27 March 2003
Mainlanders happy to pay more for Hong Kong watches
The findings were obtained from face-to-face interviews with 1,000 consumers, aged between 18 and 55, in Guangzhou, Shanghai, Beijing, Dalian and Chengdu.
All of the respondents had brought at least one watch in the past 12 months, the TDC said.
As a result of its entry into the WTO, China has had to remove its quota on watch imports, and is now also in the process of relaxing its restrictions on the trading and distribution sectors.
TDC's Assistant Chief Economist Daniel Poon said: "Coupled with the good showing of the Chinese economy and growing purchasing power, the mainland has increasingly emerged as a growth market for Hong Kong watch companies.
"Hong Kong faces keen competition from reputable foreign brands in the high-end market and from Chinese brands in the low-end market, but it has a strong edge in the middle-range market."
Respondents were asked of their perceived value of different watch brands. Given that local Chinese brands were priced at RMB 1,000, Hong Kong brands were valued at RMB 1,260, a 26% premium over local Chinese brands.
Mr. Poon said: "The premium enjoyed by Hong Kong brands showed that mainland consumers held the Hong Kong name in high regard".
Findings of the survey:
Big spender: Among the five cities surveyed, Shanghai was found to be the biggest buyer of expensive watches valued at RMB 2,000 or more each, while Guangzhou was the biggest market for watches fetching less than RMB 100.
Brands: While brand names were the most important criterion for Shanghai buyers, they were less important for consumers in Guangzhou and Beijing.
Important factors: In addition to well-known labels, durability, style and price are still the determining factors for most purchases.
Business watches: Most of the respondents said they preferred watches worn by office workers or businessmen. But they would buy casual-wear watches as gifts. Sports watches were at the bottom of their list.
Best seller: Quartz analogue watches were the best sellers. Digital watches were not as popular, while the demand for mechanical watches continued to be strong.
Basic functions: Most of the watches bought by the respondents had basic features and functions and were mostly made of stainless steel.
Price range: The average price paid by the respondents for their watches was RMB 970. Some paid up to RMB 2,000 or above. Beijing respondents were the biggest buyers of medium-price watches (RMB 100 - 1,999), and Dalian and Chengdu respondents purchased mainly watches priced below RMB 500.
Sales outlets: Respondents said they often brought watches in department stores and duty-free shops, or in shopping malls and chain stores as well as from shops in the street.
Promotion: TV and radio advertisements were found to be the most effective means of promotion
In 2002, Hong Kong exported HK$ 904 million worth of watches to the mainland, an increase of 52 per cent compared to 2001. The Chinese mainland is the eighth largest market for Hong Kong watches, accounting for 3.7 per cent of Hong Kong's total shipment of watches to the world.
This new report is available at TDC's Retail Outlets. It can also be purchased through the TDC Bookshop section in the TDC's trade portal: www.tdctrade.com.
For press enquiries, please contact Lawrence Yau of TDC's
Corporate Communication and Marketing Department at 2584 4510.
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