RAPAPORT… Every year, millions of tourists come to America — in 2010, the number was
59.7 million according to the U.S. Department of Commerce (DOC). What that number translates to for U.S. retailers is multiple selling opportunities.
“If you look at stores or markets in gateway cities, the number of tourists who are walking in the door willing to plunk down money has gone up,” points out Paco Underhill, chief executive officer (CEO) of Envirosell and the author of the new book What Women Want. “The smart stores are encouraging this; they have recognized the importance of having personal shoppers and reaching out to a third-world wealthy market.”
Just what these shoppers may be looking for when they travel to the U.S. was part of a recent study by Mandala Research released in December 2010. The survey, underwritten by Macy’s and Shop America Alliance and conducted in partnership with the DOC, polled recent visitors to America from Brazil, China, India, Australia and Korea. According to Laura J. Mandala, principal of the eponymous Virginia-based market research firm that specializes in travel and tourism, the impetus for the study was to understand travelers from emerging markets. “These five countries are identified as the fastest-growing markets by the DOC, but there has been very little data out there in the marketplace to help organizations understand these travelers. A lot of the previous surveys concerned potential in market, but there haven’t been any surveys of those travelers after they’ve had a travel experience in the United States, so this study is unique in that respect.”
The online panel of travelers surveyed consisted of individuals 18 years or older who had visited the United States in the past 12 months. “There was a representative sampling from each market, 50-50 men and women, unless that particular region had a higher portion of men versus women.” The survey polled 500 travelers in each country. The group of 2,500 included a mix of first-time and repeat shoppers. Each respondent had spent a minimum of $250 on shopping and had a minimum household income equal to the median in each country. Median incomes were: India, $40,600; Australia, $84,300; Brazil, $76,200; Korea, $71,400 and China, $42,000. The data was collected between August and September 2010.
Visitors were asked the categories of items they purchased and whether they had planned to purchase them. “It turned out that they actually bought twice as much as they planned to, which is really good news for retailers,” says Mandala. “It gives them some insight into how to merchandise their stores. There is a lot of last-minute purchasing that occurs.”
Comparison Shopping
Mandala points out several parallels between this current survey of emerging market visitors and a previous poll of the “largest inbound group to the U.S.” — Canada, Mexico, U.K, Germany and Japan — done in 2009. “The level of total shopping spend and total trip spend is nearly identical between the two studies. The earlier survey’s average trip spend was $3,692 and for the emerging markets, it was $3,517. And then remarkably, 29 percent of all that spending was on shopping. That’s a good portion.”
According to Mandala, in both surveys, shoppers were interested in good value for the price paid. “That was the most important factor for all of them, to have a shopping experience with good value for price paid. For the emerging markets, they were more focused on helpful and friendly sales associates. Service is more important to them. We don’t know why but anecdotally, for people who haven’t traveled as much, haven’t been to the U.S. before, having a friendly environment was more important.”
When asked what stood out the most for her in the survey results, Mandala says, “I thought folks from India, China, Brazil would spend less than people from the U.K. and Japan. But the spending is very comparable. And the fact that they are more focused on a friendly sales experience, a welcoming environment, has major implications for retailers when they prep their sales staff.”
Other Survey Results
- New York was the number-one place visited and shopped, 29 percent of all surveyed travelers went there. Los Angeles was number two and Las Vegas, number three, after which came Atlanta, Chicago and Washington, D.C.
- Women’s apparel was the number-one category; 23 percent of the shoppers said they planned to purchase women’s apparel and 46 percent actually did.
- In terms of jewelry purchases, 10 percent planned to buy jewelry and 8 percent said that they did. Indian visitors bought the most jewelry — 12 percent.
- Shopping was a key reason for visiting the U.S. for a majority — 56 percent — of those surveyed.
- Shopping dollars were spent among all types of retail establishments, including department stores, outlet malls, boutique or specialty stores, shopping centers or malls, and discount stores, such as Target, Walmart, Kmart, etc. Discount stores scored highest with all groups. Except for Australians, shoppers polled said they shopped the least at boutiques or specialty stores. Roughly a third of those surveyed shopped at department stores.
- Macy’s and JC Penney ranked highest in brand awareness in department stores and McDonalds, Macy’s and Ralph Lauren were the most widely known top U.S. brands.
- The availability of a wide selection of product, rated number seven overall in the shopping experience, was of more significance to visitors from India than China, while availability of luxury goods — which was number eight — was of least importance to Indian visitors.
