SHANGHAI (BLOOMBERG) - They're still coming in droves - but no longer buying in spades.
After propping up sales for overseas retailers over the past decade with a shopping-driven tourism agenda, Chinese visitors are no longer returning home with suitcases bulging like before.
A new survey by consultancy Oliver Wyman shows Chinese tourist numbers and holiday expenditure continuing to rise last year, even as shopping during overseas travel dropped 17 per cent from a year earlier.
The average Chinese tourist spent about 6,705 yuan (S$1,370) on shopping when travelling, down from 8,050 yuan in 2015. But overall holiday spending - including on hotels and sightseeing - rose 3.5 per cent to 20,317 yuan from 19,635 yuan, according to the survey of 2,000 travellers from the mainland.
The sea change in spending habits is dealing a blow to retailers from Parisian department stores to Japanese duty-free operators and Hong Kong jewellers, but bigger numbers of wealthier Chinese may create other opportunities for leisure and entertainment operators in popular overseas destinations.
"Businesses globally have to adjust their strategy to think about how to capture the new Chinese tourist dollar," said Oliver Wyman's Shanghai-based partner, Hunter Williams. "It's less about the outlet mall now and more about the national park."
One reason for the change is the easier access to foreign goods in mainland China due to a booming US$60 billion (S$83 billion) cross-border e-commerce market. Imported items can now be ordered online and delivered in as quickly as a day, often exempt from taxes levied on goods from store shelves. That has dampened the practice of buying overseas to resell locally, and the survey showed such resales falling to 3 per cent of shopping expenditures from 8 per cent in 2015.
Chinese outbound spending still ranks highest in the world. In 2016, travellers from the Asian country spent US$261 billion, a fifth of the global total, up from US$249.8 billion in 2015, according to the World Tourism Organisation. But the portion contributed by shopping has fallen to 33 per cent of overall travel expenditure, from 41 per cent in 2015, the Oliver Wyman survey showed.
Chinese consumers no longer need to travel overseas to stock up on items from Playtex bras to Christian Dior lipsticks and Blue Nile diamond rings, which are now available on online portals run by firms like Alibaba Group Holding and JD.com. With foreign brands increasingly using the Internet to reach Chinese buyers, foot traffic to malls and outlet stores in popular overseas destinations is slumping.
Japanese duty-free retailer Laox reported a 33 per cent fall in revenue for 2016 as Chinese tourists spent less, while US retailer Macy's is shutting 14 per cent of its stores to stem sales declines.
Luxury houses like LVMH Moet Hennessy Louis Vuitton and Cie Financiere Richemont as well as Japanese brewer Kirin Holdings have pointed to sales pressures from fewer Chinese shoppers visiting stores globally, said Bloomberg Intelligence retail analyst Catherine Lim.
The survey also showed that more Chinese tourists are travelling with children and spouses rather than going alone or with friends. That could benefit destinations that offer different leisure experiences or entertainment options, said Mr Williams.
"The number of Chinese tourists is still rising rapidly and at quicker pace than their overall spending," he said. "This should give industry players some pause to think about how to make up for the loss of shopping-related spending through volume."