Reason For Traveling To The US: Shopping

June 17, 2009

The Grand Canyon, Statue of Liberty and Lincoln Memorial are enticing, but a majority of international tourists have shopping in mind when they visit the U.S. — even in the recession.

A newly released survey on the behavior of visitors in the last 12 months found that 53 percent said shopping was either a key reason for their trip or a factor in choosing their destination cities.

The findings are based on responses from about 1,800 travelers polled in January by Alexandria, Va.-based Mandala Research & Consulting on behalf of Taubman Centers and Shop America Alliance, an organization representing 200 U.S. shopping destinations, with the support of the U.S. Department of Commerce, Office of Travel & Tourism Industries.

The snapshot of the global consumer suggests that they are driven by value, particularly the favorable currency exchange rate. Sixty-four percent of those surveyed said good value was their top shopping priority, followed by 56 percent who cited a wide selection of brands. Other key motivators were: Helpful and friendly sales associates, 41 percent, availability of luxury brands, 35 percent, and special discounts for travelers, 26 percent.

The three most-sought-after labels were Nike, Levi’s and Gap.

“The popularity of international travelers coming here specifically to shop really puts things into perspective, because it indicates a great marketing opportunity for retailers and brands,” said Laura Mandala, managing director of Mandala Research. “If they enhance their own marketing strategies, they could actually grow their customer base by learning how to target these international shoppers more effectively.”

International shopping travelers contribute an estimated $38.6 billion to the U.S. economy annually, according to the U.S. Department of Commerce and Office of Travel & Tourism Industries.

The five countries that send the most tourists to the U.S. are Canada, Mexico, the U.K., Japan and Germany. Each respondent to the survey had visited the U.S. in the previous 12 months and spent a minimum of $250 on shopping for gifts and souvenirs. The study catalogued total spending, including apparel, footwear, accessories and electronics as well as gifts and souvenirs, with each person spending at an average of $1,063.

Average spending for tourists from the top five countries was: Canada, $757; Mexico, $1,310; the U.K., $968; Japan, $1,200, and Germany, $1,085.

The study found 50 percent of respondents who have visited in the last 12 months are likely to return in the next year.

“What stood out to us, despite current economic conditions, is nearly 20 percent of these travelers surveyed had already booked a trip to the U.S. again in 2009,” Mandala said.

Forty-four percent of the respondents said they would be very likely to attend a shopping festival — annual citywide celebrations highlighting culture and shopping. Another 29 percent stated they would be somewhat likely to attend, with their choice of destination influenced by a festival.

“This speaks volumes to the New York City shopping initiative, which was announced last month,” Mandala said, referring to “Fashion’s Night Out,” a major retail push set for the start of New York Fashion Week. Stores in 12 major cities worldwide will band together to stage special events in an effort to get consumers back in the stores.

The study noted, “International shopping festivals are currently very successful tourism and retail drivers in more than 10 countries including Dubai, China, Japan, Thailand, India and Singapore. For further information, visit: http://www.wwd.com/retail-news/world-view-shopping-top-lure-for-us-visitors-2172099?gnewsid=8e835d258c4b13c4678f683531e41d8f

Retailers Plan For International Expansion As Soon As Economy Picks Up

May 29, 2009

U.S. retail giants in home furnishings, food and clothing are expected to push into emerging markets such as Mexico, Brazil and China, once the U.S. economy and cash flows improve, executives said.

“There are a lot of retailers who are in defensive mode right now, but a lot of retailers still have ambition to go abroad,” said Anthony Buono, executive managing director of CB Richard Ellis, the world’s largest commercial real estate services company.

Global retailers are eyeing new markets, Buono said at the International Council of Shopping Centers’ RECon retail real estate show in Las Vegas last week.

Growth in Latin America, the Middle East and Asia as well as the prospect of a shrinking domestic economy is causing U.S. corporations to look abroad.

U.S. brands already expanding globally include Collective Brands Inc, owner of PayLess, which has its highest-performing stores in Colombia and Dunkin’ Brands, which is operating Dunkin’ Donuts shops in 31 countries from Bulgaria to Qatar.

Wal-Mart Stores Inc is due to open its first cash-and-carry store in India on Saturday.

AutoZone Inc, Gap Inc and Brinker International, the owner of restaurant chain Chili’s, are expanding in Mexico.

Frozen yogurt maker PinkBerry, which has inspired cult-like status in its home market of Los Angeles, is opening a store in Kuwait City this summer, with another in Dubai to follow.

DIVERSITY

Joe Albright, Wal-Mart’s vice president of international real estate, said diverse formats designed to appeal to many had made Wal-Mart’s international unit a $100 billion business.

For many retailers, franchises and joint ventures offer common ways to expand because they minimize risk.

“It gives us an outlet to sell our product in, but we’re doing it with a third party, who puts up the capital to open the store,” said Levi Strauss spokesman Jeff Beckman. He added Levi’s is now seeking “opportunistic” deals afforded by the economic downturn.

Brinker, operator of Chili’s, plans to open up to 18 eateries in Mexico this year, adding to its portfolio of nearly 200. AutoZone is looking to add to its 160 stores in Mexico.

“We’re here to do deals,” AutoZone director of real estate Terry McKee said while at the convention.

The top brands sought by tourists, according to a study by mall developer Taubman Centers and Shop America Alliance are: Nike, Levi Strauss, Gap, Polo and Abercrombie & Fitch. All of them are planning overseas expansions.

Abercrombie says international stores will eventually make up half of total sales from the approximately 8 percent today.

VF Corp, owner North Face and Vans, plans to open 70 stores this year, pared back from its previous rate of 100, with most on a proportional basis in Europe and Asia.

Besides full-price stores, retail outlets are another venue for global growth. U.S. brands are keenly interested in outlet stores in Russia, especially in Moscow, said Neil Thompson, chief executive of outlet developer Fashion House Development. His company is opening 16 outlet centers in Russia.

“I get two (calls) a week,” from U.S. companies interested in opening stores first in Russia, Thompson said.

For further information, visit: http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSN2726935420090529?pageNumber=2&virtualBrandChannel=0