WeChat Pay and Alipay North American expansion presents golden opportunity for retailers
With Chinese travelers being one of the most valuable customer bases for luxury goods, negotiations are underway to make mobile payment solutions WeChat Pay and Alipay acceptable in North America.
The move comes at the behest of Citcon, a cross-border commerce company, China Luxury Advisors and The Momentum Group, a marketing agency that works with WeChat. Together, the three are hoping that Chinese travelers will soon be able to use WeChat Pay and Alipay while abroad in the United States, easing the purchase of international luxury goods.
“Chinese travelers are already the highest spending international tourists in the United States – having spent more than $27 billion in the U.S. in 2015, and this number is expected to continue to grow rapidly,” said Renee Hartman, co-founder of China Luxury Advisors, Los Angeles. “This tremendous growth brings new possibilities for American retailers and destinations to continue to grow their share of visitation and spending from Chinese tourists.”
But what makes Chinese luxury consumers so interesting is that few are actually purchasing their luxury goods in China. Due to China’s strict laws on imports and what stores can open shops within its borders, many affluent Chinese get their luxury goods while abroad.
The other important factor to understand about this announcement is that for many Chinese consumers, they use an entirely different ecosystem of digital platforms than many other nations.
Most notably, WeChat Pay lets Chinese customers make mobile payments, something that is extremely popular in China.
Along with Alipay, Chinese online retailer Alibaba’s mobile payment system, the two make up almost three-quarters of purchases made in China through mobile.
Alipay has also seen integration with international luxury retailers. LVMH-owned travel retailer DFS Group is furthering its partnership with Ant Financial’s Alipay by giving exclusive promotions to customers checking out with the mobile payment method.
With an already built-in integration with many luxury brands, bringing these two China-centric mobile payment platforms to North America will be an obvious boon for American luxury retailers looking to capture more of the lucrative Chinese traveling customer base.