Chinese visitors to the UK offer a huge opportunity to retailers, potentially being worth some £1 billion a year, research suggests – and a group of retail support businesses have teamed up to help make it happen.
More than 1.5 million Chinese nationals were granted visas to enter the UK in 2018, and student applications have climbed by 30,000 in the first quarter of 2019. According to VisitBritain, tourist spending will grow 40% to exceed £1 billion this year.
To enable retailers to benefit from the surge in Chinese spending, a research report and education programme has been launched by the three leading suppliers of services needed by businesses to successfully target and serve consumers from China. They have produced a ground-breaking retail report, and will run workshops that enable maximum sales returns from all visitor groups from China.
Tax Free Shopping sector world leader Global Blue, payment platform company Adyen, and Chinese marketing consultancy Emerging Communications, have undertaken major research into Chinese consumer shopping and payment habits based on a tour of China that involved extensive interviews of consumers, key spending influencers, brands and technology companies. Research also included investigation of Chinese shopping experiences, and the development and use of advanced retail technology.
Based on the research, a detailed report titled, ‘Retail lessons from China and how to sell effectively to Chinese audiences in the UK’, has been created to support British retailers and hospitality companies.
In addition, workshops will take place to provide comprehensive information on how to successfully engage with Chinese consumer audiences, drive sales traffic, provide optimum service levels, and create peer recommendation and repeat business.
The first workshops will take place in London on 24 October and Manchester on 31 October. Each is designed to be a one stop briefing for retailers managers on what they need to know about marketing, payments and tax refund in order to drive sales and serve Chinese consumers in the UK.
The majority of UK retailers are yet to fully capitalise on the opportunity presented by Chinese consumers in the UK. Research released by the three companies reveals that only 43% of retail and hospitality businesses believe that Chinese consumers are important for their business, and 42% believe they need to improve the customer experience they provide for international shoppers.
On average, each Chinese student studying overseas spends more than $100,000 a year, according to UnionPay. They receive on average three visitors from home each year. Home Office figures for the first quarter reveal a near 70% increase in approvals for Tier 1 residential visas for Chinese nationals (Tier 1 visas require proof of £2 million in liquid assets).
Myles Dawson, UK Managing Director of Adyen explains: “With Chinese tourists budgeting more than £5,300 per trip, and rising numbers of Chinese nationals entering the UK in the last year, the potential opportunity for businesses is too big to ignore. By joining forces and pooling expertise with Global Blue and Emerging Communications, we want to help UK businesses realise this opportunity – helping to understand the key touchpoints, technology and marketing platforms to create a customer experience that appeals to Chinese consumers.”
Garry Buckland, Head of Strategic Partnerships at Global Blue adds: “As the worldwide leader of the Tax Free Shopping industry, we noticed that Chinese consumers in the UK love purchasing British brands because of our heritage, and it gives them access to desirable goods they do not have access to back home. At a time when trading conditions are challenging, Chinese nationals in the UK represent such an important and untapped audience for UK businesses.”
Domenica di Lieto, Founder of Emerging Communications says: “It should be remembered that Chinese consumers are the most sophisticated in the world, and the top brands try to sell to them every day. They are quick to distinguish between those that have put careful thought into trying to attract their money, and those that use clumsy translations and blunt promotional messages. To make a retailer stand out it should demonstrate heart and sincerity behind its sales proposition. It is this authenticity that Chinese consumers buy into.”
The rise in the number of Chinese tourists, expats and students is largely being driven by a fall in Sterling and America’s trade war with China. According to data released by TripAdvisor, searches of UK destinations and hotels by Chinese nationals is up 133% on last year, and spending by tourists is expected to rise 40% to reach £1 billion in 2019, according to VisitBritain.
A free download of ‘Retail lessons from China and how to sell effectively to Chinese audiences in the UK’, and details of the workshops can be obtained via this link adyen.com/china