Heathrow ‘Passenger Ambassadors’ Secretly Encouraging Chinese Travelers to Spend Money at Airport Stores

Chinese woman reading the STC magazineAn investigative report by the United Kingdom’s Channel 4 revealed that Heathrow Airport’s 250 passenger ambassadors—service staff helping travelers at the airport—are actively trying to entice tourists to spend money at airport stores. Passenger ambassadors, who were revealed to earn commission from promoting airport stores’ special offers, were found to often actively pursue Chinese travelers as they are identified as the most likely customer segment to spend big inside the airport.

The Channel 4 report, titled Dispatches: Inside Britain’s Airports, unveils that Heathrow Airport’s passenger ambassadors are responsible for what can be considered unethical behavior. By using hidden cameras and undercover reporters, reporters found that, rather than helping passengers, Heathrow’s passenger ambassadors were eager to nudge tourists toward shopping at the airport’s many stores and restaurants. The Daily Mail, which also sent reporters to the airport to investigate, had one if its reporters ask a passenger ambassador for help to find her gate, only to find the ambassador ignoring the question and instead recommending where to find the “best shops and restaurants.”

In a segment of the Channel 4 report, one of Heathrow’s passenger ambassadors described that after successfully encouraging a traveler to spend money at one of the stores, store clerks would provide information on the amount spent by the traveler, which is then recorded in a terminal. According to the report, Heathrow ambassadors have the target of generating up to 4,000 GBP (US$4,960) in sales every day, with one ambassador claiming to have generated sales for as much as 10,000 GBP (US$12,403) in a single day.

Some airport ambassadors interviewed for the report also admitted to actively targeting Chinese tourists, since they’re perceived as more likely to spend substantial amounts of money in the airport’s retail outlets. The report by the Daily Mail further corroborates this claim and describes one of Heathrow’s passenger ambassadors seen “pursuing a man of Chinese appearance for 100ft, while a couple was forced to ignore another ambassador as she skipped beside them gesticulating outside the Cartier store.”

According to the job description that an undercover reporter received when applying for the job, “the majority of the role will involve interacting with passengers, persuading them to shop if they had not planned to, or encouraging them to spend more by talking to them about offers and promotions.” In contrast, a spokesperson for Heathrow airport described the practice as follows: “We provide fantastic restaurants and stores in order to offset the cost of running the airport, which keeps the cost of air fares down. Passenger ambassadors are an important part of our business, and we expect the team to put the needs of passengers first.”

While some experts interviewed for the investigative piece questioned how ethical it is to use employees who are described as there to help travelers for promotional services, none questioned the legality of the practice.

In the United Kingdom, the growing number of Chinese travelers that the country receives is perceived as a crucial engine for growth in the retail sector, particularly after the Brexit referendum which saw the British pound plunge in value against the Chinese yuan. With countless media reports describing Chinese tourists as “flocking” the country for luxury shopping as the value of the pound dropped, it should perhaps not come as a surprise that sales promoters working on a commission basis actively target this particular customer segment. For airport retail, just like other sectors in the tourism and retail industries, Chinese travelers is a customer segment to be reckoned with—with initiatives that encourage further spending among Chinese travelers potentially extremely lucrative.

Source: Jing Daily / Channel 4

Mainland Chinese shoppers accounted for 75% arrivals in Hong Kong in 2016

Chinese power couple - China Elite FocusShoppers from mainland China contributed 35% of Hong Kong’s total retail sales in 2016, which is up from 15% 10 years ago.

Visitors from mainland China now account for 75% of the tourist arrivals in Hong Kong according to Hong Kong Tourism Board reports, up from 54% in 2006.

Mainland travelers spend an average of 2.7 nights in Hong Kong per trip and spend more than CNY20,000 (US$2,900) each time they visit. And while 5 in 10 visitors buy jewelry and watches on their trips, some visitors who come to enjoy the food (51%) and culture (40%) who spend 10% more during their stay than those who come just to shop.

According to Nielsen’s recent study, Hong Kong covers off on the top 6 reasons that consumers look for when they consider regional travel. Online travel agencies and social media are dominant influencers to mainland Chinese travelers, at 95% and 49%, respectively according to Nielsen.

The Brexit’s One Bright Spot: More Chinese gentlemen getting bespoke suits in London

The STC magazine Sept 2016 CoverA volatile stock market, downgraded credit rating, and plunging pound may be some of the economic woes plaguing the UK after the Brexit vote, but there is one thing that seems set to go up in the near future: Chinese tourist numbers.

According to a recent report in Shanghai Daily, travel agencies are seeing a surge in Chinese travelers booking tour packages to the UK as travel and shopping in the region are set to become much cheaper. According to Chinese travel agency Shanghai Spring Tour, all of its tour packages to Britain have now been totally booked for the summer. Meanwhile, Ctrip has also seen a jump in bookings to the UK.

“An interesting reason for this increase of London travel for affluent Chinese men is the new trend for bespoke tailoring”, said Pierre Gervois, Publisher of the Shanghai Travelers’ Club (STC) magazine, a digital luxury travel magazine for wealthy Chinese gentlemen. “As London is probably the best city in Europe to get a bespoke suit, a growing number of Chinese gentlemen are going to London to see their tailor – such as Benson & Clegg, for example, and take advantage of the favorable exchange rate as well”, Pierre Gervois added.

With shopping a high travel priority and an acute awareness of where to seek out the best prices of luxury goods and avoid mainland tariffs, Chinese tourists have been known to follow currency fluctuations to get a good deal. This has been one factor in the recent Chinese spending boom in Japan as the weak yen means cheaper prices of luxury goods and premium Japanese brands. When the ruble rapidly plunged in 2014, Chinese travelers and daigou sellers rushed to Russia and cleared out entire luxury boutiques thanks to the cheap prices.

The UK has long been working to attract more Chinese tourists, but its exclusion from the Schengen Area has made the visa application process cumbersome for visitors from China. As groups such as the luxury retailer-led UK-China Visa Alliance have lobbied for easier visa access, the government has made changes such as a two-year multi-entry visa policy for Chinese travelers as well as a partnership with Belgium to grant Chinese visitors with a Belgium-issued Schengen visa access to the UK.

But these efforts for greater EU-related visa access may now be undone, showing it’s not all good news when it comes to Chinese tourism in the post-Brexit UK. UK-Europe package tours could take a hit as participants traveling to both the UK and European countries would have to declare tax-free goods brought from the UK into Europe. This includes not only European countries, but also Ireland, which will now see fewer Chinese tourists entering form the UK.

In the long run, Chinese tourists are risk-averse when it comes to making their travel plans and tend to avoid places seen as politically unstable. The perception of increased political and economic instability could also deter the Chinese real estate buyers who have been flooding to London in recent years.

Source: Jing Daily / TopTier

Major duty-free stores yet to be affected by dwindling Chinese tourists over THAAD deployment

Young Chinese shoppers - China Elite FocusSouth Korea’s major duty-free shops have been operating in the black in recent months despite the number of Chinese tourists declining over the country’s plans to deploy an advanced US missile defense system, industry sources said Monday.

Chinese travel agencies in recent weeks spent sales of tour packages to South Korea as part of the Beijing government’s retaliation against Seoul’s decision in July to have the Terminal High Altitude Area Defense system deployed on South Korean soil later this year. South Korea says the missile system will not target China but only counter threats from North Korea.

HDC Shilla Duty Free said it posted a surplus of 125 million won ($107,982) on 53.2 billion won in sales in January.

It is the first time the joint venture between Hotel Shilla Co. and Hyundai Development Co. recorded a monthly surplus since its opening in December 2015.

HDC Shilla also had 1 billion won in operating profit on 67 billion won in sales in February.

The company suffered 20.9 billion won in operating deficit on 397.5 billion won in sales last year.

Shinsegae DF said its Myeongdong branch in downtown Seoul recorded an operating profit of 1.2 billion won on sales of 75 billion won in January in the first operating profit since last May when the Myeongdong branch opened.

Hanwha Galleria, an affiliate of Hanwha Group, and Doota Duty Free Shop, run by Doosan Group, said they have been improving in recent months with their daily sales surpassing 1 billion won each.

Hanwha Galleria logged an operating loss of 43.8 billion won and Doosan a loss of 30 billion won last year.

The duty-free industry, however, may face tough business conditions in the coming months when the country is expected to receive fewer Chinese tourists in the aftermath of the Chinese government’s retaliation.

“The current geopolitical climate between Korea and China is certainly an issue for Korea’s duty free and retail industry.” declared Pierre Gervois, CEO of China Elite Focus, and Publisher of the STC magazine, a travel magazine in Chinese language.

Chinese clients account for about 80 percent of the sales for South Korea’s duty-free shops, according to industry data.

“We are trying to come up with measures for stainable management of the business while refraining from excessive and cutthroat competition to achieve sales and profits at the same time,” a HDC Shilla official said. (Source: Yonhap)

The Japanese have created a new word to describe Chinese tourists’ shopping sprees

Chinese shoppers - China Elite FocusChina’s voracious consumers have helped to create a new buzzword in Japan, with the term “bakugai” – which translates as “explosive buying” – selected as one of top additions to the Japanese language this year.

Fifty candidates were short-listed by publishing company Jiyu Kokumin Sha for the most popular word of 2015, ranging from new terms from pop culture, anime, politics and sport.

That list was whittled down to two winners, “bakugai” and the new baseball term “triple three,” to describe a .300 batting average with 30 stolen bases and 30 home runs achieved by two players this season.

The baseball phrase will have passed many Japanese by, but the influx of Chinese tourists are unmissable. And their spending sprees are fast becoming legendary among Japanese retailers.

During the Golden Week holidays in early October, around 400,000 tourists from mainland China descended on Japanese destinations, spending an estimated ¥100 billion (HK$6.3 billion) in the space of seven days.

Encouraged by the weaker yen and easier visa requirements, Chinese tourists accounted for fully 27.5 per cent of the total consumption by overseas visitors in 2014, according to the Japanese government’s white paper on tourism. And that percentage is likely to increase when the figures for 2015 are released.

And once they are here, they have a clear of idea what they want to spend their yen on.

According to the Shanghai Travelers’ Club magazine, the favorite digital publication of China’s Elite, the most affluent of Chinese travelers plan to spend between US$55,000 and US$340,000 per year in shopping overseas.

A study by the Japan National Tourist Agency indicated that 63 per cent of Chinese visitors purchased cosmetics and perfume, 55 per cent snapped up food, spirits and cigarettes and 52 per cent bought over-the-counter medicines and toiletries.

Perhaps surprisingly, only 37 per cent of Chinese bought electrical appliances – rice cookers and Japan’s famous high-tech toilet seats remain favourites – although they did buy in bulk. On average, a foreign tourist will spend ¥65,000 (HK$4,093) on appliances, but the Chinese splash out an average of ¥88,000 (HK$5,541).

Chinese tourists’ reputation for “explosive” bouts of buying have been played up in Japan’s tabloid press, which have played up reports of stores having their shelves stripped bare and tourists coming to blows over the last remaining items.

In one incident reported, two families became embroiled in a fight in a Kobe department store in August over the last box of disposable nappies.

Japan has become the most popular destination for Chinese tourists this year, with 2.75 million Chinese arriving in the January-to-July period, up from 1.29 million in the same period in the previous year.

Even the devaluation of the yuan in the late summer failed to appreciably slow down arrivals.

To meet growing demand and take advantage of an agreement reached in May between Beijing and Tokyo to permit additional flights, All Nippon Airways is ramping up its services to China and launched a new route from Tokyo’s Haneda airport to Guangzhou on October 25. At the same time, it doubled its present single daily flights from Haneda to both Beijing and Shanghai.

Similarly, the Laox chain of electronics and duty-free stores opened a new store in Tokyo in June specifically catering to visitors from China and further afield.

The new ¥2 billion (HK$131 million) store, in the Shinjuku district, stocks around 50,000 items, including home appliances, watches, cosmetics and household goods, all spread out over 2,100 square metres of floor space.

Source: South China Morning Post. All rights reserved.

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Luxury Shopping in the United States: the 2016 big trend for Chinese shoppers

Shanghai Travelers' Club magazine Media Kit 2016The Shanghai Travelers’ Club magazine, the Chinese language publication read by China’s Elite global travelers has disclosed its much anticipated 2016 Editorial calendar yesterday. And clearly, Affluent Chinese shoppers love the United States! According to Pierre Gervois, the New York City based Publisher and Editor-in-Chief of this publication “The new generation of Chinese business travelers have clearly chosen the United States as their strategic country for their business browth. We have seen in the past two years a very strong interest from Chinese corporations – and wealthy Chinese invividuals- to invest in the United States. The more they come to the U.S. for business, the more they tend to come back with their family for a U.S. luxury leisure & shopping experience”

But It’s no more just about luxury shopping: Philanthropy and real estate investment are also hot topics. The January 2016 issue will have “Philanthropy in America” as its main feature. “Many Chinese CEO’s residing in the U.S. are willing to create their own philanthropic foundations in America, as they used to do in China. We’ll publish stories to help them to understand how to create a charity organization with all the necessary partners: banks, wealth management advisors & attorneys” added Pierre Gervois.

Driving a vintage 1960 Cadillac on Road 66 is also part of a true luxury American experience. (You can also rent a brand new Cadillac SUV). The march 2016 issue will feature a “Luxury road trip to America” story. Ralph Lauren ripped Jeans, Louis Vuitton beaten up keepall bag, vintage Rolex, Vincent Peach leather bracelet, a motel with neon signs, this is America.

After the success of the September 2015 men’s fashion issue “The Gentleman Traveler”, The September 2016 issue will also feature a Men’s fashion special edition, with in depth stories about America’s best fashion designers. “Having a tailor made business suit made in USA makes a statement for Chinese global business executives” said Tyron Cutner, the Shanghai Travelers’ Club magazine Men’s Fashion Editor.

“Winter Holidays in the American West” will introduce snow experiences in the American West: Colorado, Nevada or Arizona are beautiful in winter time and very desirable destinations for Chinese frequent travelers to the U.S. who had already visited New York and Los Angeles multiple times and want to experience a truly authentic American Christmas time. A lot of opportunities for U.S. luxury retailers to showcase their products and services to their Chinese customers.

Request the 2016 Editorial Calendar & Media Kit of the Shanghai Travelers’ Club magazine here.

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Bloomingdale’s smart strategy to target affluent Chinese shoppers in New York

Bloomingdale's advertising in Shanghai Travelers Club magazine - China Elite Focus 2015We have all seen these cheezy advertising campaigns made by department stores or western brands trying to attract Chinese tourists in the last years: Be assured that affluent Chinese tourists were also smiling…  But it is going to change. Exit the low quality shopping publications targeted to Chinese tourists that ended in the hotel rooms trash bins. U.S. and European Luxury brands and high end retailers start now to advertise seriously with affluent Chinese tourists.

Although luxury sales in mainland China have still remained in slowdown mode in 2015, and Hong Kong has recorded a significant slump as well, Chinese spending remains a potent force in the global luxury industry, propping up growth rates in developed markets worldwide.
This week, Hermès reported a 22 percent increase in global sales in the second quarter, with sales in Japan leaping 33 percent—a figure attributed in large part to an influx of big-spending Chinese tourists attracted by a weaker yen and easier travel. On a global scale, Chinese travelers are spending lavishly: a recent Global Blue report found that Chinese tourist spending jumped 87.8 percent in June, while spending on leather goods in Europe grew by an even more staggering 93.7 percent. Year-to-date spending growth sits at a whopping 110 percent.
These numbers contrast sharply with the situation in mainland China and Hong Kong, one that is particularly striking in formerly triumphant Hong Kong. Last week, Burberry reported a “double-digit percentage decline” there for the three months ending in June, while sales of Swiss watches in the former British colony were down 21.2 percent in June, despite 3.3 percent growth worldwide.

These numbers further support the trend that growth is following Chinese tourists abroad, and brands need to keep up with their changing location preferences for travel—engaging outbound shoppers before they leave China and when they arrive overseas. Recent stats also illustrate the ever-shifting tides of Chinese travel patterns. Whereas Japan was, just a few years ago, faced with a Chinese tourist slump (caused in no small part by Sino-Japanese political tensions), the country is seeing a wave of Chinese arrivals and spending, owing to cooling attitudes toward Hong Kong and South Korea’s currency fluctuations and MERS outbreak.
Amid these rapid and unpredictable changes, what is clear is that brands need to have plans in place to quickly jump on opportunities, and ensure they’re able to reach and influence the Chinese outbound consumer wherever he or she happens to be in the world.
“Luxury retailers like Bloomingdale’s have well understood the importance of targeting affluent Chinese tourists”, said Pierre Gervois, CEO of China Elite Focus and Publisher of the Shanghai Travelers’ Club magazine, a high end publication in Chinese language for High Net Worth Chinese global travelers. “Bloomindale’s and the Shanghai Travelers’ Club magazine have launched a very creative marketing and PR campaign this spring showing actual Chinese customers and what it feels like to shop at the iconic Bloomingdale’s store in NYC.” Gervois added. This campaign has generated a considerable attention on Chinese social media and is the first ever campaign focused on the Chinese customer and the overall shopping experience in a U.S. luxury retailer. An example to follow for the industry.

Source: Jing Daily / Chinese Tourists Blog / Chinese tourists in America

New York City expects 1 million shoppers from China by the end of 2018

Chinese shoppers at Bloomingdales NYC - Shanghai Travelers ClubNew York City hopes to reach 67 million annual visitors by 2021, and a big part of the plan is attracting big spenders from places like China and Brazil.
Of that 67 million goal, New York expects 16 million will come from international markets, and 51 million stateside. Based on city figures, 965,000 tourists came from Brazil, and 809,000 from China last year, which ranked Nos. 2 and 3 in international tourism to the city.
“China’s been growing a little faster in percentage from a rate-of-growth perspective, so China’s been a huge growth market for us,” said Christopher Heywood, spokesman for NYC & Company, the city’s official tourism bureau. “Brazil in the last few years has also been [growing], and it still will grow this year, but our big focus is on China.”
An informal survey by China Daily of major US tourist cities finds that the Chinese and Brazilians are substantially increasing their visits.
New York expects 1 million visitors from China by the end of 2018, Heywood said.
Only a few years ago, Brazil and China were not ranked in the top three international markets for New York, but have overtaken European markets such as France, Germany, and Italy.
“One thing about Brazil and Chinese is they don’t mind coming in the winter months, so for Lunar New Year, a lot of our Chinese visitors come during that period,” Heywood said. “The Brazil market, they don’t mind the novelty of being in the snow and being in the cold, so they don’t mind coming in those winter weather months, which is exactly the time of year we want to fill the gap and create more demand during the first quarter,” Heywood said.
Las Vegas is seeing a steady increase of travelers from the two countries, which along with Australia, have been major growth markets for the gambling capital, despite not having direct flights to any of the three countries.
“Our market share and growth has been very good, and our growth in Las Vegas over the last three years has been slightly higher than the growth to the US from China, so we feel very comfortable about that,” said Rafael Villanueva, senior director of international sales for the Las Vegas Convention and Visitors Authority.
“We realize that we’re not going to go out there and get gobs and millions immediately, so we want to do it correctly,” he said. “As the second-tier cities in China start opening up, that’s going to be our volume market.”

“Chinese businessmen like Vegas to close business deals with their American business partners” noted Pierre Gervois, Publisher of the Shanghai Travelers’ Club magazine. ” we have seen a trend since the beginning of 2015, where Chinese Executives came to New York City for business, and organized a two days trip to Vegas, inviting their U.S. counterparts -sometimes in private jets-, in order to close their business deal and have good time”, Gervois added.
Those are the visitors who are going to the US to experience what Villanueva called the “sampler plate”. He said “they came and visited 10 cities in the two to three weeks they were here, and now they’re coming to the US to spend a little more time in San Francisco, Los Angeles and Las Vegas”.
Las Vegas welcomed 300,000 visitors from China in 2013, up from 263,000 in 2012, and 187,000 from Brazil in 2013, up from 161,000.
The Chinese make up a much smaller portion of Miami’s visitors, but there is growth. The city doesn’t have specific data on the number of Chinese tourists, only air studies completed by the city’s airport air service consultant, and it estimates that the Miami market generated 55,000 Chinese passengers in 2014.

Source: China Daily USA / Amy He

81% of Affluent Chinese male shoppers in the U.S. receive “Disappointing” service while shopping, study founds

Asian couple in streetThe Shanghai Travelers’ Club magazine, China’s leading luxury travel magazine for High Net Worth global Chinese travelers, launches a new monthly regular section about Men’s Fashion.

“As Chinese entrepreneurs are becoming more and more international, they are more attentive to their personal style while in business meetings or in corporate events” said Pierre Gervois, Publisher and Editor-In-Chief.

The newly appointed Men’s Fashion Editor, Tyron Cutner, will be in charge of this new editorial feature.  An expert in men’s fashion, Tyron Cutner is a well known fashion adviser in New York City and will bring his expertise and style to the publication.

“I feel proud to be part of the prestigious Shanghai Travelers’ Club magazine. Every month, we’ll share with our Chinese readers the latest trends in Men’s fashion and accessories, as well as the basics that every international gentleman must have in his suitcase when traveling”, said Tyron Cutner.

Every month, starting in September 2015, the Shanghai Travelers’ Club magazine will feature a section providing fashion advice for the modern, style conscious, Chinese businessman.  Wether he’s attending a negotiation meeting in New York City, at a Charity ball in London, or attending a gala dinner in Paris.

According to a survey by China Elite Focus, 74% of Chinese male entrepreneurs and top executives aged 30 to 45 agree that paying attention to their personal style has a positive impact in conducting business.  And a staggering 81% think that they receive a “Disappointing” or “Very disappointing” welcome when shopping in the United States.

“It’s also important that fashion brands realize that they need to substantially improve the way they interact with affluent Chinese customers in the United States. We hope that this new editorial content will encourage U.S. retailers to implement long awaited changes in the customer service towards Chinese travelers”, Pierre Gervois added.

The Shanghai Travelers’ Club magazine is a China Elite Focus Magazines LLC publication withg offices in Hong Kong, Shanghai and New York City.