Golden Week spending spree: UK retailers set to receive much needed boost

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Every year retailers across the UK eagerly await Golden Week, a small window following London fashion week and pre-Christmas, which has long been established as the industry’s bumper season. Throughout the Golden Week period, wealthy Chinese shoppers traditionally flock to the UK and Europe to purchase new season, luxury products from leather designer accessories to the latest fashion collections.

Tax-free spending data from Global Blue supports the trend of affluent Chinese Globe Shoppers spending significantly throughout the Golden Week period. In October 2017 and 2016, tax free spending from Chinese visitors grew by +8% [2017] and +54% [2016] YOY to represent a total of 33% [2017] and 29% [2016] of sales respectively. In 2018, Chinese visitors have remained the UK’s biggest group of tax-free spenders, accounting for 26% of total tax free sales in the nation’s capital between January and August 2018. Despite representing the largest group of tax-free spenders in the UK, in August 2018, Chinese tax free spending was down-13% in the nation’s capital. Consequently, UK’s retailers are more eager than ever for the week-long spending spree that Golden Week traditionally delivers.

To promote spend in store, many luxury retailers focus heavily on strategies to make their brand more appealing to Chinese visitors throughout October, including highlighting products specific to the Chinese market for both gifting and individual purchase, adding touches of China’s lucky colour red or introducing more Mandarin -from bilingual staff to small translations on name badges – in store.

Following the trend of catering to international visitors, Global Blue’s new London Lounge in Mayfair has been specially designed to ensure Globe Shoppers feel welcomed during a visit, either during Golden Week or throughout the year. The lounge features a team of five multi-lingual experts – including Mandarin speakers – as well as an immersive, luxury environment where visitors can relax and re-charge after a busy day of shopping, while also enjoying an early tax free refunding service.

Although London has consistently been one of the most popular destinations for Chinese travellers, other parts of the UK as well as Ireland are becoming more appealing for Chinese visitors due to new of new flight routes and tax refund capabilities.

In June, Cathay Pacific introduced a new flight from Hong Kong to Dublin four times per week, while Hainan Airlines introduced a route from Beijing to Dublin, which stops in Edinburgh to collect additional passengers en route.  In addition to this, in September Global Blue launched brand new tax refund desk in Dublin. The desk will offer customers with support to complete tax-free forms, as well as TFS refunding to customer’s credit card or mobile wallet. This new service, combined with new flight routes, should bolster the appeal of Ireland as a new destination for Chinese Shoppers throughout Golden Week.

Derrick Hardman, Managing Director UK and Ireland at Global Blue said: “Golden Week is a major moment in the retail calendar as it drives an influx of affluent Chinese visitors to luxury retailers and hotels. Despite a difficult retail environment, our historical statistics reveal that spending from Chinese visitors has consistently increased every Golden Week (October) over the last two years and consequently, Golden Week should provide retailers with a much needed boost.”

“To further increase the appeal of the UK as a top destination for affluent Globe Shoppers, this August, we proudly launched the UK’s first Global Blue VIP Lounge in London. The lounge provides guests with a seamless experience while they relax, refresh and receive their early tax-free refund. We estimate that the Global Blue VIP Lounge in London’s Mayfair will welcome hundreds of visitors this October.”

Brian Bickell chief executive, UK China Visitor Alliance, added: “Chinese visitors remain incredibly important for UK’s retail and hospitality sectors, bringing a real boost to both businesses and the economy. UKCVA and its members have therefore made it their goal to ensure that these high-spending customers receive the best possible experience while visiting the UK.”