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■ Hainan Daily reporter Zhou Xiaomeng intern Zhang Ziyi
From January 31 to February 6, the seven-day sales of duty-free shops on Hainan Outlying Islands exceeded 2.1 billion yuan, an increase of more than 150% year-on-year.
On January 1 this year, statistics provided by the Provincial Department of Commerce showed that the total sales of 10 duty-free shops on Hainan's outlying islands exceeded 60 billion yuan in 2021, an increase of 84% year-on-year. This is the second time that the duty-free sales of Hainan outlying islands have doubled year-on-year in 2020, and the duty-free sales of Hainan outlying islands have achieved another eye-catching report card.
The record of duty-free sales on Hainan's outlying islands is still being refreshed. Our province proposes that during the "14th Five-Year Plan" period, it is necessary to improve the island-wide duty-free sales network, realize the full docking of foreign goods and domestic purchasing power, and attract 300 billion yuan of duty-free shopping. At this year's provincial two sessions, the provincial government work report proposed that in 2022, Hainan will enhance the international competitiveness of duty-free shopping and strive to sell 100 billion yuan of duty-free shops on outlying islands.
From the total sales of more than 60 billion yuan a year for outlying island duty-free shops to the "100 billion yuan" target, there are many "untapped potentials" behind the continuous hot market in Hainan in recent years.
From rising star to industry "lighthouse"
Embark on a "win-win business and consumer" path
On the afternoon of February 6, in the duty-free shop of Sun Moon Square in Haikou, Wang Xiaonan squeezed out of the crowd on her side and docked with her colleagues, and her voice was quickly drowned out by the sound of people.
"There are too many customers in the past few days, and the flow of customers entering the store has increased significantly." Wang Xiaonan, a beauty consultant for the Estée Lauder brand at the duty-free shop in Haikou Riyue Square, told the Hainan Daily reporter that although the Spring Festival holiday has come to an end, the shopping momentum of consumers is still unabated.
In the spring of the Year of the Tiger, major outlying island duty-free shops have "put prices". China Exemption Group "China Exemption Blessings Like Tiger Wings", Hai travel investment "New Year welfare release", Haifa Control "GDF New Year does not close", China Service "Serve the tiger to send blessings"... While doing a good job in epidemic prevention and control, the duty-free shops on the outlying islands in Hainan have launched a series of Preferential Spring Festival reward activities, and the outlying islands have sufficient goods and varieties, and the products such as aromatization and liquor are generously discounted, and many brands have also launched duty-free exclusive products and New Year limited sets to better meet the needs of consumers.
The "fire" of the duty-free tax on Hainan's outlying islands is not only "burned" during the Spring Festival. Its popularity has continued to climb in recent years.
On May 7 last year, at the theme forum "Global Consumer Innovation and Duty Free and Travel Retail Conference" of the first China International Consumer Goods Fair, Moody's Davit Report Magazine, KPMG and Asia Pacific Travel Retail Association jointly released the "Global Travel Retail White Paper" (hereinafter referred to as the "White Paper"), which conducted research and analysis on the development of global tourism duty-free and Hainan tourism duty-free retail market.
The White Paper points out that since the implementation of the "outlying island duty-free" policy in 2011, the tourism retail industry on Hainan outlying islands has been the rising star of the global tourism duty-free retail industry. In 2021, it became the industry "beacon" mentioned in moody's Davit report.
From the rising star to the industry "lighthouse", the story of the tourism retail industry on Hainan's outlying islands is a "win-win path for business and consumers", and it is also one of the core contents of the vision of making full use of the domestic consumer market. The return of consumption, the emergence of the policy effect of the Hainan Free Trade Port and the opportunity of market expansion, transformation and upgrading are the superimposed factors driving the continuous heat of the duty-free market on Hainan's outlying islands in recent years.
The duty-free shopping quota for outlying island tourists has been increased from 30,000 yuan to 100,000 yuan, the types of duty-free goods have been increased from 38 to 45 categories, and the two delivery methods of mail delivery of outlying island passengers and the return of island residents to the island to pick up the goods... Since July 2020, a series of new policies have been implemented to make the "fire" of the duty-free market on Hainan outlying islands more vigorous.
"Since its opening in January last year, the first phase of Haikong Global Boutique Duty Free City has sold more than one million pieces of duty-free goods on outlying islands, with sales exceeding 1.6 billion yuan, ushering in a milestone development with the help of the continuous release of policy dividends and the new development pattern of 'double circulation' under the new tax exemption policy." Lin Yuewen, vice president of Global Consumer Boutique (Hainan) Trading Co., Ltd., said.
"After the implementation of the new tax exemption policy for outlying islands, Sanya International Duty Free City has added new product categories with strong consumer demand such as alcohol and electronic products, and the sales momentum after the implementation of the new policy is good, which has added more space for exploration in the store." By providing a wide range of goods and carrying out promotional activities such as discounts, full discounts, and coupons, we have released the effect of the new tax exemption policy on outlying islands to a greater extent. Gao Xujiang, executive director of Sanya Duty Free Shop Co., Ltd. of China Exemption Group, said.
"From the continued prosperity of China's tourism retail industry, especially the performance of China Exemption Group in the Hainan market, it is clear that Chinese consumers still have strong purchasing power. Therefore, we should have firm confidence in the future development. In October last year, at the opening ceremony of the 2021 Moody's Davit Travel Retail Online Expo, Chen Guoqiang, general manager of China Exemption Group, said so.
During the Spring Festival, tourists buy duty-free goods at the cdf Haikou Riyue Square duty-free shop. Xinhua News Agency
New services for immersive consumption
Premium quality and better price, more diversified shopping experience
The opening of new stores, the entry of new brands, and the listing of new products continue to promote the synchronization of duty-free brands, varieties and prices in Hainan Outlying Islands with international standards, providing consumers with more shopping choices.
"I've been to Sanya seven or eight times, and every time I have to visit the duty-free shop, which can meet the consumption needs of myself and my family." Zhang Shilong, a tourist from Shenyang, said.
Xia Feng, a researcher at the School of Politics and Public Administration of Hainan University and executive dean of the Advanced Research Institute of Humanities and Social Sciences, pointed out that the increase in the main body of duty-free products and the intensification of market competition will directly bring about the increase in the supply channels of duty-free products and the improvement of service quality. ”
On February 8, the relevant person in charge of China Exemption Group revealed that in order to further strengthen the brand image of "tax exemption for outlying islands, select exemption", the group, under the leadership of its parent company China Tourism Group, has continued to exert efforts around the three levels of brand, price and service, and actively explored digital innovation under new consumption habits.
Since 2020, Since 2020, Qiong's shopping travelers have been using the combination of offline and online as the contact points for Qiong shopping travelers, and have continued to create new immersive consumption services. Online, China Exemption Group continuously optimizes the functions of the large member platform to strengthen the pre-bank penetration rate; in the line, it continuously deepens IP activities to continuously enrich the interactive experience of consumers; and after the trip, it continuously enhances consumer loyalty by encouraging consumers to share experiences.
In terms of brand introduction and category expansion, in the past year, including internationally renowned brands such as Van Cleef & Arpels, Givenchy, Bruneno Cuccineli, Balman, and cutting-edge products that have attracted the attention of consumers such as Apple and Alien, have successively settled in the Hainan market of China Exemption Group, with China Exemption Group as the platform, these internationally renowned brands have opened a new journey into China's tourism retail market, while also providing more diversified choices for domestic consumers.
It provides a rich shopping experience for the "choppers", and the performance of the "new" outlying island duty-free operators is also good.
As a "young" outlying island duty-free shop officially opened on December 30, 2020, Sanya Haiyou Duty Free City introduced hundreds of brands in the first year of its opening, covering 45 categories of duty-free goods, not only with popular brands widely recognized by consumers, but also introduced more than 170 brands such as Ta Siqi, Gucci Makeup, Burberry, Swiss Ruiyan and other brands that have entered the outlying island duty-free market for the first time or exclusively.
"We not only invite brands with strong appeal in the hearts of consumers to meet the needs of outlying island tourists, but also hope to create a business district that is loved by different groups of people and can constantly discover new things and trends by enriching business formats." Zhang Yimei, deputy general manager of Hainan Travel Investment Duty Free Co., Ltd., said. In 2021, Sanya Hailu Duty Free City received more than 2.4 million customers throughout the year.
These changes are a witness to Hainan's duty-free development. Looking back on 2021, duty-free shopping on Hainan outlying islands has shown the characteristics of rapid growth of duty-free sales, richer brands, optimized shopping environment, diversified marketing methods, improved shopping convenience, and continuous strengthening of risk prevention and control.
During the Spring Festival, duty-free shops on the outlying islands of Hainan launched a series of Preferential Rewards for the New Year. Hainan Daily reporter Wu Wei photographed
Tapping into "untapped potential"
Setting international benchmarks in the field of tourism and consumption
From a broader perspective, as a "new force" in the global tourism duty-free retail market, how can Hainan move into the future?
"The competition in China's duty-free market has always been an international war." Recently, Wu Lin, a senior researcher in the industry, pointed out in an analysis of Hainan's duty-free market that international duty-free operators represented by South Korea's duty-free market have been participating in the share competition of China's duty-free market in an invisible but omnipresent way. Among them, there are Korean tax exemptions to directly export goods in the form of purchasing agents and cross-border e-commerce, and there are also dufry, DFS, Lagardère and other indirect participation as wholesalers.
Hainan to build an international tourism consumption center, tourism, consumption is indispensable. Whether it is tourism or consumption, the flow of people landing on the island is the key. When the epidemic fades and navigation is opened at home and abroad, if Hainan cannot attract consumers to really land on the island, tourism and consumption will flow abroad again, and Hainan's road to guide overseas consumption back will become more difficult.
To build an international tourism consumption center, Hainan should face both domestic and international, attracting both domestic 1.4 billion people, especially middle-income groups, and international tourists from the Asia-Pacific region and even the world. Only by setting an international benchmark in the field of tourism and consumption can Hainan truly become a world-class tourism consumption center.
Wu Lin suggested that to set an international benchmark, the introduction of international IP is indispensable. The entry of "head" IP and brand will bring passenger flow, attract more elements and brands to settle in Hainan, and achieve the effect of combining pearls and doing more with less. Hainan can refer to the Florida model of the United States and learn from the successful experience of Universal Studios Beijing and Shanghai Disneyland to create an international theme park group represented by "Universal Studios" and "Disney" to make up for the current situation of tourism resources with more natural environment and less humanistic IP.
In addition to working passenger flow, Hainan also has to make a fuss about the commodity structure. Wu Lin pointed out that adjusting the structure of duty-free goods and increasing the unit price of customers is the key transformation to achieve Hainan's "14th Five-Year Plan" goal of 300 billion yuan of duty-free shopping returns.
From the perspective of the actual per capita shopping amount, although the per capita unit price has increased from more than 3,000 yuan to more than 7,000 yuan before the implementation of the new tax exemption policy for outlying islands in October 2020, there is still a huge room for increase compared with the amount of 100,000 yuan per person per year, which objectively also provides conditions for operators to improve the sales scale and profit level by adjusting the commodity structure.
Swiss research firm m1nd-set also believed in a recent study that there is "untapped potential" in Hainan's duty-free consumer market. "About three-quarters of outlying island visitors haven't used up their duty-free shopping credits, so retailers and brands still have a lot of potential to attract consumers to continue spending through a series of marketing campaigns." Clara Susset, chief operating officer of M1nd-set, explained.
The existing duty-free operating entities in Hainan need to work together to build a duty-free commercial foundation in Hainan, so as to create a good duty-free shopping environment after the customs closure and make full preparations for international competition. Wu Lin said that Hainan has strengthened the infrastructure construction of tax-free business, including hardware and software. In terms of hardware, it includes the establishment of a supply chain system with international connections, localized warehousing capabilities to meet market growth scale and regulatory requirements, and an efficient and convenient transportation system throughout the island. It involves a variety of elements such as land resources, digital level, supply chain capacity, etc., and the existing duty-free operators in Hainan have their own strengths in these aspects, and should learn from each other's strengths, cooperate with each other, and cooperate to build together. In terms of software, it includes the establishment of a product guarantee system, a service standard system and a supervision and punishment system for duty-free shopping.
On the other hand, from the perspective of "being able to control it in order to be opened", Huang Shengqiang, dean of the School of Customs and Public Administration of Shanghai Customs College, reminded that it is necessary to strengthen the supervision of duty-free shopping, that is, to ensure that the tax-free policy on outlying islands truly serves to attract tourism and vacation, to ensure that duty-free goods are actually off-island, and to ensure that duty-free goods are used for shopping for personal and family consumption, so that this policy can be implemented healthily and effectively.
(Hainan Daily Haikou, February 9)