As celebrations for the Chinese New Year kick off and we enter the Year of the Rooster, the time is ripe for retailers, brands and hotels selling luxury goods and services to build their business for the global shopper.
The post-Brexit climate has been a massive driver. The weakened pound prompted an influx of bargain hunting ‘Brexit tourists’ to the UK over the Christmas period, with foreign visitors spending over £725 million on British high streets in December1. This is especially true of brand-conscious Chinese tourists, for whom luxury goods over here are already at least 30% cheaper because of high tax rates back at home.
The number of payments Worldpay processed from Chinese shoppers increased by 24% year-on-year from 2015 to 2016, and could increase again in 2017. And many more holidaymakers are set to visit the UK since the Home Office launched new two-year visa rules for Chinese nationals.
London is home to many of the world’s biggest premium brands. And huge spikes in demand during Chinese Golden Week provide a great opportunity for brands that are geared up to provide the international consumer with a first-class experience. But business outside of London – including those in the historic centres of Edinburgh, York and Bath – can also benefit as visitors seek to combine tax-free shopping with cultural experiences.
But retailers must remember that international visitors can have culturally different expectations when shopping. And, given the sums they are spending, they’re increasingly demanding high levels of service.
Simple things like letting them pay using the card they want to, can go a long way. China UnionPay has a monopoly in its home country. That’s why Worldpay will shortly be adding UnionPay as a standard payment method to over 300,000 customers across the UK. We’ll be writing to you to let you know more in the coming weeks.
Dynamic Currency Conversion can also help. Readily available from major payment service providers including Worldpay, it displays the transaction in real time in a shopper’s local currency – improving the whole experience for customers.
Train employees so they know the expectations of shoppers coming from different cultures. Consider amending in-store signage with additional languages and international size labelling for certain items. Also, be sure to clearly display the tax-free benefits of shopping in-store and consider putting the tax-free price on goods. Specialist personal shopping services and extras for big spenders like free taxis or refreshments may also help to draw in those lucrative international customers.
The message is clear for UK retailers: if you haven’t begun already, it’s time to start thinking globally if you want to mine a rich seam of international custom.
1 Analysis of non-UK card transactions processed by Worldpay in December 2016 compared to the same period in 2015