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It comes as no shock that retail footfall is on the decline, both locally and internationally. But while Australian consumers are increasingly heading online to shop, brick-and-mortar stores are finding solace in another customer base.
According to a joint report from Nielsen and Alipay, the average budget for Chinese tourists travelling abroad has increased by 15% to $9,382.
Shopping continues to be a major expense for them, accounting for 24.6% of their spend, followed by accommodation, dining and tourist attractions.
The report also found that 17% of outbound Chinese tourists surveyed had visited Australia in 2018 – making them a key target market for local retailers in tourist and shopping hot spots.
In fact, China is Australia's largest tourism market. Commonwealth Bank reports that Chinese tourists injected $10.9 billion into the local economy in 2017. There are also 166,000 Chinese nationals studying here in Australia, making up 43% of all international enrolments.
Late last year, both Commbank and NAB announced that their merchants would be able to offer Alipay in-stores to customers.
Alipay also announced February this year that it would be launching a pilot program in Sydney with Tourism Australia to make it easier for Chinese tourists to visit and pay in tourist hotspots across the city including Westfield Sydney, Darling Harbour and The Rocks.
With many Chinese consumers already using mobile payment platforms like WeChat Pay and Alipay, Australian retailers are starting to reap the benefits of offering them in-store.
One such retailer is Superdry.
While the global brand already has a strong following in the Asian market, its Australian branch has been focusing on capturing the tourist market here.
It recently launched its fifth Lunar New Year collection, that was marketed towards Chinese customers through Chinese social media platforms. Australian-born, China-based social media superstars David Gulasi and Amy Lyons were enlisted to promote the collection.
Superdry national brand manager Antony Hampson says that the brand chose to work with key opinion leaders who were prevalant in China but still had ties to Australia.
“We wanted to push a collection to the most receptive audience and the challenge that we face is the audience is not as present across our traditional advertising channels. So, we found that what we were looking for were key opinion leaders or KOLs from Australia who are based in China and could help us cut through the masses.
“There's a lot of retailers doing it. So, how do we cut through? How do we get directly to that consumer who is going to most engage with the product?
“We felt that both these individuals served that purpose. They're based in China, they're associated with Australia, they have a good point of difference and most importantly they have a strong following.”
Gulasi and Lyons were asked to create video content along with some static posts, Superdry PR and marketing manager Matthew Iozzi explains.
“We brought these guys on to create a video series. So, video content is by far the most engaging form of content on these platforms. They both created – we gave them a 60 second brief, although David went up to 3.5 minutes – super engaging content that was both half in English and half in Mandarin.
“Very, very strong features of the product [are shown] throughout the video and they also generated two to three static posts for us as well calling out specific pieces of the range like for the matching tracksuit, like the embroidered bomber jacket and then also calling out key detailings of the product like emphasising the quality.
“I think that that's something that resonates quite strongly with the Chinese market in particular.”
The global retailer has 430,000 followers on Chinese social media platform Weibo and a webstore that operates in the country.
“Through key partnerships we've been able to advertise across these social media platforms and regularly communicate product offerings and new range releases,” Iozzi explains.
Since last year, it has also begun to offer Alipay, WeChat Pay and JD Pay across 18 of its Australian stores and seen significant results.
From October, it has seen a 120% month-on-month increase in usage with January seeing the highest increase in usage up 140% from December.
Hampson says that offering these payment platforms makes sense as a retailer in Australia, given how much Chinese tourists spend here.
“From a commercial perspective you would be crazy not to see the opportunity there. We also have a brand that resonates and our product resonates with the Asian market. It's a strong market globally for Superdry – not just in our market.
“So, we only see opportunity there and I think the stronger customer service and the better experience will only help grow sales for us.
“I think that you're always trying to win over the local customers but, you know, in retail footfall it's certainly challenging across the globe at the moment. It's just innovatively thinking of ways to connect with potentially a new consumer as well and cut through the competition.”
With 40% of its client base being Chinese, luxury retailer Harrolds has also been working on strategies to connect with this customer.
Its managing director Mary Poulakis says that the high-end department store is focusing on expanding its presence on Chinese social media to connect with the market. On WeChat, she says, it has 200 followers and growing at the moment.
“Currently our main focus is expanding our WeChat platform, we only recently launched the Harrolds Official Account – so we're working on getting that up and running first. In addition though, we are looking to launch WeChat Pay and Alipay in the very near future with the hopes that this convenient payment method will help.”
As well as working with a communications agency here in Australia, it has begun to work with an agency in China to assist with reaching new clients.
“We use WeChat to create Chinese-specific content relating to the Harrolds brand and product offering. We are working closely with an agency based in China, as well as a communications firm based in Australia.
“We recently worked with Jamie Wu to host an in-store event – Wu is a very influential KOL, and from this we saw great engagement with our Chinese clients.”
Poulakis notes that for Harrolds, there are so many opportunities by reaching out to new and existing Chinese shoppers in its stores. Already, she says, the contemporary section is popular with this customer base, along with growing interest in its tailoring department.
“The opportunities are endless, especially with delayed release cycles and increased cost of luxury goods in China.
“There are multiple avenues to explore, from an operational standpoint, to marketing standpoint, and buying/product standpoint. For example – our buying teams are always looking toward that market for trend forecasting and up and coming labels.”