US Retailers Target International Travelers’ Spending
Foreign visitors are becoming increasingly important to American business. These visitors spend lavishly and are a big contributor to US retail success. Most visitors come to the US for either business or leisure. Business travelers likely have a corporate per diem and/or personal funds for incidentals like food or entertainment; tourists normally have earmarked a chunk of their vacation money for discretionary spending. In the last 10 years, world travel has grown by more than 90 million people. However, long waits for US visas have sent many (and their dollars) to other destinations in Europe or Asia.
Over the past few years, retailers have taken more aggressive measures to capture this discretionary spending and to ensure America’s stake in the global travel market. Two years ago the National Retail Federation (NRF) pressured the US State Department to expedite the processing of visa applications so more affluent travelers from the growing economies, specifically Brazil, Russia, India and China (BRIC), could enter the US and of course spend their highly prized disposable income on retail goods. The result of this pressure: Millions of visitors and billions of dollars. It is estimated that the average foreign visitor spends US$4,000 per trip.
Of course, other industries are also benefiting from these efforts, including the hospitality industry that hosts these international travelers. In fact, the NRF joined forces with the travel industry this summer to campaign in support of the passage of the JOLT Act in US Congress. If passed, this legislation would make it even easier for a broader range of international travelers to experience US retail. It also would make it easier for retailers’ foreign employees to enter the US for training or to attend conferences like retail’s BIG Show.
For residents of some countries, the US visa process could take up to 4 months. Previous efforts from the NRF helped to reduce the turnaround time for a visa for some countries to about a week. According to NRF President, Matthew R. Shay, the JOLT Act “would make expeditious processing of [visa] applications a matter of law”. Currently there are 38 countries that are exempt from requiring a visa for travel into the United States. The JOLT Act would further expand this list to include other countries. “Adding Brazil, Poland, Israel and Croatia to the list of countries that don’t require a visit to visit the United States could add US$10 billion and 60,000 jobs alone.” (www.nxtbook.com) It is estimated that a combination of expedited visas and expanded national security services could create around 1.4 million American jobs and produce US$500 billion in economic output by 2020. This is a big ROI.
Retailers are taking matters into their own hands, not just relying on help from Washington to get international shoppers into their stores. Many retailers in major shopping destinations like Los Angeles, New York and Chicago are adding multilingual staff and translating websites to include travel and other tourist-related information. Others have brought in technology to make the buying experience more like home, like adding UnionPay terminals for Chinese credit card purchases.
Global travel means big retail money. Are you getting your share? Are you set up to attract, support and sell to these international travelers? Smart retailers are and they have their “bem-vindo/willkommen/welcome” signs up.