The future looks bright for luxury retail in Macao, according to a panel of experts that met today at a travel symposium in Singapore.
Speaking at the MICE & Luxury forum – held as part of Sands China’s Macao Showcase – panel members said that Macao retained a number of unique advantages, including the ability to attract high-end mainland Chinese shoppers, continual investment in retail properties, and being able to offer some types of goods, like new-release cosmetics, quicker than the rest of China.
Moderator Timothy Jones, the senior vice president of retail at Sands China, opened the discussion – entitled “Luxury retail: setting a new pace” – by pointing out that retail sales in Macao in 2019 greatly eclipsed sales in such benchmark-setting destinations as Dubai Airport.
According to government data, the total value of retail sales in Macao in 2019, the last year before the Covid-19 pandemic, stood at 77.18 billion patacas (about US$9.56 billion). Dubai Airport, Jones said, posted sales that year of US$1.46 billion.
As a consequence, he said, Macao “sits as a globally recognised destination and that reputation is only going to grow as we invest in our retail properties”.
For upscale mainland Chinese shoppers, Macao holds considerable allure. Sonia Tsui, the managing director of the Unique Timepieces Watches Group, said: “We are seeing big changes in terms of how the Chinese spend and how they come to Macao, [with their interests] changing from gaming to retail. They are younger and more balanced in terms of male and female, more educated. Social media platforms help a lot in terms of educating them before they come to Macao about what they want to do”.
Mukesh Valiram, executive director of Southeast Asian luxury goods specialists Valiram Group, agreed. “The charm of what Macao has to offer in terms of bringing in a focused audience that turns to authenticity and newness, this is what we are about”, he told the audience.
He added that Macao, like other destinations, did well from the fact that “Consumers behave strangely when they travel – in a positive way. What they don’t do at home in terms of discretionary spending comes out with the feel-good factor [of being on holiday]”.
It isn’t just Macao benefitting from the mainland Chinese dollar, of course. Sunil Tuli, the Group CEO of Hong Kong’s King Power Group pointed out that “Even at the Louis Vuitton flagship store in Paris, 50 percent of their staff are Mandarin speaking”.
For Sue Lewis, the regional travel retail director for French luxury cosmetic company Sisley, Macao’s dynamism and romance were a huge part of its attractiveness as a retail destination.
“You stand there and see the Parisian, the Venetian – it’s mind blowing”, she said, “and the same applies to the retail as well. Macao just keeps surprising people because things just seem to open and grow and the potential is endless. Someone mentioned the only limit is your imagination and Macau is the embodiment of that. The Macao experience is something very special and from a luxury point of view that’s where everybody wants to be. When you build a destination like Macao and have some of the best retail spaces anywhere, everybody wants to be there”.
She also pointed out one of Macao’s practical advantages for her business. In mainland China, cosmetics need to go through a lengthy product registration process – but in Macao they can be put on the market right away. Lewis said this meant that Macao could be as far as a year ahead of the mainland when it came to releasing new products.
The experts mentioned some of Macao’s challenges. There is the perennial issue of finding enough of the right kind of staff among a small population. Tuli also felt that the airport was hampering the growth of the city’s tourism. “It’s too small an airport”, he said. “The runway is too small for larger aircraft – the airport needs enlarging”.
But overall, the panel struck a positive note. “The customers are going to keep coming”, said Lewis. “Macao is the embodiment of [the saying] ‘If you build it, they will come’”.