Since October 1st and until end December, Watches and Wonders has taken up residence in Sanya, in the island province of Hainan. This “Chinese Hawaii” is the subject of a recent report by McKinsey. At stake: a $40 billion market.
自 10 月 1 日至 12 月底，Watches and Wonders表展已在海南省三亚落户。这个“中国夏威夷”是麦肯锡最近一份报告的主题。成败攸关：一个 400 亿美元的市场。
While the Chinese property developer Evergrande labours under a colossal $260 billion debt, the island of Hainan carries on oblivious. Month after month, this island and southernmost province confirms its status as China’s new luxury hotspot. Official figures in the wake of Golden Week – seven days of holiday to celebrate National Day which this year ran from October 1st to 7th — speak for themselves.
当中国房地产开发商恒大背负着 2600 亿美元的巨额债务时，海南岛却毫无影响。月复一月，这个岛屿和最南端的省份证实了其作为中国新的奢侈品热点的地位。黄金周之后的官方数据——今年 10 月 1 日至 7 日为庆祝国庆节的 7 天假期——不言自明。
oblivious：未注意，未察觉
Whereas tourism revenue generated by the 515 million trips made within the country amounted to “just” $60 billion, down 4.7% on 2020, sales registered by Hainan’s nine duty-free shopping malls totalled $252 million, leaping 75% on 2020 and 359% on 2019. The immense popularity of this duty-free paradise for luxury shopping is reason enough for Watches and Wonders to host its second edition at the Sanya International Duty Free Shopping Complex, where 14 brands have their pavilions in marquees opposite the main entrance, from October 1st to December 31st.
全国5.15亿人次旅游产生的旅游收入“仅”600亿美元，比2020年下降4.7%，而海南九家免税购物中心的销售额为2.52亿美元，比2020年增长75%，比2019年增长359%。这个奢侈品购物免税天堂的巨大人气足以让 Watches and Wonders 在三亚国际免税购物中心举办第二届展会， 14 个品牌在正门对面的帐篷里开设展厅，从10月1 日至 12 月 31 日。
marquee：帐篷
Growth on the cards
既定的增长
There is nothing fortuitous about the stellar growth of this Chinese Hawaii, as the island is often called. Its transformation into a giant tropical shopping mall is the result of a government plan to make Hainan the biggest free trade port in the world, supported by a range of policies and incentives such as a reduction in tax rates and a relaxing of visa requirements. In addition, visitors are now allowed to spend up to $15,000 during their stay and can continue to purchase duty-free products online for six months after returning home. Better still, as from 2025 the entire island will be designated a duty-free zone, hence brands will no longer have to collaborate with duty-free licence holders.
这个经常被称为中国夏威夷的岛屿，惊人增长并非偶然。它转变为巨大的热带购物中心是政府计划将海南建成世界上最大的自由贸易港的结果，并得到了一系列政策和激励措施的支持，例如降低税率和放宽签证要求。此外，现在允许游客在逗留期间最多消费 15,000 美元，并且可以在回家后的六个月内继续在线购买免税产品。更好的是，从 2025 年起，整个岛屿将被指定为免税区，因此品牌将不再需要与免税许可证持有人合作。
on the cards：即将发生的
fortuitous：偶然，巧合
The government’s five-year plan estimates that Hainan’s duty-free market will grow tenfold by 2025 to reach $46.4 billion.
政府的五年计划预计到 2025 年，海南的免税市场将增长十倍，达到 464 亿美元。
In the meantime, Hainan’s growth is unlikely to slow. Chinese international air travel isn’t expected to return to pre-Covid-19 levels for another two to three years, which leaves the island ideally placed to absorb Chinese tourism and the demand for luxury goods that goes with it. Already last year, Chinese visitors to the island spent twice as much — $4.3 billion — on duty-free as they did the previous year. The province’s government expects this figure to exceed $9 billion in 2021.
与此同时，海南的增长不太可能放缓。预计中国的国际航空旅行在未来两到三年内不会恢复到疫情之前的水平，这使得该岛成为吸收中国旅游业和随之而来的奢侈品需求的理想之地。去年，前往该岛的中国游客在免税品上的花费是前一年的两倍，即 43 亿美元。省政府预计，2021 年这一数字将超过 90 亿美元。
At this rate, and according to the Hainan provincial government’s five-year plan, the duty-free market will grow tenfold between now and 2025 to reach $46.4 billion. A survey by Bain & Co and Atlagamma reports that Chinese consumers accounted for 35% of the global luxury spend in 2019 yet only 11% of these purchases were made domestically. Within the next four years, this figure should be nearer to 30% with Hainan in the front line to benefit. A further relaxing of rules should provide an additional boost, combined with increased investment by brands and local developers who plan to double mall capacity over the coming four years. Price competitiveness is an additional factor, with products costing between 20% and 30% less than on the domestic market even before further discounts.
按照这个速度，根据海南省政府的五年规划，从现在到 2025 年，免税市场将增长十倍，达到 464 亿美元。贝恩公司和 Atlagamma 的一项调查报告称，2019 年中国消费者占全球奢侈品消费的 35%，但其中只有 11% 是在国内购买的。未来四年，这个数字应该会接近30%，海南在前沿受益。进一步放宽规则应该会提供额外的推动力，再加上计划在未来四年内将购物中心容量增加一倍的品牌和本地开发商的投资增加。价格竞争力是另一个因素，即使在进一步折扣之前，产品的成本也比国内市场低 20% 至 30%。
A word of warning
一句警告
In its report on Hainan, “the new battleground for global luxury,” McKinsey sets out three points which luxury brands tempted by the Hainan experience should bear in mind. Firstly, the duty-free model, which is optimised for volume sales at significantly discounted prices, can damage brand equity. Secondly, differences in pricing between Hainan and the mainland puts brands at risk of cannibalising their domestic business in China and eroding margins in the long term.
麦肯锡在其关于“全球奢侈品新战场”的海南报告中提出了受海南经验诱惑的奢侈品牌应牢记的三点。首先，针对以大幅折扣的价格进行批量销售而优化的免税模式可能会损害品牌资产。其次，海南与内地之间的定价差异使品牌面临蚕食其在中国国内业务和长期侵蚀利润率的风险。
cannibalize：同类相食
Thirdly, the volume-based sales model also makes it harder for brands to build customer relationships. “The response of some luxury brands has been to actively limit their presence on the island or to refrain from opening a presence entirely,” writes McKinsey. “However, with Hainan growing fast to take an increasingly significant share of the Chinese luxury market, and slated to become a fully duty-free island province by 2025, it is imperative that luxury brands formulate a strategy to enter, operate, and scale in the market.”
第三，基于数量的销售模式也使品牌更难建立客户关系。麦肯锡写道：“一些奢侈品牌的反应是努力限制他们在岛上的存在，或完全不存在。” “然而，随着海南在中国奢侈品市场占有越来越大的份额，并计划在 2025 年成为完全免税的岛屿省份，奢侈品牌必须制定进入、运营和规模化这个市场的战略。”
It is imperative that luxury brands formulate a strategy to operate and scale in Hainan. – McKinsey
奢侈品牌在海南制定经营和规模战略势在必行。- 麦肯锡
Watches and Wonders is an excellent illustration as it gives visitors the opportunity to familiarise themselves with the different aspects of watchmaking excellence through demonstrations at the workbench. Other highlights include a deep-dive into the history of iconic watches, analyses of the latest market trends and explanations of complications, in addition to the many activations offered by the participating brands. A reminder that watchmaking is an entire world and not simply a question of price.
Watches and Wonders 是一个很好的例证，因为它让参观者有机会通过在工作台上的演示来熟悉卓越制表的不同方面。其他亮点包括深入了解标志性手表的历史、分析最新市场趋势和复杂功能的解释，以及参与品牌提供的许多活动。标示着制表业是一个完整的世界，而不仅仅是价格问题。