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CDFG’s innovative practices and digital transformation journey M ichelle Sun, Vice President, China Duty Free Group, discussed the evolving landscape of Chinese consumers within the duty free and travel retail market, with a focus on three areas: precise identification of consumer needs, establishing an integrated marketing ecosystem, and enabling core business through digital-intelligent operations. Sun highlighted China Duty Free Group’s innovative practices across all channels and its digital transformation journey, with the aim of collectively exploring new avenues for growth and fostering the prosperity of the global duty free and travel retail industry. She shared some compelling observations on the outlook for China’s travel retail market in the coming years, highlighting three key trends: • Robust recovery in China’s tourismmarket signals broader consumption prospects. “National Bureau of Statistics data shows that domestic travel trips reached 5.6 billion in 2024, a year-on-year increase of nearly 15%. Inbound tourist numbers reached 130 million, a year-on-year increase of 61%, with a 112% year-on-year increase in foreign tourists entering visa- free. These figures indicate rapid growth in both domestic and inbound tourist flows, opening up new growth opportunities for the travel retail market. Hainan is a key domestic tourism destination, and we believe that as the benefits of the free trade port policies are further realised, we will undoubtedly usher in even greater development opportunities.” • Increasingly diverse consumer demands. “Overall, consumers are placing greater emphasis on quality, value for money, and health. Looking at specific customer segments, the consumption patterns of Generation Z and the Silver Generation have been particularly notable in recent years. According to CDFG’s membership big data platform analysis across different age groups, Generations X and Y remain the primary consumers, while Generation Z and the Silver Generation are making significant contributions to sales growth. New customer segments, such as the increasing number of international travellers and consumers in third-tier and below cities, are also showing higher consumption willingness. CDFG is continuously leveraging AI-powered customer insights, and we look forward to broader data collaboration with government and industry partners.” • Enhanced focus on experiential consumption. “Consumers’ purchasing logic is evolving towards a balanced consideration of ‘functionality’, ‘value for money’, and ‘emotional value’. For specific groups (like Generation Z) and particular scenarios (such as travel destinations), products and stores that can offer greater emotional resonance and connect with their social circles tend to be more popular.” Michelle Sun, Vice President, China Duty Free Group (CDFG): “CDFG will further cultivate the brand perception of ‘Bringing the World’s Best to You’. Our strategy for a complete business upgrade involves focusing on digitalisation, developing robust platforms, building a strong ecosystem, and integrating our operations.” Wednesday 14 May 2025 4 T F W A D A I L Y Yesterday’s TFWA Workshop – ‘Market Watch: China’ provided a fascinating exploration of how China’s consumer landscape is evolving, shaped by generational shifts, digital acceleration, and changing consumer priorities. Delegates heard from China Tourism Group Duty Free Corporation Limited Vice President Michelle Sun; Jingzhi Media Group Founder and CEO Charlie Gu; and the Co-founder and CEO of Yaok Group and Dean of Yaok Institute Dr Tina Zhou. The workshop was moderated by Hannah Gao, Chief China Representative, TFWA. Market Watch: China