Mall of America looks to China for more shoppers

Lu Yan had never heard of the Mall of America until shortly before she stepped off a plane at Minneapolis-St. Paul International Airport last weekend. In town from China for a trade show, she and a colleague spent their first full day in the U.S. walking the mall's endless corridors and 520 stores with an agent from a local travel agency that caters to Chinese visitors.

She consulted her smartphone for the pictures of face creams and toys friends requested through WeChat, a text messaging app, and asked her guide to help find them.

"It's so big — and it's so cheap," she said as shopping bags from the Disney Store and Macy's dangled from her arms. The things she bought, she added, are either much more expensive or hard to find in China.

China is more than 6,000 miles and at least two plane rides from Minnesota, but Mall of America officials are zeroing in on the world's most populous country as a lucrative source of shoppers to help the mall grow in the next decade.

"They love shopping," said Doug Killian, the mall's senior director of international tourism. "They love designer brands. And they love value. We see tremendous potential given the size of that market and the assets the mall has."

International visitors have been a part of the mall's fabric since it opened in 1992. That inaugural year, the mall promoted "Shop till you drop" weekend packages to British tourists. For $450 at the time, they could get round-trip airfare from London and two nights in a hotel near the mall.

Today, Killian leads a four-person tourism department that promotes the mall overseas and hosts tour operators from around the world. One of their biggest selling points is that Minnesota doesn't collect sales taxes on clothing and shoes.

Though the Mall of America is the largest in the U.S., many Chinese shoppers have never heard of Minnesota. They gravitate instead to New York, Los Angeles, Las Vegas, Chicago and other huge cities.

So the mall has been stepping up its efforts to elevate its profile in China. It started making trips there in 2008 and now goes twice a year to hit up the big travel shows in Beijing and Shanghai.

In May, it contracted with a marketing firm in China to reach out to tour operators on its behalf and to put together travel promotions and ads in various Chinese publications and websites. "China is such a complex and different market," Killian said. "At least in the tourism industry, if you're going to be a serious player, you have to have a presence there."

Next month, the Mall of America is planning to roll out versions of its website in six different languages, including Mandarin. It also has created introductory videos in each of those languages to go on the website.

In the Mandarin version, a Chinese woman notes Minnesota's natural beauty as well as its vibrant theater scene. She also lists a number of brands the Mall of America has that resonate with Chinese shoppers, such as Prada, Chanel, Juicy Couture, Coach and Nike.

"Not only are the prices at Mall of America generally lower than the East and West coasts of the U.S., there is also no sales tax on shoes and clothing. International guests can save hundreds and even thousands of dollars," a woman says on the video, according to a translation.

This summer, the Mall of America also began encouraging more of its stores to start accepting UnionPay, the most popular credit and debit card used in China. About 40 of its stores already accept the card.

A handful of stores such as Coach and Kay Jewelers that are especially popular with Chinese tourists have even hired Mandarin-speaking employees.

And the 1½-year-old Radisson Blu, which is connected to the mall, translated its menus and a hotel fact sheet into Mandarin once it realized it was attracting a fair number of Chinese guests.

Small numbers, big spenders

An estimated 50,000 Chinese visitors come to the Mall of America every year, up 20 percent over the past five years. Most of them are coming to Minnesota for business or to the University of Minnesota. Still, they represent a sliver of the 42 million people at the mall each year. A little more than half the mall's total visitors are from Minnesota and nearby states, one-third are tourists from other parts of the U.S. and 7 percent come from abroad.

The mall is aiming for double-digit percentage growth among Chinese visitors in the years to come. In addition to the sheer number of Chinese, 1.3 billion, the country is becoming wealthier. China now boasts more millionaires than any country except the U.S. And Chinese visitors spend the most of all international tourists in the U.S., an average of $5,400 on each visit, according to the U.S. Travel Association.

Killian can list off many examples of that spending prowess in the Mall of America, such as one Chinese shopper who bought five Rolex watches for $25,000 in cash.

Melody Zhou, president of CIAC Travel in Bloomington, said it's not uncommon for the Chinese groups her agents take to the Mall of America to pick up 15 to 20 handbags from Coach in one fell swoop. She often orders a seven-person van to transport two shoppers, or a 15-seat shuttle for five, to have enough room for the bags.

"There are many big huge retail complexes like Mall of America in China," she said. "So it's not really something new to them. But they always say, 'Oh, everything's so cheap here.' "

Now she is working with the mall to organize a Lunar New Year celebration in February to help build more buzz about the mall among Chinese travelers.

No LV, no direct flights

Besides location and awareness, the mall faces other challenges in attracting Chinese tourists. One is that it needs more upscale brands.

"There's no LV in the Mall of America," said Zhou, referring to Louis Vuitton. She takes tourists to the Galleria in Edina for luxury brands. The Mall of America expects to have more luxury retailers next summer when it opens an expansion.

Then there's the matter of getting to Minnesota. Mall of America executives would like to see a nonstop flight to China from Minneapolis. The mall's top markets for international visitors are countries that already have direct flights to Minneapolis: Canada, England, Japan and Germany.

In the mall's promotional video for Chinese tourists, the narrator notes that there are direct flights to Minneapolis from other major cities around the world. So the shopping paradise in Minnesota, she says, is "closer than you think."

Kavita Kumar • 612-673-4113