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C M Y CM MY CY CMY K Thursday 14 May 2026 6 T F W A D A I L Y As China’s travellers redefine the rules of engagement, the implications for global travel retail are hard to ignore. Yesterday’s TFWA Workshop: Market Watch China examined the trends, technologies and market dynamics shaping a new chapter for the sector, from innovation in Hainan to the growing power of social media and AI-driven insight. TFWAWorkshop: Market Watch China CDFG on shifting Chinese consumer spending behaviours Y vonne Chan, Chief Operations Officer of China Duty Free Group, offered the perspective of the world’s largest travel retailer. In a compelling address to the first TFWA Asia Pacific Exhibition & Conference since China launched island-wide special customs operations in the Hainan Free Trade Port on 18 December 2025, she provided updates from the first fewmonths. Chan focused on shifting Chinese consumer spending behaviours and how these shifts are driving product categories growth. China’s travel retail landscape is evolving beyond price and product, with emerging brands, creative storytelling, and innovative retail experiences shaping the next generation of travel retail. “Emerging local brands are driving this change by using travel retail as a testing ground for global appeal, bypassing traditional models,” Chan explained. “Through culturally rooted products – like terroir-inspired fragrances – they offer a sense of discovery and authenticity that legacy luxury brands often lack. With price parity now a standard, storytelling has become the key differentiator, moving from static brand history to immersive, situational experiences.” Hainan has become a live testing ground for retail innovation, with China Duty Free Group’s beauty duplexes in Hainan representing a breakthrough in travel retail. “This itself offers products, services and experiences rarely found in a high-volume locations,” said Chan. “Sanya International Duty Free Shopping Complex‌is a prime example of how beauty retail can be reimagined at scale.” From a broader perspective, Chan highlighted a real shift away from the old duty free model. As outbound travel recovers and inbound policies open up, travellers are expecting more than just shopping – they want frictionless experiences. “On the opportunity side, one big change is that Chinese outbound travellers are no longer just buying for status,” Chan shared. “They’re looking for cultural experiences, such as workshops, local collaborations, or something they can’t easily access at home. So for retailers, it’s less about selling products and more about creating access.” On the inbound side, there’s a growing curiosity around ‘China-specific’ experiences. Chan added that, with more international visitors arriving, things like tea culture, local beauty brands, or design-led retail can really stand out – especially if they feel unique to China. “And more broadly, the line between travel and retail is blurring. Airports and transit hubs are becoming lifestyle spaces, and there’s a big opportunity to connect with travellers earlier in their journey through platforms like Ctrip or Alipay.” How China travel retail is moving to an AI agent-driven model Vince Li, Chief Scientist and AI Business Partner at DeepZero, explored how data and artificial intelligence (AI) are shaping the next generation of retail experiences. He shared that China travel retail is moving from a traffic-driven model to an AI agent- driven model. “In the past, brands and retailers focused more on traffic recovery, channel expansion, and member growth,” said Li. “Today, the Chinese traveller journey is highly fragmented, across Xiaohongshu, Douyin, WeChat, mini-programmes, airports, duty free stores, and private-domain services. Traditional reporting and manual operations are no longer enough to understand and serve travellers in real time. The value of AI agents is to connect data, content, marketing, sales, and service. They help companies not only ‘see’ consumers, but also generate insights, strategies, and actions automatically. For travel retail, the future competition is not only about location, price, and brand. It is also about who can understand, engage, and serve travellers more intelligently.” In China, the biggest change brought by AI is that brands aremoving froma static understanding of consumers to a dynamic Yvonne Chan, Chief Operations Officer, China Duty Free Group: “I think we’re seeing a real shift away from the old duty free model. As outbound travel recovers and inbound policies open up, travellers are expecting more than just shopping – they want frictionless experiences.”