Throughout Hong Kong this week, shoppers have had to contend with large crowds, long lines and a curious plethora of suitcases being dragged through the streets.
It’s Golden Week, which means an influx of mainland Chinese visitors to the city, many of whom spend their days shopping.
First implemented in 1999 by Beijing to promote domestic tourism, Golden Week occurs once in the spring, celebrating Lunar New Year, and once in the fall, surrounding the Oct. 1 National Day. The Hong Kong Tourism Board counted more than 600,000 mainland arrivals in the first six days of Golden Week – a 25% increase from the same period last year and the highest number in the past five years. Visitors don’t go home empty-handed - last year, they spent an average of HK$7,000 during Golden Week.
Hong Kong’s many malls are on most itineraries. The flagship Chanel, Gucci and Louis Vuitton stores on Canton Road in Tsim Sha Tsui drew 20-foot-long lines that were managed by notice signs, rope barriers and security doormen.
Shoppers are willing to wait. Hong Kong’s lack of sales, luxury and import taxes, its wide product variety and the attractive RMB-to-HKD conversion rate make shopping a bargain. Luxury goods are often 30% cheaper than the same products in the mainland.
Many shoppers come equipped with large, empty suitcases, in which they stuff their purchases. Outside the Chanel store on Canton Road, a Ms. Chen and her family packed boxes of Ferragamo shoes into their already-full suitcases, before going home to Chengdu.
Hong Kong retailers are doing their part to capitalize on Golden Week by promoting special discounts and events. Stores specially produce signs in simplified Chinese (as opposed to traditional Chinese used in Hong Kong) for mainland customers.
Times Square, the popular Causeway Bay mall, saw a 7% growth in foot traffic this week from last year’s Golden Week and expects a 20% increase in sales from last year. To lure mainland shoppers, the mall held a raffle, an iPad giveaway and a joint promotion with mainland bank card company China Union Pay. Wharf Holdings, which manages both Times Square and Harbour City, a shopping center in Tsim Sha Tsui, says approximately 20% of the malls’ patrons come from mainland China. Since last year, the company has provided free shuttle buses from the port city of Shenzhen, in Guandong province, to the two malls.
Hong Kong, though, may soon have to fight for the honor of being China’s top shopping destination. Duty-free shopping zones are being set up on tropical Hainan island that could offer similar prices and, perhaps, shorter lines.
