 Good afternoon, and Aloha Kako. My name is Ray Tsuchiyama. I'm the contributor along with Russell Liu to my left for Asia In Review. And we have an exciting 30 minutes on setting a spotlight on new trends in global tourism today. And we're going to start out with Russell kind of describing a recent conference held in Honolulu that may be the conference that people will look back decades from now as defining a change in what's happening in tourism and business investment for the entire state of Hawaii. He has spent over 13 years in Beijing in law and teaching and is an expert on what's happening in China. And we're going to just turn to Russell and say, what was this conference all about? What's the name and when it was? Tell us the sponsors and so forth. What was this HTA conference? Aloha Ray. Thank you very much. It was really an honor to be part of the Hawaii Tourism Conference this year. The conference set the pace for a vision that I think, like the book, the tipping point, we're going to look five years from now and then think back, that was the magic moment when everything changed. And I think this conference is a real change. It was a fantastic conference. I've been to many global conferences. We were 2,000 attendants all over the world. And it was exciting, it was dynamic, a lot of vision, a lot of clarity. So looking at this conference and vis-a-vis the previous conferences, what was different this time? What was different in terms of the markets for tourism, for how Hawaii positions itself? What were some themes that you can tell the audience? Talking about themes, it was interesting because the Executive Summit, which preceded the actual conference, was designed for government leaders. The governor was there to give the keynote address, as well as industry leaders, and I was fortunate to attend a very humbled by it. And it really set the theme and it was very impressive. We had Steve O'Zell, first of all. He's a national geographic photographer, but he's been to Hawaii over 82 times. And what he did was his message. His whole presentation at the Executive Summit was showing pictures of open roads around the U.S. and the globe. And the message there was, we need to look at an open road because sometimes the open road allows us to focus. It gives us clarity. It gives us a purpose and ideas. And it gives us the solution to the problems we have. So that's at the pace. Then we had Billy Bean, the general manager of Oakland A's. He had a very interesting movie. And his theme, he's made famous because of the movie, the Money Ball with Brad Pitt. And basically what the movie was about was the Oakland A's that were losing steam in the MBL. They had the smallest budget to work with. And what he did was he said, well, people look at baseball players. They look at them six foot five. Okay. They run fast and they look good in uniform. That's what we want to think of baseball players. But it turned out what he did was they hired a geek stats guy who ran the stats and said it wasn't how they look. It wasn't the number of homeruns. It was the guy who got on the baseballs. And that baseball player was usually five foot six, short, squatty guy, 160 pounds. And he was much more valuable than the six foot five guy, the great in uniform. And he said, take the emotion out. Look at your numbers. And you can be more efficient. Wonderful message. Then we had Mark Dunkley, CEO of Hawaiian Airlines. And his message was prophetic. He said, yes, Japan's a great tourist market. They're going to continue. They've in fact increased the flights to Japan. But he said there's a seismic change, a big change. They see it and it's no secret. It's the China up on tourism. They're spending millions more on promotion. And they're going to open up flights possibly to cities that are not on the east coast of part of the country. Seismic change. And he showed the numbers. And it's going to be huge in the next 50 years. And we need to get into it now. We cannot wait for it to happen because competing destinations. So from this macro view of this moment in time, and of course tourism is so important to Hawaii. It's like 7% of the economy. We are very dependent on people coming here and enjoying the natural scenery and also doing investments and create jobs and so forth. Now, I heard that you were on a panel discussing on China and tourism. Any takeaways from there? What were the kind of, if you go down and say, oh, from a macro viewpoint, this is the things that people are talking about. Good. That's an excellent question, Ray. And I was actually on four panels. And it was exciting because this is the first time the HTA has put China all day, which meant that you had an opportunity to hear all the experts. There are several important takeaways that I had. Okay, first of all, we need to understand that the Chinese are here already. A lot of people will think, okay, there's smaller numbers. And that we're going to wait until the money comes. And until the money comes, then we'll do something wrong, wrong, wrong. Why? Takeaway number two. The Chinese are heavy into technology. And one of the big complaints that they had was lack of signage and lack of technology, lack of Wi-Fi. And why? Because living in China, it's my experience also. I communicate daily with other lawyers, other friends in China through WeChat. And what WeChat is, is over-in-the-internet communication. It's real-time. So for example, in Asia, everything is done by word of mouth. So what happens if somebody has a bad trip here, immediately they'll WeChat either the voice message, take a picture, send it off, or type it in. And you have a very interesting point that we cannot ignore that although China has been behind in the economy and technology until recently, their overwhelmingly users of mobile technology and devices for e-commerce, business, all kinds of things now. Even more than Americans maybe. Yes, it's even more because it used to be the PC, now the smartphone market. And actually China has been ahead for five years. I've used WeChat for several years. They call it WeChat. We means hello in Chinese. Wei, wei, wei. Wei? That's right. You know a lot about Chinese language. But in the US, you can see it on your Apple platform, it's called WeChat. We, they drop the I out. So it's real-time. So you know the past, if there was a complaint in the industry about what we did wrong, it would go back, the visitor would go back, and we'd have like two or three weeks to come back and say let's do a campaign because we did something wrong. Okay, but now it's all real-time. So immediately they'll know. So your points about addressing the Chinese consumer or be consumer-centric. We have to respond in terms of signage. We have to respond in terms of mobile technology in Wi-Fi. What are those? Well, especially signage. That was a big thing, not only for Wei, but generally outbound Chinese tourists wherever they go, Europe, US, the big complaint was signage. And really in the Asian culture, it's really a sign of respect because they are a big, big group. In 2015, 129 million travelers outbound spent over $200 billion, and that's going to increase this year. And it's estimated it's going to be close to 300, 400 billion in a few years, money-wise. That's a lot of money. So if they come to an airport and they don't see signage, they see Korean and Japanese, then they feel slighted. And they'll take a picture of that, send it back to China, say, we're not welcome here. And I think we need to take a look at a lesson. And I go back because I've been in Beijing for many years. Six, seven years ago, when I'm in my language commanding classes, I would meet these managers from ANA, Aldeniponir, and Jail. And they were taking Chinese, so I'm asking, why are you taking Chinese? Well, for them it was a requirement, especially middle management. They want to move up, they had to take two years of Mandarin, and they had to be a certain level speaking Mandarin. Fast forward. When I go to Tokyo all the time, stopping over, every airport, Haneda or Narita, everything is not only Japanese, but Chinese, all the Japanese staff, they all speak Chinese, Mandarin, and it's ironic. And I go on the airport express bus. My favorite is actually Haneda, they run every recently. There's Chinese tapes, there's Mandarin, and there's tons of Chinese who travel there. And in my office in Beijing, all my secretaries are eager. They're planning a trip to Tokyo, and they're planning what they're going to buy. So it's no secret that the research showed up at this conference that one of the top five destinations for the Chinese is actually Tokyo. So this is a big learning for Hawaii to learn from Japan about China. And I think, yes, we should learn because they did things right, and we would advance, and maybe the geographic difference of culture, but I think that we can't wait any longer, we need to move on it. The big mistake is if we take the sort of American thing, when they come, I will invest. We can't do that because if they don't see it now, they'll tell the market and they'll just turn away and go back. Two important reasons is that from this conference, the experts said that the two important groups that are traveling are the little emperors. They are between 25 and 40, that generation, and the silver-haired. And the silver-haired are the ones that have a lot of money. They come in here, their language is not so good. So when they don't see any Chinese signs or they get a bad experience, they will tell their friends and you've lost a market. Now let's go back a little bit, little emperors. Is this kind of coming out of the one child policy generation you're talking about? That's correct. There are two sets. There's the 1980s onwards and 1990s onwards. They're slightly different. The 1990s are probably much better in language. And so when they see no signage, they may say, okay, I like the place. I'll come back. Okay, the 80s, maybe their language is okay. So those are the two one-child policies. The categories we're talking about. Age categories. That's right. The silver category, like in Japan, will be less skilled in language, but also eager to go out. This may be sometimes their first trip abroad for many of these people. And they've kind of tried out domestic trips and now they have some money and they're going abroad to Hawaii. And is there anything that you see Hawaii addressing or accommodating kind of like different marketing styles and so forth for the silver market? Sure. I see, because first of all, I think language is important. And I think I was a young high school student working like he had for SABU years ago. And so we learned that to make people welcome, we would say Japanese word konnichiwa or something like that. For the Chinese the same, but for many people, they can't distinguish the difference between Chinese and Japanese. And I have a thing to tell you. All you have to say is one sentence first. Where are you from? If these are from Japan, then you say it in Japanese. If they're from China, you say, anyhow. So you're going back to the hotel industry and training. At the customer level. I mean, this is the point of sale or greetings or people, the concierge that those people and there are thousands of these people who are having direct interaction with tourists. And here you're saying these little things mean a lot. That's right. And the smile and if you know the Chinese anyhow, it goes a long way. It's the experience. And it was the same thing for the Japanese tourists. So we got to think that we got two markets. We're adding on to what we have. And we just need to add a vocabulary. Just a few more words. That's all we need. And the second thing for the Chinese, if you know of a lot of Chinese tourists coming in, our big competitor, we call Long Haul Destinations. And if you can just hold on to that thought about Long Haul, we'll be back in a few minutes after this important break. And you're on Think Tech today. Aloha, everybody. My name is Mark Shklav. I'd like you to join me for my program, Law Across the Sea on ThinkTechHawaii.com. Aloha. Hello, my name is Crystal. Let me tell you my talk show, I'm all about health. It's healthy to talk about sex. It's healthy to talk about things that people don't talk about. It's healthy to discuss things that you think are unhealthy because you need to talk about it. So I welcome you to watch Quok Talk and engage in some provocative discussions on things that do relate to healthy issues and have a well-balanced attitude in life. Join me. Welcome to A Show in the Wheel. Looking forward to see you next month on October 13, Thursday at 11 o'clock. Thank you very much for joining us on Think Tech today. We are continuing a very scintillating, exciting conversation on the seismic change that is right around the corner for Hawaii's tourism market regarding China. And we're going to go into the Long Haul market right now, transportation, which is a key to tourism because that's how people get here. Long Haul is so important. Well, I think that term, I learned it through the conference, we're a Long Haul destination. Long Haul means we take eight hours, 11 hours to get here, direct flights. Short Haul for the Chinese has been like Thailand, Southeast Asia, four or five hour flight. And the reason why we make the distinction is because we need to look at our competition. Where are the Chinese going for Long Haul destinations? And there's a paradigm shift because many Chinese have been traveling. You know, we were talking over the last 10 years, okay? They've been going to the short haul. So they're ready to change your experience. They're ready to try a Long Haul destination. That includes, for example, Australia. And the big competitor we have, an island destination, is the Maldives. And Maldives is incredible. They do so much volume of travelers that there are four flights from their four national cares daily. They even open a Chinese embassy there. So we need to look at the lessons of what they did right. So short haul is all about trips to Seoul, to Tokyo. I mean, of course, Hong Kong was right across the border. But as you pointed out, there's been historically, over the last 10 years or even more, great numbers of Chinese tourists to Thailand, to Bangkok. Easy access via visas and so forth. Singapore is another. But destinations that require a few more hours will include Sydney, Melbourne, New Zealand. So they must be also thinking about responding to the needs and interests and aligning themselves infrastructure to Chinese tourists too. But you pointed out, Japan is one model that we should look at very closely. Are there any place else that came up during the conference that says, wow, they're doing something that's unusual, exciting? Well, I think the Chinese have been going the last couple of years to a place called Maldives. It's off the Indian Ocean. It's really a European enclave for the wealthy. And it's interesting because the hotels there, they put in hot pot kettles for the Chinese. And why do they... For tea. Well, not only tea rate. Yeah, yeah. Why do they do that? Because in Hawaii, we have a lot of Japanese restaurants. So I think the diet, the cuisine is there. But for the Chinese, we don't have the type of food that they... And so they carry... I travel with Chinese. I know this. I think of Fang Bingmen. And it's the noodles. But it's not just like your Udon noodles or simple ramen. It's hot, spicy. Right, right, right. And so when they go to a new destination like Hawaii, they don't have the restaurant. So they're really hungry. Or they go to Maldives. So they come back to the rooms and they just fill the stomach up. They have this hot noodles, okay? So Maldives made the mistake where one hotel pulled the hot kettle tea pots away from the rooms. They left in the rooms of the European visitors. We didn't use them. And so there was an outcry on WeChat in China. I was there in China. And the industry message is, let's stop going to Maldives. Let's boycott them. Let's cancel our bookings. So it hurt really the Maldives. So it's a black guy for the Maldives. That's right. Which they did not understand. The Chinese tourism culture. That's right. And you came to point because we had one speaker who actually was called by the King of Cambodia to personally advise him on Chinese tourism and outbound tourism. So we had her talk and then she gave a fantastic presentation on everything to know about the Chinese culturally. And that's very important. We'll talk about culture, culture, culture. But I think people don't understand the culture. And so we had somebody who said, we've heard this presentation about culture many times. But it turned to that person, in every minute you have. Well, what have you done about it then? The reason why it's being said is because nobody does anything about it to adjust to the market. And it's what you do with it that's important. Now you came to culture, but of course, and I want to go back to about business investment in a short while. But before that, so all these leaders came to the conference from the business community, from research, from the governments, of course, and so forth. So how much is the work to be done by the state government? How much to be done by the private sector, like the Hawaiian Chamber of Commerce and the airlines and the hotels? Or it shouldn't be a coalition who takes the lead and say, we have to organize and do this on a grand scale and make Waikiki a Chinese destination. What other steps are necessary to do? That's a great leading question. Well, I talked to somebody, the head of the Waikiki Association and told them the language is important. Start educating people to look at them and don't assume that they're going to be Japanese. Ask them where they're from and then you can say the proper greeting. I think the other issue is signage and I think it's a sign of respect. If you have Japanese signs, then have Chinese signs. Make everybody feel welcome. But the telling sign is we just two weeks ago, just when the conference began, we had some really important breaking news and the news was this. China Oceanwide has announced they're going to build a second resort besides their own hotel right on the beach next to the Disney Hotel. They just finished acquiring the property to bring in the first Atlantis in the United States. And if you Google that, Atlantis in Dubai, you will see this magnificent 21st century hotel. So it's a mega international kind of thing. It dwarfs a lot of these smaller projects. So we're going to make a great leap and this is what, going back to your seismic leap, this is not only a seismic leap in terms of tourists but also in terms of project size. That's right. To me, it's really shaping that we're here. This is the next level of tourism. It's global destination. Not just a destination but a global destination. We should be proud and we should welcome this kind of investment and we should ramp up for this because it helps us to bring in other good investments, possibly, that can change our look here and not only have one kind of tourism but a global tourism platform that's going to be something greater and make us truly global. And I think it's very important and I think that's not only a statement, the confidence that the high-well Chinese are going to be here because they're used to that kind of luxurious hotel but also other travelers from Europe, from other places where they're accustomed to very high end. So just because the Chinese are coming here doesn't mean you continue business as usual. The Chinese themselves, through investment, are going to bring the bar and level up of tourism in Hawaii. That's what you're trying to say. That's right. Let's invest in here with the Japanese did in the 80s, 90s and let's all benefit from it. So the infrastructure even grows up because of this. But getting back to my question, there's the state government, where is, for example, you talk about language and culture, where does that reside in Hawaii? UH, University of Hawaii, for Chinese language, the high schools, DOE, we had a previous show on immersion. There seems to be pieces of the puzzle that has to be put together. Hawaii Airlines, of course, has a stake in opening up new cities to fly into. But when they come here, if there's not that, you know, the welcome in the culturally sensitive areas, then it's not going to work and we don't have another Maldives black eye. And that's what I think you're very frightened about for the future. Am I correct or are you optimistic? I'm optimistic and I think that not just Hawaii, but overall, I think Americans, we have a Tennessee short-term look. When the money comes, we'll move on it. But I think the second thing is, I think historically Hawaii hasn't had a lot of culture ties with this new China. When I say new China, you mean in China, post-4950s, you know, I can count the numbers on my hand with people that really have relationships or have really been in China. I think you need to listen to them and you need to listen carefully and you need to work with them and that's very important. Now's the time to do it. I think it starts from the governor. But I think I really applaud the Hawaii Tourism Association, George Segeti. He's a businessman. He gets it. He gets it. And thank you to George and Randy Baltimore and JDG with the China side. They get it. They know where it's going to go. In the hotel sector? Hotel sector. So he's leading that brand in hotels. So that's why this conference is electrifying. It was dynamic. And I've been to many global conferences. There was excitement there. Clearly excitement. And I think that we now have to work with the industries and we need to get the government, the leadership to say, okay, remember one thing. Tourism is the biggest driver. And Mark Dunkley, in his speech at the Executive Summit, clearly point out federal spending is down. Military spending is going to go down. What do we have? So we need to work quickly. We need to move on. And in this Executive Summit, and I know Thomson gave a very emotional, I think just a chicken skin presentation. He talked about Hokelia. He talked about the old going around the world, his message that we have to change, you know, how we think, you know, preserve the ocean. That word change and commitment. We need change and commitment. But it really starts with leadership, you know. But I think it's something daring. There's a risk to take. But we have to do it. Now the Mounties, I've never been there, but like you said, it's mostly European destination and full of natural beauty. There's not much shopping going on there. And I felt, wow, it's like going to Lanai or Molokai for some people, except they're very high-end luxury resorts there. Is there a lesson in this? Can these destinations like the Mounties and Kauai or Kona be attractive to Chinese tourists? Well, that's a very good question. You know, you hit it on the point. On a business development track, a speaker came from CETRIPS. CETRIPS is the largest online tour operator in China. It has 250 million members, and they book their travel around the world. And he said a prophetic message that says, Hawaii needs to differentiate itself from Maldives. Maldives has a sudden ocean beaches, same as Hawaii. So what does Hawaii have that's different? Well, we have shopping centers. We have the dollar. We have a different kind of culture. We have sophistication, you know, fine dining. It's a U.S. city. All of these things all means there's an added value. And one thing that he was amazed to me was saying, Russell, you said, you know what, I was amazed. You've got some stores here that open 24 hours and some that open at midnight. Other places close early. So it's a big point in the favor. Because, again, there's an added value to it. But again, it's the thing that we need to do is we need to make them feel welcome. We need to feel them made welcome that not only, you know, we have Japanese tours, but we have now Chinese tours. And that's why the Chinese are investing on the koalina side, because maybe Waikiki has not been so much interesting to them. It's a little older. It needs improvement. And maybe, you know, they don't feel welcome in the Waikiki area. And I think it would be... So you're talking about Chinese investment to make a second Waikiki. That's a little grained up. Well, possibly. You know, because it takes a big overhaul in Waikiki. That's right. But, you know, it's good for that. It's good for white. And, you know, out or out, it's too. So I see it as a growing dynamic industry, but we need to quickly get on the curve. We need to get on this learning curve. We need to understand it. We need to learn culture. We need to make the fine-tuning changes that will make them welcome. First of all, the airport. Where are the signs in Chinese? Where's the language? Look in Tokyo Airport, all the language. All the signage is there. Even the airport bus that goes into the city. It's in Mandarin. They have Mandarin tapes. Again, these are the things. And, you know, remember the first and last impression of visitor gets to the airport. And one complaint I heard two of her presenters talk about is when they got the taxi, the taxi drivers were asking, that's not enough for a tip. How much do you give her a tip? And that's a black eye because they're not accustomed to that. Right. Well, again, education, going back to education, even for taxi drivers, people who greet the people at the airport, signage, language, cultural sensitivity, hot water at the hotel rooms. There's a whole list that goes on. And I think we have enough to go for another show. But at this point, unfortunately, we're out of time. And Russell, great to hear of your comments on the recent HTA conference. I think it is a seismic moment. But in order to move forward for Hawaii, we have to seize the moment. We thank you very much for Asian Review for Think Tech. Thank you very much. Thank you very much. Aloha.