Retailers need to embrace changing Chinese tourist demographics

Increasing numbers of Chinese tourists are travelling alone – and retailers in Asia seeking to cash in on their growing spawning power need to find ways to embrace the trend.

Traditionally, Mainland Chinese tourists have travelled in groups – sold packages before they leave home and effectively herded into shopping destinations, often with commissions paid to tour organisers or guides.

But that is set to change soon with the Beijing-based government tightening the rules on cheap package tours.

South Korea is a case in point where the trend has been identified early and active work is underway to appeal to the new demographic.

Duty-free operators and department stores have stepped up customised marketing targeted at shoppers in their 20s and 30s and deep-pocketed travelers from China, as they have become the main customers over the past few years.

The shifting focus took on a new urgency as the Chinese government has been moving to tighten regulations on cheap tour packages, raising concerns among South Korean businesses relying on them as the biggest source of travel income.

Out of 5.98 million Chinese nationals who visited South Korea last year, nearly 60 per cent were independent travelers, according to the state-run Korea Tourism Organization.

Lotte Duty Free, which is operated by Hotel Lotte, offers a “personal shopper service” for VIP customers to pair them up with stylists who give advice and suggest products that may suit their needs.

The nation’s largest duty-free operator has about 600,000 customers registered for VIP programs and also provides airport pick-up services for those who spend a certain amount of money.

Shilla Duty Free, which is operated by Hotel Shilla, said it regularly holds “beauty classes” to advise on the best cosmetic products and offer makeup services to attract Chinese customers in their 20s and 30s.

Tourism officials stress efforts to develop a wider array of options for Chinese travellers to encourage them to revisit in the future.

“We have focused on attracting more independent travelers over the past years not only from China and Japan but also Southeast Asian nations and the Middle East to meet their diversifying needs and upgrade the tourism industry’s competitiveness,” Hwang Myung-seon, a senior official at the Ministry of Culture, Sports and Tourism, said.