China Insights

How will Emerging Generation Y change China’s travel market

Yan Li

Head of Qualitative, Kantar China

Shoppers 03.07.2019 / 18:00

Emerging GenY group photo

Their complete travel experience circle has five stages: dream, plan, book, experience and share.

Overview of Emerging Generation Y’s power

There is no strict demographic definition for Generation Y – they were often defined as born from the end of 1970s to the middle of 1990s. The cohort, also known as Millennials, is also referred to as two generations in China: post 80s and pre 95s. Generation Y now accounts for 31% of China’s total population. Their income vs expense ratio is 3:2. They will lead the change of consumption patterns of China, or even the world, in the next 10 years. They are a demographically diverse generation, and this diversity has shaped their preference for cultural openness and exploration.

Because of the cohort’s size, Generation Y in China can be helpfully divided into Adult GenY (born from 1979 till 1986) and Emerging GenY (born from 1987 till 1994) as they bridge the critical life stages of early adulthood and parenting. In 2019, Emerging GenY are from 25 to 33 years old, accounting for 44% of the whole GenY. Among Emerging GenY, 39% live in rented house/apartments, while another 32% live with their parents.

How they grew up has influenced what they will become

Each generation grow up in a different world and that will largely impact their mindset on consumption when they enter adulthood. For Emerging GenY, their consumption preference has three characteristics:

1. Spend to please themselves

When the oldest members of Emerging GenY were born, China had adopted one child policy for at least five years. Naturally they became the centre of their big family’s attention and grew up in a “4+2+1” family structure. They are relatively independent and often have strong opinions by themselves. Influenced by this background, Emerging GenY pay more attention to their own needs and prefer more personalized services/products.

2. Spend to upgrade

Emerging GenY were born in a time when China’s economy really took off. The amount of dispensable income and level of urbanization kept climbing. They lived in a much better off financial environment than their parents and have never experienced any shortage of necessary daily goods. This group are eager to upgrade the products/services they are using.

3. Spend to explore

Emerging GenY grew up with China’s Internet and their mindset has been heavily influenced by the philosophy of Internet. In late 1990s, Internet boom began in China and became an essential tool as well as an entertainment platform for Emerging GenY. As China’s Internet continuously revolutionize itself and the digital landscape kept shifting, Emerging GenY are very open to new digital innovations and lifestyle. They are keen to spend money on innovative, cutting-edge and even disruptive products/services/experiences.

Emerging GenY is reshaping China’s travel market

They are digital natives. By 2020, half of the world’s working population will be Millennials. They have been carrying similar tags since their adolescence days, such as unique taste, keen to have special experience, savvy in socializing and technology, and passionate about fashion. In 2019, are these characteristics still valid?  

What are the expectations of the Emerging GenY in their 20s and 30s? More importantly, how are they going to change the landscape of China’s travel market?

The exact consumer journey of each Emerging GenY traveller is different, but overall, this generation’s complete travel experience circle can be summarized as five stages: dream, plan, book, experience and share.

Emerging Gen Y 5 Stages

Stage 1: Dream

Emerging GenY’s travel begins with a dream. Travel experience is their new social currency. Social media has an oversized influence over their travel decision. They made travel decisions much earlier than the actual travel date.

Emerging GenY’s travel dreams were inspired by others. They rely on social media to collect information of travel destinations. They are also keen to search information about travel experiences. User generated contents can win their trust and enhance their willingness to try. They see fellow travellers around the world as their travel consultants.

Thanks to the dynamic social media ecosystem, Emerging GenY is no longer satisfied by traditional tour groups or classic travel routes. They want customized destinations, itinerary, hotel and experience, such as new travel scenic spots that suddenly go viral, cultural icon trips, or a completely relaxing vacation.

As more and more Emerging GenY become parents, they want to take their family out on longer trips. They expect exciting family travel experiences. Their choices are related to the age of their children: for 3-5 year old, they will travel to see things; for 6-9 year old, they travel based on their interests; for 10-year and above, they wish to learn new knowledges during the trip.  

During the “dream” stage, Emerging GenY are very uncertain about their destination and other travel brand choices. It’s a good opportunity for marketers to engage them. The long time window between when they start to “dream” and when they actually pay for their travel arrangements means there are many touchpoints for marketers to recruit or engage them.

Stage 2: Plan and book

Travel is now a very segmented experience: Emerging GenY travellers not only constantly check travel information on apps, but also buy whenever they feel right. They are always planning and booking on the go.

Kantar’s Connected Life study showed that Emerging GenY not only collect information from digital platforms, but also rely technology to make their travel experience more independent and to ensure they are always in control. They wish their travel can be more empowered by technology, can search destination information or related products on more apps, can view travel arrangement options in a module-based model. They even want to receive recommendations based on their mood at a specific moment during the trip.

This insight indicates that travel brands can still approach Emerging GenY even when they are already on their way.

CN Emerging Gen Y Planning Full

Emerging GenY travellers are not yet in their prime time for income and have relatively lower budget. But this doesn’t necessarily mean they are frugal. During their booking process, they are empowered by travel platforms and technologies to get more cost-effective or authentic experiences from their limited budget.

Price comparison platforms, online travel agencies, shared lodging booking platforms are constantly upgrading their digital services. They have also nurtured a whole generation of travellers with savvy booking knowledge and tips. As long as they can get an answer, Emerging GenY don’t mind talking to ChatBots. AI and immersive experience devices can help them feel more in control for future trips.

CN Emerging Geny Tech Full

Stage 3: Experience and share

People are under the impression that Emerging GenY prefers unique accommodation experience or shared economic lodging. This is still valid. At the same time, they want customized content from travel; they want their experience to be exclusive to themselves.

In fact, they won’t stop at their own experience: they share it on social media. This is not just for their own memory, but also for consolidating their online identity. They even want to become a source of inspirations for others, become a KOL (key opinion leader) of their small travel circle.

CN Emerging Gen Y Experience Full

Direction for travel industry to get ready

Unique: They long for unique travel experience and communications messages to please themselves. If you are a scenic spot, can you offer that experience?

Quick: They want to book a customized travel experience quickly. They expect to see new travel products launched more frequently. They are always eager to try out the latest technology. If you are an online travel agency, do you have enough new products? Does your offer have enough technology elements in it?

Show: One of the key outcomes of their travel is to consolidate/optimize their digital identities, to enhance their influence in their circles, to share their value and taste. If you are a hotel, are you confident that Emerging GenY will take selfies in your hotel and share them onto their WeChat Moments?

As Emerging GenY become the mainstream customers of travel market, is this industry well prepared to serve their needs? Please contact us to get more insights about them.

Source: Kantar

Editor's notes

* To reach the author, or to know more information, data and analysis of China's travel market or China's consumer segmentation, please contact us ;

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