LEADING ASIA PACIFIC OPERATORS: CHINA DUTY FREE GROUP
can take even greater advantage of big data and improved marketing and logistics. For example, through the new
partnership, CDFG says it will be able to more easily target the consumer at the time they book their trip, or when they pre-order duty free products online. By marketing to travellers before
they shop, Chen says the company hopes to improve penetration into stores, as well as conversion and average transaction value. It also hopes to take advantage
CDFG and Alibaba signing ceremony.
“The Duty Zero by cdf customer app is one of our greatest achievements, and we firmly believe it will not only drive customer engagement and satisfaction, but also generate additional sales.”
Charles Chen, President, CDFG
only expanding its presence at the airports in China. In March, the company announced that it would be opening new downtown stores in Beijing, Macau, Shanghai, Dalian, Qingdao and Xiamen. A CDFG source told TRBusiness that
the company will open the Beijing store first, but in a phased approach with around 10,000sq m expected to be finished around May this year. The store will carry all categories aside from liquor and tobacco. The news was announced
during the TFWA’s China’s Century Conference in Hainan
province (5-7 March). CDFG already operates offshore
duty free shops in Hainan at Sanya, Haikou and Bo’ao and Chen confirmed to TRBusiness that the company’s Haitang Bay, Sanya store registered $
1.1.bn in 2018. This represented over 73% of Hainan’s total duty free sales, which rose to RMB10bn ($1.5bn) in 2018 (+19% vs 2017). Chen emphasised once again
at the TFWA China’s Century Conference how CDFG benefits from a huge resource of data. This is through its own database of loyalty members; those recruited by Sunrise Duty Free; through its new joint venture retail concept, Duty Zero by cdf; in addition to the company’s tourism business arm, The China Tourism Group. CDFG insists that it already had
a ‘strong online platform’ before it began working with Alibaba, but through its new partnership CDFG
‘Robust growth’ of online sales for luxury goods
CDFG President Charles Chen divulged during the TFWA China’s Century conference that China witnessed ‘robust growth’ of luxury goods sales online in 2018, up by 37% year on year. In 2018, China’s online luxury goods
sales reportedly hit RMB36bn ($5.4bn), accounting for 14% of all luxury goods sales in China. “Nearly 90% of luxury brands are
expanding online services, including product launching, reservation for store visit and launch events, etc,” said Chen
50 TRBUSINESS
in Hainan. “By the end of 2018, over 400 stores of more than 90 premium brands had started working with third party VIP service platforms.” Chen insisted that there was certainly
a demand for more limited editions, exclusives and customised products in duty free. He said shopping experiences needed to be more interactive with opportunities for tastings and lectures or tutorials where appropriate. He also said there was scope for working more frequently with celebrities for special
occasions/launches or openings.
of re-purchasing opportunities by engaging with consumers after they shop in store. It hopes that this way it can better facilitate travellers’ sharing and recommending their purchases. Pre-order is definitely becoming
more important for the company, which actually launched an app for this very purpose for its Hong Kong International Airport Duty Zero by cdf stores when they opened in 2018. The retail fascia of joint venture
CDFG and Lagardère Travel Retail (CDF-Lagardère Company Limited) – announced in January it would be extending the app to departures at HKIA. The app currently permits arrivals passengers to pre-order food & liquor up to three days in advance to collect from the arrivals hall pick- up counter. “The Duty Zero by cdf customer
app is one of our greatest achievements, and we firmly believe it will not only drive customer engagement and satisfaction, but also generate additional sales,” said Chen. «
Customers are happy to queue for their duty free purchases at CDFG’s Haitang Bay Sanya store in Hainan.
MAY 2019
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