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Chinese are the biggest luxury spenders in the world

Chinese travelers are the biggest spenders in the world. As reported by Hotels.com, the average of Chinese tourists’ expenses during their trips abroad is around 6,707 RMB per day, excluding accommodation costs.

The majority of the travel’s budget of Chinese tourists is earmarked to go shopping.

Throughout their travels, Chinese holidaymakers spend up to 57.76% of the money on retail products, representing more than half of the estimated expenses while they only spend 3.72% on attractions or entertainment.

The big amount of money than Chinese tourists spend on the destination country is the reason why governments and marketers are trying to attract these tourists, who are the most beneficial customers in the world.

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During the first 11 months of this year, the number of Chinese tourists who traveled overseas was more than 100 million, being this quantity a historical record, according to official data released by tourism authorities.

Nowadays, only the 10 percent of Chinese demography can afford travel outside China but this situation is going to change due to different reasons.

The Asian giant is in the midst of an economic, technologic and social revolution. Over the last years the Chinese economy has grown and disposable incomes of Chinese society have increased. Due to these factors, the Chinese middle class has increased and therefore the number of people with enough economic power to travel abroad has increased too. This tendency will continue and as a consequence there will be more Chinese tourists overseas and with the desire to purchase luxury goods.

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According to the United Nations World Tourism Organization (UNWTO), in 2020 the number of Chinese tourists abroad will rise up to 100 million.

As reported by the Chinese National Bureau of Statistics, in 2013 the disposable income per capita in China increased 10.9 percent, representing 18,311 RMB. However the growth between urban and rural residents is dissimilar. The urban population disposable income increased 9.7 percent annually to 26,955 RMB while disposable income of rural residents rose 12.4 percent to 8,896 RMB.

The main barrier for Chinese tourists is the travel visa. In comparison with Americans who can travel to 170 countries without visa, Chinese travelers only have access to 44 countries. Last year, a quarter of Chinese travels who had decided to visit Europa, canceled their trip due to the difficult visa process or visa delays. Nonetheless, this is changing and governments around the world are simplifying the visa process in order to attract more Chinese tourists.

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In 2013, Chinese citizens bought 47% total luxury items of the world. In 2016 is expected an expense of 194 billion dollars a year in Europe and the U.S.A. by Chinese travelers.

Chinese travelers buy abroad because of the price. According to the Wall Street Journal, luxury brands are 50% less expensive outside China and that is the reason why shopping is the main activity to Chinese travelers. However Chinese tourists not only purchase for themselves, most of their purchases are gifts for others.

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Before their travels, Chinese holidaymakers carry out an extensive and deep research about what products buy during their trips. Besides the lower price there are other factors which motivate Chinese costumers to purchase abroad such as the unprofessional sales staff and poor after-sales service in China or the biggest products variety in Europe and the U.S.A.

European companies have seen to Chinese tourists as their business opportunity and therefore brands are focused all their efforts to attract and satisfy those customers. Many brands have adapted their services to Chinese population such as include Mandarin-speaking staff or incorporate Chinese payment systems.

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In addition, luxury stores are offering to Chinese customers the chance to participate in guided tours in Mandarin of the flagship showrooms or provide backstage access to couture runway shows.

The reality is that the number of Chinese tourists is increasing in unprecedented numbers and fashion brands must tap this business opportunity. Increasingly more, Chinese shoppers are more sophisticated and demanding and brands have to adapt their services in order to satisfy their luxury demands in an efficient way.

To attract these big spenders it is necessary a marketing strategy in China. If you are interested to have presence in the Chinese market and attract Chinese shoppers, don’t hesitate to contact us.

Sources:

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