda purchasing the AMC movie chain in 2012). As Ma put it, “In ten years, I want five of the top ten global movies to be made by Alibaba.”

Look for Chinese companies to also intensify their focus on acquiring high-profile hotels or hotel chains in 2015, coming off of the heels of this fall’s purchase of the iconic Waldorf-Astoria hotel by China’s Angbang Insurance Group for $2 billion.

3.) 2015 Will Be the Year of Mobile Innovation for Chinese Tourism.

By 2015, the number of smartphone users will exceed PC users in China. Younger Chinese consumers in particular have established themselves as highly mobile-savvy, in many cases preferring mobile commerce (m-commerce) to traditional e-commerce, and spending an increasing amount of time using mobile apps such as WeChat to communicate with peers, shop, and interact with brands.

This growing reliance on mobile devices has also extended to the tourism industry. Currently, 40 percent of bookings on the Chinese online tourism-booking site Qunar are made on mobile, and the company’s mobile revenue skyrocketed 400 percent in 2014. This year, look for Chinese travel sites to invest heavily in innovation as a means to remain relevant and compete in a cutthroat market.

2.) WeChat Will Extend its Reach Outside of China, In Line With Chinese Tourism Destinations and Trends.

Already the most relevant platform to reach and influence Chinese users, Tencent’s mobile messaging app WeChat is here to stay. Currently with more than 400 million users, WeChat has steadily increased its global footprint, and now boasts some 40 million users outside of China. For many Chinese tourists, WeChat has become an indispensable resource for pre-travel research, and via innovative new features has become a way to interact with travel destinations – and even book trips. For brands, WeChat is arguably the easiest way to interact with Chinese fans worldwide, to provide tools such as global store locators and live-chat customer service to globetrotting shoppers.

This year, look for WeChat to continue its overseas expansion efforts, extending new advanced functions and m-commerce to make it easier than ever for international brands, retailers, hoteliers, and malls to get Chinese travelers in the door and increase conversion rates.

1.) 2015 Will Be the Year of the Individual Chinese Tourist.

Building on trends seen over the past several years, 2015 will be the year that the individual Chinese tourist becomes more important to brands and retailers than their group-travel counterpart. The ongoing anti-corruption crackdown has crimped organized group travel among government officials – trips that invariably included high-end shopping excursions. The rise of the independent traveler – typically young, educated, and relatively wealthy by Chinese standards – has been noted by Chinese travel sites such as Ctrip, Caissa, and Qunar, all of which have put more emphasis on tailored experiential travel packages in recent years.

Young tourists have increasingly fueled the emergence of independent Chinese travel. Thirty-eight percent of outbound Chinese travelers are between the ages of 25 and 34, and 67 percent plan to make their own travel arrangements. Additionally, independent travelers have often engaged in group travel in previous years and now opt to go it alone, with greater confidence in their itinerary-building abilities. (A fact that has led to a strong increase in Chinese visits to places off the beaten track.)

Independent travelers are not just important to brands and tourist destinations – they’re increasingly critical, because they influence friends and family, and spend on experiences and accommodations – whereas group travelers typically spend only on shopping trips, skimping on accommodations, food, and experiences.

With many young, digitally savvy Chinese leapfrogging straight to online video, watching 698 million hours of video on Youku Tudou and an estimated 569 million hours on iQiyi this August, the country’s online video market has become big business. As consumers increase their time watching streaming TV shows and films — particularly on mobile devices, which account for around 60 percent of Youku Tudou’s more than 500 million users — the country’s online video market is expected to double in size to $6.5 billion by 2017. In the second quarter of 2014 alone, Chinese online video sites reportedly raked in $662 million in ad revenue, an increase of 43 percent year-on-year.

The rapid emergence of China’s online video market has disrupted the industry not only within China, but around the world, as powerful homegrown players have spent heavily on securing the China rights for foreign film and TV content while investing ever more in producing original content. In the third quarter of 2014, Youku Tudou and iQiyi launched in-house movie studios, and within the next year, iQiyi plans to produce seven local films and 500 web series, up from 300 such series this year. In total, research firm EntGroup expects Chinese video sites to produce 1,700 original episodes this year, a rise of 70 percent over 2013.

For these sites, creating original content is a no-brainer: production costs are around one-third those of traditional programs, and the speed with which concepts can be churned out means producers can quickly jump on hot-button issues and resonate with viewers.

As producers in China pump out new shows, international developments illustrate the growing footprint (and ambitions) of China’s online video market. In the US, home to nearly 275,000 international Chinese students, new Mandarin-language productions such as “Looking For Angels” — which follows a group of young affluent Chinese residents in Los Angeles — provide a window for Chinese consumers to learn about international lifestyles, brands, and fashion. (And for brands to influence these viewers, as they have via Korean television programs with rabid followings in China.)

With Chinese tourist arrivals in the US expected to triple to nearly 6 million by 2020, and overseas spending on luxury items and consumer goods remaining strong, smaller brands in particular may find online video to be a more cost-effective way to attract Chinese shoppers in the US or Europe. Meanwhile, the seamless nature of online video gives brands a new and valuable avenue to tap viewers in China via emerging e-commerce sites and tools like Alipay’s ePass or Asia Checkout.

To discuss “Looking for Angels” sponsorship and partnership opportunities, contact CLA at renee [at] chinaluxuryadvisors.com.

Ideally positioned between China and popular European tourism and business destinations, and linked by dozens of direct flights to major Chinese cities, the United Arab Emirates (UAE) has already benefited greatly from China’s outbound investment and travel boom. In 2013, Dubai saw Chinese arrivals increase 11 percent to nearly 276,000, and more than 81,000 mainland Chinese visited Abu Dhabi in the first nine months of 2014 — a 167 percent increase year-over-year.

According to the Hurun Report, Dubai is the third most popular global destination for Chinese travelers, and the Abu Dhabi Tourism Authority reports that China is now its fourth largest source of foreign tourists. (Trailing only the UK and India among non-Gulf countries.)

Since gaining approved travel destination status from the Chinese government in 2009, Dubai in particular has spent heavily in China promoting itself as an elite destination, linked by easy direct flights and offering tax-free luxury shopping at world-class venues like the Dubai Mall. More recently, Abu Dhabi has taken a more proactive approach, looking to cater to Chinese visitors at The Galleria (which boasts brands such as Alexander McQueen, Balenciaga, and Céline) and offering ample conference space to Chinese companies.

Luxury hotels in the UAE have reported strong growth as well, with the total number of Chinese guest nights in Abu Dhabi increasing 115 percent in the first eight months of the year. Dubai hotels have also pulled out the stops to appeal to Chinese travelers, featuring Chinese buffets and lion dances and handing out red envelopes around Chinese New Year. By all accounts, these efforts are starting to work. This April, Nu Skin China flew 14,500 employees to Dubai and Abu Dhabi for a massive corporate trip that pulled in an estimated $80 million for the emirates, and Dubai reported a 26 percent rise in Chinese tourist visits in the first half of the year.

Despite the positive momentum, a great deal of work remains to be done before the UAE joins Paris, New York, and even Seoul as a top destination among Chinese globetrotters. Mandarin-speaking sales staff remains in strong demand and relatively short supply, and malls, hotels, and restaurants are struggling to catch up with the influx of Chinese guests (and their unique demands). In 2015, the UAE must do more in China to promote more than just luxury malls and shiny skyscrapers, crafting the right message to ensure Chinese tourists feel the need to return again — for more than just tax-free shopping.