Crowds Flock to IKEA and Fortnum & Mason Amid Reports of Withdrawal from China and Hong Kong

Crowds Flock to IKEA and Fortnum & Mason Amid Withdrawal News
"Stark Contrast to the Economic Downturn"

Last weekend, record-breaking crowds flocked to IKEA stores in mainland China and the Fortnum & Mason store in Hong Kong. As news spread that famous international brands were withdrawing from China and Hong Kong, each store was packed with shoppers, creating scenes that stood in stark contrast to the recent economic downturn.

As news of the closure spread, an unusual crowd of shoppers gathered at the Fortnum & Mason store in Hong Kong (left) and the IKEA store in China. Screenshot from Hong Kong Xinbao, Yonhap News Agency

The Swedish furniture company IKEA announced that it will close seven large stores, including those in the suburbs of Shanghai and Guangzhou, starting in early February. Even though the IKEA stores slated for closure did not hold large-scale "farewell sales," unprecedented crowds still gathered. On social networking services (SNS), photos of shoppers waiting in long lines at IKEA went viral and became a hot topic.

This outlet analyzed that the surge in customers was driven more by emotional reasons than by prices. Many citizens reportedly said, "After hearing about the closure, I wanted to visit one last time," and "IKEA has been with us for many years." Currently, there are about 40 IKEA stores in mainland China. The report added that IKEA is shifting its market strategy by reducing the number of large stores and increasing smaller locations.

In Hong Kong, the British premium tea brand Fortnum & Mason announced it will cease operations as of January 25. Fortnum & Mason opened its first Asian flagship store in Tsim Sha Tsui, Hong Kong, in 2019, but decided to close after a significant decline in sales due to shrinking consumer spending.

When news of discounts due to the closure broke, record crowds gathered, with the number of people waiting to purchase reportedly exceeding 1,000 at one point. In some cases, products sold out so quickly that the store closed earlier than scheduled.

Regarding these cases, the media noted, "This shows that consumers in China and Hong Kong are not necessarily lacking in spending power," and that "what is needed is a trigger to unleash their consumption." The report also pointed out, "A closing sale is something that can only be used once," adding, "If retail companies can effectively utilize economic and psychological effects without closing their stores, they will be able to win in future competition."