A Little Marketing Could Go a Long Way To Woo Overseas Shoppers

Tourists are flocking to the United States on shopping sprees this year, and it looks like most retailers are doing little more than prop open their doors for the throngs of shoppers. One would guess a little marketing aimed at the overseas crowd could go a long way.

Some visitors are arriving with empty suitcases to feast upon the bargains, snapping up everything from electronics to clothing, shoes and accessories.The streets of New York are even feeling so Parisian that New York Magazine recently ran a satirical illustrated column entitled "Find Your French Boyfriend," complete with tongue-in-cheek instructions for locals on how to snag a "Euro-wielding hottie."

And not all of these folks are here on tourist visas either. Many are here investing in American real estate, businesses and settling down. In 2007, 1.1 million people applied for permanent residence in the U.S., according to the U.S. Department of Homeland Security. And while that number is down
slightly from '05 and '06, it represents a 49.6% jump over 2004. It also doesn't reflect the numbers of people here on temporary work visas. Marketers ignoring these new immigration trends are missing a chance to win over a group of consumers, many of whom are ready and willing to embrace new brands.

Marketers in the travel industry should pay particular attention: U.S. tourism is up everywhere from San Francisco to Boston and New York, which estimates in the first three months of '08, 9.5 million people visited the city, up 11.8% from the same period in 2007. Spending is also up. New York forecasts it brought in $6.3 billion in the first quarter of '08, compared to an estimated $5.6 billion during the same period a year ago. NYC & Co., the official marketing, tourism and partnership organization for the City of New York, which released these estimates, also predicts that roughly 19% of total visitors-or about 1.8 million-will come from overseas, with spending expected to be 20% above forecasts from the same quarter last year. In Boston, the projections are just as rosy: The Greater Boston Convention and Visitors Bureau is forecasting 6.12 million visitors will travel to Boston and Cambridge this year, up 2% from '07, and expected to spend $3 billion locally.

Nationally, the number of foreign visitors to the U.S. hit 57 million last year, up 39% from 2003, according to the U.S. Commerce Department's Office of Travel and Tourism Industries. And spending skyrocketed, hitting $122 billion in 2007, up 52.5%, from '03.

While some of those increases are accounted for by domestic travelers, staying close to home because of high gas prices, a good chunk of those visitors hail from overseas, particularly Europe, where the Euro's strength, now at $1.55, makes shopping in the US feel like a golden bargain. So, what, if any, marketing is being targeted to these shoppers? Retailer Gap Inc. is one retailer with a high profile in Europe, and increasingly elsewhere, including the United Kingdom, Canada, France, Ireland, Japan and other European, Asian and Middle East countries through franchise agreements.

Gap has cut its marketing by 18% in the first-quarter of 2008, mainly by putting on hold TV ads for its GAP brand. Meanwhile, business at most of its stores, from Banana Republic to Gap and Old Navy is down. When asked if it was doing or planning any specific marketing targeted Europeans here or abroad, a spokeswoman replied, no. "While customers are always our No. 1 priority, there's nothing specific we're doing to target them," the spokeswoman said.

However, other businesses, like NYC& Co. It understands that marketers need to grab the opportunity and reach these folks and bring brand awareness before they even step on our shores. In the last year, it has opened 10 more offices overseas to better reach travelers planning New York excursions, and in April it launched phase two of its "Just Ask The Locals" campaign, which is aimed at domestic and overseas tourists and encourages visitors to ask people on the streets of New York for suggestions of what to do and see while in town.

The campaign was underwritten by JCDecaux, which donated more than $10 million in ad space, including five JFK terminals for six months. The campaign also includes New York bus shelters and street pole banner ads, as well as print, radio and taxicab monitor ads. And importantly, international media is also in the mix, with ads appearing in major cities in Europe and elsewhere in front of shoppers plotting trips to the U.S. The campaign also has the marketing muscle of American Express Co., a sponsoring partner, which is giving exclusive offers to its American Express card members at leading stores, restaurants, cultural institutions and other organizations. The offers will be available online at nycvisit.com, as well as in a customized booklet distributed at more than 80 local businesses, NYC  Visitor Information centers, hotels, and will be distributed by street teams and inserted in Time Out New York magazine. At this rate, it appears that New York, which garners almost a 30% market  share when it comes to overseas travel, could well continue to attract the masses, maybe even reaching Mayor Bloomberg's goal of luring 50 million visitors annually by 2015. But how much these people spend while they're here, hangs in the balance. And marketers who heed the signs--both tourism and immigration trends-will lead the way in reaching these new consumers.