The Breakdown

Explaining Southern California's economy

Retailers bet big on Chinese tourists

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In L.A., many tourism officials see Chinese travelers as the wave of the future.

California's No. 1 market for overseas visitors is China, said Caroline Beteta, president and CEO of Visit California, a non-profit geared toward maintaining and developing tourism marketing programs in the state.  She said Chinese tourists spent more than $1.6 billion in 2012, and spending levels are expected to increase, with China's growing middle class and the easier access to visas for U.S. travel.

"We're seeing a trajectory on China that is once in a career or lifetime," Beteta said. 

And it's that growth that many tourist attractions and venues want to capture in sales.

Beteta's non-profit hosted a forum at the Langham Huntington hotel in Pasadena on Wednesday, where more than 460 people gathered to discuss tourism issues, including how to better cater to Chinese travelers.

The tourists are coming from large metropolitan Chinese cities like Shanghai and Beijing, as well as second-tier cities like Qingdao, Hangzhou or Chengdu, said Renee Hartmann, co-founder of China Luxury Advisors, a firm that counsels luxury brands. 

"It's really become aspirational to want to travel around the world. That's something that people are really looking into to show to their friends to visit places they haven't been before," Hartmann said.

Hartmann said there's interest from affluent Chinese nationals to invest in American real estate, business and send their children to the U.S. for study. Additionally, Chinese millionaires tend to be on the younger side. The average age of a millionaire in China is around 37, compared to 57 in the U.S., Hartmann said.

One key factor is also how much money tourists from China spend - an average $170 a day in L.A., which compares with tourists from other locales spending an average $163 in L.A., according to a report given to KPCC by Hartmann that cites the LA CVB.

Businesses are hoping to give tourists more reasons to come to their attractions by pulling out all the stops. Hotels like the Hilton are offering Chinese breakfast, with dishes that include rice porridge. And stores like Macy's are offering a 10 percent discount that can be used on some luxury brands.

RELATED: Chinese visitors top L.A. tourism numbers

"We've done a number of promotions to make it very easy and appealing for the consumers to shop at Macy's," said Brian Chuan, director of tourism marketing and development at Macy's. "We have the products that they want. We carry all the American designer brands that they are looking for." 

He said Chinese tourists spend the most money at Macy's compared to any other international group. Macy's tracks the sales by how much the tourists spend on their international credit cards. He said it's cheaper for Chinese tourists to buy the American brands here, because in some cases it might cost three times more in China.

"We see them leaving with an extra luggage filled with things they want to bring home," Chuan said.

Chuan also said Macy's accepts the China UnionPay card, which is a payment card associated with network of banks in China. That makes it convenient for shoppers who don't want to pay in all cash. 

Spending from international visitors make up just 3 percent of Macy's overall sales at its 800 stores nationwide, Chuan said. But he pointed out that at some locations, spending from international tourists could make up 20 to 50 percent of a store's total sales, he said.

Chuan travels to China to market Macy's to groups such as tour operators and banks. Macy's doesn't have any locations in China, but Chuan said people there are familiar with the brand.

Macy's has 13 stores with visitor centers, that allows customers to check in their bags. Centers in Southern California include one in San Diego and Downtown L.A., for its close proximity to the convention center and Staples Center. At key stores, Macy's may have Mandarin speaking staff.

It appears to be working. Just one day last week in New York, buses dropped off about 1,500 Chinese travelers at the Macy's, he said.

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