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Cautious Chinese travellers: Food and beverage brands need to … – FoodNavigator-Asia.com

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Related tags China COVID-19 experience Travel retail
With China finally having opened its borders earlier this year, the travel retail industry is pinning many of its growth aspirations on the resurgence of the Chinese traveller.
However, it is well-known that Chinese consumers place a great deal of importance on sensory experience when it comes to making purchases – a factor that combined with increased post-pandemic consumer caution is likely to emerge as a key issue for food and beverage brands in the industry.
“There is no doubt that with Chinese consumers having basically had the longest hiatus in the world from duty free shopping with its borders closing the earliest and opening the latest, there is a lot of pent-up demand there,”​ Pi Insight Managing Director Stephen Hillam told the floor at the recent Tax Free World Association (TFWA) Conference in Singapore.
“Our data has revealed that there is very high interest in duty free products [including] high demand for alcohol (61%) and confectionery (47%).
“However, it is also likely that when some of the Chinese shoppers return, there is likely to be a renewed level of concern or some caution when it comes to certain activities in our stores – [this includes] activities such as sampling or tasting alcohol or confectionery products.
“Indeed, our surveys have shown that a good 53% of Chinese shoppers have highlighted that they are far less likely to sample products when travelling – [a situation that could have ramifications for] products that rely on sampling as an experiential component in-store.

“As such, it will be crucial for food and beverage brands to implement supporting, innovative measures in order to drive reassurance around this area and still provide consumers with a good, enjoyable shopping experience.”
The importance of solving this dilemma becomes even clearer when noting the amount of revenue likely to be brought by Chinese shoppers – 51% stated plans to spend more time in store than in previous trips, and 38% to spend more compared to previous trips, which translates into a lot of potential sales.
“It is no longer enough to simply create and sell the product that the Chinese shopper is looking for – so high quality alone is no longer enough,”​ he added.
“There is that potential to really capitalise on their desire to spend more or have an increased basket size or ‘revenge spend’ such as we have seen in other regions and amongst other nationalities – but all the aspects need to be right.
“So the key is to provide both the product of interest and also the reassurance surrounding the in-store experience, especially for food and beverage items, in order to secure those purchases.”
Another major insight presented was that travel retail consumers today are far more likely than in 2019 to make impulsive purchases, yet another factor backing the importance of creating a good shopping experience.
“A total of 55% of consumers in 2022 planned their purchases during travel, as compared to 62% in 2019 – which means a 7% decrease,”​ Hillam said.
“This shows that duty free shopping in APAC is becoming much more impulsive and less planned out – although we also have seen that the core purchasing drivers that were important then remain important now such as quality, brands, pricing and so on so these need to be maintained.”
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