Hotel expansion China: it’s all marketing

2/3/2016 3:09:00 PM

International hotel chains are expanding their presence in Mainland China at high pace. Their purpose is not just to sell rooms in the saturated Chinese market. Building hotels in major Chinese cities is part of the brand-building among Chinese tourists with plans to travel abroad.

The South China Morning Post reports about international hotel operators hoping to build up their brands through opening hotels in different mainland cities. The idea is that when Chinese know the brand from home, they may choose it for their travels abroad. This concept is based on the analysis of Goodwin Gaw, chairman of Gaw Capital, a Hong Kong-based private equity real estate fund. Gaw believes that international brands’ expansion is part of the marketing strategy, insisting that “when mainlanders travelling abroad. They may pick their hotels.”

The newspaper quotes a spokesman of Meliá Hotels International Group that is currently establishing hotels in China, saying that the expansion has a dual purpose. One is Chinese market in China. “Outbound is also interesting for us, we see the potential of Chinese to go abroad.” Other chains also have big plans for China. Hilton is planning to open 180 hotels in China.

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