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Overseas merchants “actively exploring digitalisation via Chinese mobile payments to boost sales and customer traffic” report claims

How to open up China for growth (Image: Adobe Stock)

Overseas merchants are actively exploring facilitating Chinese mobile payments to increase sales and customer traffic, finds the latest survey by Nielsen and Alipay, building on anecdotal evidence that the key to growth lies in China and that means adapting to its payment mores.

The survey shows that nearly 8 out of 10 (78%) UK merchants surveyed say they are likely to recommend Alipay to their peers, especially for using digital operations to improve efficiency and turnover.

Surveying 4,837 Chinese travelers and 547 overseas merchants, the report finds that Chinese tourists’ usage of mobile payments while traveling overseas continues to increase, with Singapore, South Korea, Japan, Australia, France, Thailand, New Zealand, Canada, the UK and the US ranked as the “top 10 countries where Chinese tourists love to use mobile payments in 2019.”

Regions like the UK are accelerating the acceptance of Chinese mobile payments. Overseas merchants are also going beyond payment to explore more digitalised solutions including digital marketing, with nearly 70% of UK merchants surveyed saying they have already utilized additional services other than payment in Alipay.

Nearly 9 out of 10 UK merchants (88%) surveyed who have used additional services on Chinese mobile payment platforms recognised that these solutions helped market their stores, and 63% believed they improved the efficiency of store management.

The report also provides a new look at the digitalization trends of the overseas retail sector at a time when online and offline businesses are increasingly merging, and Chinese tourists are poised to have more influence in this industry. It finds that there is increased outbound tourism by Chinese residents of lower-tier cities. The gap between residents of second-and-third-tier cities and those from first-tier cities is quickly narrowing in terms of per capita outbound destinations, travel expenditure, and future travel budget.

On per capita annual overseas travel expenditure, the difference between residents in third-tier and first-tier cities significantly dropped from USD 1,724 in 2018 to USD 606 in 2019.

The transaction volume of Chinese mobile payments continues to increase, too. On average, Chinese tourists paid via mobile 3.4 times out of every 10 payments in 2019, up from 3.2 times in 2018. As a result, European merchants have accelerated the adoption of Chinese mobile payment solutions. In the U.K., 61% of local merchants surveyed adopted Chinese mobile payment solutions since 2019, and since then, usage among Chinese tourists has risen.

The wider adoption of Chinese mobile payment solutions increases the willingness of Chinese tourist to spend. According to the survey, 92% of Chinese tourists traveling to Europe said they are more likely to pay with mobile phones if more local merchants supported Chinese mobile payment solutions, and 89% said that they are more likely to shop and spend locally.

Mobile payment is more than payment, says the report. It also enhances overseas merchants’ digital marketing efforts. In the UK., where Chinese mobile payments are increasingly embraced, 88% of merchants surveyed recognized that additional services on Chinese payment platforms facilitated the marketing of their stores, and 63% saw improved efficiency in store management.

More overseas merchants may continue to deepen their use of Chinese mobile payment platforms as they go digital. 66% of merchants surveyed hope to carry out more digital store operations and further their stores’ promotional and marketing activities by leveraging Chinese mobile payment platforms.

Nearly 8 out of 10 (78%) UK merchants surveyed said that they are likely to recommend Alipay to their industry peers, especially utilising digital operations to improve efficiency and turnover.

The improved acceptance of mobile payment solutions has also made it possible for Chinese tourists to bring less cash on their travels, with data showing that the amount of foreign currency exchanged by Chinese tourists before leaving for Europe in 2019 fell by 16%. 

In 2019, 100% of Chinese tourists surveyed have Alipay on their mobile phones while travelling overseas. On average, Chinese tourists surveyed used Alipay in nearly 4 use cases during their most recent trip overseas. 

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