Hong Kong shoppers nuts for Nutella? Here's why

August 24, 2016 08:45
Personalized Nutella spreads are all the rage in Hong Kong, so are pop-.up stores that complement them. Photo: Bloomberg

Lorraine Lam waits in line for two hours at a luxury Hong Kong mall to buy the same Nutella spread that grocery stores sell for much less.

She does it for a friend, so she can get her name on the label.

Bloomberg is reporting that Nutella’s pop-up store in the Pacific Place center is swamped with customers willing to spend HK$80 (US$10) for a 350-gram jar of the hazelnut confection with a personalized touch.

The Ferrero SpA brand is selling almost 1,000 jars a day from its counter.

“I rarely go to the mall because I need to take a one-hour bus ride to get here,” said Lam, a 21-year-old university student.

“But this time it’s worth coming.”

With retail sales in Hong Kong declining for 16 straight months, brands such as Nutella and Havaianas are capitalizing on falling rents to open temporary outlets in some of the city’s high-end shopping districts.

At the same time, anchors such as Nike Inc. are trying to generate more traffic by “popping up” in front of mall walkers with new or limited-edition products.

“Retailers are trying more aggressively to adjust to changing consumer demand by providing more ‘special’ and better-quality products,” said Angel Young, managing director of market researcher Nielsen Hong Kong and Macau.

“Pop-up stores bring new excitement to customers.”

Malls like Pacific Place in Admiralty and Wharf Holdings Ltd.’s cavernous Harbour City in Kowloon long relied on a steady stream of mainland Chinese shoppers loading up on Louis Vuitton handbags and Cartier watches.

But now those high spenders are spurning Hong Kong in favor of Tokyo and Paris, while less well-heeled shoppers worry about China’s decelerating economy and the city’s social and political tensions, culminating in the violent Occupy protests.

The number of mainland Chinese visitors to the city declined for a 13th straight month in June to 3.2 million, according to the Hong Kong Tourism Board.

That’s triggering a decline in retail sales, which fell almost 11 percent during the first six months of the year, according to the Hong Kong government. Sales in June fell 8.9 percent, exceeding analysts’ estimates.

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