Duty free shopping plays a big role in Hainan’s tourism boom
The 3-day break set around Labour Day public holiday from May 1 – 3 sees more than 150 million Chinese set off for a week of holidays, and every year tourism operators fight for their share of this lucrative market.
Hong Kong has long cherished its reputation as the first choice for holiday destination of Mainland Chinese due to its bargain shopping. Last year along approximately 22.7 million Chinese headed to Hong Kong spending 76% of their money – an estimated total of HK$109.59 billion (9.6 billion euros) – on shopping.
However, 2011, the year that marked the 100th anniversary of the 1911 revolution that led to the founding of modern China, has seen a dramatic change in tide with Chinese tourists flocking instead to the newly duty-free, tropical island of Hainan.
‘We have been hearing about these good deals for months,’ said Wei Qinan, a tourist from Jiangxi province.
Hainan island became the world’s fourth duty-free zone on April 20, with a new policy enabling both foreign and domestic shoppers leaving by air to purchase imported goods tax-free, saving at least 30% on 18 types of commodities including perfumes, electronics, watches, fashion and leathergoods.
The duty-free policies have had a dramatic impact on the island’s tourism sector, sending the cost of package tour holidays in Hainan soaring by 30%. The island’s hotels, packed over the 3-day break, have noticed the change.
‘More than a half hotel rooms have been booked, an increase of about 50 per cent compared with the previous year,’ said Nie from the Sanya Yalong Bay Holiday Inn Resort. ‘This can be mainly attributed to the duty-free shopping policy,’ she said.
The four-star Golden Palm Hotel likewise commented that 90% of its rooms were booked well before the weekend with tourists keen to take advantage of the savings at the Sanya Duty Free Store.
‘These tourists prefer to buy products related to their travel needs, such as branded sunglasses, clothes and diving equipment. They cost several hundred Yuan cheaper than if they were to buy from Shanghai,’ said Assistant General Manager of Domestic Travel, Spring International, Bian Xiang Guo.
At the opening of the Sanya Duty Free Store, more than 15,000 shoppers passed through the store’s doors in just two days, the majority being Mainland Chinese.
Travel agents cashed in on the duty-free shopping policy, designing specific travel tours and itineraries based on shopping with bonuses like shopping credits and free drinks to appeal to customers.
‘We have added duty-free shopping to all our tour packages to Hainan and will arrange regular shopping-themed tours in the future,’ said Zhang Lingjie, director of the domestic tour department at China International Travel Service (CITS).
The Sanya Duty Free Store was packed for the Golden Week holidays, with customers lining up outside the stores from 5a.m. to purchase goods. Before the store even opened for business, staff were preparing for 16 tourist groups that had made reservations.
‘More than 60,000 tourists had been expected to visit the store on Sunday, the second day of the 3-day Golden Week May Day holidays,’ reported the English language ‘Global Times’ of China. ‘Few items were left at the Estée Lauder, Chanel, Dior and Lancôme store counters, as a salesman at the Swatch store counter told the China News Service that his supplies would be replenished only after May Day holidays.’
Hainan has been steadily building itself up to become on of the top international tourist destinations, as part of the Chinese Government’s 10-year plan. It already sees its fair share of Chinese tourists who venture southward for its beaches, golf and food, and this year it has offered it’s visitors another reason to visit: shopping.
China is expected to become the world’s largest luxury market by 2014, with a 20 – 25% annual increase in demand, and Hainan in particular is sure to be a hot spot for tourist both from the Mainland and from around the world.
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