Louis Vuitton informed Korean travel retailers of the decision last month, in what one local observer called “shock news” and another a “bodyblow”

CHINA. The Moodie Davitt Report weekly WeChat Official Account is going from strength, this week reaching a new milestone by exceeding 1,000 followers.

The latest post went online this Monday, with the lead story on Louis Vuitton pulling back from downtown duty free retail (notably in South Korea) being viewed over 1,600 times on the first day alone. That readership in the Chinese language is additional to the heavy traffic generated by the original MoodieDavittReport.com English language coverage.

The WeChat platform is published under the direction of Penelope Zhou, the Hong Kong-based Chinese Editor at The Moodie Davitt Report.

The Moodie Davitt Report Founder & Chairman said: “We are absolutely delighted at the rapid pick-up in Chinese readership of our new WeChat service. The platform has been critical in growing our influence in the world’s most vibrant duty free market and bringing a range of stories, both Chinese and international, to our readers in their language.

“The combination of high-quality content and Penelope’s outstanding translation and writing abilities, nurtured through her experience as a professional interpreter, and solid journalistic background, has seen readership surge. WeChat now forms the cornerstone of our China strategy with several further enhancements planned and a bolstering of our China team.”

In his popular The Moodie View column, Martin Moodie picks up on the lead story and another article on the improved April sales figures from Korean duty free and considers both developments in a Chinese context. “The relationship between the Korean and Chinese duty free markets is one of the most closely watched – and fundamentally intertwined – in the travel retail world,” he notes.

Moodie explores the comments of Shinhan Investment Corp analysts Sung June-won and Hanny Lee suggesting that Hainan’s strong duty free growth of recent times is a temporary phenomenon, driven by the pandemic’s impact on Chinese outbound travel.

“Duty free sales growth in China has been driven mainly by wealthy Chinese consumers flocking to Hainan for duty free shopping amid the country’s restrictions on outbound travel,” Sung and Lee wrote.  “We believe the strong performance of Hainan duty free shops is a one-off event caused by the pandemic, and expect wealthy Chinese consumers to return to shopping overseas, especially in Korea and Japan, once travel restrictions are lifted.”

Moodie pushes back on that view, noting, “While the Chinese people will, of course, travel and shop abroad in great numbers once the pandemic is under some form of regional and ultimately global control, the strong foundations of Hainan’s duty free business – generous allowances, a proliferation of retailers, ease of travel from the mainland and the island’s many natural attractions – mean that the business is no temporary phenomenon but a long-term, growing and very lucrative business sector.”

Hainan duty free reaches new high and brand set sales records

Moodie Davitt WeChat also reported on booming offshore duty free sales in Hainan, which rose +980% year-on-year in April to RMB4.75 billion (US$745 million). Total sales, including duty paid, reached RMB5.2 billion (US$814 million), a +997% increase over the same period in 2020.

On 4 June, the Hainan Provincial Department of Commerce revealed at a press briefing that more than 20 brands, including Estée Lauder, Cartier, Bvlgari and Tiffany, had posted global record-setting travel retail single-store sales in their Hainan offshore duty free shops over the past year, according to report by local media Hainan.net and Sansha Satellite TV.

#ClaimYourLove: YSL Beauté and CDFG host spectacular Beauty Villa party in Hainan

Elsewhere in Hainan, L’Oréal Group-owned beauty and fragrance house YSL Beauté and China Duty Free Group (CDFG) celebrated 20 May (China’s own version of Valentine’s Day) with the spectacular #ClaimYourLove campaign.

From 19-21 May, the partners hosted a spectacular Beauty Villa event at the Intercontinental Sanya which offered travellers a 360° O2O experience. The villa offered everything from live makeup demonstrations to DJ performances, a variety show and livestream broadcasts, while shining the spotlight on YSL Beauté’s All Hours Foundation range.

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Highlights from Moodie Davitt WeChat post 8

The previous WeChat post saw particularly strong interest in the Chinese language version of our global exclusive interview with Hainan Development Holdings Party Secretary and Chairman Gang Gu who discussed the newly-opened GDF Plaza and the company’s bold duty free vision.

Hainan Development Holdings (HDH) Co Ltd, a fully state-owned company of the Hainan Provincial Government, supported by leading international travel retailer Dufry, opened phase one of the Global Premium Duty Free (GDF) Plaza in Mova Mall, Haikou on 31 January.

The business is progressing with the second and third phases of the opening this year. It also unveiled a new joint loyalty programme during the recent Hainan Expo.

Haikou International Duty Free City renderings revealed

The post also shared further details of China Tourism Group Duty Free’s (China Tourism Group) extraordinary Haikou International Duty Free City project. The striking new renderings underline the beauty and vast scale of the development.

The Haikou International Duty Free City design drawings, revealed publicly for the first time, illustrate the complex’s unique architectural design style, based on the begonia flower. The design incorporates local elements such as Haikou’s nature and marine culture to create a unique and comfortable experience space for consumers.

“This will become a one-stop comprehensive tourist destination that tourists cannot miss,” China Tourism Group promises

Haikou International Duty Free City is scheduled for a June 2022 opening, according to China Tourism Group, parent company of China Duty Free Group (CDFG), which will run the operation.

The Haikou International Duty Free City project covers over 110 acres, with a planned total construction area of about 926,000sq m. It comprises six plots, anchored by a sprawling duty free complex that will rank as the world’s biggest duty free retail space.

(Left) CDFG and Luxottica are also promoting the Prada for Asia launch online through the retailer’s social channels; (right) Xin Liu from ‘THE9’ is celebrated for breaking boundaries in the celebrity world

Superstar power: Liu’s fans drove a surge in Foreo’s sales just after the announcement

Luxottica unveils ‘Prada for Asia’

Elsewhere in Hainan, Luxottica and CDFG have teamed up for the launch of the Prada for Asia sunglasses line at the Sanya International Duty Free Shopping Complex in Haitang Bay.

The launch reinforces the eyewear company’s strategy to offer styles specifically developed for Asian customers. The Prada for Asia sunglasses are the latest addition to the Italian fashion brand’s Prada Cinéma Collection. The Asia-exclusive eyewear launch is supported by an O2O campaign which will run from now until the end of June. It features high-profile LED window displays and personalised stands at various high-traffic locations at the CDF Mall.

Foreo names Xin Liu from ‘THE9’ as Global Brand Ambassador

The WeChat report continued by sharing our recent story on Foreo’s newest Global Brand Ambassador, Chinese singer Xin Liu from the pop group ‘THE9’.

Liu is a regular trending name on Chinese social media since her first appearance on the Chinese TV Programme, ‘Youth With You 2’ in 2020, whose finale reached over 6 million views.

The official announcement was made on Foreo’s official Weibo, WeChat and TMall channels. Liu’s fans drove sales of over US$1 million on the Foreo TMall flagship store within 30 minutes of the announcement.

(Left) Moodie was honoured for his extensive coverage of Hainan’s booming offshore duty free sector. (Right) The success of which he says will continue long after the pandemic eases in his latest The Moodie View column.

A taster of the quality on offer: Click on image to download Edition 5 free of charge

Oriental travel Retail Observer: A key guide to duty free in China

The post continued by previewing the latest edition of the Oriental Travel Retail Observer (OTRO), which offers a series of rich and timely insights into China’s duty free sector.

Issue 9 summarises the impact of the latest developments, regulatory and commercial, on the two key and interrelated duty free sectors of China and South Korea. This issue also focuses on the rise of home delivery service from duty free stores, a price index covering duty free stores in China and South Korea and promotions for popular brands at Sunrise Shanghai.

OTRO is a research and publishing alliance between Jessica’s Secret, China Merchants Securities, and law firm Jincheng Tongda & Neal. The Moodie Davitt Report works closely with Jessica’s Secret, having developed the popular Jessica’s Secret Index with the fast-growing Shanghai-based company.