Trade War Affecting You?
For companies selling to a lot of tourists from China, the current trade war between the U.S. and China can be rather perplexing. Visitors from China still rank at the top in spending among foreign visitors although that position is in jeopardy. Chinese tourists spend an average of almost $7,000 per visit, 50% more than tourists from any other country
Visitor traffic from China to the U.S, however, dropped nearly 6% last year, the first decline in 15 years. Merchants in New York and Honolulu are among those reeling from the effects. How about you?
How Does It Affect Me?
If you’re a retailer, do you know the demographics of your customers? You should. Having this information is invaluable when conditions change and you need to analyze and adapt.
Take Brooklyn, for example. The ethnic composition of the city changed dramatically when workers in New York City began relocating there to reduce their cost of housing. Odds are that many merchants there who weren’t quick to notice the evolution and adapt to it had to shutter their doors. Much like we monitor the weather forecast for changes, be aware of changing fronts in your business.
What To Do
If the demographics of your market appear to be changing, first consider the reason(s). If it’s something you can’t control (and it usually is), there are some viable options available.
Look at your secondary and tertiary markets or next most loyal customer base. Who are they? What’s their typical spending like? Do they also patronize your competition and, if so, why? What about your product line interests them and which generation do the belong to?
Once you gather that information, determine what kind of focus you need to give and changes you have to employ to make you more desirable to them. What’s the most effective way to reach them and how much more will you need to budget?
Roll all of these up into an action plan with deadlines and target goals. Track your progress and make adjustments, if needed.
As you’re moving on your new action plan, consider the following as well if you serve a good number of tourists from other countries. To some, like China, email is passe’. Chat is what they favor.
Here again, it’s important to gather and leverage that kind of information. If, for example, you depended on sales from Chinese visitors, you can still let them know via Chat that their business is much appreciated and that they can still order direct from you.
Did you know that a greater percentage of Europeans than Americans not only own cell phones but also text on them more often? The most important thing to remember is to know as much about your customers as possible, including how they best communicate. This knowledge can be extremely valuable during periods of transition or change.
Today’s world is changing quicker than ever before and oftentimes the company that recognizes and responds quickly emerges the winner.