Retailers can bump up store sales by creating marketing strategies that focus on international shoppers.
by COLEEN R. CONKLIN and JEAN GUINUP
As Americans adopt new shopping habits, often away from bricks and mortar, the No. 1 activity of travelers visiting the U.S. is shopping in stores.
The impact of the travel industry on retail hasn’t been fully appreciated, which means there’s an extraordinary opportunity to increase in-store sales by capturing a larger share of this market. In the past, international shoppers were mostly seen in major destinations such as New York City, Orlando and Las Vegas. But a growing number of travelers are visiting secondary and tertiary destinations in the U.S., where they shop for a broad selection of products in a variety of retail environments.
Tourism is a vital element of the U.S. economy, accounting for 2.7 percent of the country’s GDP. Leading the growth of this industry is international travel. When travelers from global destinations visit the U.S., they buy our goods and services, stay in our hotels, shop in our stores, and eat in our restaurants. In 2014, the U.S. welcomed a record 73.9 million international visitors. According to the U.S. Travel Association, those visitors spent $180.7 billion on U.S. goods and services, and anecdotally, retailers that track shoppers nearly always record significantly higher spend levels by international visitors.
Despite the world’s ups and downs, people still travel to the U.S. Although the strong U.S. dollar has been roundly blamed for the decline in spending by international visitors, the U.S. Department of Commerce shows just a 2 percent decrease in their spending through August 2015. We know that inbound market shifts are ongoing, however, while one market might be spending less per capita, another is growing or rebounding.
For retailers, focusing on traveling shoppers’ wants and needs is critical, yet few have proactive strategies in place.
Today’s communications channels have made it easy for consumers to be in touch with a brand, a place or an experience. They see what’s happening in the world and have an overwhelming desire to live life to the fullest, and often travel is at the top of their wish lists. Retailers can be part of this demand for new experiences by packaging shopping opportunities into overall travel itineraries.
The U.S. is known for its cultural diversity, breadth of unique experiences and natural beauty. Tying into larger destinations and all they have to offer is key. A Lobster Bake in Maine, a genteel tea in Atlanta, a rodeo in Texas , a winery tour in Napa or a Broadway show in New York City make excellent identification points for brands to connect with international shoppers. Customers are drawn to a brand’s products, but they’re also drawn to a brand’s image, heritage and authenticity. It is no accident that Polo Ralph Lauren and Tommy Hilfiger capture international shoppers because they represent Americana.
To attract the attention of global visitors, U.S. brands must first understand these shoppers by enlisting help from national, state and city resources such as Brand USA, U.S. Travel Association, convention and visitor bureaus, destination management organizations and economic development alliances. Of course, retailers should integrate this information with their own POS data and shopping center feedback to discern actionable insights.
Reaching travelers while they’re still in the planning stages gives retailers an even stronger way to garner sales from this audience. Partnerships with companies abroad, such as tour operators, travel agents, airlines and credit card companies, will help brands form culturally appropriate messaging. Brands can also drive consumer interest and demand in target countries through public relations and social media outreach. Each market offers its own challenges and opportunities, so it’s best to seek guidance from resources well-versed in specific cultural nuances, market motivators and traveler preferences, as well as the best engagement techniques for consumer-driven platforms.
To maximize reach, brands have to stay ahead of trends and adapt to shoppers’ needs. While many retailers are investing in new store layouts with enhanced technologies – such as Neiman Marcus’ smart mirrors and Tommy Hilfiger’s virtual reality headsets – customized services for international shopper services shouldn’t be forgotten.
In-language signage and multi-lingual staff, on-demand translation services and international credit card acceptance go a long way in welcoming international shoppers and creating a positive in-store experience. Gap’s partnership with Virgin Hotels to deliver purchases directly to travelers’ rooms is a great example of connecting with visitors who are looking for convenience, value and a personal experience they can’t get at home.
Brands often worry that aggressive programs aimed at attracting visitors to their outlet stores might conflict with their company’s brand-building efforts and hurt their wholesale business. But outreach directed to travelers and those that sell product to them can be done in a way that builds awareness of the brand’s overall assets. And, when international visitors enjoy a positive in-store experience, the brand’s overall desirability is lifted, too. Simply put, targeting an international visitor who has dedicated money for shopping makes perfect sense.
Positive word of mouth is the No. 1 asset for building business, but it isn’t a slam-dunk given that many cultures are reticent to communicate their dissatisfaction – except to fellow travelers! Therefore, brands must be ready to receive feedback from international visitors. Tools to achieve this can include staff training, concierge programs, social media audits and upgraded in-store data capture systems,
Generating interest from global markets is both complex and simple. The complex part is the need for a multi-layered approach that touches each component – from the actual consumers to the influencers and sellers. In truth, these layers are discovered only through continuous and industrious research and experience.
The simplicity part is knowing that relationship building is at its heart.
Retailers can increase sales to global visitors by making a commitment to long-term investment, personnel and resources, and the ability to ebb and flow with travel trends.
Coleen R. Conklin and Jean Guinup, Managing Partners of GC Communications, are international marketing experts who honed their skills overseeing strategic outreach to a multitude of global markets aimed at driving traffic and increasing retail sales. Visit their website at www.gc-communications.com.