VisitBritain is predicting that international visitors will spend a forecast £22.2bn ($33.1bn) in 2015, despite a slight fall in 2014.

 

According to international tax free refund company Global Blue, international spend in the UK reached the highest level on record for the month of December 2014, but 2014 as a whole saw international spending fall by -3%.

 

Nevertheless, Global Blue says that despite the weak year, December growth shows how important the Christmas period has become in the global shopper calendar, overriding the effects Black Friday discounts had on domestic spend.

 

Gordon Clark, UK Country Manager of Global Blue says: “2014 was a turning point for how Christmas is a key period for international spend, a trend which we expect to continue.

 

“Unlike domestic, globe shoppers are not simply drawn by the heavy discounts, but also by the added benefit of shopping these discounted goods tax free in the UK, at a time when the streets are festively decorated to look their best.

 

“In what has been a slower year for international spend, it is encouraging for retailers to see strength over this period.”

 

 

SPENDING HIGHLIGHTS IN 2014

According to Global Blue, spending by Hong Kong visitors saw the highest growth in December, almost doubling, up 48% year on year (YOY), contributing to the 9% growth seen for 2014 as a whole. Hong Kong visitors are now the 11th top shopper group in the UK as they follow the travel trend of their Chinese neighbours.

 

By contrast, the Chinese visitor spend rose by 20% YOY in December, beating growth seen over Chinese New Year and Golden Week last year which were previously the biggest spending periods.

 

China finished the year retaining its title as the number one shopper group representing 25% of total spend for 2014, but saw growth of just 6% YOY overall – significantly less than the double figure growth seen in 2013.

 

Middle Eastern nations also continued to see growth with Qatar and Kuwait leading for December – up 33% and 24% YOY – but the UAE trailing down -2% YOY for the month.

 

Global Blue said: “Qatari shoppers have long been known for their soaring spend per transaction, now reaching £1,406 ($2,120) thanks to their taste for global powerhouse luxury brands, and Kuwaiti shoppers are now beginning to follow suit, with average transactions rising 18% YOY to £621 ($937).”

 

The strength of December’s figures also reflected these visitors’ position for 2014 as a whole, with total Qatari spend up 16% YOY and Kuwaiti up 7%, but visitor spending from the UAE again reporting a decline of -7%.

 

 

EVERYONE IS NOT SPENDING…

During what has been a difficult year of political unrest in Thailand, Global Blue says that Thai shoppers in the UK were ‘disinclined to spend’ in 2014, with sales down -24% for the full period, although December was the exception with a 21% increase from this nationality.

 

Turning to Russian spending – or the dramatic lack of it – Global Blue said that this shopper nationality actually dropped out of the top ten overseas visitor-spending league last December.

 

The company says that this reflected the continued decline of the economy and a rouble that has halved in value over the year. As a result, Russian spending fell by -28% in 2014 as a whole.

 

As mentioned, VisitBritain now predicts that international spending will rise by 4.5% to total £22.2bn ($33.1bn) this year. However, it also cautions that the growth rate is slowing ‘and it will not be the rapid rise as seen in the last five years’.

 

Global Blue expects Chinese and Middle Eastern shoppers to continue their growth as more and more are attracted by its tax free shopping and especially Chinese with their high import and luxury taxes. In addition, the relaxation of visa rules for Chinese and the introduction of new flight routes between the UK and Asian cities is also facilitating more visitors’ journeys, which is encouraging for UK retail tourism from these nations.

 

KEY VISITOR PERIODS FOR THE UK…

Global Blue adds: “Though Christmas has proved to be an increasingly popular period for these shopper groups, Lunar New Year and Golden Week will continue to be key periods for Chinese shoppers and retailers and hotels should also still prepare for the influx of Middle Eastern shoppers pre and post Ramadan.”

 

Meanwhile, the company says that the European Travel Commission is continuing to predict that Russian outbound tourism will continue to decline in 2015.

 

Global Blue’s Gordon Clark: “It is more important than ever for businesses in the UK to improve and enhance their international visitor welcome by offering traveller services like Tax Free Shopping, Currency Choice and Unionpay acceptance, so that Britain can maintain its competitive edge against other European retail destinations.”

 

It adds that this also goes hand in hand with ‘the important work’ already being done by the UK China Visa Alliance, which is helping to improve the visa application process and also that of the ‘Let Britain Fly’ Campaign to gain government approval for an additional runway at one of the existing London airports.