Top tips to welcome Chinese shoppers and drive sales
By Yoav Chernitz, Director of China Business Development, SafeCharge
In 2017, more than 130 million mainland Chinese citizens travelled around the globe, spending a total of $115 billion USD in goods and services overseas. This growth in tourism is showing no signs of slowing down, and as such, businesses are beginning to take notice of this increasingly lucrative market segment.
While exploring the world, Chinese travellers bring with them their unique habits of eating, travelling, shopping, and – of course – paying for these activities. Research has shown that three quarters of Chinese consumers prefer to pay via QR codes on a daily basis, through the likes of either WeChat or Alipay.
This preference for mobile payments over traditional cards or cash, means that businesses aiming to engage this market must rethink their approach to payment acceptance and fine-tune their infrastructure to ease the acceptance of the digital payment methods Chinese tourists most comfortable with.
To successfully convert these shoppers into customers, businesses should first understand who Chinese shoppers are and the reasons behind their preferences. They can then figure out how to engage with them through a variety of platforms, from local payment methods to on-site Mandarin signage. Finally, with mobile payments soon becoming the global standard, it is vital to partner with a payments provider who can seamlessly and quickly integrate these new methods without disrupting existing payment infrastructures.
Finding the pot of gold
The numbers speak for themselves. Chinese tourists are the world’s biggest spenders, and are far too important to ignore. In 2017, over 130 million mainland Chinese citizens travelled around the globe, collectively spending $115 billion USB. In less than 20 years, China has become the world’s most powerful outbound market, leapfrogging the United States.
Chinese tourists’ purchasing power has also been increasing steadily, widening the spending gap between themselves and other tourists. Their expenditures abroad now represent 21% of global tourism spending, and is predicted to rise by 3% every year. Furthermore, they spend (on average) more per person, per trip, than tourists from any other country.
Clearly, the potential for further growth is immense. As China’s influence continues to spread across the globe and more consumers adopt their cashless habits, merchants must move swiftly to take advantage of this growing market.
Tip #1: Playing a crucial role in this scenario is the type of payment method supported by the merchant. 41% of Chinese tourists believe the payment methods supported by local merchants is a key factor in driving them to the counter, and is equally important as the price of the goods they are planning to buy.
Retailers should therefore consider offering popular Chinese platforms such as WeChat Pay and Alipay. Offering both these platforms at the Point of Sale can help retailers create a positive shopping experience and maximise sales conversion. With Alipay and WeChat Pay constantly issuing new promotions and benefits to win a bigger slice of the market, offering both platforms may be smart move.
Engaging with the modern Chinese consumer
Chinese travellers come with speciﬁc behaviours and expectations, and there are a few things merchants must keep in mind about those travelling in Europe.
First and foremost, shopping is a big part of their travel experience; comprising 25% of their expenses, followed by hotels (19%), and meals (16%). While Chinese travellers might save money on food, accommodation, and transportation, they will freely splurge when it comes to shopping, and retailers must ensure they offer the most welcoming and familiar shopping experience possible. Their purchasing power is also much stronger than those of other tourists, with an average spending of $762 USD against $486 USD of their Western counterparts.
Secondly, almost all of them state that it is a huge plus when merchants update their technology to support digital payments. 65% of Chinese shoppers use mobile payment methods to pay for their expenses abroad. That means that when presenting them with the chance to pay via mobile, merchants are more likely to close the sale, and customers may even be encouraged to purchase more items.
Tip #2: Adopting Chinese mobile payments is only the first step. To make this strategy successful, retailers must also raise awareness of this offering. With Chinese people spending an average of three hours a day on their smartphone, merchants must target the various digital channels their potential audience are using to deliver a seamless shopping experience.
Integrated social media and e-commerce platforms, such as WeChat, are highly popular among tourists, and will be critical to brand awareness and attracting customers, especially as these platforms often run commercial retail schemes that allow Chinese customers to get the best out of their shopping experience, such as promotions, discounts, and cashback.
Making this clear to them though shop front signage in Mandarin with the official WeChat Pay or Alipay logos will therefore help lure Chinese customers into the store and boost sales, especially as 91% of Chinese travellers would feel more comfortable in spending if Chinese mobile payments were accepted.
Getting your Point of Sale ready
With nearly half of Chinese customers agreeing that it makes them proud to see Chinese payment platforms being accepted abroad, retailers cannot afford to miss out on this opportunity. Integrating such payment methods will encourage tourists to spend more online and in-store, especially as 43% state they are likely to get a better exchange rate.
Tip #3: We have established the importance of offering Chinese payment methods, but how can retailers actually do this? To set up platforms such as Alipay and WeChat Pay, retailers must apply for a cross-border account and integrate this with their front end payment system. While applications for this can be done directly, a more efficient method for retailers would be to use a certified payment partner; allowing them to eliminate the arduous paperwork process and get the business up and running in just 10 days.