Attract the World

At Global Blue, we give you the tools and insights needed to look further and attract a whole new world of lucrative foreign customers. Whether you’re a small boutique or a large department store, we provide the inspiration and support you need to tap into new markets and develop the most compelling propositions.

www.global-blue.com

CC_CM_217x283mm_120420.indd 1 4/20/12 8:56 AM

The founder and CEO of Wanda explains how he built one of China’s biggest companies

Wang Jianlin

runway walksbetween gatesHow airports have become hot spots for high-end fashion and shopping

globe shoppercity index: europeThe definitive guide to Europe’s top destinations, for both shoppers and retailers

A magazine from Global Blue issue 6 2012

The innovations set to entice consumers

offline and back into stores

5future

technologies

A magazine from

Global Blue issue 6 2012w

ww

.global-blue.com

t is quite remarkable to see how quickly shopping habits can change. The Internet transformed the retail industry, taking many customers away from physical stores. In this issue of Visitors, we look at some of the latest technological innovations, which will potentially help retailers reclaim consumers

(p.12). Some of these concepts defy many of our basic as-sumptions – such as shops without stock or payment via smartphones – but many of the best innovations often do.

Many people still see airports as transport hubs, but as you’ll see in this issue, airports have also evolved into world class shopping venues, too (p.16).

Change is inevitable, and what distinguishes a business is its ability to adapt. Chinese entrepreneur Wang Jianlin, who we interview in this issue (p.21), is a great example. He has managed to build a remarkable business empire, on the back of the rapid changes that have taken place in China over the last 30 years.

Keeping abreast of new developments and trends is vital for any business, and I hope this latest issue of Visitors helps to keep you informed of the latest changes in the industry.

Enjoy!

Per Setterberg, President & CEO, Global Blue

Visitors | I S S u E 6 2 0 1 2 | 3

content

This magazine is published by Global Blue. Website: www.global-blue.com Address: visitors@global-blue.com Project manager Global Blue: Marie Bergfelt, mbergfelt@global-blue.com Editorial production: Spoon, göteborg, Sweden Editor: Susanne Magnusson, susanne.magnusson@spoon.se. Designer: Charlotte Sundberg, charlotte.sundberg@spoon.se Website: www.spoon.se Repro: Spoon, göteborg, Sweden. Printed by: lenanders grafiska, Kalmar, Sweden. Translation: Språkbolaget, göteborg, Sweden Advertising contact: Erika Olsson, eolsson@global-blue.comPhoto: Gregory Boyd

8 Professionals

12 Trend

26 Smart Business

16 Insight

28 Dreams

21 Up Close

30 Global News

34 Market Outlook

6 What’s up?News and facts affecting your international customer business.

Two Global Blue customers explain the importance of accommodating international travellers.

Increasingly, consumers are shopping online. However, the latest innovations could see them return to shopping in physical stores.

Airports have traditionally been gateways to destinations, but, with airport shopping, they are quickly becoming destinations in themselves.

In a little over twenty years Wang Jianlin has built a huge business empire and is now one of the richest men in China.

Square is an exciting new technology that brings new meaning to the term ‘payphone’.

Escaping the crowds at the world’s most southerly ski resort.

All the latest news from Global Blue.

Take a closer look at the numbers that reveal much about who is buying what, and where.

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Explore ways retailers across the globe use Retail Pro retail management solutions to achieve their goals

How do I get my retail businessfrom 1 to 100 locations

4 | I S S u E 6 2 0 1 2 | Visitors

people

Laure Pelloux Crepy

Marketing & Trade Marketing Director, Grupo Escada Espana“It’s important to understand the cultural habits of our foreign customers, and this is something Global Blue really understands.”

1412

Eric Fassbind

Owner and Director, Fassbind Hotels“With Currency Choice they know exactly how much they pay, and its another of those small things that contributes to an enjoyable stay”

Holidays affect spending, but they differ the world over. Ramadan will have a big impact on UaE in July, China will close for national Day in October, while many

Japanese will take time off for the Obon festival in September.

Calendar 2012

July 16thGolden WeekJuly 16thMArine dAy

July 15th to August 31stSuMMer School holidAy

uAe RussiAJApAn chinA

SuMMer School holidAy

september 30th to October 7thMid-AutuMn FeStivAl

October 8thSport dAy

December 25thchriStMAS dAy

november 3rd to 5thunity dAy

August 22nd to 24th, Wednes-day, Thursday and Fridayeid Al-Fitr (end oF rAMAdAn)

From August 11th to 18thoBon FeStivAl Week

October 25th, ThursdayArAFAt (hAj)  dAy     October 26th to 28th, Friday, saturday and sundayeid Al-AdhA (FeASt oF the SAcriFice)

november 15th ThursdayAl-hijrA (iSlAMic neW yeAr’S dAy)

november 3rdculture dAynovember 23rdlABour thAnkSGivinG dAy

December  2nd, sundayuAe nAtionAl dAy     

December 23rd, 24thBirthdAy oF the eMperor   

July

AugusT

sepTembeR

OcTObeR

nOvembeR

DecembeR

October 1stnAtionAl dAy

October 1stnAtionAl dAy, china

July 22nd, sundayrAMAdAn, uAe

september 17thoBon FeStivAl Week, Japan

December 31st to January 9thneW yeAr’S holidAyS, Russia

July 22nd, sundayrAMAdAn 

December 31st to January 9thneW yeAr’S holidAyS

From september 15th to 23rdSilver Weekseptember 17threSpect For the AGed dAyseptember 17thoBon FeStivAl Weekseptember 22ndAutuMnAl equinox

WATch OuT exTRA FOR ...

21Wang Jianlin

CEO, Wanda“Great companies are born,

not developed, because each company has its own DNA.”

Visitors | I S S u E 6 2 0 1 2 | 5

Tourists from China and Japan are reluctant to visit the uK this summer according to major tour operators in those countries.

Fears of excessive prices during the Olympics are deterring many tours, with the exception of high-end, VIP groups. In Japan, some travel companies are not organising any groups at all to London this summer.

However, flight bookings to London before and during the Olympics are up by a quarter compared to last year. Outbound bookings are down by 11%, contradicting forecasts that many Londoners would avoid the games. The figures indicate that Lon-don’s hotels, restaurants, and retailers are in for a bumper sum-mer.

Germany and America have recorded the largest increase in bookings to London, with significant increases also being recorded from Jamaica, Japan, and Brazil.

Mixed signals on london tourism in Olympics year

little italy in China

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What’s up?

is there anything you would like to know more about? We would appreciate your opinion on global Blue’s magazine. Write to us at visitors@global-blue.comWRitE tO ViSitORS

6 | I S S u E 6 2 0 1 2 | Visitors

You don’t need a time machine, or even a long-haul flight to experience renaissance Italy, thanks to Florentia Village, which is billed as China’s first authentic Italian outlet village. It promises the ultimate shopping experience with nearly 200 fa-mous Italian and international brands at discount prices.

Florentia Village opened in summer

2011 and is designed to recreate Flor-ence as it was in the 17th century, albeit a little shinier! The developers promise: “beautiful Italian style architecture, au-thentic Italian and international cuisine, and entertaining public events - deliver-ing the fashion, culture and spirit of Flor-ence, Italy, without ever leaving Beijing.”

The site covers 60,000 square metres,

including a canal running through the en-tire village with gondolas, bridges, foun-tains, romantic squares and porticoes, not to mention a variety of food from all over the world, as well as outdoor cafés.

Florentia Village is located in Wuqing, a fast-growing town between Beijing and Tianjin. For further details visit: www.florentiavillage.com

Vionnet, the revived haute couture label, has opened its first Milanese boutique. Situated on the ground floor of Palazzo Premoli on Corso Mon-forte, the store is linked to the brand’s showroom and atelier on the upper floors. A salotto in the store is dedicated to Vion-net’s evening wear; discreet doors allow the area to become completely private, and it will also be used for the house’s new ‘demi-couture’ exclusive personalisa-tion service.

Vionnet opens its firststore in Milan

Your premium brand had better be delivering something special, or it’s not going to get the business.

Warren BuffettAMErICAN BUSINESS MAGNATE, INvESTOr, AND PHIlANTHrOPIST.

Wealthy Indonesians have propelled the country to fourth in the league of global Tax Free shoppers. Around 90% of their spending takes place in Singapore, mean-ing they spend as much as the Chinese in this shopping paradise. In 2011 Indone-sians spent more than EuR 300m on Tax Free goods, up 20% on 2010, and in 2012 they are expected to outspend even Japanese tourists.

New figures

USD 9 BilliOn

the value of the brazilian luxury goods market in 2010, which is double the

2006 figure.

102,000 the number of chinese visitors to spain during 2010, only the ninth most popular

european destination among chinese tourists, despite being europe’s second

most visited country.

the number of visa applications by Russians for european countries in

2010, 99.5% of which were granted.

4.5 MilliOn

1. China +57%

2. Taiwan +36%

3. Switzerland +36%

4. Russia +31%

5. Brazil +26%

the tax Free shopping

Hit liStWhich nations

recorded the largest rise in Tax Free shopping

during 2011?

MOOD Stockholm is one of the city’s most ambitious retail projects for many years. The mall, situated between Regeringsga-tan and Norrlandsgatan, hosts around 60 retail and leisure units. Several interna-tional fashion brands, including Armani Jeans, Napapijri and Scotch & Soda, are present. Scandinavian retailer Best of Brand is selling clothes from well-known brands including Polo Ralph Lauren, Gant and Tommy Hilfiger. According to the developers AMF Fastigheter the mall

“delivers a new concept called ‘Beyond Shopping’, which can also be described as ‘Fifth Avenue meets Meatpacking Dis-trict’. It combines carefully selected pre-mium retailers with exciting and edgy retail brands and exclusive modern res-taurants on all three levels.”

MOOD Stockholm will be the first mall in Sweden to provide a full concierge service, offering help with spa treatment bookings, dry cleaning, home delivery, a cobbler, as well as personal shoppers.

in the mood for MOODFlorentia Village includes renaissance-era architecture and even a canal.

indonesian shopping paradise

Eric Fassbind was born and raised with hotels – they’re in his genes. His family has worked in the industry for six gen-erations, and in 1962 his parents opened up the first Fassbind Hotel in Lausanne, Switzerland. Today, Eric and his brother Marc continue to run their parent’s busi-ness, which now extends to eight hotels in five cities, and is the largest family-owned hotel chain in Switzerland.

“Above all, guests want to feel relaxed, comfortable, and get a good night’s sleep,” says Fassbind. “It’s simple, but it’s some-thing many hotels forget.”

All eight Fassbind Hotels are centrally located in Lausanne, Geneva, Zurich and Bern, and can be distinguished by their distinctive Swiss ambience and design.

“We don’t want to be just another inter-

national hotel that could be anywhere in the world. On arrival, guests should feel a sense of being in Switzerland. A lot of business travellers will only be here for a short time, so we want to give them a unique Swiss experience.”

Being a small country located be-tween France, Germany and Italy, means Switzerland attracts plenty of interna-tional guests, all speaking a wide variety of languages.

Having multilingual staff is essential, and Fassbind Hotels tries to ensure that 4–5 different languages are available at reception at any given time. “We try to welcome guests in their own language,” adds Eric Fassbind. “It’s just one of those small things that help them feel more comfortable.”

FASSBind hotelS,SWitzerlAndEstablished: 1962. Hotels: 8. Employees: Approx. 200. Global Blue services: Currency Choice. Global Blue customer since: 2006.

As with language, paying in your own currency is also comforting, which is why Fassbind Hotels use Global Blue’s Currency Choice service.

“Not many people know the Swiss franc, so they’re never completely sure how much they’re paying. With Currency Choice, they know the exact amount and it’s just another one of those small things that contribute to an enjoyable stay.”

“it’s the small things that make the difference”

Visitors | I S S u E 6 2 0 1 2 | 9

Professionals

No matter where they come from, international travellers appreciate exceptional service. Here are

two businesses that make that extra effort.By niC tOWnSEnD

PHOTO FRED MERz ,tOni MatEU

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HOW i DiD it

Eric Fassbind Owner and DirectorFassbind Hotels

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laure Pelloux Crepy Marketing & Trade Marketing

Director, Grupo Escada Espana

often attract many international custom-ers, particularly its branches in popular tourist destinations such as Barcelona, Marbella and Majorca. Nearly half of its international customers are Russian, which Laure Pelloux Crepy puts down to the strength of Escada’s brand awareness in Russia. To improve customer service, Escada even employs native Russian staff.

“It’s important to understand the cul-tural habits of our foreign customers, and this is something Global Blue really un-derstands,” adds Laure Pelloux Crepy, who feels that quick and easy tax refunds help facilitate additional sales.

“Escada’s new system is very helpful. Previously, it was all manual whereas now it is done online. We can now tell our customer, ‘we’ve just arranged for

Escada’s stores attract women of all ages and nationalities, but one thing they share is the appreciation for elegance, style and quality.

“What distinguishes Escada is that we can dress the 24-hour woman. From casual and business wear, to red carpet attire. We offer a rich collection of high-end fashion,” says Laure Pelloux Crepy, Marketing & Trade Marketing Director, Grupo Escada Espana. “We have a loyal customer base, who value the quality of our products.”

Escada was founded in Germany in 1976, and quickly expanded to become a top global luxury brand. All of its stores and franchises in Spain and Portugal come under Grupo Escada Espana. Hav-ing a strong global brand means its stores

€200 to be redeemed, so maybe you’d be interested in another item?’ So it helps increase our business.” Escada Espana also advertises in Shop magazine, and subscribes to monthly business insights, which Laure Pelloux Crepy believes have helped improve their business. “These in-sights are very useful for tracking data and comparing our performance with the competition, while Shop magazine also helps us to reach new customers.”

eScAdA, BArcelonA, SpAinEstablished: 1987. Employees: 300. Stores: Over 75. Global Blue services: Tax Free Shopping, Market Intelligence, Marketing services. Global Blue customer since: 2005.

“Quick and easy tax refunds help us to increase sales”

HaiR anD MaKE UP COURtESy OF iVan gOMEz, lOla MaKE UP

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House of fraser Buy & Collect concept stores offer over 1,000 brands, yet have nothing in stock.

Shopping online, while in store.

Trend

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With the rise of internet shopping, bricks and mortar stores are starting to look a little dated. across Europe and north

america in particular, many retailers are struggling to excite jaded customers who are enthralled by the internet. But retail-

ers are fighting back, and Visitors takes a look at the latest innovations that are enticing back tech-savy consumers.

By SiMOn O’COnnEll

TRenDs5

Answer: When it has no stock. The new House of Fraser Buy & Col-lect concept stores blur the lines between on and offline retailing. They feature large touch screens on which customers can order from over 1,000 brands available

WHEn IS A STORE nOT A STORE?1 at the uK’s largest chain of department stores, which are then either delivered to your home, or can be picked up in store the next day.

The ‘stores’ feature a luxurious envi-ronment with personal advisers on hand to help with payment and navigation,

FUTURE TECHNOLOGY

IN RETAIL

46” touch screens, and a free coffee bar. Inspired by the level of service given by hotel concierges, an assisted sales service is offered with advisers helping custom-ers to navigate House of Fraser’s online offering, helping with everything from product selection to online payment.

With the Starbucks app you can gift a coffee to a friend by adding funds to their card, but it’s also possible to use the latest technological advances to

improve the accuracy of your gifting in myriad ways. Take Pepsi’s social media vending machine, at which users can pur-chase a Pepsi for a friend, which can then be picked up at any other social- media enabled vending machine, where the

recipient also gets a video message from the sender.

In Target stores, undecided adults can check which video game should please young gamers via the Gaming Kiosk, which offers advice on age suitability and user reviews. A similar service is availa-ble at Mastermind toy stores, where video reviews advise unsure gift seekers. On the Kobo bookstore website you can gift an eBook and it will automatically be e-mailed to the recipient.

WHAT TO GIFT?4attach a video message to your bottle of Pepsi.

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ROBOT COnCIERGES In THE MAllEver got lost in a giant mall? Can’t find that shoe store you read about? Fear not, for if you’re

shopping in Abu Dhabi later this year, you may get assistance from a new breed of humanoid robots called REEM, with touch screens built into their chests, and cam-eras in their heads allowing them to rec-ognise users, remember their names, and carry their heavy shopping. These robots, designed by Barcelona-based PAL Robot-ics, can even lead you to your destination.

REEM debuted as a guide at the Abu

Dhabi National Exhibition Centre last year, where 20 robots were ordered. PAL Robotics is backed by the Abu Dhabi based Royal Group and it plans to introduce them in a mall in the Emirate later this year. They plan to produce a dozen robots a month. PAL Robotics marketing man-ager Jorien Guijs says: “REEM has been prepared for use at exhibition centres and shopping malls. In the future we will also focus on healthcare, airports, muse-ums and other public spaces.” Each REEM will cost around €200,000.

2BODy SCAnnERSTake the guesswork out of clothes sizing by hav-ing your exact measure-ments taken by a 3D body scanner. Body scan-ners have been avail-

able in the jeans department of stores like London’s Selfridges for a while, but PrimeSense, the next generation from Bodymetrics, uses 3D sensors to give a more accurate ‘map’ of your body, and the ability to match the size of a a garment to your body shape as closely as possible – very useful when sizes vary significantly from brand to brand.

The implications for off and even on-line retailing, where up to 40% of orders are returned because of sizing issues, are massive. Now you can store your body shape and order the garments that most closely correspond to it. Bodymetrics’ PrimeSense scanner allows you a virtual ‘try on’ of outfits both in store and online, enabling a more accurate fit. “The body is

the last piece of information to go digital. Most of your life is already digital – your friends, your music, your bank account – all are accessible online – but your body is not. This enables consumers to store and access all their body information online and link this to retailers. Now, body scan-ning becomes a powerful platform for retailers to provide the personalized fit and service their customers have always wanted,” says Suran Goonatilake, CEO, Bodymetrics.

5

PrimeSense uses 3D sensors to determine

your exact size.

Starbucks is one of the first companies (out-side Japan) to offer the option of paying for

things by simply waving your mobile phone in front of a scan-ner. The system relies on relatively simple technology combin-ing the stores’ existing pre-paid value card, a Starbucks app, and a bar code. When you get to your local branch, open the app on your smartphone, and the cashier will scan the bar-code from your phone – you don’t even need to be online at the time. Smartphone payments were introduced in the uK in early 2012 following a successful launch in the uSA.

BuyInG COFFEE WITH yOuR PHOnE3

With the Starbucks

app, con-sumers in

the uK and uS can now

pay for their coffee using their smart-

phones.

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Insight

airport retail is a seriously profitable business, with many airports containing as impressive a range of stores as you would find in most upscale malls. So why do airports devote so much time and space to retail? and why do retail outlets want to be seen at airports?

AiRpORTs – ReTAil – shOpping

SHOPPingBEtWEEn gatES By SiMOn O’COnnEll

Visitors | I S S u E 6 2 0 1 2 | 19

hours of passengers waiting for their plane to refuel as they travelled between the uSA and Europe.

Broadly speaking, airport retail has passed through three phases: first, general stores selling duty free alcohol, tobacco, and perfume; second, up-market stores selling luxury accessories from global brands; and third, where we are now, both of the above combined with mainstream stores including H&M, Zara, and Dixons, as well as a plethora of food, bever-age, and entertainment options.

Airport retail has come a long way since the first duty free store opened at Ire-land’s Shannon airport in 1947, seeking to capitalise on the spare cash and idle

AENA, the Spanish Airports Author-ity, is very much at the forefront of this trend, but how do they choose their re-tail partners? Is it simply the highest bid-der? “No. There is a public auction, and the brands which are interested present their marketing strategy, and plans for investments in staff, etc. We’re not solely interested in how much they are going to pay us,” says Luis Triana, head of AENA’s commercial division at Madrid Barajas Airport.

“Our aim is to keep passengers enter-tained whilst increasing commercial rev-enue. We take a percentage of turnover from each retailer, so it’s in both parties interest that the store succeeds.”

Given this profit sharing agreement, how do they monitor what each store is selling? “We insist all outlets use our POS systems and software so we can monitor sales in real time, and know exactly how much they turn over.”

With space at a premium, every square metre has to count, and with this in mind AENA is about to be floated on the stock market, as the Spanish government seeks to raise money, whilst sharpening the commercial focus of its non-aircraft re-lated activities. “We want to increase the value of our commercial activities, mainly by altering the passenger flow through the commercial areas”, says Triana. “In

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the future 100% of passenger flow will pass through the commercial areas.”

From the retailer’s point of view air-port stores are a valuable opportunity to spread the word of the brand. However, they also need to turn a profit.

The Folli Follie Group sees both sides of the story, holding both the exclusive rights to sell duty free products at all exit points from Greece (it runs 21 airport stores in Greece), and also operate stores for its brands at other airports around the globe.

The group’s flagship brand Folli Fol-lie has airport stores all over the world, including locations such as Hong Kong, Shanghai, Seoul, Athens, Taipei, and Ma-drid. “Airport stores are a combination of brand building, awareness, and pure fi-nancials,” says Johnnie Voutsas, vice pres-ident – international division, Folli Follie lUIS TrIANA,

aena’S HeaD of CommerCial DiviSion at maDriD BarajaS airPort

“We want to increase the value of our commercial activities, mainly by altering the passenger flow through the commercial areas.”

Group. “Having a presence in airports is an integral part of our global distribu-tion strategy; it complements our local market channels, allowing a repetition of the brand message, giving our brands a strong international association.”

For Voutsas the international element is a key factor. “People think ‘If it’s in an airport it must be an in-ternational brand, it gives an extra dimension to the brand; it gives credibility to the brand. Airports are tru-ly global channels, so you get people from all differ-ent nationalities carrying the message of your brand.

These people have a higher disposable income than that of the average

local market and there is also a strong element of word of mouth.”

So what makes airport stores differ-ent to high street or mall? “The differ-ences are not fundamental and are based on some limitations that we must work around, such as less space, third party sales staff or limited dwell time in some airports.”

Madrid-Barajas Airport is one of the busiest in the world, with

nearly 50 million passengers passing through every year.

Not surprisingly, Madrid-Barajas provides a huge array of shops, restaurants and entertainment venues.

this june will see the opening of the brand new berlin brandenburg Airport, which is set to transform the german capital into one of europe’s main transport hubs.

After years of planning, construction of the new airport finally began in 2006, and when fully complete, it will have a capacity of up to 50 million passengers per year. The airport complex will also include over 40 acres of retail space, offering restaurants and shops.

Berlin replAceS three AirportS With one

aSia DRiVES SalES gROWtHGlobal Duty Free sales will grow from $46bn during 2011 to $52bn in 2012, although this is dependent on a continuation of strong sales growth in Asia and par-ticularly China in 2011 – sales in Asia grew +22.9%.

Highlight categories included luxury goods’ sales, up by +20%, while the beauty sector rose by +19% and tobacco by +11.6%.

intERnatiOnal aRRiValSInternational tourist arrivals grew by 4.4% in 2011 to 980 million, up from 939 million in 2010, impressive in a year characterised by stalled global economies, upheaval in the Middle East and north Africa, and natural disasters in Japan.

As an inbound region, Europe (+6%) was the best performer, while as a sub-region, South America (+10%) topped the ranking. Contrary to previous years, growth was higher in advanced economies (+5.0%) than in emerg-ing ones (+3.8%), due largely to the strong results in Eu-rope, and the setbacks in the Middle East and north Africa.

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Luis Triana says that the key difference is one of size. “The difference between a high street or mall store and an airport one is primarily the size of the shop. Take Zara: in a mall its shops are often more than 2,500 sq. metres. In an airport, you can’t have a fashion shop that size. It’s more likely to be 500 sq. metres.

Maria Silva at AENA says that this is changing and that in the future airport stores will be closer to their high street counterparts. “Retailers want to be able to sell a broader range of products. At present most stores sell a very limited range, but in future they will be much closer to the brand’s normal stores, selling almost the full range. In the future our retail services will be more like a normal shopping mall.”

Silva says that the focus is shifting from exclusive brands towards entertain-ment. “We will focus more on entertain-ment, so, for example, to satisfy bored children there will be more toy shops.”

Luis Triana of Aena says that its strategy is to focus on global brands. “We intend to increase the number of high street brands and focus more on entertainment. At the moment most of our brands are not known outside the airport so passen-gers don’t know what to expect. We want to ease the decision making process so passengers know what they are getting,

and the decision making process is made easier.”

What is the thinking behind this? “We want to increase commercial revenues whilst also making it more comfortable for the passenger. We aim to retain pas-sengers in the airport, so, for example, we no longer tell people which gate to go to as soon as possible, because then they go straight to the gate and miss out on the other areas of the airport,” says Tri-ana. “Now we say: ‘We will inform you in 45 minutes which gate your plane will be leaving from’. That way you know you have 45 minutes to do what you want, whether that’s just sitting down, eating, or doing some shopping.”

Johnnie Voutsas at Folli Follie says it is important that its downtown stores convey the same message as its airport

stores. “It’s important to have brand consistency: there must be a clear and consistent message be-tween the types of stores, otherwise we confuse the consumer. Customers must find the same elements, albeit customised to differ-ent markets. We also try to offer products that are ex-clusive to airports, to give

people a unique purchasing opportunity.” Is opening an airport store a precur-

sor to launching in that market? “Today, and after experimentation, we feel that for us to open in airports we also need to have local market presence and the infra-structure to fully support it. This way we better establish and manage our brand in that market and we ensure brand con-sistency while delivering the financial performance,” says Voutsas. “Airports are like a high traffic shopping and commu-nication venue for international passen-gers. They allow brand repetition to the returning traveller, but also brand propa-gation to a new market before we even establish any presence there.”

When opening an airport store there are many extra factors to bear in mind in comparison to standard retail outlets. The retailer may not be able to hire its own staff, so the airport authority’s staff must be trained in the brand’s message and service expectations. Stock cannot be moved easily so merchandising must be conducted very carefully.

Despite these additional hurdles, there is no doubt that more and more retail-ers are choosing to open in airports, and airport authorities, including AENA, are more than happy to accommodate them. n

the BeSt Airport ShoppinG in the World?every year millions of air travellers from over 60 countries take part in the annual airport passenger satisfaction survey, which determines the winners of the World Airport Awards.

in 2011, london heathrow Airport won the best Airport shopping Award for a second suc-cessive year. The selection and quality of brands on offer, combined with competitive prices, are believed to be the main reasons behind heath-row’s popularity. singapore changi and Dubai Airport finished second and third, respectively.

Falling PRiCES in SPainSpanish Travel retail sales are forecast to decline by 1% from 2010-2015 according to Euromonitor. It says prices in many travel retail categories will decline in constant value terms, as low-cost products, last-minute offers and falling demand drive prices down. It adds that price comparison websites such as Trivago will put pressure on travel retailers to limit their prices.

Visitors | I S S u E 6  2 0 1 2 | 21

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The DNA of a business empire

wanG jianlin

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entrepreneurs dream of get-ting rich quick, Wang Jianlin had some-thing different in mind when he set up real estate developer Dalian Wanda in 1988 – he wanted longevity.

“Great companies are born, not devel-oped, because each company has its own DNA,” says Wang. “We had great ambition, not like other companies. Our strategy was to develop into a large-scale company instead of just gambling some money and enjoying ourselves. We wanted centennial development.”

Wang’s current surroundings suggest he is succeeding in his aim. He is sitting in a vast office on the 25th floor of the Wanda Plaza in Beijing’s Guomao business district, a complex that also comprises a luxury Sofitel hotel and a cinema. Out of the windows on three sides can be seen rows of office and residential blocks, most of which have been built over the past 20 years, testament to the huge real estate boom that is still underway in China.

Wang started Wanda with 500,000 yuan

(about uS$130,000 at 1988 exchange rates) when he was in his early 30s. He had just spent more than ten years in the Chinese military before settling in Dalian, a developed port in northeastern China that was one of the first cities to open up to foreign investment.

Today Wanda has mushroomed into a huge property group specialising in five main areas – commercial property, luxury hotels, tourism, the cultural industry and a department store chain – and with as-sets across more than 60 Chinese cities worth about $31 billion. The group oper-ates 49 shopping malls, each of which is said to have created 10,000 jobs, and 40 department stores. It runs 26 five star hotels and has entered into partnerships with big hospitality names such as Hil-ton, Accor and Starwood. The group is also China’s biggest cinema operator, with 730 screens in 86 theatres, including 477 Imax screens across 94 cinemas.

In fact Wanda has become one of the

five biggest private Chinese companies (many of the country’s biggest companies are huge state-owned groups) and is head-ing for the top 500 in the world. Wang himself is ranked as China’s 15th rich-est individual by Forbes magazine, and has also topped the 2011 Forbes China philanthropy list, making nearly uS$200 million in donations, including big dona-tions, including a large donation towards the reconstruction of an historic temple in Nanjing.

But it hasn’t been easy. Being an en-trepreneur can be a rollercoaster ride anywhere in the world, and running a company in China as the country lurched chaotically from being a centrally planned Soviet-style economy to its current hybrid of raw capitalism and government control can seriously damage your health – as Wang himself found out.

Wanda’s toughest moment came in 1993, when the company was tasked with re-locating about 6,000 households. At the

same moment came the kind of wrench-ing change of economic policy that is hard for Western CEOs to imagine facing. The government ordered banks to stop lending money to real estate developers and said all outstanding loans had to be repaid immediately. Some 70 percent of real estate companies went bankrupt.

“The pressure on me was so intense that I fainted and had to spend a week in hospital in Beijing,” he says. “It was our most difficult moment but we learned a big lesson. Afterwards, there were sev-eral occasions when the government adjusted macro-economic policy but we survived because we had good cash flow,” Wang says, who also took advantage of the chaos.

“Because of China’s rapid development the rule of law is lagging behind,” he says. “It’s a natural phenomenon. This irregular situation actually provides more opportu-nities, though they are risky. If the rule of law had been as developed as it is in the west, there would have been fewer op-

portunities and GDP growth would have remained at around three percent.”

Powering Wanda’s success is the emer-gence of the Chinese middle class. Es-timates vary from about 40 million to about 400 million, depending on how mid-dle class is defined, but what is certain is that their number is growing fast and they represent an enormous market. Mar-ket research firm Euromonitor estimates 700 million people – nearly half the popu-lation – will be middle class by 2020.

“Before, a large population was a bur-den to China but after economic develop-ment it has become a potential market.”

As with many Chinese statistics the num-bers involved are bafflingly huge. During the five years to 2010, consumption in China more than doubled and investment bank Credit Suisse believes Chinese con-sumption will be worth uS$16 trillion by 2020, making China the world’s biggest service market. Chinese incomes are go-ing up, people want to spend their new

W “Our strategy was to develop into a large-scale company instead of just gambling some money and enjoying ourselves.”

Wang Jianlin started Wanda in 1988 with only 500,000 yuan and built it up to become one of the biggest private companies in China.

By tOM SPEnDER PHOTO gREgORy BOyD

hile many Chinese

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money and Wang says this is the only way for the country to keep growing.

“It’s a must. China used to focus on ex-ports and investment. However the big-gest export destinations, the uS and Eu, are experiencing a sluggish economic situation. Increasing domestic demand and consumption is the only way to go,” he says.

Wang himself is a discerning consum-er – every year he travels to Paris for clothes shopping. Now he has his eyes on bigger bargains.

“In the first half of 2012 you may see reports of two major Wanda acquisitions via M&A in Europe and America. Because of the sluggish economy in the west, there are some really good bargains,” he says.

These deals will mark Wanda’s first business interests outside China, although Wang hopes that over the next ten years the international market will become Wanda’s focus.

“We will integrate ourselves in local culture, abide by local law and retain the management team of the local compa-nies,” he says. “In time we believe we will be well received by local people. Branding takes time. Wanda has been a brand for 24 years and people in China recognise it. We are ready to take another 10-20 years for the brand to be acknowledged inter-nationally.”

Wang’s decision to retain the manage-

ment teams of any companies Wanda purchases abroad was made after observ-ing how different foreign companies be-have when they enter China.

“Carrefour and Walmart have been very successful because they use local talent. However, some companies keep their sen-ior management teams entirely foreign, are reluctant to integrate, and they fail. You need to adapt to China if you are to be successful,” he says.

But Wanda also aims to change China. In November, the company made an eye-catching deal with uS theatre arts pro-duction company Franco Dragone to build five state-of-the-art theatres capable of staging Las Vegas style shows in locations including Wuhan, east of Shanghai, Da-lian, and Hainan island, China’s emerging winter sun beach resort.

Wang, an avid football fan, was in the spotlight in July when he provided uS$95 million to sponsor the Chinese Super League. His aim is to develop young Chi-nese footballers through its ‘Chinese Foot-ball Star of Hope’ programme, in which gifted young Chinese players will be sent to train with Atletico Madrid, Villareal and Valencia in Spain.

However, Wang’s focus on youth also extends to entrepreneurship. “From the beginning I have been thinking about what kind of company Wanda should be. Finally I decided to make it a company that belongs to society,” he says. “Charity in Wanda is systematic. Our major focus is not poverty alleviation but education, business funding and entrepreneurship. From a personal point of view, I would like to contribute most of my properties to a charity fund that can benefit people.”

For Wang, that means encouraging more young Chinese to take the plunge

WAnG jinAlinage: 57. lives: Beijing, China. Family: Wife and one son. Football team: Real Madrid. Favourite city for a holiday: Orlando for the theme parks. what do you like to buy abroad: Clothes. Every year I go to the Champs-Elysees in Paris to stock up on clothes. what is most important in a hotel: the style of luxury. Favourite city in China: Shanghai. Favourite brand of clothing: lanvin. what do you do in your free time: I don’t have any free time!

and start their own companies (his son has launched an IT company that is not connected to Wanda). Although there is tremendous commercial energy in China, according to Wang just two percent of university graduates choose to start their own companies, with most aiming for a less demanding career in government.

“China’s biggest problem is that there is much more emphasis on government officials than on entrepreneurs. We want to encourage young entrepreneurship,” he says. Together with five other entre-preneurs, I have set up a fund to support young entrepreneurs, but regrettably, the budget cannot be allocated each year be-cause of the lack of candidates.

“China’s system is now more conducive to starting a business, although the mar-ket is more regulated. Decades ago there were more opportunities but things were also more chaotic and riskier.”

The experience Wang gained during those turbulent times will prove invalu-able as he takes his company global. n

As a successful entre-preneur, Wang Jianlin

now wants to encourage more Chinese youth

to follow his footsteps and start their own

companies.

A small white square device plugged into the top of a smart-phone has emerged as one of the most exciting things to happen in the payment industry in recent years.

Square, one of whose founders is Twitter creator Jack Dorsey, has devised an inno-vative way for individuals and businesses to accept credit card payments on their mobile devices. Across the uS today, you can find cabbies, local farmers’ markets, pop-up shops and even Salvation Army bell-ringers taking money by swiping cus-tomers’ cards through the plastic device.

The strength of Square’s idea and tech-nology can be seen in its list of backers:

been put off by traditional point-of-sale systems due to the upfront investment and monthly fees. However, many Square users have reported increased cash flow, while shoppers appreciate being able to use cards at establishments that previ-ously only accepted cash.

“Square increases the prospect of clos-ing a sale,” chief operating officer Keith Rabois told AFP in a recent interview. “In a tough financial time, we make it easier. We remove a lot of the pain from starting a business and growing a business.”

Competitors – including Google – are jostling for position but it’s a booming market: mobile-payment transactions doubled last year, with the number of people spending their money in this way increasing by 40%. n

Virgin Group head Richard Branson has invested capital in the product, as has Visa. “Square is an incredible technology that inspires and empowers everyone to be an entrepreneur,” said Sir Richard.

Square distributes the card reader and mobile application – often for free – and then makes its money by collecting transaction fees. Since launching in 2010, Square has shipped about 1 million card readers and is processing over $2 billion in payments annually. A new app update takes the next step and removes the need for swiping – or even taking your phone out of your pocket – altogether.

While currently focused on uS growth, the company plans to go international this year.

Many small businesses have in the past

Squaring the bill

Smart Business

By DaViD WilES

Square might look small and simple,

but it’s set to make a big impact.

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80% of shoppers’ decisions are made before they reach the high street.

The key to marketing effectively to travelling customers is catching them at the points in their journey when they’re at their most receptive – whilst they’re at home planning their trip, at the airport ready to depart, or even in their hotel room. Marketing Services from Global Blue is the international marketing suite that helps you approach the traveller at these and many other carefully chosen moments, and because it’s highly targeted, it’s more affordable and offers higher returns on investment than most conventional campaigns.

www.global-blue.com

CC_PT_217x283mm_120420.indd 1 4/20/12 8:55 AM

Ski at the end of the worldIf you think the Alps are too crowd-ed and the Rockies just aren’t exotic enough, maybe you should turn your attention south. A long way south.

Cerro Castor is about as far south as a skier can get. Located on the 54th parallel, Cerro Castor is the world’s most southerly ski resort, and Argen-tina’s most exclusive. It’s just 1,000 km from Antarctica, but still only three hours from Buenos Aires by air.

With its low latitude and south-facing slopes protected from the sun, Cerro Castor boasts fantastic snow quality and one of the longest skiing

By DaViD WilES PHOTO CERRO CaStOR

Established: 1999.Employees: 300.accommodation: 15 cabins (sleep 60 guests).number of guest nights: 4,232.Top visitor nationalities: Brazilian, Argentinian.

Cerro Castor

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seasons in South America, running from June until October.

The slopes are excellent – as the many national ski teams who train here in the pre-season can confirm – and the lift queues are blissfully short. Away from the piste there is snow-shoeing, and dog sled rides, as well as the opportunity to explore the immense unspoilt landscape of this southern tip of the Andes.

Castor Ski Lodge, at the foot of the main lift, offers luxurious log cabins with open fireplaces, set amongst beech for-ests. A short drive away the five star Las Hayas Hotel, beneath the Martial Glacier,

Dreams

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has stunning views of the Beagle Chan-nel.

With its blend of the exotic, the luxuri-ous and the adventurous, Cerro Castor is certainly worth travelling to the ends of the Earth for. n

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Global News

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top of the shopsGlobe Shopper City Index – Europe is the definitive guide to Europe’s top destinations, based on the factors most impor-tant to tourists who like to shop. Compiled by the Economist Intelligence Unit and sponsored by Global Blue, this unique

interactive index is an invaluable tool for both shoppers and retailers.

To see the globe shopper city index – europe in full, and to find the shopping destinations that best match your preferences, visit www.globeshopperindex.eiu.com.

SMaRt DECiSiOn-MaKing FOR allGlobal Blue CEO per setterberg says the globe shopper city index – europe is a significant step in the company’s strategy to become the go-to brand for everything to do with international shopping and spending. “This index will help retailers and shopping brands make better business decisions, while the online globe shopper city index will enable travellers to discover their ideal shopping city based on their personal priorities,” he says.

Robin bew, editorial Director and chief economist at the econo-mist intelligence unit, says the index highlights which european cit-ies are best placed to take advantage of the continent’s reputation among international consumers. “The findings show that the right balance between convenience, availability and price is essential for international travel shopping,” he says.

HOW it WORKSThe Globe Shopper City Index – Europe is the world’s first detailed international shopping index, comparing the shopping strengths and weaknesses of 33 major european cities. The custom Research division of the economist intelligence unit rated each city in five categories that are important to travellers: shops, Affordability, convenience, hotels and Transport, and culture and climate. These categories are in turn broken down into 22 key indicators covering the priorities for globe shoppers. scores from 0 to 100 were based on quantitative data (such as average daily hours of sunshine) and qualitative assessments (such as convenience of using a foreign language). On the Globe Shopper City Index – Europe website, globe shoppers can customise the ratings to find the destination that best meets their shopping preferences. The ratings can be customised by the shopper’s priorities – such as climate, affordability and convenience – or by what type of shopper they are.

tiPS FOR REtailERSThe index is a useful tool for retailers and international brands look-ing for ways to boost the attractiveness of what they are offering to globe shoppers. For instance, it shows that longer opening hours and the possibility of obtaining discounts on goods could improve a city’s performance in the convenience category, and therefore its rank in the overall index.

DiD yOU KnOW?Kiev, Sofia and Dublin tie for the longest sales season in europe – they each offer 12 weeks of reduced prices.

¡ViVa ESPaña!The Spanish cities of madrid and barcelona may not have top-ped any of the index’s categories, but they performed consistently to score an unexpected joint second place. both performed well on climate, prices, their excellent cuisine and their convenient ho-tels and transport. The global success of spanish brands like Zara, loewe, Desigual and camper shows that this is a country that takes its shopping seriously.

paris topped the culture and climate category and took sec-ond place for shops, putting it 3rd overall. The French capital also ranked high for hotels and Transport.

anD tHE WinnER iS ...... london! is the number one shopping city in europe. The english capital tops the globe shopper city index – europe thanks to its huge variety of shops and shopping districts; the availability of international and local brands; its accessibi-lity, and its sheer range of cul-tural attractions.

Per Setterberg, President and CEO Global Blue, Dame Judith

Mayhew Jonas, Chairman of London & Partners, Patricia Yates,

Director of Strategy and Communications – Visit Britain.

EUROPE’S tOP tEn SHOPPing CitiES

1. london

2. madrid & barcelona

3. paris

4. Rome

5. berlin

6. lisbon

7. Amsterdam

8. prague

9. budapest

pricewaterhousecoopers experts: Why Vat rates are rising

The correlation between Corporate Income Tax and Value Added Tax (VAT) rates shows a European trend away from direct to indirect taxation.

European tax rates in recent years are showing a general trend away from direct taxes (taxes that are paid by the taxpayer directly to the gov-ernment) to indirect taxes (taxes that are passed onto a third party).

This general trend is visible when com-paring the development of the corporate income tax rates (a direct tax) and VAT rates (an indirect tax) of Switzerland and the top eight European countries meas-ured on their GDP. Between 2008 and 2011 three of the observed countries (uK, Sweden, the Netherlands) decreased their Central Government corporate income tax rates (see chart 1). Meanwhile, four countries (uK, Spain, Italy, Switzerland) increased their ordinary VAT rates during the same period (see chart 2).

In view of the ongoing financial crisis it is not clear whether this trend will continue. However, it is safe to assume that governments will face growing fi-nancial needs and will have to expand their tax revenues. Accordingly, it is ex-

CHART 1comparison of central Government corporate income tax (“cit”) rates

*CH, DE IT: local government taxes not included.** The 2012 standard CIT rate to be applied against profit before tax varies between 12.6% and 24.2% depending on a corporate taxpayer’s location in Switzerland.Source: Swiss Federal Tax Administration (FTA), www.estv.admin.ch: PwC, www.pwc.com

2008* 2011* 2012 Standard cit rate

ch** de Fr uk it eS nl Be Se0%

10%

20%

30%

40%

pected that the trend of decreasing corporate income tax rates is likely to fade, but VAT rates may continue to increase. Driven by the respective governments’ growing financial needs, the past trend of decreasing corporate income tax rates and increasing VAT rates, looks set to change.

However, the one notable exception is Switzerland, which may follow the same general trend but also stands out since both corporate income tax and VAT rates are significantly lower than the other top eight European coun-tries. The Swiss VAT rate of eight per-cent is by far the lowest, and competi-tion amongst Switzerland’s 26 cantons is also expected to ensure tax rates continue to decrease.

Fabio Dell’Anna, Partner, Tax Consulting & Simon Flückiger, Senior Manager, Tax & legal Services,PricewaterhouseCoopers AG, Switzerland

CHART 2comparison of ordinary vAt rates

Source: Swiss Federal Tax Administration (FTA), www.estv.admin.ch

2008 2011

ch de Fr uk it eS nl Be Se0%

5%

10%

15%

25%

20%

30%

Global News

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Travellers using Global Blue’s Curren-cy Choice are now guaranteed the best exchange rates. Should they discov-er that their bank would have given them a better rate on the date of pur-chase using the same credit card had they not used DCC, Global Blue will refund the difference. Currency Choice allows international travellers to pay for purchases or hotel stays abroad in their payment card’s currency. How-ever, some users of the service have been concerned about what exchange rate they were getting.

“Our Currency Choice Best Rate gives travellers peace of mind and confidence when using Currency Choice while they are abroad,” says Aurelie Totin, Product Analyst – Cur-rency Choice at Global Blue. “Our rate guarantee means merchants can re-spond to travellers’ queries about the competitiveness of exchange rates with a simple and straightforward an-swer, thereby increasing the shopper’s confidence and increasing the service acceptance.”

Best rate guaranteed

Global Blue’s new smartphone app has been developed to simplify the tax re-fund process and make shopping in a new city more pleasurable. users can search for stores by name, by prod-uct category, or locate all the retailers nearby who offer Tax Free shopping in conjunction with Global Blue. The app allows them to call the store with one click, provides a checklist that simpli-fies the process of claiming a tax re-fund, and even provides step-by-step

directions to each location.Happy shoppers can plan their route

and itinerary, be notified of nearby events and promotions, and even ex-plore a brand’s history and profile. For retailers this is an invaluable opportu-nity to connect in real time with for-eign visitors who are in their city to spend, spend, spend!

The first city app to launch will be London, launching soon, just in time for the Olympics.

new app launched

Having previously wor- ked for Global Blue in his native Australia and in Singapore, Anthony Dono-hue is today Manager of Market Development at Global Blue’s OneInterface

division in New York City.What is the OneInterface solution all about? It’s about making life easier for our re-tail customers. We are a software system integrator between retail point-of-sale systems and different retail payment systems. We work with multinational companies and different point-of-sale companies to bring them a standardised methodology of payment software system integration.

“We try to make life easier for our retail customers” Anthony donohue, MAnAGer – MArket developMent

Anthony donohueProfession: Manager – Market Development. age: 33. lives: Manhattan. at Global Blue: since 2005 Hobby: exploring Manhattan.

What does the Market Development depart-ment do? We work with expanding our offering to existing customers as well as develop-ing new channels, new partners and new markets. I am responsible for executing the business strategy for the division, to ensure that we expand into the relevant markets, both in terms of our software partners as well as new physical coun-tries.What do you do on a typical day? I don’t know that I ever have a typical day, but at the moment I am working on a uS implementation for two customers. It is a matter of ensuring that we have the coordination throughout all the different partners, making sure that everything

Global Blue’s new feature simplifies the process of filling in a Tax Free form at the point of sale. until now, Tax Free Shopping transactions have required shoppers to fill in their personal details on the Tax Free form. “Some travellers find the form complicated and we often

quicker transactions with Autofill get incomplete forms,” says Karine Grivet at Global Blue. “As a result we cannot pro-cess the refund.”

With AutoFill, travellers’ details are automatically added to the form once an identifier – such as a Global Blue card, a mobile phone number or a Global Blue

barcode on a smartphone – is presented to the retailer. “This makes the process much easier for the traveller,” says Grivet. “As a result they will ask more often for Tax Free Shopping, and we know that when travellers want tax-free shopping they tend to spend more than other shoppers.”

is going to run incident-free, which is our goal. I’m kind of a jack of all trades. What’s it like working for Global Blue? I enjoy the global aspect the most. I get to meet people from cities that I have to look up on Google Maps to find out exactly where they are. This is the third country I have lived and worked in for Global Blue, so the company has been very good to me.

The Chinese have extended their lead and now account for 20% of global tax free sales. With a far smaller population, and a far smaller number of travellers, the Russians have shown their astonishing spending power by extending their lead in second place.

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Market Outlook

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Every day Global Blue processes tens of thousands (55,000) of Tax Free transactions from global shoppers the world over. A closer look at the numbers reveals much about who is buying what, and where.

Global blue stats TOP 5 COunTRIES

1. FrAnce

chinA 26% 49% 1,472

ruSSiAn Fed 11% 31% 1 015

jApAn 7% 15% 860

united StAteS 5% 4% 903

tAiWAn 4% 41% 1,089

% oF totAl SAleS vS 2010

SAleS vS 2010

SAleS vS 2010

SAleS vS 2010

SAleS vS 2010

AvG Spend

2. uk

chinA 18% 62% 783

kuWAit 6% 29% 637

SAudi ArABiA 6% 25% 958

ruSSiAn Fed 6% 28% 748

uAe 6% 6% 1,283

% oF totAl AvG Spend

3. itAly

ruSSiAn Fed 27% 30% 638

chinA 14% 72% 834

jApAn 7% 9% 603

united StAteS 7% 0% 724

BrAzil 4% 36% 587

% oF totAl AvG Spend

4. SinGApore

chinA 26% 73% 1,126

indoneSiA 26% 18% 527

MAlAySiA 6% 20% 832

AuStrAliA 4% 14% 460

indiA 4% 4% 495

% oF totAl AvG Spend

5. GerMAny

chinA 27% 50% 510

ruSSiAn Fed 24% 33% 352

SWitzerlAnd 7% 28% 138

uAe 3% 1% 310

BrAzil 2% 35% 251

% oF totAl AvG Spend

The Chinese are the top globe shoppers in all leading desti-nations apart from Italy, where Russia’s affinity with Italian glamour makes them number one. In Singapore, China has narrowly overtaken Indonesia, with Malaysia taking third spot, followed by Australia. Only 150,000 Chinese tourists visited the UK, yet they account for 18 percent of their total tax free spend.

TOP 10 MOST POPulAR CITIES FOR TAx FREE SHOPPInGMeasured in shopping amounts

1. Paris2. london3. sinGaPore4. Milan5. roMe6. MuniCH7. FrankFurt8. Vienna9. berlin10.seoulParis remains the favourite destination for globe shoppers, with last year’s number one, London, finishing second. (http://www.global-blue.com/corporate/news/london-tops-for-shopping/). Singapore is benefiting from increased travellers from China, as well as Indonesia. Italian and German cities are very popular with Russian tourists.

TRAnSACTIOn DEvElOPMEnT vS 2010

12%

22%

3% 4%4%4%4% 2% 1% 1%

ruSSiAn FedjA

pAn

indoneSiA

united StAteS

BrAzil

SWitzerlAnd

tAiWAn

honG konG

SAudi ArABiA

chinA

The number of transactions grew modestly for most of the top ten na-tions, apart from China, which was up 12% and Russia, up 22%. This can be explained by the fact that there are many more tourists travelling overseas in the former case, and a strong economy in the latter.

DEvElOPMEnT vS 2010Spending delvelopment vs 2010

chinA

ruSSiAn FedjA

pAn

indoneSiA

united StAteS

BrAzil

SWitzerlAnd

tAiWAn

honG konG

SAudi ArABiA

59%

33%

17%24%

2%

30%34%

38%

26%

12%

nATIOnAlITy SPEnDInG 2010

chinA

ruSSiAn Fed

jApAn

indoneSiA

united StAteS

BrAzil

SWitzerlAnd

tAiWAn

honG konG

SAudi ArABiA

other

Other strong risers in terms of overall spending include Taiwan +38%, Switzerland +34%, and Brazil +30%. In the long term, Brazil is the most exciting prospect be-cause of its huge population, rapidly expanding middle class, and close cultural ties to Europe.

SAlES AnD TRAnSACTIOn DEvElOPMEnT 2011 vS 2010

touriSt country % oF totAl SpendinG

SpendinG developMent vS 2010

trAnSAction developMent vS 2010

AverAGe SpendinG per purchASe (euro)

chinA 20%

16%

4%

2%

41%

4%

3%

2%

4%

2%

2%

59%

33%

2%

38%

17%

30%

26%

24%

34%

12%

12%

22%

3%

2%

4%

4%

1%

4%

4%

1%

813€

360€

579€

493€

534€

358€

747€

579€

257€

771€

ruSSiAn Fed

jApAn

indoneSiA

united StAteS

BrAzil

SWitzerlAnd

tAiWAn

honG konG

SAudi ArABiA

other

The huge rise in overall spend by most out-bound nations, led by China with a massive 59% rise, demonstrates the overwhelming desire to travel and to include shopping as an

integral part of that holiday. The transaction development broadly mirrors the growth in outbound tourists figures, whereas the spend-ing development combines this international

tourism growth with economic growth and the sheer demand to acquire luxury goods.

39%

20%

16%

5%4%

4%3%3%2%2%

2%