Chinese New Year will boost UK shopping but growth is slowing says Global Blue
Chinese New Year remains a key shopping event for visitors to the UK but it’s seeing rivals to its status as the biggest spending period for Chinese ‘globe shoppers’. And the transactional outlook for the next 90 days as a whole is down 15% so Chinese shopping appetite outside of the main New Year weeks could be less buoyant than last year.
That’s according to tax-free payments specialist Global Blue. It said that hotel and flight bookings for the Chinese New Year are up 18% so a surge in shoppers is expected during this period, but “sales will be more muted in comparison to previous years due to recent changes in consumer behaviour”.
The event last year saw 13.44% growth in sales in-store in Britain, as well as a 21.7% growth in transaction volume, so it will be interesting to see just how muted shopping appetite will be this time.
That said, the New West End Company predicted on Friday that Chinese shoppers would boost spending in the area by £17 million in the week ahead.
But there’s no denying that the impact of coronavirus travel bans could weigh on shopper sentiment. And other issues include shopper sentiment of those coming from Hong Kong, which could also be a significant factor. Shopping within Hong Kong itself has been devastated in recent months and Global Blue also said that travelling Hong Kong consumers reined-in their spending for the first time in 11 months during December with a 1% drop.
Overall, some shoppers are also shifting their big spend away from the New Year and towards the autumn and early winter. Global Blue said that during Golden Week in October, Chinese shoppers made up 30% of tax-free spend with an increase of 3% year-on-year and an average transaction value of £1,092. And over the Christmas period, mainland China visitors accounted for 21% of tax-free spend, also up 3% with an average transaction value of £1,014.
That said, the company is anticipating a short surge in shoppers over the Chinese New Year period (which runs from the end of January until mid-February) based on current hotel and flight booking trends. But it expects spending growth to be less than the 13%+ seen in 2019’s equivalent period.
It said that for last year’s event, shoppers from mainland China, Hong Kong, Macau and Taiwan completed 41,809 transactions, with an average spend of £1,104.
The most popular purchases for these consumers over the Chinese New Year period are likely to be luxury fashion and leather goods, but with the biggest spend being on watches and jewellery.
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