Retailers - Fall 2016 - page 11

Cover Story
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mainly same-day visitors coming to buy household items,
creating capacity problems, not so much in tourist attractions,
but in certain residential areas and makes parallel goods trading
activities in these areas rampant. Another 20% of the increase
belong to group tour visitors, who join what we called the "zero/
negative fare tours" which generated complaints about coerced
shopping involving our Mainland visitors and in certain cases
tarnished Hong Kong's hard-earned reputation as a tourist-
friendly destination.
The sudden upsurge in Mainland visitors has also caused our
shop mix to tilt towards the preference of Mainland visitors
with perhaps disproportionate number of certain types of
merchandises. This may give a wrong perception to visitors from
other places that Hong Kong as a tourist destination is not that
diversified, and render us more vulnerable to competitive pressure
from other tourist destinations. Moreover, over the past decade,
retail space in Hong Kong has only increased by some 15%. This
explains why the shop rental level skyrocketed in Hong Kong,
leading to a higher cost of operations for our retail business.
New tourism development strategy
It is plainly unrealistic to expect such a rapid growth in a single
visitor market to persist. Looking back, such a phenomenon
has created much tension in our society. Recently, we have seen
places like Italy and Spain voicing out complaints about the fast
growing number of visitors. Hong Kong is thus not alone in
facing a paradox of tourism growth and social disharmony.
As the old saying goes, "opportunities arise amidst adversity".
We believe that now is the right time for our tourism industry
to reflect on our strategy and seize the opportunities ahead. To
ensure a healthy growth of our tourism industry, our experience
in the past decade clearly suggests that we should not just focus
only on increasing the number of visitors. With limited space
and capacity, we ought to move up the value chain by drawing
more high value-added visitors. Our policy objective is to move
towards diversified and high value-added services for a balanced,
healthy and long-term development of our tourism industry.
And our focus is to draw more overnight high-spending visitors
to Hong Kong.
Indeed, starting from April 2015, the Central Government, after
paying heed to our views on the pressure from the large volume
of Mainland visitors, decided to replace the multiple entry permits
by the "one week one trip" permits. With the implementation
of the new policy, the drop in the number of Mainland visitors,
especially same-day Mainland visitors holding multiple entry
permits with relatively low per capita spending, is within
expectation. On the other hand, we are glad to see that social
harmony in districts concerned has largely been restored, which
is beneficial to the long term and sustainable development of our
tourism industry. Our tourism industry is now going through a
stage of transition, moving towards a more diversified customer
base and high value-added visitors.
Under our new tourism development strategy, we have been
focusing on six areas to facilitate our tourism industry to move
towards greater diversification and high value-added services.
(1) Enhanced promotion and marketing in short-haul markets
First, we have been putting more resources on promotion and
marketing in short-haul markets like Southeast Asia, India,
South Korea and so on with a view to bringing in more visitors
from these new and emerging markets with significant growth
potential. Indeed, visitor arrivals from Southeast Asia reverted
from a decline of 2.2% in 2015 to an 8.8% year-on-year
increase in the first eight months of 2016. With the planting
of seeds today, we believe that in time, these markets could be
strengthened as one of the prime engines of growth of visitors in
the years ahead.
(2) Re-branding of Hong Kong's image
Second, we will soon re-brand Hong Kong's tourism image by
showcasing the diversified products and experience that we
could offer to visitors. Starting from later this month, four new
promotional videos will be rolled out by the HKTB successively
in all our key overseas markets to boost our tourism image
and attract more tourists. We will also step up publicity in
the Mainland for quality and honest tours through various
media and collaborate with trade partners in the Mainland in
promoting such tours with a view to helping Hong Kong recover
from the negative impact of the previous anti-Mainland protests.
The resources come from the new money of $240 million given
out in this year's Budget for implementing various supportive
measures to the tourism industry.
(3) Development of diversified tourism products
Thirdly, we are keenly aware of the changing preference of
visitors nowadays who look for a deeper experience of a place's
culture and customs, instead of merely having visits to many
tourist attractions in a short period of time. It is therefore of
paramount importance for us to develop new and creative
tourism products to cater for our visitors' needs. In recent years,
we have strengthened the emphasis on the development of
cultural and creative tourism as a strategic move to diversify our
tourism offerings, including to re-energize Hong Kong historical
buildings as our new cultural and creative landmarks such as the
former Police Married Quarters, which is popular among Taiwan
and Korea visitors. We have also made better use of the open
area in Central waterfront by building the Ferries Wheel and
hosting various events such as circus and carnivals against the
backdrop of our beautiful Victoria Harbour. The 3D Mapping
Light Show at the Hong Kong Cultural Centre we introduced
during festive seasons is another very popular attraction among
tourists in recent years. To further enhance our tourist appeal
with cultural and creative elements, we set up in April this year
the Comic Garden - a theme-based exhibition area featuring
local comic characters adjacent to the Golden Bauhinia Square
in Wan Chai. In the next few years, we will be turning the "Big
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