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Report: Mainland visitors key to Hong Kong retail

By Chen Yingqun | chinadaily.com.cn | Updated: 2016-12-01 16:06

Hong Kong businesses still have a big chance to profit if they can find the right way to attract travelers from the Chinese mainland and to adapt to changing consumer preferences, the latest Nielsen study said.

According to the 2016 Mainland Tourists Syndicated Report conducted by Nielsen, a leading global market research firm, 42.8 million mainland visitors travel to Hong Kong every year, accounting for 75 percent of all tourists and generating 35 percent of retail sales.

Visitors from the mainland will have a major impact on Hong Kong' s businesses for a long time, the study said, so Hong Kong businesses need to keep a close eye on consumer preferences.

"Overnight visitors are small in number but strong in buying power compared with the day-trippers," said Angel Young, managing director of Nielsen Hong Kong, so it's a key group to watch.

For the past 12 months, 17 million tourists from the mainland spent nights in Hong Kong. About 80 percent of them visit twice annually, on average, spending HK$20,000 ($2,578) individually — and not only on popular items like clothes, jewelry and electronic products. Around 40 percent of them intended to buy insurance and financial products, according to the report.

Business owners in Hong Kong might need to adapt by transforming their advertising and feedback mechanisms to create better customer experiences for digital-savvy mainland travelers. They should focus more on the pre-travel period as mainlanders are increasingly planning independent tours to HK. They are getting 95 percent of the information they need from online travel agencies, with 49 percent coming from social media. Many can't wait to post shopping pictures on social websites and to share both positive and negative comments and discount information.

Businesses also need to improve in-store customer service, as the research showed that 80 percent of mainlanders' purchases in Hong Kong are for personal-use.

"The old days when mainland travelers used on a shopping list — the 'grab- and-go' type of shopping style — is long gone," Young said, adding that this means businesses need to explain their products or services in greater detail.

To boost sales, business owners must always look at the customer structure and narrow their focus. The Nielsen report has recommended two specific targets: the "super mainlanders" and the "culture seekers".

Super mainlanders have a big thirst for shopping. They make up only 23 percent of all the mainland tourists but are responsible for 54 percent of total sales to mainlanders as they spend 46,902 yuan ($6,810) each during a single visit, the report said. That's triple what the remaining 77 percent normally do. Surprisingly, the super mainlanders are spending much more when making pretty much the same income as others, with a family income of 18,760 yuan per month.

Culture seekers travel to Hong Kong for concerts, local food, sightseeing and exploring the places they've seen on HK TV shows. Although not shopping-oriented, they spend 10 percent more than other mainland tourists.

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