If there were no urban tourists, luxury would not exist as an industry
Posted on 5 June, 2014 by Marta Campusano
The Luxury and Premium market is connected to the different capitals of the world, and it would not exist without cities and urban tourists. Is it not surprising to know that 70% of the luxury goods sales produced in France takes place in Paris? (Totalling 11 billion euros) and that London accounts for 75% of the industry turnover in the United Kingdom?, corresponding to 9 billion, and what’s more, that more than one-third of the 62,000 million luxury turnover in United States in 2013 was sold in New York? This shows us the great importance and strong affinity that exists between cities and the luxury sector.
According to the study carried out by the Premium Market Observatory and Prestigious Products IE Business School, on The Urban Explorers and the positioning of the destination, more than 50% of European luxury goods sales is by non-European citizens. If we look at other continents, half of what is sent to Asia is consumed by the Chinese market. In the United States, one-third is sold to tourists. In Japan, China and Latin America, the luxury sector for tourists is still not significant. However, Japanese tourists have played a very important role in the history of this industry, due to the fact that in the 1970s the country was very well-off, leading them to travel and bring back European luxury products, which shows us the knowledge of the Japanese in today’s luxury market.
In Europe, the drop in the sales by local consumers, as a result of the crisis, has been offset by the tourists’ purchases, accounting for more than 50% in Italy and more than 60% in France and the United Kingdom, according to María Eugenia Girón. Another interesting fact that has emerged in the presentation of the report has been what Tokyo generates: 2% of the global GDP and Milan, 12% of the city’s economy is generated in one single Street: Via Montenapoleone, where the cream of the luxury brands are.
The Economist and Professor Gildo Seisdedos, one of the authors of The Urban Explorers and the positioning of the destination, stated that what tourists value most in what a city has to offer are shopping, food and culture. According to various in-depth surveys, the researchers have established that there are various types of tourists, taking into account hard variables (purchase of tangible goods) and soft variables (services), and other factors that are only available in a specific city.
The most relevant thing to point out is how important it is to strengthen connectivity so as to expertly serve these Premium tourists coming to big cities in order to buy. These tourists are sophisticated, come from the digital world and travel with their mobile devices to all destinations.
Madrid has a major challenge as a hub, which it should strengthen and move forward by introducing more technology to these tourists by means of the different mobile applications being developed and the Google Glass project, which was presented at FITUR last February by Antonio López de Ávila.
Marta Campusano 5th June 2014
Source: Premium Market Observatory and Prestigious Products IE Business School. “The Urban Explorers and the positioning of the destination”