Five phenomena behind ‘experiential consumption’ led consumption rebound
HONG KONG, Sept. 14, 2020 /PRNewswire/ — In the midst of the broader revenge consumption trend, there is also a new drive for ‘experiential consumption’ led by domestic shoppers has sparked a remarkable Q2 sales rebound in K11 shopping malls in Mainland China and Hong Kong SAR. In the second quarter of this year, sales turnover at K11 shopping malls in Mainland China saw quarter-on-quarter growth of 85%, while K11 MUSEA in Hong Kong experienced a 35% rebound from the first quarter. As Mainland China was the first market to see gradual recovery from COVID-19, K11 China captured this opportunity for ‘experiential consumption’ by connecting shoppers with art, culture, nature, child-friendly activities and bespoke experiences as consumers coming out of months of social-distancing and lockdown due to the COVID pandemic crave new experiences and opportunities to accumulate "knowledge capital" on top of doing some high-quality shopping. This coincides with a three-day round-the-clock shopping campaign at four K11 malls from 7 – 9 August 2020. The result was over RMB100 million in total sales, a four-fold growth from a year earlier.
K11 MUSEA in Hong Kong sees revenge consumption as the city gradually recovers from a third wave of COVID-19
K11 shopping malls in both Mainland China and Hong Kong continue to appeal to domestic customers and top tier recurring spending consumers, making them more resilient and less exposed to the drop of tourism during the pandemic.
Furthermore, in response to changing consumer needs during the pandemic, K11 shopping malls worked with tenants to craft an omni-channel sales approach that digitally transforms and improves the products and services offered, which fueled five phenomena behind a new trend of ‘revenge consumption’.
K11’s Accelerated Digitalisation Unleashes Domestic Shoppers’ Accumulated Purchasing Power
With travel restrictions still in place and the global COVID-19 situation yet to stabilize, domestic shoppers in both the Mainland China and Hong Kong markets continue to prefer to stay home. K11 Group has been quick to innovate and adapt existing online and offline channels to lead a change in consumption habits and serve customers’ changing needs and purchasing preferences.
K11 drove online traffic and sales by launching several online sales channels including "K11 Go" on WeChat in Mainland China, which has drawn more than 1.8 million members, and "K11 Live Shop" in Hong Kong. It also ran multiple livestreaming events on popular social media platforms. In addition, K11 MUSEA in Hong Kong provides shopping and meal delivery services for its VIP customers. These innovative digital/online sales channels, which accounted for 15% of overall sales from July to August, have helped K11 mall tenants stay connected with their customers despite social distancing restrictions during the pandemic. The innovations allow tenants to generate sales while fulfilling the fast-changing needs of millennial customers who crave bespoke experiences, curated content and products.
Artificial Intelligence-powered CRM+ provides Optimal Customer Experience
K11 Group leverages the ecosystem of the New World brand to send marketing information to its large stakeholder network, which helps to drive footfall and sustain a loyal customer base. K11 malls also use an artificial intelligence-powered CRM+ system to understand customers’ past consumption habits and preferences to accurately promote the right products that will appeal to them. Currently 60 % of K11 MUSEA customers are K11 members, reflecting customer traction and a tendency among our customers to come back for recurring spending.
New Global Restaurants and ‘High Tea’ Draw Visitors to K11 Despite Pandemic
Even though the F&B industry was the first to experience the impact of the pandemic, K11 shopping malls have continued to introduce different gastronomy experiences from all over the world. In Hong Kong, more than 10 new restaurants and bars will debut at K11 MUSEA between August and October, defying overall trends during the pandemic. These include COBO HOUSE and its exquisite gourmet dining, Sushi Wadatsumi which is famous for its Omakase, contemporary Korean vegetarian at Soil to Soul, hotpot flagship COUCOU Reserve, and Greyhound Café Galleria from Bangkok. At Glasshouse Greenery, innovative culinary fusions and specialty catering include noodle bar concept Sexy Crab, truffle specialist Golden Diamond Truffle, all-in-onebox, grab-and-go concept Foodbox, artisanal dessert maker Flakes & Layers by acclaimed model Amanda S, creative cookies brand Cookie Vission, and local craft beer brewery hEROES Beer Co.
Restaurants that provide afternoon tea service including Fortnum & Mason’s first stand-alone store and restaurant in Asia, Western-Japanese fusion cafe Afternoon Tea TEAROOM, and Artisan Lounge all saw bookings rebound after public gathering restrictions eased.
Malls with Vast Open Spaces as Preferred Hang-out Spots for Shoppers and Families Post-COVID
K11 MUSEA’s ability to provide diversified consumer choices sees shoppers, young couples and families enjoy the full spectrum of goods and services from fashion, luxury buys, dining to children’s products, leisure, art and entertainment. Furthermore, outdoor recreational spaces have also become particularly important to the public during the pandemic. The Bohemian Garden and Nature Discovery Park at K11 MUSEA, which is Hong Kong’s first urban biodiversity museum and sustainability-themed education park, continues to be popular among families and shoppers who go there to relax in the open air in between shopping.
K11 Malls Connect Locals with the World by Cultivating Immersive Consumer Experience in Art, Culture, Nature and Commerce
As part of its commitment to create shared value and enrich customers’ daily lives through creativity, art and culture, innovation and sustainability, K11 malls have continued to bring unique cultural and art content to the public. These visionary efforts aim to stimulate creativity and build up a wealth of ‘knowledge capital’ to inspire the boundless imagination of millennials and future generations.
K11 MUSEA opened the K11 Art & Cultural Centre and Sculpture Park in August. Covering an area of over 105,000 square feet (9,830 square meters), the multi-purpose cultural space features an inspiring collection of international artworks by globally celebrated artists such as KAWS, Mary Weatherford, Erwin Wurm and Yayoi Kusama. Curation of art pieces across K11 MUSEA represents the exchange of ideas in a multicultural, multilingual society like Hong Kong.
About K11 Group
K11 Group was founded in 2008 by renowned entrepreneur Adrian Cheng. The unique concept brand combines art and commerce in commercial and residential real estate, and a growing portfolio of brands across different sectors in Greater China and around the world.
A destination 10 years in the making, K11 MUSEA, K11 Group’s most ambitious Cultural-Retail development, opened its doors in August 2019. Reinvigorating Hong Kong’s waterfront, Cheng’s vision is to make K11 MUSEA the Silicon Valley of Culture that will facilitate a broader discussion on the interconnectedness of creativity, culture and innovation.
In addition to its flagship K11 Art Malls, K11 Group also operates K11 ATELIER, a network of office buildings for the next-generation workforce; luxury residences for worldly travellers K11 ARTUS; open education platform K11 KULTURE ACADEMY; consulting and market research institution K11 Future Taskforce; K11 Art Foundation, China’s first not-for-profit to incubate Chinese artists and curators; K11 Craft & Guild Foundation, a foundation that is dedicated to preserving traditional Chinese crafts and bringing them into the future.
K11 Group is based in Hong Kong and has operations in Greater China, as well as investments in Europe and the US.
Through K11 Group, Cheng’s stated aim is to enrich the new consumer’s daily life through the power of creativity, culture and innovation. This work will create a new global identity for Chinese millennials as well as cultivate opportunities for communities to thrive, connect, work and shop. By 2025, K11 Group will have gained a footprint in 36 projects (total GFA 2.84million sqm) in ten cities across Greater China. K11 was honoured by Fast Company as one of the most innovative companies in 2019 for its disruptive retail model.