The European austerity measures may have Londoners staying at home, but international shoppers and tourists are spending like never before, buying British and European luxury goods. Consumers from China and South East Asia see London as a key destination for buying luxury products, with non-European tourist spending up 34% over last year. “These tourists are increasingly targeting the UK as a place to spend their growing wealth,” says Richard Brown, vice-president of Global Blue UK, which tracks spending by tourists from outside Europe. The average spend per tourist is £747, up 20% in 2011.
In an article published by Retail Week, British brands are a key driver for foreign shoppers looking for luxury. Burberry, for example, caters to approximately 50% of its European sales to tourists, using its heritage image to attract them. So too Selfridges is a key destination for foreign shoppers, where Chinese and Arabic speakers can find signage in their language in certain fashion concessions, with Mandarin and Russian-speaking staff on hand. Harrods, too, has multi-lingual staff and employees on the shopfloor wear badges that show the flags of the languages they speak. Harrods, Selfridges and others also accept UnionPay, which is China’s most popular bank card, and some retailers offer schemes such as Smartax for non-EU shoppers to claim back VAT.
Wealthy fashion conscious Chinese shoppers are drawn to British brands and are in a position to buy products not available in China so they can stand out from the crowd at home. European luxury brands are highly taxed in China and are less expensive in London. China now accounts for a fifth of non-European shopping in the UK and its spend was second only to the Middle East in the first quarter of this year – nationals from Kuwait, United Arab Emirates, Qatar and Saudi Arabia are the big spenders from the Gulf. Rees notes that for the last few years, exchange rates have made UK prices cheaper for overseas customers.
Chinese New Year, which this year was in January, is one of the top selling months for retailers, research by Global Blue has revealed. The "Peking Pound" as it is dubbed, reflects an important cultural shift in China with families now electing to travel abroad during this period as an alternative to celebrations at home. Retailers saw a growth of 89% in tax free sales from Chinese shoppers in January 2011, where luxury brands were the main attraction and shoppers spending an average of £729 per tax free transaction.
Source: Retail Week
Image: Luxury goods