Arnold Ma and Ting Zhang share their tips for jewellery retailers
Chinese tourism is set to boom in the UK under changing visa terms, but is your business prepared to welcome this wealth of luxury goods shoppers? Qumin digital marketing director Arnold Ma and China Business Solutions chief executive Ting Zhang share their tips on how UK jewellers can get ready.
The value of Chinese tourists is not in dispute by those in the luxury goods sector. When the UK allows the entry of Chinese tourists under the Shengen visa arrangement next year visitors numbers are expected to double in the following 12 months and rise steadily for the foreseeable future. It is estimated that in 2014 the market could be worth as much as £1.4 billion to the UK economy.
The question for retailers and brand owners is how to connect to the fastest-growing highest-spending consumers the world has ever known. Cultural and language barriers unquestionably exist, but for those who learn the basics of how to create dialogue the rewards are huge. Take a trip to Bicester Shopping Village and you will see the benefits.
To connect with the Chinese tourist market it is important to understand the motivation behind the luxury spending behaviour. For the individual the notion of ‘face’ is tremendously important in China. In the West there is no equivalent word, though reputation, status and worth are all descriptions that apply. To do well both socially and in business in China it is essential to have face, and a Patek Philippe watch in China sends out a far more important message than in the West. It reflects on the individual, family, community and business.
The giving of gifts is equally important when it comes to face. Gifts have to represent the value of both the giver and receiver. Compromise does not enter into it, but measurable value and the need for it to be identifiable with the holiday destination does.
So, spending on self and gift giving for Chinese tourists is hugely important. But shopping in the UK has other attractions: Bond Street pricing is a third less than the cost of similar items in China. Europe is also seen to have the most up-to-date products; to have the latest fashion, watch, jewellery or accessory is a key success indicator in a society in which there are more than a million millionaires, and the number is growing fast.
Shopping in the UK
The majority of wealth creation in China lies outside the main cities of Shanghai, Beijing and Guangzhou. Most of those who live beyond these cities feel left out of the latest trends. So they come to the UK to get ahead of the domestic game, but finding what they want is not always easy here either.
When Harrods undertook a research tour of China it was surprised to find that almost nobody had heard of it. Some brands have a foothold, but they are nowhere near as secure as in the West. In fact, the aforementioned Bicester Village is much better known in China than the majority of West End stores or shopping centres such as Westfield. It is perfectly possible for small retailers and groups to outperform bigger players in the Chinese tourist arena.
It is not difficult for brands and retailers to quickly implement a strategy that reaches out to Chinese tourists. Those that do make the effort to target and serve the Chinese tourist market are at a huge advantage compared to those that do not bother, or those that try and get it wrong.
Research consistently shows that Chinese tourists consider they are taken for granted by retailers and brands. For a culture that demands face they find it insulting that almost no effort is made to communicate, while taking their spending for granted. Putting up badly worded Mandarin pages on a website only compounds the problem.
Attract and Sell
What follows are the key steps to attracting and selling to the Chinese tourist market. First it is important to attract the target audience and make it aware of who you are, where you are and what you sell so that tourists can plan a visit when deciding their holiday itinerary. They may travel as part of an organised party, as nearly all Chinese tourists do, but they have plenty of time on their own to shop.
Chinese social media can be used to tell them what is new in store. Tell them they will receive a warm welcome. This will stand out because it is rare and greatly appreciated. It gets you on the shopping radar.
Having search-friendly web pages is important. There are examples of high-profile jewellers with impressive Mandarin pages written in Flash coding. The pages look wonderful, but Baidu – the Chinese equivalent of Google – cannot see the coding and therefore the pages do not register in searches. In practical terms the expensively produced pages may as well not exist.
Mandarin-based search engine optimisation (SEO) will greatly enhance the effect. For retailers in particular, there is very little word search competition for key phrases like British luxury jeweller and British luxury watch shop.
At the top end of the market the ability to create store appointments online can work well. It appeals to face, and if trying to attract ultra high-worth individuals it allows for the temporary use of Mandarin speakers in store.
For retailers and brands with deeper pockets the development of a Mandarin app provides the benefit of creating a dedicated digital format that is user friendly and requires less data. It also reinforces the message of devoting attention to the consumer.
Make Use of Mandarin
The in-store journey for tourists should begin by seeing a welcome sign in Mandarin in the window. Approaching tourists in a dignified way and the simple use of the phrase, nee how – which translates as hello – helps enormously. But to truly have an impact, Chinese cultural training for staff is recommended.
Mandarin point of sale should be used, and preferably a dedicated display area created. A Mandarin catalogue is important, but iPads with Mandarin information that can be updated are even better. Fixing them to a wall with a written invitation to browse its contents breaks through the language barrier very effectively. Include a section on how tourists can claim VAT back. Most tourists will know, but it shows you care.
If high volumes of Chinese tourists are being aimed for it is worth adding a China Union Pay (CUP) card facility to existing card payment options. This allows for direct payment from Chinese accounts, which saves tourists money. Putting CUP signage in the window is also an instantly recognisable invitation to enter a store. Obtaining a CUP facility is relatively straight forward and can be enabled through UK banks.
For brand owners it is not only important to highlight the latest products to lead Chinese consumers to new models and designs, but also to let them know where they can buy them.
In Chinese consumerism it is the fast that eat the slow, not the big that eat the small, and nowhere is this more prevalent than in the UK Chinese tourist market. Those that set out their stall first gain quick rewards. The rest are left to play catch up. There are great opportunities to reap great rewards quickly, and at the same time lay down valuable foundations for the future – Chinese tourists do return.
The to-do list: targeting Chinese shoppers
Essential: Create a Mandarin website, or pages that have content that can be seen on web searches in China. Enhance your online presence through SEO and social media in China.
Recommended: For those targeting ultra high net worth shoppers, offer online appointment booking. Targeted online advertising and the creation of a dedicated Chinese tourist app.
Essential: Mandarin window decorations, a Mandarin display area and catalogues with price lists or touch screens. China Union Pay facilities should be installed and staff should receive cultural and etiquette training.
Recommended: A print support reference for any cultural and etiquette training. In the case of ultra high net worth individuals, establish an on-call interpretation service for private appointments.
This feature was taken from the April issue of Professional Jeweller. To read the issue online, click here.