Retail Traffic

South Americans Flock Northward

Every day, thousands of South American tourists arrive at Miami International Airport with one clear priority: shopping at south Florida malls.

Of course, they check out attractions like Miami Beach, the Seaquarium and Bayside. But according to surveys by the Greater Miami Convention and Visitors Bureau, 80 percent of South American visitors say what they like most about Miami is its shopping. Only 29.6 percent of domestic visitors cite shopping as their favorite activity.

South Americans are crucial to south Florida's retail industry. In 1997, more than 2 million visitors spent $912 million shopping in the Miami area. That's up from 1.7 million who spent $648 million in 1992. Tourism officials expect the number of South American visitors to grow well into the next century. As a result, competition for valued shoppers is keener than ever, as mall marketers step up efforts to lure them.

Visit more, spend more "South American shoppers are a booming market," says Judith Montgomery, marketing director of The Galleria, located near Fort Lauderdale beach. "As our competition gets greater locally, we try to capitalize on those areas where you're going to see the growth. For us, that's the tourism market in genera l, and especially the South American market.

"South Florida malls lean heavily on South Americans for business. "They represent a very significant percentage of sales for a number of malls in the region," says Cynthia Cohen, head of Marketplace 2000, a Miami-based consulting firm."

At some points of the year, they may account for as much as 60 percent of sales at certain malls," she says. "The malls are doing more to attract them because they represent higher-margin dollars. South Americans aren't just looking for sales, they're looking for branded items. And they're looking for items on their lists to bring back for friends and family.

"More than half of South American shoppers come from Brazil. Last year, the nation accounted for the second-highest number of visitors to Miami, after Canada. However, Brazilians outspent Canadians by a considerable margin. Large numbers of shoppers also come from Argentina, Venezuela, Colombia, Chile and Peru.

Many South Americans make two or more trips per year and visit two or more malls during each stay, according to the Miami CVB. The number of South Americans peaks during the summer, creating a shopping season that, for many malls, is second in importance only to Christmas, retail experts say.

South Americans take their Florida shopping visits much more seriously than American consumers, mall executives say. "South Americans save their money for trips to Florida malls," says Damaris Holmes, the international marketing director for three Simon DeBartolo Group properties - Dadeland Mall, Miami International Mall and The Shops at Sunset Place, which opens this fall.

"We have a lot of business travelers who may come several times a year," she says. "They may or may not bring their families. And if they don't, they bring lists. We try to create loyalty among shoppers so that they come again. I'd say about 40 percent of them come twice a year.

"Not surprisingly, South Americans spend more money than domestic shoppers. At Sawgrass Mills, one of Florida's top destinations for South American tourists, the typical shopper spends $100 to $130 per visit, compared to more than $1,000 for South Americans, says Anne Lipscomb, vice president of marketing for The Mills Corp., the Arlington, Va.-based real estate investment trust that owns Sawgrass Mills.

According to figures provided by some of south Florida's largest and most popular malls, Latin Americans contribute mightily to their year-round business. At Dadeland Mall in Miami, they account for about 40 percent of all customers. At Sawgrass Mills, west of Fort Lauderdale in Broward County, the figure is 30 percent to 40 percent. At Miami International Mall, near the airport, it's about 30 percent. At The Falls, located far south of Miami, the figure ranges from 20 percent to 30 percent.

Mall anchors have difficulty tracking their numbers of South American shoppers, but the stores say these visitors are a big part of business. At Burdines, the 48-store Florida division of Federated Department Stores, South Americans are by far the largest group of foreign shoppers, says spokesman Carey Watson.

"Whenever there has been a soft tourism season from South America, we have seen a softness in our business, especially in our stores in Dadeland and downtown Miami," says Watson.

Luring the South American shopper As the flood of South American shoppers continues, competition for them intensifies. Major malls that already have extensive South American marketing strategies are beefing them up dramatically.

Meanwhile, other malls are just starting their advertising and promotional programs. Malls are so competitive that some start pitching their properties to South Americans long before they even open.

For example, Holmes began promoting The Shops at Sunset Place to South Americans shortly after construction started over a year ago. "We have been giving hard-hat tours of the site to journalists coming from South America," says Holmes. "I contact people who write for tourism sections of major newspapers, and we give them a tour and explain the entertainment concept of the mall.

"During last year's La Cumbre convention, a major trade show of Latin American tour operators, Holmes hosted a reception at Sunset Place for 35 journalists from Brazil, Argentina, Venezuela and other countries. Holmes and her staff also exhibited at the convention.

This month, Holmes will launch a South American direct-mail campaign on behalf of all three Simon DeBartolo malls. "The mailing will be done with Visa International to more than 3 million cardholders. It will offer them a special 20 percent discount at certain stores," says Holmes.

Last year, Dadeland and Miami International Mall started a program called Latin Pass in conjunction with 12 South American airlines. Pass holders receive one mile for every dollar they spend shopping, and win a free round-trip airline ticket from their country upon reaching 35,000 miles. So far, several families have won free tickets by pooling their purchasing power, says Holmes.

In addition, the Simon DeBartolo malls offer $3,000 in gift certificates to the South American tour operator that sends the most shoppers. The malls also advertise in South American newspapers and in magazines such as Vanidades and Cosmopolitan in Spanish. Recently, Dadeland sponsored a fashion show to benefit an AIDS organization in Bogota, Colombia.

International advertising and promotions account for half of the marketing budget at Dadeland. "The international market, especially South America, is as important as the domestic market," she says.

Sawgrass Mills also is flexing marketing muscle. The Mills Corp. is increasing the frequency of magazine advertising in South America from once per quarter to twice per quarter. Also, the company recently hired general sales agents on the continent to market its properties directly to travel agents and tour wholesalers.

"We decided that it makes a lot of sense for us to have people in the market," says Lipscomb. "We hired a person in Brazil to [market] all the Mills properties. The properties other than Sawgrass are just starting to develop their Brazilian business. The agent in Argentina is exclusively selling Sawgrass.

"Sawgrass Mills' international advertising budget has grown considerably in recent years, says Lipscomb. She declines to give numbers but says the investment is paying off, with sales to South Americans growing 20 percent to 30 percent per year.

Each day, caravans of buses loaded with foreigners pull into Sawgrass Mills. Up to 20 buses come per day, and sometimes hundreds per week during the summer peak of the South American shopping season. Overall, Lipscomb says, Sawgrass attracted more than 25 million shoppers last year, making it one of the state's most popular tourist stops.

In contrast to Sawgrass Mills, The Galleria has only just begun to aggressively target South American shoppers. About 10 percent of the mall's shoppers are South Americans, says Montgomery. However, she expects that figure to rise as new marketing programs take hold.

Late last year, the mall hired a director of tourism who has started promoting the property at travel industry trade shows in Brazil, Venezuela, Colombia and Argentina. Since October, The Galleria has arranged for visits by five tour groups from South America.

"We really just started tapping the market," says Montgomery. "Our location near the hotels and Fort Lauderdale Beach has led us to realize that it's a market we can grow.

"To step up its marketing efforts, Aventura Mall, owned by North Miami Beach, Fla.-based Turnberry Associates, is teaming with Turnberry Isle Resort and Country Club to kick off a new promotion program this spring, says marketing manager Carolyn Feimster. The package offers South Americans a shopping tour of Aventura Mall and resort amenities such as breakfast, spa visits and golfing. Feimster is advertising the package in Expressions magazine, an American Express publication distributed in South America.

"We began the [South American promotion] two and a half years ago," says Feimster. "Each year we increase our exposure down there. This year, we've scheduled a dozen trips to five countries - Brazil, Colombia, Argentina, Chile and Venezuela. We set up one-on-one meetings with important tour operators and wholesalers. We also host dozens of visits from them each year, along with journalists.

"The Falls, owned by Bloomfield Hills, Mich.-based The Taubman Co., is working on a nature-oriented shopping tour to be unveiled later this year. Marketing director Julie Goldman explains: "We are working in partnership with nearby attractions like Parrot Jungle, Monkey Jungle and Fairchild Gardens, and with South American tour and wholesale operators, to market a shopping tour that would include visits to those sites, along with shopping discounts."

The Falls is somewhat tougher to sell to South Americans than other malls, says Goldman, because it sits far south of downtown Miami, away from the main tourist attractions. The nature program is an effort to take advantage of what the area surrounding The Falls has to offer, she says.

Fueling the boom The South American shopping boom has roots in the 1970s. That's when the Venezuelan oil industry began to flourish, prompting droves of people from that country to make shopping trips to Miami.

As the economies of other South American nations improved, people gained more disposable income, which they were willing to spend in Florida malls. The healthy South American economies also have made it cheaper to travel to Florida.

"In those countries, it used to be that only people with financial means traveled," says Holmes. "But now, the economies of the nations afford almost anyone the opportunity to travel. Airfares are more competitive. And people who don't have the money can finance trips. Many countries have also lowered their import duties because the economies are better.

"Indeed, retail experts say, visits to Florida malls have become a way of life for many South Americans. According to Cohen, a growing number of South American parents are giving Florida shopping trips to daughters celebrating their quinceanera, or 15th birthday. In some cases, Cohen notes, the trips substitute for the traditional religious ritual and wedding-type ceremony marking the birthday.

Some South Americans visit Florida so frequently that they know the shopping terrain as well as natives. Says Steve Bittel, president of Terranova Corp., a Miami-based mall management and leasing firm: "In their first visits, they tend to shop mostly in downtown Miami.

"Eventually, as they make multiple trips and become familiar with the market, they end up shopping at regional malls and discount stores, and behaving no differently than American consumers - except that they spend more money.

There are several reasons that south Florida is a shopping mecca for so many South Americans:

* The region has more than 30 major malls with prices generally lower than those in the visitors' home countries.

* Miami International Airport has plenty of convenient and inexpensive air connections to South America.

* Spanish- and Portuguese-speaking visitors feel comfortable in south Florida. The population of Miami-Dade County is more than 50 percent Hispanic; the Broward Hispanic population, now about 15 percent, is rising rapidly.

* Visitors can always find salespeople who speak their language, restaurants that serve their favorite foods and nightclubs that play their music.

* The warm weather and beaches, of course, are also attractions.

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