Insight into The needs and attitudes of

Chinese Free and Independent Travellers (FIT)

Module 1- The Context #NZCNTourism

2

MODULE 1 – THE CONTEXT

In this module we will cover

The China FIT market – WHY it is important to you

• Size of the opportunity

• Rapid Growth – is set to continue

WHY travel - WHY New Zealand

• Travels role and relevance for the Chinese

• How the Chinese see New Zealand – WHAT is the attraction

• What is key to our story

Understanding WHO we are targeting

• Different target opportunities within FIT - Understanding Chinese FIT segmentation and different needs and opportunities

• How to identify the target audience that fits for you - using a simple overview of the Chinese FIT groups.

The TOOLS to build a targeting plan for growth

• Customer Segment tool – either simple or more comprehensive to enable you to identify your customers

• #NZCNTourism adaptation of the Lean Canvas – enabling you to build a business plan on one page, this will be used though the modules and can be built on as you work though your areas of interest

Welcome

This module provides insight into the rapidly evolving Chinese Free and Independent Travellers (FIT) market, outlining key segments to enable you to identify target audiences for your services.

WHY is the Chinese Traveller market important?

Chinese travellers to New Zealand are

our second largest visitor market

growing over 34% in a year

Imagine applying that value and growth

to your business

CHINESE TRAVELLERS REPRESENT A SIGNIFICANT

OPPORTUNITY

AUSTRALIA1,317,616total visitors

509,392holidayCHINA

344,944total visitors

263,952holiday

USA239,952total visitors

148,544holiday

UK200,112total visitors

84,672holiday

Germany83,616total visitors

61,040holiday

Japan86,112total visitors

56,832holiday

Chinese travellers are the second largest visitor market to New Zealand.

Source: Statistics New Zealand – International Travel & Migration: YE Nov 2015

6

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

2007 2008 2009 2010 2011 2012 2013 2014 2015

CHINESE VISITOR GROWTH IS STEADILY

INCREASING YEAR ON YEAR

CHINESE VISITOR ARRIVALS

through time

Total

Holiday

119,880 112,155104,527

120,222

141,289

194,752

231,120

257,584

344,944

73,855 73,672 67,39380,087

94,917

138,912

170,832188,656

263,952

In 2015 more than 260,000 holiday makers arrived from China to New Zealand, a 40% increase from the

previous year.

Source: Statistics New Zealand – International Visitor Arrivals: YE Nov 2015

34%

11%

19%

38%

18%

15%-7%-6%

40%

10%

23%

46%

19%-9%0%19%

7

CHINESE TRAVELLERS REPRESENT A SIGNIFICANT

OPPORTUNITY

Source: Statistics New Zealand – International Visitor Survey: YE Jun 2015

Chinese travellers are rapidly changing their travel patterns, The Independent visitors are staying longer, visiting more regions and taking on more activities.

TOUR / PACKAGE

VISITOR

INDEPENDENT

VISITOR

AVERAGE

SPEND

AVERAGE

SPEND

MEDIAN STAY

MEDIAN STAY

7DAYS

3DAYS

$4,322

$4,832

158,730

136,195

REGIONS

VISITED

REGIONS

VISITED

AVERAGE NUMBER OF

ACTIVITIES

3.7 12.7

AVERAGE NUMBER OF

ACTIVITIES

2.5 10.6

It is only at the beginning

There is an opportunity to build for a

market that has further growth potential

9

AND CHINESE TRAVELLERS WILL CONTINUE TO

DRIVE SIGNIFICANT FUTURE GROWTH

CHINESE INTERNATIONAL OUTBOUND TRAVELLERS

China outbound tourism will continue to accelerate as more Chinese travel overseas and are choosing to travel multiple times a year

Source: China National Tourism Administration – 2015

MIL

LIO

NS

28 3035

4146 48

57

70

83

98

109

130

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

10

CHINESE ARE TRAVELLING MORE

From 2014 to 2015 the number of Chinese visitors to New Zealand grew 34%1.

This growth is global2 – with even greater potential for New Zealand as short haul travellers increasingly travel greater distances.

JAPAN115%

FIJI40%

MAURITIUS40% AUSTRALIA

20%

MALDIVES40%

THAILAND93%

NORWAY60%

FINLAND44%

NEW ZEALAND34%

The fuel in the engine is the continuing growth of the Chinese urban middle class

Source1: Statistics New Zealand – International Visitor Arrivals: YE Nov 2015

Source2: Wolfgang Georg Arlt, Dec 2015, China's Outbound Tourism In 2015: Another Year Of Resilient Growth And New Trends – Forbes

WHY is travel important to the Chinese?

AND

WHAT is it about New Zealand that is

attractive?

The growing Chinese middle class is

changing the global tourism industry

Travel is a core part of the emerging

middleclass Chinese psyche

They want to travel more

to places they love

13

CHINESE FIT ARE CONFIDENT, SOPHISTICATED, EXPERIENCED

TRAVELLERS

Chinese - The FIT Active Considerer

• Travel is an extremely important part of life. Planning, experiencing, sharing

• They have had many different and varied travel experiences

• Confident to plan and book independently all aspects of the trip - on line

• Time rich and will spend – within a (generous) budget

• Do not require 5 star accommodation – Will spend less here to spend more elsewhere - balancing the budget

• Look for and appreciate deals – from airfares, to add on experiences

• Travel companions and fellow-planners are important – planning, reviews of others, travelling with others, sharing, connecting

• Live their lives online and through social media – mostly via smartphones

13

14

TRAVEL IS FUNDAMENTALLY IMPORTANT TO THE

GROWING MIDDLE CLASS CHINESE

Seeking unique, real and impactful experiences - memories and stories to share.

“I want to feel it, see it, memorise it”

“I would have to just plan the next trip if I

couldn’t travel”

“Not being able to travel would feel like being a frog at the bottom of the well – seeing a small part of the sky”

“If I am there, I feel REAL, and I can bring it back to

China with me”

A social status personal

reflection of taste, interest,

sophistication, success

Social connectionSharing, meeting and developing

friendships, building friend networks

Scoping – new lifestyle

and business opportunity.

Education opportunity

EscapeCrowded, stressed,

polluted environment,

cold, heat, dirt, pressure

New experiencesLearning – lifestyles, language,

personal challenge

Relatively new freedom – opening up of visa access

An interest, hobbyTaking time to search and share

• Talking to friends

• Online

• TV travel programmes

• Travel guides

Understanding the needs and attitudes of Chinese FIT

WHY New Zealand?

16

Place/

environment

People

Experience

Take me away from... To…

• Polluted air, sky and food

• Urban intense living

• Man made environment

• Crowded

• Busy

• Competitive

• Pressured

• Stressful

• Lack of trust

• Difficult to get around

• Repetitive day to day

• Boring

• NATURE - dramatic, intense,

impactful, unspoilt, protected

• Natural intensity of clean air

and sky (blue)

• Clean and safe

• Open spaces with fewer

people

• Welcoming, trust

• Different / contrasting

lifestyles, people, cultures,

history

• Easy

• Calm, relaxing

• Safe

• Stimulating

“We are in a crowded noisy city – I want something different”

WHAT NEW ZEALAND HAS TO OFFER THE CHINESE FIT

New Zealand is very attractive

Our ordinary is their extraordinary

17

OUR ENVIRONMENT HOLDS SIGNIFICANT APPEAL FOR THE

CHINESE FIT

“I want to melt into nature”

“Pure nature – like 100 years ago – the original way”

“Relaxed, casual and free – you can do what ever you want”

“What is beautiful – I want to go there”“The air and the sky – it is so different”

“I want to personally feel it – see if its true – be there”

“If I’m there I feel REAL – and I can bring it back to China with me”

“I want to explore an untouched land”

“Be free”

18

NEW ZEALAND OFFERS – ZERO DISTANCE IMMERSIONDIVERSITY - INTENSITY + EASE

100% Pure

New Zealand

FRESH VIBRANCY

EVERYTHING CLOSE

Zero Distance

Immersion

Feel it, see it, touch it, do it, taste it, share it

EASEInclusive

AccessibleSerendipity

WelcomingOpenSafe

FriendlyResponsive

flexible

DIVERSITY

Variety

ManyDifferent

ContrastingChoicesOptions

Multi layered

INTENSITY

From beginning to

endMulti

layeredInvolving

Stories and experiences

Ensure things to see and do are in close proximity. Consider how we enable and communicate this?

Understanding the FIT mind-set

20

NOT ALL CHINESE FIT VISITORS ARE THE SAME… NOR DO THEY WANT THE SAME THING

Understanding and targeting is important to:

• Attract high value visitors

• Target our product development and communication at people who will

respond

• Understand who will be interested in our different experiences and what the

development opportunities are

• Build regional and seasonal spread

• Help grow the segments that are of value to us

21

CHINESE FIT ARE CHANGING – THEY ARE MORE

OFTEN TIME RICH AND DON’T WANT TO BE RUSHED

Many Chinese FIT are time rich – they are not so much the ‘short stayers’ of those we saw in the

early years of Chinese travelling to New Zealand.

This new breed choose to stay longer – often between 7 – 21 days and up to six weeks

They will take time to see and experience one area well rather than try to do it all and will return

to a destination to build on an experience and try something they couldn’t do on the first trip

They do not want to be rushed, feel pressured or have to do it all in one day. A relaxed pace

with time to get to experiences, time to just sit and watch, and to “live like the locals”

Key is to continue building relationships after travellers have left – to consolidate the

desire to return

While multiple combined experiences may be good – they may not want to do

them all on one day. They take into account the group needs to decide the plan for

the day.

Many activities will be booked at the last minute, or the day ahead. It must be easy

to do this online or by phone. Do look at last minute options for this market.

22

CHINESE FIT TRAVEL TOGETHER. BEING TOGETHER

AND SHARING IS KEY – IT’S AN ETHOS

They are adventurous and independent – happy to pre book, organise their own travel, self drive,

Pre booking can be limited to airfares and some key experiences / accommodation – the rest will be

organised the day before, or on the same day so they need to be easily able to book at the last minute

A group can be anywhere between 4 to 20

23

We must understand clusters – and how to optimise their experience

There need to be options so people can do different things together. Watching an activity

can be as rewarding as doing.

There does tend to be a leader – the leader needs to feel equipped with information,

prepared and confident to “sell” the idea or experience to the rest of the group.

We have to be flexible and make it work – e.g. eating together may mean shifting the cutlery

to other rooms.

If one person is not enjoying it, the trip will be cut short (no-one is left behind) – change if

needed.

Those that travel together play together. Socialising together can be noisy – and they don’t

want to annoy others – how can we facilitate this?

Time management can be important – with groups of sometimes over 20. How do we

facilitate this easily and ensure everyone enjoys the experience?

They stay together

They play together They eat together

They are more accustomed to

communal sleeping arrangementsThey socialise together

The group may split up – but no one will be left alone

Chinese FIT: being with others is everything

Understanding the FIT customer segments

and how to maximise value

Which Chinese FIT audiences are

relevant for you?

26

25%

CHINESE TRAVELLER – KEY SEGMENTS

95% of Chinese Travellers are in the Active Boomers and Independent Professional segments

1294K

320K

236K199K

81K 84K43K 16K 13K

26%

60%

14%

31%

64%

Active Boomers

(55-74 years)

Independent Professionals

(25-54 years)

Backpackers

Source: Statistics New Zealand International Travel and Migration, YE Aug 2015, Holiday only

5%

45%

44% 10%

43%

40% 16%53%

19%

28%

AUSTRALIA CHINA USA UK GERMANY JAPAN INDIA INDONESIA BRAZIL

45%

11%

44%

26%

13%

61%

6%69%

18%

21%61%

Tourism New Zealand Chinese Market Segmentation

CATEGORY:

PROFILE:

STRATEGY: 31% of holiday visitors

Self drive 26%*

Stay: hotel, motel & luxury

LOS:1-3 weeks

Ave spend:

Travel with: partner/spouse

Organised group tour 50%**

Stay: hotels

LOS: 3 days

Activities: tbc

Ave spend: tbc

* 26%% of ABsV2 self drive holiday

**50% ABsV2 are on an organised

group tour

QUESTIONS:

• What / where the recommended things to see and do are

• How easy it is to travel around

• How long it takes to travel between the main attractions

• Where I should get information about how to organise a

holiday to NZ

SCENIC ATTRACTIONS: Beaches and coastal, native forests,

geothermal, lakes and rivers, local towns

ACTIVITIES: wildlife, shopping New Zealand souvenirs, local arts

and crafts, local cuisine, Maori culture and performance, historic

sites, museums & galleries.

Age: 55-74 Shanghai, Beijing, Guangdong

Desire: To get in touch with nature, have fun and enjoy myself ,

to broaden my mind

Keen desire to arrive in Sep-Nov and Mar-Apr

Market: ChinaDate: As at 1/10/15

SEGMENT: Active Boomers

Source: Tourism New Zealand

SEGMENT: Independent ProfessionalsMarket: ChinaDate: As at 1/10/15

CATEGORY:

Self Drive Exploring 27%*

Stay: hotel, motel & luxury

LOS:1-3 weeks

Ave spend:

Travel with: partner/spouse

Organised Touring 61%**

Stay: hotel

LOS: 3 days

Ave spend:

Travel with: partner/spouse

* 27%% of IPsV2 self drive

**61% IPsV2 are on an organised

tour

PROFILE:

STRATEGIC ROLE: 64% of visitors

QUESTIONS:

• What / where the recommended things to see and do are

• How easy it is to travel around

• What the transportation options are for travelling within NZ

SCENIC ATTRACTIONS: Beaches and coastal, geothermal, fjords,

lakes & rivers, cities

ACTIVITIES: hot pools, historic sites, local cuisine and wine,

shopping – arts and crafts, local markets and New Zealand

souvenirs, wildlife

Age: 25-54

Shanghai, Beijing, Guangdong

Desire: To get in touch with nature, to broaden my mind, to learn

and explore new things, have fun and enjoy myself, to take a

break from routine, relax and refresh

Source: Tourism New Zealand

29

CHINESE TRAVELLERS – TRAVEL STYLE

Organised

touring

59%

Explore on

a budget

6%

Explore from

a base

8%

Self-drive

exploring

26%

3%

<1%

42%

4%

19%

4%

14%

2%

7%

4%

<1%

<1%

3%

Backpackers

68%

Independent Professionals

28%

Active Boomers

Most of the FIT visitors are self drive exploring and exploring from a baseNB: This information was gathered in 2014 and is different to 2015 data in previous pages.

Source: Tourism New Zealand – International Visitors Survey 2014

There are also key factors influencing the

decisions of your customers and

impacting on what they want and where

they choose to go

Which factors are important to you in

building your business – and who don’t

you want to target?

31

FIRST

SUBSEQUENT

SHORTERTRIP

IN PEAK CHINAEmployed

LONGER TRIPCHINA OFF PEAK

Self Employed

CONSERVATIVE

FOLLOWER

ADVENTUROUSINDIVIDUAL

FRIENDSHIP

FAMILY

VERY HIGH

HIGH

MODERATEBUDGET

FACTORS – DIFFERENTIATING VISITORS

NZ EXPERIENCE LEVEL

INCOMETRIP LENGTH& EMPLOYMENT

TRAVELLER APPROACH

PARTY COMPOSITION

More in depth immersion

and focused

More time and less

travelling

More time 10 -30 days More off the beaten

track

More independent

and impulsive

More personalised

More unique

More activities

More key attraction

overview

Short trip 7-14 days China

peak holiday focus

More safe and

familiar

More natural sights

Less activities

Must do – popular

To target for value growth, and regional and seasonal development

32

DIFFERENT TARGET OPPORTUNITIESTRIP ORDER TO NEW ZEALAND

More in depth immersion

• Spend more time – overall and in each place

• Choose a more limited area to explore in more depth

• Go to new regions and places

• Visit in a different season

• Experience more / different activities and allow more time for serendipity

• Follow a special interest

• More off the beaten track

Scoping overview

• Often shorter and limited time in each place (one night)

• Realise that you can’t see it all in New Zealand in one trip

• Itinerary includes “must do” icon places and activities and may

include:

– Auckland

– Rotorua

– Queenstown

– Milford

– Or North / South Island only

OPPORTUNITIES

• Target second and third visitation for:

– Regional and seasonal extension

– Longer experiences e.g. 2-3 nights, cycling, hiking, boating.

• Target extension experiences – overnight, or 1 day 2 night experiences targeted at returning travellers.

• Ensure maintain connection with visitors and promote new, different, more immersive experiences.

• Build awareness of new and different “must do” experiences while in New Zealand – for the next trip.

New Zealand is known as a destination to come back to – you can’t do it all in one trip – and there

is lots to see and experience.

FIRST

SUBSEQUENT

NZ EXPERIENCE LEVEL

More in depth and focused

More time and less

travelling

More key attraction

overview

33

DIFFERENT TARGET OPPORTUNITIES

LONG TRIP SELF EMPLOYED

Short holidays around Chinese public holidays (up to 10 days - 2 weeks)

• Limited time can mean increased need for multiple visits to New

Zealand

• First overview trip will include one or two nights maximum per stop and

often have limited flexibility for activities or itinerary change

• First trip will be to icon “must do” places and experiences

More: Beijing, Shanghai

OPPORTUNITIES• Target Guangzhou and second tier commercial centres for longer stay itineraries and regional / seasonal

extension.• Clearly deliver longer and shorter itinerary options.• Prioritise the development of second tier “icon” “must do” destinations to relieve potential increasing peak

demand relating to those who must plan around national holidays.

Longer holidays generally (2 weeks – 2 months)

• Greater flexibility and desire to come away from Chinese public

holidays

• Want an immersive more in depth experience from trip one

• Will select one area for more time

• Inclined to have less structure and more flexibility

More: Guangzhou, second tier cities – commercially orientated

Employment status (e.g. employed in corporate / government or self employed / private commercial) has a substantial

impact on travel planning, timing, length, degree of immersion and number of trips planned.

Self employed are relatively time rich, flexible, avoid main holidays, travel more slowly and in depth, more open to

serendipity and discovery.

SHORTERTRIP

IN PEAKEmployed

LONGER TRIPOFF PEAK

Self Employed

TRIP LENGTHEMPLOYMENT

More time 10 -30 days

Short trip 7-14 days

peak holiday focus

34

DIFFERENT TARGET OPPORTUNITIESCONSERVATIVE TRAVELLERS

Search

• Tend to search on Chinese websites mainly

• Less likey to consider or be aware of New

Zealand local & “official”l sites

Itinerary

• Follow others to icon experiences

• Tend to “collect’ popular “must do”

• Need review and recommendations to have

confidence

• Tend to tightly and often over structure itinerary

Activation

• Key Opinion Leaders (KOLs), top rated itineraries,

most popular must do

• Images, ratings

Product

• Shorter (20 minutes – 2 hours), operator

reputation, easy and challenging

• Reassurance / confidence, assistance and

Mandarin translation (QR code)

OPPORTUNITIES

Conservative

• Guidance with a Mandarin speaker – by region, by day (personalised).

• Better utilisation of i-SITEs – recognition, explanation (free), knowledge of Mandarin speakers, awareness (with visa, at

air arrival, at accommodation).

• 24 hours assistance line in Mandarin.

• Personalised independent trip organisation (and accommodation, activities / transport).

• New Zealand driven, design your own itinerary options (online button and calculator).

• Promote Official New Zealand site – Newzealand.com

CONSERVATIVE

FOLLOWER

ADVENTUROUS

TRAVELLER APPROACH

More off the beaten

track

Must do – popular

35

DIFFERENT TARGET OPPORTUNITIESADVENTUROUS TRAVELLERS

Search

• Search global and China sites

• More aware of local information sites and their

value

Itinerary

• Will go beyond the most popular spots

• Will define own trip and follow special interest

• More interested in “off the beaten track”

• Will leave lots of flexibility

Activation

• Plus stories, reasons, emotive and experiential

descriptors

• Images, links

Product

• Longer – if time, up to two nights

• More immersive special interest, more able to

participate independently

• Seek drama, different unique experiences

OPPORTUNITIES

Adventurous

• Targeted “adventure” experience in regions through hiking, biking, skiing, fishing, sailing, golf, food, delivered in a safe and easy ‘luxury’ way

• Organisations in China and specialist site networks medias

• Off the beaten track itineraries – e.g. paua diving, heli-bush / hunting, live like a local, fly drive immersion.

CONSERVATIVE

FOLLOWER

ADVENTUROUS

TRAVELLER APPROACH

More off the beaten

track

Must do – popular

36

DIFFERENT TARGET OPPORTUNITIESTRAVEL GROUP STYLE

• Convoy – nuclear families travelling together in separate

cars e.g. 6 adults with 3 children

• Intergenerational family – children, parents,

grandparents

• Young Social Groups

– Younger, more flexible

• Older Established Friendship Groups

– Special interest

– money

– will take time

• Self Focused Independent

• Traditional backpacker

– Adventurous

– Take time “off the beaten track”

– Low accommodation cost and high

activity spend

– Will engage in special interest

INDIVIDUAL

FRIENDSHIP

FAMILY

PARTY COMPOSITION

More independent

and impulsive

More safe and

familiar

37

DIFFERENT TARGET OPPORTUNITIESFAMILY COMPOSITION

Convoy Family Clusters

Travel during Chinese school holidays

• Child oriented

• Accessible, easy activities

Intergenerational Family

• Short – 20 minutes to 2 hours (maximum)

• Facilitating bonding – time sharing together

• Wi-Fi free – play on gadgets

• Play grounds

• Feed the ducks

• Communal cooking facilities

IMPLICATIONS / OPPORTUNITIES

• Family targeted holidays: 1June – 1 September are the school holidays in China.

– Family trips to temperate (cool… hot… not hot… ) New Zealand

– New Zealand is percieved as uncrowded…a relaxed time

– Longer trip (2 weeks plus) more relaxed immersion time in each place

– Ski play, learn to… ski, farm, animal park, playgrounds

– Opportunities for bragging rights that even adults are scared to do – e.g. sky dive, sleep in a unique space

(Hobbit Hill, tree house) stargaze, wonders of the world

– Sail a boat (e.g an Optimist), ride a horse

INDIVIDUAL

FRIENDSHIP

FAMILY

PARTY

COMPOSITION

More independent

and impulsive

More safe and

familiar

38

DIFFERENT TARGET OPPORTUNITIESFRIENDS

Young Social

• Friendship groups travelling together – mixed, only women, only men

• Seeks challenge with ease – travel is stimulating and exciting, pushes

boundaries… but not difficult, rushed or in any way pressured

• Camper van, car, public transport. homestay, farm stay, affordable self

cook accommodation

Established Friendship

• Independent friendship groups or couples post children. Time rich,

financially well off

• Relatively short experiences 1-4 hours or overnight

• Extended and private group experiences

IMPLICATIONS OPPORTUNITIES

Young Social• Easy immersion experiences

• Safe adventure – many experiences to share, back stories

to add to the story telling and give meaning and

uniqueness

• Ability to do things together – but layered so all can

participate in different ways

• Photography – opportunities for photos, special spots, specific times,

record and share

• Enabling groups to form – similar travel interest, engage online

• Different experiences for different groups – active adrenaline, food,

nature

• Create and share stories that make an experience or place unique

Established Friendship• Experience local life – want depth, “act like a local”

• Flexible and tailored options

• Genuine, unique, local experiences

• Self cook – BBQ cooking with Asian flavours

• Encouraging regional repeat visits – developing and maintaining

relationships

INDIVIDUAL

FRIENDSHIP

FAMILY

PARTY COMPOSITION

More independent

and impulsive

More safe and

familiar

Segments

Travel Style

Origin

International / Local

INTERNATIONAL

CHINA

FREE INDEPENDENT TRAVELLER (FIT)

ACTIVE BOOMER

LOCAL

USA

ORGANISED TOURING

BACKPACKER

AUSTRALIA

INDEPENDENT PROFESSIONAL

Income

Party Composition

Traveller Approach

Employment

Trip Length

NZ Experience Level

FIRST

SHORT

SELF EMPLOYED

ADVENTUROUS

SUBSEQUENT

LONG

EMPLOYED

CONSERVATIVE FOLLOWER

FRIENDSHIP INDIVIDUALFAMILY

VERY HIGH MODERATEHIGH

QUICK EXERCISE

THINKING ABOUT YOUR TARGET AUDIENCE MIX

• If you don’t know your target

market then this is a great

opportunity to identify it.

• Once this is identified all your

decisions, direction and

investment will become a lot

clearer.

It is time to build value!

Getting Started – thinking about the

emerging Chinese FIT

41

INTRODUCTION TO #NZCNTOURISM LEAN CANVASBUILDING THE CONSUMER INTO YOUR

ONE PAGE BUSINESS PLAN

Using #NZCNTourism lean canvas

The Lean Canvas has ten elements, together these elements provide a view of the “key drivers” for future value growth

Key Drivers

• Problem / opportunity - Top 3 problems / opportunities

• Customer Segments: Who are the customers? What do they think? See? Feel? Do?

• Unique value proposition and story: What’s compelling about your offer? Why do customers buy, use?

• Unfair advantage: Can’t be easily copied or bought

• Key product offer : The product experience

• Channels: Your path to customers. How are these propositions promoted, sold and delivered?

• Customer Relationships: How do you interact with the customer through their “journey”?

• Revenue Streams: How does the business earn revenue from the value propositions?

• Key Activities and metrics: What uniquely strategic things does the business do to deliver its’ proposition?

• Key Resources: What unique strategic assets must the business have to compete?

• Key Partnerships: What can the company not do so it can focus on its Key Activities?

• Cost Structure: What are the business’ major cost drivers? How are they linked to revenue?

Why it is great

• Focus: A canvas puts your idea on a page and strips away the “stuff” providing clarity and focus on what’s driving your

business (and what’s non-core and getting in the way).

• Flexibility: It’s easy to tweak the model and try things on a single page.

• Transparency: It’s also easy to share

To help you get started we have adopted the Lean Canvas so you can rapidly capture your

ideas as you work though the modules.

You can use the NZCN Lean Canvas to rapidly build a one page plan which you can share. The

Lean Canvas focuses on addressing broad customer problems and solutions and delivering

them to customer segments through a unique value proposition.

You can use it across all of the modules to successfully build your game plan. In addition, each

module may have some extra tools to help you distil your thinking as you fill out your Canvas.

BUILDING A PLAN ON A PAGEAN END TO END APPROACH

Adapted from Flint-Box Lean Canvas

PROBLEM / OPPORTUNITY

Top 3 problems /

opportunities

SOLUTION

Top 3 features &

related benefits /

actions

KEY ACTIVITIES & METRICS

Key activities and

how you will

measure them

UNIQUE VALUE PROPOSITION & STORY

Single, clear,

compelling message

that states why you

are different and

worth paying

attention

UNFAIR ADVANTAGE

Can’t be easily

copied or bought

CHANNELS

Path to customers

CUSTOMER SEGMENTS

Target customers

PRODUCT MARKET

My Canvas:

This module

focuses on

the target

audience

but adds

ideas and

thoughts

into the

whole of

your

canvas as

you work.

KEY PRODUCT OFFER

The product

experience

Ref Module 3Developing

stories & icons

Ref Module 8Digital strategy development

Ref Module 2 Enabling

Experiences

Ref Module 7Keeping your

finger on the pulse Ref Module 5

Product &Experience

Development

Ref Module 4Optimisation

of current offer

Ref Module 6Special Interest

Ref

Module 1. The Context

Ref Module 9

Seasonal Development

Ref Module 10Regional

Development &Activation

43

SELECTING YOUR CUSTOMER SEGMENT IS EASY

Now you understand the segmentation model and key attributes of the target audience

STEP 1.

Identify your target segments

Focus for Top 3 Markets

STEP 2.

Develop key customer profiles

Target Audience needs

STEP 3.

Optimising the product to meet

needs

My Plan on a Page

Current value

Future value

Cost of acquisition and service

Seasonal spread

…

FOCUS FOR TOP 3 MARKETS

Segments

Travel Style

Origin

International / Local

INTERNATIONAL

CHINA

FREE INDEPENDENT TRAVELLER (FIT)

ACTIVE BOOMER

LOCAL

USA

ORGANISED TOURING

BACKPACKER

AUSTRALIA

INDEPENDENT PROFESSIONAL

1. China 25% 3. USA 25%

2. Australia 25%

4. NZ Domestic

25%

Income

Party Composition

Traveller Approach

Employment

Trip Length

NZ Experience Level

FIRST

SHORT

SELF EMPLOYED

ADVENTUROUS

SUBSEQUENT

LONG

EMPLOYED

CONSERVATIVE FOLLOWER

FRIENDSHIP INDIVIDUALFAMILY

VERY HIGH MODERATEHIGH

Segments

Travel Style

Origin

International / Local

INTERNATIONAL

CHINA

FREE INDEPENDENT TRAVELLER (FIT)

ACTIVE BOOMER

LOCAL

??

ORGANISED TOURING

BACKPACKER

??

INDEPENDENT PROFESSIONAL

1. % 3. %

2. % 4. %

Income

Party Composition

Traveller Approach

Employment

Trip Length

NZ Experience Level

FIRST

SHORT

SELF EMPLOYED

ADVENTUROUS

SUBSEQUENT

LONG

EMPLOYED

CONSERVATIVE FOLLOWER

FRIENDSHIP INDIVIDUALFAMILY

VERY HIGH MODERATEHIGH

Your plan for the next ___ years

TARGET 1 TARGET 2 TARGET 3

Age

Nationality

NZ Experience Level

Trip Length

Employment

Traveller Approach

Party Composition

Income

Age

Nationality

NZ Experience Level

Trip Length

Employment

Traveller Approach

Party Composition

Income

Age

Nationality

NZ Experience Level

Trip Length

Employment

Traveller Approach

Party Composition

Income

VALUE DRIVERS

1.

2.

3.

4.

5.

VALUE DRIVERS

1.

2.

3.

4.

5.

VALUE DRIVERS

1.

2.

3.

4.

5.

PRODUCT NEEDS PRODUCT NEEDS PRODUCT NEEDS

SERVICE NEEDS SERVICE NEEDS SERVICE NEEDS

KEY TO ACTIVATION KEY TO ACTIVATION KEY TO ACTIVATION

TARGET AUDIENCES – Your Pen Portrait

NEEDS STATEMENT

“I want …….

I love ……..”

NEEDS STATEMENT

“I want …….

I love ……..”

NEEDS STATEMENT

“I want …….

I love ……..”

TARGET 1 TARGET 2 TARGET 3

Age

Nationality

NZ Experience Level

Trip Length

Employment

Traveller Approach

Party Composition

Income

20-35

Chinese

First

Short

Mix – Self Emp., Emp.

Adventurous

Group of 6 friends

Moderate, High

Age

Nationality

NZ Experience Level

Trip Length

Employment

Traveller Approach

Party Composition

Income

20-60

Chinese

Subsequent

Long

Mix – Self Emp., Emp.

Adventurous

2+

High, Very High

Age

Nationality

NZ Experience Level

Trip Length

Employment

Traveller Approach

Party Composition

Income

VALUE DRIVERS

1. A new challenging experience

2. Hands on immersion

3. Reputation – famous, unique

4. Something for everything

5. Something I am interested in ‘special

interest’

6. Safe

7. Convenience

VALUE DRIVERS

1.

2.

3.

4.

5.

VALUE DRIVERS

1.

2.

3.

4.

5.

PRODUCT NEEDS PRODUCT NEEDS PRODUCT NEEDS

SERVICE NEEDS SERVICE NEEDS SERVICE NEEDS

KEY TO ACTIVATION KEY TO ACTIVATION KEY TO ACTIVATION

TARGET AUDIENCES

NEEDS STATEMENT

“I want …….

I love ……..”

NEEDS STATEMENT

“I want …….

I love ……..”

NEEDS STATEMENT

“I want …….

I love ……..”

MY PLAN ON A PAGE

Product Targeting with our market – Meeting a Need

UNIQUE VALUE PROPOSITION AND STORYSingle, clear, compelling message that states why you are

different and worth paying attention to

Adapted from Lean Canvas

KEY PRODUCT OFFER

The product experiences

TARGET FOCUS

PRODUCT OFFER x MONTH/SEASON x TARGET

MY PLAN ON A PAGE

Product Targeting – Meeting a Need

Product offer and developmentThe experience, tailored to target audiences

KEY PRODUCT OFFER

The product experiences

Target DEVELOP MAINTAIN FIX / STOP

49

CONGRATULATIONS - NOW YOU UNDERSTAND MORE

ABOUT YOUR CHINESE FIT TARGET AUDIENCES

• Think about how to tailor the experiences for different target groups

• Understand who will be interested in your experiences

• Build unique product experiences to meet needs

• Develop a plan by month

• Use targeted communications

• Encourage sharing

To maximise value

Additional Segmentation Resources

51

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