22 Feb 2017
2017 Chinese New Year Sales: Dalian
Dalian’s retailers suffered mixed fortunes over the 2017 Chinese New Year period. While many of the city’s upscale and low-end malls saw sales decline compared to last year, a number of the mid-range malls reported something of an upturn in their sales records.
Overall, figures from the Ministry of Commerce showed that, from New Year's Eve to the sixth day of the Chinese New Year (27 January-2 February 2017), the total takings of retail and catering enterprises across the mainland exceeded RMB840 billion, up 11.4% over the same period last year. Traditional New Year goods, eco-friendly food, seasonal clothing, gold and silver ornaments, smart energy-saving home appliances and several new digital products were among the best-selling items for 2017.
As part of the survey, staff at the HKTDC's mainland offices - Beijing, Dalian, Qingdao, Xi’an, Shanghai, Hangzhou, Nanjing, Wuhan, Chongqing, Chengdu, Guangzhou, Fuzhou and Shenzhen - selected a number of representative local shopping centres and monitored their performance before, during and after the Chinese New Year sales period in order to ascertain just how their respective local consumer markets fared this year.
In order to get an overview of consumer spending patterns throughout Dalian during the Spring Festival period, HKTDC’s Dalian Office monitored three shopping centres. The findings of its survey are summarised below:
Dalian Parkland Shopping Center (upscale)
Dalian Parkland is a high-end shopping mall located in the Qingniwa commercial district. Its target customers are young, style-conscious high-level white-collar workers or the children of the nouveau riche. Overall, the best-selling items at the shopping centre during the 2017 Chinese New Year period were: (1) watches priced from RMB30,000 to RMB100,000; (2) handbags priced from RMB4,000 to RMB8,000; (3) men’s wear priced from RMB2,000 to RMB5,000; (4) women’s wear priced from RMB1,000 to RMB3,000; (5) women’s footwear priced from RMB1,500 to RMB2,000; (6) accessories priced from RMB500 to RMB1,000; (7) Apple products priced from RMB2,500 to RMB6,000; (8) international cosmetics brands priced from RMB600 to RMB1,000; (9) household goods/gifts priced from RMB300 to RMB500; (10) haircare/catering services priced from RMB200 to RMB300.
This year, during the Spring Festival period, no new products or star performers dominated sales at Parkland. While the overall average spend per customer was around RMB1,000, total retail sales dropped by almost 4% compared to the same period last year.
Parkland-based Jinhua Watch is currently the most upmarket watch retailer in Dalian and offers a wide range of leading international horological brands, including Baume & Mercier, Longines, Maurice Lacroix, Breitling, Chopard, Hamilton, Rado, Hublot, Panerai, Cartier, Blancpain, and Glashütte. A few years back, its sales of high-end watch brands were adversely affected by the central government’s eight-point austerity regulations and the growing prominence of overseas purchasing agents. More recently, however, as a result of interest rate increases in the US, the price differential between international branded watches sold in China and those sold abroad has gradually narrowed. As a consequence, watch sales over the Chinese New Year period were brisk, a reversal of the downward sales trend seen over the last three years.
In order to boost footfall, the shopping centre also organised a number of promotional activities, including a New Year goods collection and a special Dance with the Rooster event. Their overall impact on sales, however, was said to be limited. Sales of consumer electronics were also hampered by the lack of any new Apple products to promote over the holiday period. Sales at Apple’s flagship Parkland store also suffered on account of the growing popularity of a number of local brands, most notably Huawei and OPPO.
In terms of online sales, the provision of certain services – notably catering, beauty and haircare – remained wholly unaffected by competition from the digital sector, with customer flow actually increasing throughout the holiday period. In terms of product sales, online retailers also made little impact over the Spring Festival period, largely because deliveries were generally suspended throughout the course of the holidays.
Despite this, though, many conventional retailers recorded a somewhat mediocre sales performance, with growth best described as negligible. Indeed, the only areas to prove relatively prosperous were online food ordering and the online sale of fresh flowers.
Dalian Peace Place (mid-range)
Dalian Peace Place, a medium-range shopping centre situated in Dalian’s Peace Plaza commercial district, primarily targets young and stylish middle-income earners. Here the bestselling items during the Chinese New Year period were: (1) watches priced from RMB500 to RMB2,000; (2) men’s wear priced from RMB500 to RMB1,000; (3) handbags priced from RMB300 to RMB800; (4) gold ornaments priced from RMB1,000 to RMB5,000; (5) women’s wear/footwear priced from RMB300 to RMB800; (6) sporting goods priced from RMB300 to RMB500; (7) accessories priced from RMB100 to RMB300; (8) cosmetics priced from RMB300 to RMB500; (9) catering/supermarket items priced from RMB200 to RMB500; (10) movie tickets priced from RMB50 to RMB100.
During the holiday season, the best-selling brands at the shopping centre were West Link and Boy London, two young and fashionable clothing brands. An impressive performance was also recorded by Sephora and Kiehl’s, two mid-range cosmetics brands primarily aimed at young consumers. Overall, the average spend per customer was about RMB600, with total retail sales rising by 6.4% compared to the same period last year.
Recognising that many Spring Festival shoppers are now placing an increased emphasis on product quality and health, the Peace Place supermarket allocated additional space to the display of traditional New Year goods, gift baskets of imported fruit, imported live and fresh produce, as well as food items deemed to be particularly nutritious, including sea cucumbers, bird’s nests and certain high-end mushroom products. Similarly popular were a number of Hong Kong-based jewellery brands, with New Year gold bars and gold coins, as well as items with a rooster motif, proving most in demand.
Almost entirely unaffected by online sales, local restaurants, cinemas and supermarkets enjoyed a surge in visitor numbers throughout the holiday period. Indeed, it was only with regard to booking cinema tickets and ordering food and drink deliveries that the digital sector made any inroads.
Wenzhou City Mall (low-end)
Wenzhou City Mall is located in Dalian’s Erqi Square commercial district. A comprehensive shopping mall, it specialises in the wholesale and retail sale of medium- to low-end garments, footwear, headgear, luggage, daily use products, curtains, upholstery, beddings and linen. Its target customers are low-to-middle income earners. Here the bestselling items during the Chinese New Year period were: (1) adults’ garments priced from RMB200 to RMB500; (2) children’s wear priced from RMB100 to RMB300; (3) handbags priced from RMB100 to RMB300; (4) curtains/beddings priced from RMB200 to RMB500; (5) gifts/handicraft priced from RMB100 to RMB200; (6) underwear priced from RMB50 to RMB100; (7) socks priced from RMB5 to RMB10; (8) slippers priced from RMB10 to RMB30; (9) daily use products priced from RMB20 to RMB100; (10) food and beverages priced from RMB5 to RMB20. Among its most in demand items this year were ornaments, handicrafts and figurines featuring the rooster, which proved the prime choice for Spring Festival gifts for relatives and friends. Overall, the average per customer spend at the Wenzhou City Mall was about RMB150, while total retail sales dropped by around 7% over the same period last year.
In a bid to boost sales, the Mall promoted itself as a one-stop shopping site for New Year goods, allowing it to take advantage of its full product range as a means of wooing consumers. In addition, a promotional Spring Festival Couplets zone, set up within the mall, also helped create a festive atmosphere, while successfully attracting customers and boosting sales.
The mall’s highest footfall during the Chinese New Year period was recorded on New Year’s Eve, although the overall number of visitors was lower than last year. This fall was largely attributed to the mall’s primary focus on daily use products and small commodities, sales of which migrated online, with many such items purchased via WeChat sales. In a bid to counter this, a number of the mall’s retail tenants attempted – largely unsuccessfully – to drives sales via WeChat Moments. On the upside, the volume of food ordered locally via various mobile apps rose noticeably.