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MARCH 2018 · SUMMIT OF THE AMERICAS · VOL 28 · NO 1
Brazil’s side of the border expected to open p. 14 Dufry’s New Generation Store concept comes to life p.2/21/18 34 5:11 PM London Supply expands further South in Argentina p. 56
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LETTER FROM THE EDITOR
MARCH 2018· SUMMIT OF THE AMERICAS · VOL 28 · NO 1
The Americas Duty Free & Travel Retailing magazine (ISSN 0962-0699) is published four times a year April, June, October and November by Global Marketing Company Ltd. 26 Pearl Street, Mississauga, Ontario L5M 1X2 Canada. It is distributed throughout Central America, South America, the United States, Canada, U.S. Virgin Islands, U.S. Pacific islands, and the islands in the Caribbean. The views expressed in this magazine do not necessarily reflect the views and opinions of the publisher or the editor. March 2018, Vol 28. No. 1. Printed in Canada. All rights reserved. Nothing may be reprinted in whole or in part without written permission from the publisher. © 2018 Global Marketing Company Ltd.
THE AMERICAS DUTY FREE & TRAVEL RETAILING 26 Pearl Street Mississauga, Ontario L5M 1X2 Canada Tel: 1 905 821 3344; Fax: 1 905 821 2777 www.dutyfreemagazine.ca PUBLISHER Aijaz Khan email@example.com EDITORIAL DEPARTMENT EDITOR-IN-CHIEF Hibah Noor firstname.lastname@example.org SENIOR EDITOR Wendy Morley email@example.com ASSOCIATE EDITOR Jas Ryat firstname.lastname@example.org SOCIAL MEDIA COORDINATOR Eman Khan email@example.com ADVERTISING AND MARKETING MANAGER Kevin Greene firstname.lastname@example.org ART DIRECTOR Jessica Hearn email@example.com CONTRIBUTORS Mary Jane Pittilla Ronnie Lovler
CIRCULATION & SUBSCRIPTION MANAGER firstname.lastname@example.org
Reaching a new Summit W
hile those in the duty free industry are meeting in Orlando in March as it happens every year, 2018 will be very different. This is the first year that IAADFS and ASUTIL are both fully committed to this event, christened the Summit of the Americas, with ASUTIL no longer holding a separate conference. About two years of planning have gone into this true joining of forces, and it’s safe to say everyone is very excited to see the result. In addition to the trade show floor – always an important part of IAADFS and the chance for brands to showcase what’s new – will be ASUTIL-style educational sessions and an opportunity to meet with the buyers all week and in the “Buyer’s Lounge.” As ASUTIL Secretary General José Luis Donagaray stated in our exclusive interview, “You will have all the brands and the buyers. You will save money and time. This is about doing business.” As a region, Latin America is also bringing out enthusiasm on the part of the industry; it is on an upward trend after two years of contraction, and retailers are seeing the results. London Supply’s Magdalena Ducos has often said the company’s Puerto Iguazu store is somewhat protected from economic ups and downs, and after a slowdown in 2016, with the help of “retailtainment,” the store is bouncing back. The company is also finally opening the Rio Gallegos free zone in the country’s Patagonia region, so will be especially busy this year. Of particular importance to South America’s duty free industry, Brazil will soon allow border stores. This could have an enormous effect on stores that currently border the country, as Carlos Loaiza Keel tells us, and the industry is anxious to see if there will be an even playing ground. Meanwhile, airports in LATAM, the Caribbean and North America continue to offer opportunities for companies such as Motta and Dufry to expand. Dufry has upped its game again, offering a whole new shopping experience, which you can read about in our interview with Rene Riedi. This year’s inaugural Summit of the Americas is sure to offer a world of opportunities for brands, buyers and others with stakes in the industry. We at Americas Duty Free wish you a very successful event. Kindest Regards,
Hibah Noor Editor-in-Chief email@example.com
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
LETTER FROM THE EDITOR
Hacia una nueva Cumbre S
i bien todos los participantes del sector duty free se reunirán en Orlando en marzo como ocurre cada año, el 2018 será muy diferente. Por primera vez, IAADFS y ASUTIL estarán total y conjuntamente comprometidos con este evento, que lleva el nombre de “Cumbre de las Américas”, pues ASUTIL no seguirá organizando una conferencia independiente. Cerca de dos años de planificación se han materializado en esta auténtica unión de fuerzas, y no exagero cuando digo que todos están muy entusiasmados por ver el resultado. Además del salón de exposiciones– que es siempre parte importante de IAADFS, y la oportunidad de que las marcas muestren sus nuevos productos– será la conferencia de ASUTIL, y la posibilidad de reunirse con los compradores para Latinoamérica. Como bien afirmó José Luis Donagaray, Secretario General de ASUTIL en nuestra entrevista exclusiva: “Tendrán todas las marcas y los compradores. Ahorrarán tiempo y dinero. Todo está enfocado en hacer negocios”. Como región, Latinoamérica también está aportando entusiasmo por parte de la industria, que experimenta una tendencia ascendente luego de dos años de contracción, y los comerciantes minoristas están viendo los resultados. Magdalena Ducos, de London Supply, ha dicho con frecuencia que la tienda de la compañía en Puerto Iguazú está protegida en cierta medida
4 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
de los altibajos económicos, y después de una desaceleración en el 2016, con la ayuda del “minoristenimiento”, la tienda se recupera. Y como la compañía está inaugurando la zona libre de Río Gallegos en la región de la Patagonia, estará particularmente ocupada este año. Asimismo, y de particular importancia para el sector duty free de Suramérica, Brasil permitirá próximamente la creación de tiendas de frontera. Esta medida podría tener un enorme efecto en las tiendas que bordean actualmente el país, tal y como nos afirmó Carlos Loaiza Keel; y la industria está ansiosa por ver si habrá igualdad de condiciones de operación. Entretanto, los aeropuertos de Latinoamérica, el Caribe y Norteamérica siguen ofreciendo oportunidades de expansión para compañías como Motta y Dufry. Dufry ha subido nuevamente la parada, ofreciendo una experiencia de compras totalmente nueva, cuyos detalles podrán conocer en nuestra entrevista con René Riedi. La edición inaugural de la Cumbre de las Américas este año, ofrecerá seguramente un mundo de oportunidades para marcas, compradores y otros participantes del sector duty free. Americas Duty Free les desea un evento muy exitoso. Muy cordialmente,
Hibah Noor Editora en Jefe firstname.lastname@example.org
Lead Stories 14 Brazil border shops Brazil’s debut
Brazil’s side of the border is expected to open for business in 2018 as the government begins reviewing permit requests to establish duty free shops
El debut de Brasil
Se espera que la parte de la frontera perteneciente a Brasil esté lista para operar en el 2018, si el gobierno comienza a revisar solicitudes de permiso para crear tiendas duty free
22 Motta International Continued growth
Motta International is focusing on its home base in Panama as Tocumen airport undergoes a major expansion effort, but is still keeping tabs on its new stores in other regional locations like Colombia and Trinidad and Tobago
En continuo crecimiento
Motta se enfoca en su base de operaciones en Panamá con una importante iniciativa de expansión en el aeropuerto de Tocumen, sin desatender sus nuevas tiendas en otras plazas regionales como Colombia y Trinidad-Tobago
34 Dufry Group Dufry 2.0 After a few years focused on acquiring and creating new stores, travel retail giant Dufry is beginning to transform the industry from within; the New Generation Store transformation is coming to life in targeted stores around the globe, most recently in Cancun
Dufry 2.0 Después de algunos años de enfoque en la adquisición y creación de nuevos establecimientos, el gigante minorista de viajes Dufry comienza a transformar la industria desde dentro. La transformación de New Generation Store cobra vida en tiendas selectas de todo el mundo, y más recientemente en Cancún
52 Baja Duty Free An optimistic future for Baja Duty Free
Irene Rojas, Marketing manager & Elisa Castro, Vice President of Retail at Fairn & Swanson Inc., reveals how corporate developments, renovations and brand awareness will lead to a buoyant 2018 for its US/Mexican operator Baja Duty Free
56 London Supply New horizons
London Supply plans to open its new complex in Argentina’s southern Patagonia region in the first half of 2018 and readies for another dynamic year of ‘retailtainment’ offerings in Puerto Iguazú
28 Dufry Brazil
As the largest economy in South America, Brazil continues to offer both challenges and opportunities. As General Manager Brazil and Bolivia Gustavo Fagundes reports in this exclusive interview, Dufry is always poised and ready to progress, regardless of circumstances
Features Anonymous questionnaire 12 TRG kicks off in Texas 45 MyDutyFree upswing 48
Siñeriz Shopping steps beyond Caribbean deals with hurricane Ready. Set. Satori
78 82 84
Lead Stories 64 Summit of the Americas All change for the Summit of the Americas IAADFS President and CEO Michael Payne reveals the thinking behind the major program changes for the 2018 Summit of the Americas and confirms that the event will move to a new location from 2019
70 Frontier Duty Free Association FDFA: End of an era and new beginnings Winds of change are expected in Canada with a new outlook on improvement of the annual Frontier Duty Free Association tradeshow
72 Regional Overview
Outlook is good for for regional duty free and travel retail industries as investments grow and businesses expand, with economic recovery in LATAM and the Caribbean recovering from impact of 2017’s devastating hurricanes
76 ARI North America
Keeping travelers in The Loop
Award-winning operator ARI North America is living up to its promise of “Experience is Everything” at both its new and revamped stores across the region
86 m1nd-set Research
Americas airport shops under scrutiny
Travel retail researcher m1nd-set has released its latest duty free business intelligence, based on 11,000 face-to-face interviews at airports across the Americas
92 Safe Skies
96 94 Mazaya
Socializing at the Summit
Innovative tobacco brand Mazaya is gearing up for success in the Americas market, due to the huge take-up of the shisha trend among trendy millennial consumers
96 Essence Corp
A team with a mission celebrates 30 wonderful years
As the beauty distributor marks its 30th anniversary, Americas Duty Free sits down with Essence Corp’s owners Patricia and Jean-Jacques Bona to find out what makes the company tick
Safe Skies has the market on lock Safe Skies luggage lock brand shares how a major victory in court is the key to its future
Costa Sunglasses expands 98 Buckley London returns to Orlando 104 Editor’s picks 106
Spotlight on SOTA exhibitors Lindt tells a different story
DISCOVER A WORLD OF SHOPPING Wherever you go, make Dufry your first destination. Find world class brands at the best prices in our worldwide network of 2,200 stores, in 63 countries across six continents.
118 Lead Stories 100 Morrocanoil In full swing JuE Wong, Global CEO of Moroccanoil, shares her long-term and ambitious vision for the beauty brand to Americas Duty Free
112 The Hershey Company
Hershey bulks up for travel retail
The Hershey Company uses its retail store success to find a parallel in global travel retail
120 Guest Writer Empowering the alcohol category through collaboration Mohit Lal talks about brand building, enhancing customer relationships and corporate structures as a new organization for the global travel retail channel is established at French liquor group Pernod Ricard
The family-owned company may have become famous for its rum, but the name Bacardi is now associated with some of the top global spirits brands, often appearing in GTR campaigns across the Americas region
The brass ring
Edrington has been working with a clear vision toward claiming its rightful place in travel retail and beyond, and The Macallan Quest Collection is this year’s grand step in the right direction
128 Beam Suntory Combine and conquer: Beam Suntory’s new resolution Global liquor group Beam Suntory explains how combining its bourbon portfolio into one global category solution for retailers is the key to success in 2018
126 Features Flor de Caña looks to the future Spirits in the Americas Distell gives back
118 122 130
Sazerac educates consumers 132 Bonfils brings France to the world 136 MONARQ strengthens its portfolio 137
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WHAT DO YOU THINK If I had known about the option of having meetings with buyers in “buyer’s lounge” on Wednesday I wouldn’t have exhibited on the trade floor!
of the creation of Summit of the Americas tradeshow and modified program?
I think it is a very good idea to have two shows in one venue. IAADFS was declining in visitor numbers, we were considering pulling out.
Both IAADFS and ASUTIL conference needed a change of format. IAADFS was falling behind on attendance, while ASUTIL was adding more buyers each year. Personally, I was doing good business on both; whoever I did not have the opportunity to meet in Orlando, I was able to see in ASUTIL. It is too early to tell. We need to have this first experience in March 2018 and see the results. But a combination of both shows should be very positive for the business.
12 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
I think they should move the tradeshow from Orlando to either Panama, Mexico or somewhere in the Caribbean.
As a small supplier the costs of attending multiple regional tradeshows have enforced us to be selective but the new Summit of the Americas will hopefully enable us to have a wider exposure in one trade event
Maybe the creation of the buyer’s lounge and facilitating meetings in the lounge on Wednesday will stop the buyers from leaving to see suppliers in Miami. Instead maybe the suppliers will visit as Visitors.
We believe that strategically the combination of IAADFS and ASUTIL is the right decision. A change was needed, over the past several years we have noticed a decrease in floor space and relevant foot traffic on the trade floor. The scheduling of this year’s show unfortunately coincides with “ProWein” in Düsseldorf, Germany, which focuses on Spirits and Beer. As a result of this, and some other factors, a number of our clients and suppliers have indicated they will not visit Orlando this year.
Yes, having a show of the Americas is beneficial and there is a conference. There is a need to move the venue from Disneycontinue to other locations every year
Remains to be seen – we only judge after the show if we meet same people with same kind of quality of meetings
The consolidation of the duty free industry into larger more powerful retail groups is often seen as a barrier to new suppliers and brands; hopefully buyers attending the Summit of the Americas will recognize the commitment of all agents/suppliers to bring new sales opportunities to the market
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Brazil Border Shops
debut by RONNIE LOVLER
Brazil’s side of the border is expected to open for business in 2018 as the government begins reviewing permit requests to establish duty free shops
hange is in the wind for the duty free and travel retail industry in Brazil. Under a new law that is soon to be implemented, duty free stores will be allowed to operate on the Brazilian side of the country’s border with Uruguay, Argentina, Bolivia and Venezuela. Expectations are that the first Brazilian duty free stores on the border will open their doors in 2018. In an exclusive interview with Americas Duty Free, Carlos Loaiza Keel, Secretary-General of the Chamber of Commerce of Free Shops of Uruguay, said Brazil’s Federal Revenue Service, or Receita, could begin reviewing permit requests from Brazilian entrepreneurs as early as March.
The Uruguayan free shop operators are worried about the possible advantage the Brazilians could have. Current information is that Brazil would allow its nationals to make duty free purchases of up to US$300 per visit, which is twice as much as what is currently allowed on the Uruguayan side of the border. Duty free 14 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Brazil Border Shops
“The concern in Uruguay is that the stores in border cities like Chuy and Rivera will suffer once Brazilian free stores go operational, unless Uruguay gives its nationals the same shopping parameters as the Brazilians have.”
Carlos Loaiza Keel, Secretary-General of the Chamber of Commerce of Free Shops of Uruguay
shop operators on the Argentine, Bolivian and Venezuelan side of the border have similar concerns. “According to information provided by Brazilian authorities, the final regulatory instruction of the Revenue Service will be issued in the coming days with a view to reviewing the first requests to operate in March,” Loaiza said. “Logically that does not mean the stores will be operational, because the effective opening of a store requires multiple activities before it can serve the public.” Still, Loaiza was quick to acknowledge that there are positive aspects to the Brazilian entry into the regional free shop system. “They are a business threat because they will be our competitors, but at the same time they would broaden the market,” he said. “The new businesses will generate more commercial opportunities and bring more tourists to the area. What needs to happen is to be sure the rules of the game are equal for both sides, and Brazil has a different system.”
Same parameters necessary
The concern in Uruguay is that the stores in border cities like Chuy and Rivera in that country will suffer once Brazilian free stores go operational, unless Uruguay gives its nationals the same shopping parameters as the Brazilians have. Presently, Uruguayans are not permitted to shop duty free in domestic border stores. Brazilian nationals are limited to US$150 in purchases by law, 50% less than the tax-free allowance they would be permitted in Brazil under existing proposals. Loaiza and other chamber delegates recently traveled to Brasilia to present their case and have also been in close contact with colleagues in the duty free and travel retail industry in the region to seek their support. Some aspects of the existing norms worry Loaiza and others, particularly the degree of regulatory control that the Brazilian government may exercise over who is allowed to enter the market. “Right now, anyone can enter the market if they have enough money, and we feel the entry level is not very high. It permits anyone to enter the market. We want to preserve the
16 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
characteristics that the border has up to now, which is controlled by governments,” he said.
Concerns of legitimacy
Another major worry is that opening the border to new business could “create an opportunity of money of doubtful origin,” Loaiza said. “Up to now we have preserved the border the same way the Canadian-US border is managed, and we want to continue like that.” Established duty free operators and organizations are pushing for adequate governmental controls over norms and procedures for the establishment of Brazilian free shops so that the soon-tobe-realized dual border shopping opportunities parallel those of the US and Canada. “We are working closely with the Uruguayan Government, which is very sensitive to the issue, so their actions are responsive to the need for a comparable competition between the two regimes, Brazilian and Uruguayan,” said Loaiza. “The Uruguayan Government is in permanent contact with the Brazilian Government to reach consensus on some of these aspects, and we are collaborating with them. We have proposed concrete measures and we are optimistic about them.”
But the Chamber of Commerce of Free Shops of Uruguay is casting a wider net in its lobbying efforts and is working to generate legislation that would benefit duty free shop operators in all the countries of the Southern Cone that are part of the Mercosur pact. The Brazilian law allowing the establishment of border stores was first approved in 2012, and has gone through a regulatory review and public consultation process since then. The period for public comment on the law ended in Brazil in December 2017. Loaiza said the chamber has no issues with Brazilian entrepreneurs getting into the duty free shop business, as long as there is equal opportunity. “The rules of the game need to be equal for both sides,” Loaiza said.
Brazil Border Shops
El debut de Brasil Se espera que la parte de la frontera perteneciente a Brasil esté lista para operar en el 2018, si el gobierno comienza a revisar solicitudes de permiso para crear tiendas duty free
ay cambios latentes para el sector duty free y minorista de viaje en Brasil. Según una nueva ley que se implementará próximamente, las tiendas duty free podrán operar en el lado de la frontera perteneciente a Brasil y limítrofe con Uruguay, Argentina, Bolivia y Venezuela. Se espera que las primeras tiendas duty free brasileñas en la frontera abran sus puertas en el 2018. En una entrevista exclusiva con Americas Duty Free & Travel Retail, Carlos Loaiza Keel, secretario general de la Cámara de Comercio de Tiendas Libres de Uruguay, afirmó que el Servicio Federal de Impuestos de Brasil conocido como Receita, podría comenzar a revisar solicitudes de permiso presentadas por empresarios brasileños en fecha tan temprana como marzo próximo.
18 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Los operadores de tiendas libres uruguayas están preocupados por la posible ventaja que podrían tener las tiendas brasileñas. La información actual es que Brasil les permitiría a sus ciudadanos hacer compras duty free de hasta $300 por visita, lo cual equivaldría al doble de lo permitido en la parte uruguaya de la frontera. Los operadores de tiendas duty free en los lados de la frontera pertenecientes a Argentina, Bolivia y Venezuela comparten preocupaciones similares. “Según la información proporcionada por las autoridades brasileñas, la instrucción regulatoria final del Servicio de Impuestos se daría a conocer en los próximos días, con la posibilidad de revisar las primeras solicitudes de operación en marzo”, explicó Loaiza. “Lógicamente, eso no quiere decir que las tiendas estarán en capacidad de operar, porque la inauguración efectiva de un establecimiento exige la realización de múltiples actividades antes de que pueda servir al público”. Sin embargo, Loaiza reconoció en seguida que existen aspectos positivos para la entrada de los establecimientos brasileños en el sistema regional de tiendas libres. “Son una amenaza a los negocios porque serán nuestras competidoras,
Brazil Border Shops
Duty free stores will be allowed to operate on the Brazilian side of that country’s border with Uruguay, Argentina, Bolivia and Venezuela
pero al mismo tiempo ampliarían el mercado”, afirmó. “Los nuevos negocios generarán más oportunidades comerciales y atraerán más turistas a la zona. Lo que necesitamos es garantizar que las reglas del juego sean iguales para ambos lados, pero Brasil tiene un sistema diferente”.
Se necesitan parámetros similares
La preocupación en Uruguay estriba en que las tiendas en ciudades fronterizas de esa nación, como Chuy y Rivera, sufrirían en cuanto las tiendas libres brasileñas entren en operaciones, a menos que Uruguay adopte con sus ciudadanos los mismos parámetros en vigencia para las tiendas brasileñas. En la actualidad, los uruguayos no pueden comprar mercancía duty free en tiendas fronterizas nacionales. Por su parte, los brasileños tienen, por ley, una limitación de compra de $150, un 50 por ciento menos que la asignación libre de aranceles que se les permitiría en Brasil si se aprueban las propuestas existentes. Loaiza y otros delegados de la Cámara viajaron recientemente a Brasilia para explicar su caso, y también han estado en estrecho contacto con sus colegas en el sector duty free y minorista de viajes de la región, para solicitar su apoyo. Algunos aspectos de las normas existentes preocupan a Loaiza y a sus colegas, en particular el grado de control regulatorio que el gobierno brasileño podría ejercer con respecto a quiénes se les permitiría entrar en el mercado. “En estos momentos, cualquiera puede entrar en el mercado si tiene dinero suficiente, y estimamos que el nivel de entrada no es muy alto, lo cual permite que cualquiera pueda entrar en el mercado. Queremos preservar las características que ha tenido la frontera hasta ahora, controlada por los gobiernos”, agregó Loaiza.
Preocupaciones sobre legitimidad
Otra preocupación notable es que la apertura de la frontera a nuevos negocios “podría crear una oportunidad de dinero de dudosa procedencia”, según Loaiza. “Hasta ahora hemos
20 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
“La preocupación en Uruguay estriba en que las tiendas en ciudades fronterizas de esa nación, como Chuy y Rivera, sufrirían en cuanto las tiendas libres brasileñas entren en operaciones, a menos que Uruguay adopte con sus ciudadanos los mismos parámetros en vigencia para las tiendas brasileñas.” preservado la frontera de la misma forma en que se administra la frontera entre Canadá y los Estados Unidos, y queremos que siga así”, añadió. Los operadores y organizaciones duty free establecidas están ejerciendo presión a favor de controles gubernamentales adecuados con respecto a normas y procedimientos para la creación de tiendas libres brasileñas, a fin de que las oportunidades duales de compras de frontera, que se materializarán muy pronto, sean paralelas a las vigentes en los Estados Unidos y Canadá. “Estamos colaborando estrechamente con el gobierno uruguayo, que es muy perceptivo con este tema, para que sus acciones respondan a la necesidad de una competencia comparable entre los dos sistemas de tiendas libres, el brasileño y el uruguayo”, destacó Loaiza. “El gobierno uruguayo está en contacto permanente con el brasileño para lograr un consenso en algunos de esos aspectos, y nosotros estamos colaborando con ellos. Hemos propuesto medidas concretas y nos sentimos optimistas con respecto a las mismas”.
Igualdad de oportunidades
Pero la Cámara de Comercio de Tiendas Libres de Uruguay está siendo más abarcadora en sus iniciativas de cabildeo, y tratando de generar una legislación que beneficiaría a los operadores de tiendas libres en todos los países del Cono Sur que forman parte del pacto del Mercosur. La ley brasileña que permite la creación de tiendas de frontera fue aprobada por primera vez en el 2012, y desde entonces ha sido sometida a un proceso de revisión regulatoria y consultas públicas. El período de presentación de comentarios públicos sobre dicha ley culminó en Brasil en diciembre del 2017. Loaiza agregó que la Cámara no tiene problema alguno con la entrada de los empresarios brasileños en el negocio de tiendas duty free, siempre y cuando haya igualdad de oportunidades. “Es necesario que las reglas del juego sean iguales para ambas partes”, concluyó.
growth by RONNIE LOVLER
Motta International is focusing on its home base in Panama as Tocumen airport undergoes a major expansion effort, but is still keeping tabs on its new stores in other regional locations like Colombia and Trinidad and Tobago
M Motta International offers its customers an opportunity to purchase exclusive Adidas products at its Adidas store at El Dorado International Airport in Bogota
22 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
otta International is looking homeward to Panama for company expansion and growth in 2018 with more duty free opportunities there. Company CEO Erasmo Orillac says the time is right for his Panamanian-based company to pay more attention to their own home front, given that Panama’s Tocumen International Airport is looking forward with its construction of a second terminal building. In an exclusive interview with Americas Duty Free, Orillac said it is an exciting time to be doing business in Panama. “We will see a bigger and better airport there, with a greater capacity for passengers,” he said.
“Panama is very important for us. It is our home, and apart from that Tocumen is an airport that is growing,” he said. “It is an important airport and the home base for Copa Airlines, with 12 million passengers.” In fact, Tocumen International Airport, which is already a hub for Central and South America, expects to increase its capacity to 25 million once the new terminal opens. More passengers mean more possibilities for duty free business. Motta has a long history in Panama. According to the company’s website, under the name of Motta & Motta, the company began selling liquors and perfumes to cruise shops transiting the Panama Canal in 1936. One year after the Colon Free Zone was opened in 1948, Motta & Motta opened the first duty free store in the hemisphere. In 1952, the Colon Free Zone issued its first operating license to Motta International, which had three employees at the time. Now, nearly 70 years later, Motta International’s footprint is all over Latin America. In addition to Panama, Motta International has done business as Attenza Duty Free in Colombia, Mexico, Nicaragua, Venezuela, Ecuador, and El Salvador, with Trinidad and Tobago and Cuba joining the mix in 2017. In Panama, Motta successfully bid on a contract to operate a traditional duty free store in the old terminal late last year. “We won the bid for a 724-square-meter store, and we are hoping to open in April 2018,” Orillac said. “The concession is only for general duty free merchandise. In the shop we are remodeling, we will have a MAC shop, as cosmetics is considered traditional duty free under the bid.”
Motta had a concession in the still-operational old terminal, as it is now known in Panama, under a 10-year contract that expired in December 2017. But Orillac said Motta is already gearing up to make its proposals for spots in the new terminal when bidding opens for new concessions later this year. Motta International is also closely monitoring its new operations in Trinidad and Tobago. Last year, the company opened three stores at Piarco International Airport, its first business venture on the islands, under a five-year contract. Orillac said it is too soon to talk about Motta International’s future there. “It is still a learning process and it has taken us some time to get to know the customer profile.” Orillac said bids are in place in other international locations where Motta International already has a presence, such as Colombia and Ecuador. “It is business as usual in the other places. We are building stores and bidding for new stores. We are concentrating on Panama right now,” he said. In addition to retail, Motta International is paying attention to e-commerce and its online business offerings for travelers. “We already have services in some countries where people can enter, reserve merchandise and pick it up at at the airport,” he said. “Colombia, Ecuador, Panama, El Salvador and Nicaragua – if you go to one of those places you can order and we will have merchandise ready for you.” He said online trade accounts for 6 to 7% of the company’s business. So what more is in store for Motta International in 2018? As a privately held business, Orillac is reluctant to share too much. But he said 2017 was a good year, and he anticipates another good year for 2018.
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Motta has been learning about its customers since opening shop at Piarco International Airport in Trinidad and Tobago
Over its nearly 70 years of existence, Motta has opened stores in many locations in South America, including El Dorado International Airport in Bogota
crecimiento Motta se enfoca en su base de operaciones en Panamá con una importante iniciativa de expansión en el aeropuerto de Tocumen, sin desatender sus nuevas tiendas en otras plazas regionales como Colombia y Trinidad-Tobago 24 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
otta International está concentrándose en su base operativa de Panamá para lograr la expansión y el crecimiento de la compañía en el 2018 con más oportunidades de tiendas duty free. Erasmo Orillac, Director Ejecutivo de la compañía, afirma que es el momento preciso para que su firma, radicada en Panamá, preste más atención a su propio frente principal, dado que el Aeropuerto Internacional Tocumen está mirando al futuro, con la construcción del edificio de una segunda terminal. En una entrevista exclusiva con Americas Duty Free, Orillac aseguró que es un momento pleno de entusiasmo para hacer negocios en Panamá. “Tendremos un aeropuerto más grande y mejor allá, con una mayor capacidad de atención a pasajeros”, afirmó. “Panamá es muy importante para nosotros. Es nuestra sede, y aparte de eso, Tocumen es un aeropuerto en pleno crecimiento”, explicó. “Es un aeropuerto importante y la base de operaciones de Copa Airlines, con 12 millones de pasajeros”. Por
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cierto, el Aeropuerto Internacional Tocumen, que ya es centro de concentración de vuelos para Centro y Suramérica, espera incrementar su capacidad a 25 millones de pasajeros cuando se inaugure la nueva terminal. Y más pasajeros equivale a más posibilidades para el negocio duty free. Motta tiene un extenso historial de trabajo en Panamá. Según el sitio web de la compañía, comenzó a vender licores y perfumes, bajo el nombre de Motta & Motta, a las tiendas de cruceros que cruzaban el Canal de Panamá en 1936. Un año después de la inauguración de la Zona Libre de Colón en 1948, Motta & Motta abrió la primera tienda duty free en el hemisferio. En 1952, la Zona Libre de Colón expidió su primera licencia de operación a Motta International, que en ese momento contaba con tres empleados. En la actualidad, a casi 70 años de distancia, la huella de Motta International se extiende por toda Latinoamérica. Además de Panamá, Motta International tiene negocios en Attenza Duty Free en Colombia, México, Nicaragua, Venezuela, Ecuador, y El Salvador. Además, Trinidad-Tobago y Cuba se incorporaron a la lista en el 2017. En Panamá, Motta ganó a finales del año pasado una licitación para un contrato de operación de una tienda duty free tradicional en la antigua terminal. “Ganamos la licitación para operar una tienda de 724 pies cuadrados, y esperamos inaugurarla en abril del 2018”, expresó Orillac. “La concesión es solamente para mercancía duty free general. En establecimiento, que ya estamos remodelando, tendremos una tienda MAC, pues los cosméticos se consideraron mercancía duty free tradicional en los términos de la licitación”. Motta tenía una concesión en la antigua terminal, como se conoce en Panamá, que sigue operando, amparada por un contrato de diez años que expiró en diciembre del 2017. Pero
Attenza’s three stores at Piarco International Airport in Trinidad and Tobago were the company’s first venture on the islands, under a five-year contract
26 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Orillac reveló que Motta ya está preparándose para formular propuestas para establecimientos en la nueva terminal cuando, a fines de este año, se inicie la licitación para nuevas concesiones. Motta International también está supervisando estrechamente sus nuevas operaciones en Trinidad-Tobago. El año pasado, la compañía abrió tres tiendas en el Aeropuerto Internacional Piarco, primera empresa comercial de la compañía en las islas, amparada por un contrato de cinco años. Pero Orillac advirtió que es demasiado pronto para hablar sobre el futuro de Motta International allí. “Todavía estamos en un proceso de aprendizaje, y nos ha tomado algún tiempo conocer las características del cliente”. Orillac agregó que existen otras licitaciones para otras plazas internacionales en las que Motta International ya está presente, como Colombia and Ecuador. “En los otros lugares los negocios marchan como siempre. Estamos construyendo tiendas y participando en licitaciones para nuevos establecimientos. En estos momentos estamos concentrándonos en Panamá”, destacó el alto funcionario. Además del sector minorista, Motta International está prestando atención al comercio electrónico, y a sus ofertas en línea para viajeros. “Ya contamos con servicios en algunos países donde los clientes pueden visitar el sitio web, reservar mercancías, y recogerlas posteriormente en el aeropuerto”, explicó. “Todo el que vaya a Colombia, Ecuador, Panamá, El Salvador y Nicaragua podrá hacer su pedido, y le tendremos la mercancía lista”. Orillac agregó que el negocio en línea totaliza del 6 al 7% de la operación de la compañía. ¿Qué más nos tiene reservado Motta International en el 2018? Como se trata de un negocio privado, Orillac es reacio a las revelaciones excesivas, pero aseguró que el 2017 fue un buen año, y que espera que el 2018 también lo sea.
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Gustavo Fagundes, General Manager of Dufry Brazil and Bolivia
As the largest economy in South America, Brazil continues to offer both challenges and opportunities. As General Manager Brazil and Bolivia, Gustavo Fagundes reports in this exclusive interview, Dufry is always poised and ready to progress, regardless of circumstances
f anything is consistent in the economies of South America, it is volatility. Since the turn of the millennium, that volatility had mostly calmed and growth was strong, but from 2014 through 2016 the region saw a strong contraction. As had been predicted by many in the duty free industry and certainly José Luis Donagaray, Secretary General of ASUTIL, however, the recovery became apparent in 2017, and the positive trend is certainly continuing, with industry-wide caution. Gustavo Fagundes, General Manager of Dufry Brazil and Bolivia, shares this sense of cautious optimism. “The economic scenario is still under pressure, but we are already seeing some signs of recovery like the GDP growth, lower inflation rates, improvement of unemployment rates and, to a lesser extent, a stable US rate, which benefits travelers in Brazil,” he says. Fagundes says Dufry “will continue using our tools and initiatives in order to further drive our performance based on the current economic scenario” while Brazil’s economic recovery continues, and although the company is confident of its positive
28 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
outcome, it understands this will take time. “In general terms investors see economic recovery,” he says. “On the other hand, Brazil is facing a delicate political moment where important decisions, mainly this year’s election and the Pension Reform, could pressure the economy.” Fagundes believes the Pension Reform decision will probably be pushed to next year after the new President has been elected, but the election brings its own concerns. “We are waiting for the approval of the Pension Reform, which will make the government accounts more balanced and bring more stability to the country, both economically and politically”, says Fagundes. “As far as our business is concerned, what we really hope is for the stable currency to continue. Market and currency volatility can impact customer’s behavior and lower their purchase power level.”
Brazil is one of the world’s largest countries by both land mass and population, and it is by far the largest economy of South America, with more than double the GDP of Argentina, which holds second place. The country also shares borders with all but two of the continent’s countries. These realities create an undeniable weight to Brazil’s effects on the rest of the continent’s economies. This was unfortunate during the recession, but is more positive with the improving economy. According to Itau BBA estimates, Latin American growth will more than double this year when compared to 2017, from 0.9% to 2%, says Fagundes. “The main reason for the increase
One of the major expansions in Brazil was related to RIOgaleão airport, in 2016, where Dufry Brazil now operates close to 11,000 square meters of retail space
is the recovery of Brazil, which is expected to grow 2% in 2018 after recording two consecutive years of contraction in 2015 and 2016. In this environment, a strong economy will help the region and will drive better indicators, such as tourism and travelrelated business.” When the economy in the region improves as a whole, Brazil’s tourism industry also improves. “Argentina leads the ranking of the countries that sends most tourists to Brazil, followed by Paraguay, Chile and Uruguay,” says Fagundes. “We expect that by the end of summer season we will have received 3.5 million foreign tourists here in Brazil, at least 2.3 million of them Latin Americans.” Of course, when Brazil’s economy improves, more Brazilians also travel. “The most important indicator of tourism/travel retail is when Brazilians travel abroad, whether to LatAm or other parts of the world,” says Fagundes. “As a general rule they have one of the highest tickets when it comes to consumer spending, especially in the duty free business. Therefore the exchange rate is especially important, to keep the Brazilian purchase power high.”
A long way to go
Despite improvements, Brazil continues to face obstacles in attracting more travelers. “The lack of infrastructure is one of
30 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
the main challenges,” says Fagundes. “In the recent years we have seen some developments in this area, such as the privatization and consequent improvement of Brazilian major airports, but this is not enough. Brazil has huge potential as a tourism destination, but little work has been done so far to address this.” Fagundes points out the limited air routes as another concern. “Currently, foreign airlines aren’t allowed to hold 100% of Brazilian air travel and the ‘Open Skies’ agreement with the US has yet to be approved by the Senate,” he says. “Supporters of this agreement say it would boost travel between Brazil and US, which is the main tourist destination for Brazilians, with an increase in the number of routes and lower fares.” Fagundes notes that the country’s hosting of the World Cup and the Olympics helped attract close to 13 million foreign visitors, but says this number is still below Brazil’s potential. “These events helped develop the tourism infrastructure of host cities, however,” he says. “For instance, new and modern hotels and sports arenas built for the Olympic games are now used for events that attract thousands of tourists. These events also served to bring about considerable improvements of infrastructure of the cities as a whole, with new buses and subway lines.” The government is committed to develop the tourism industry and is taking steps toward that commitment. These include facilitating the issue of electronic visas for visitors from Austra-
If there’s anything Dufry has shown it can do well, it is weathering a slowdown, especially in emerging markets – a skill that has helped the company become the global force it is today. “We are constantly working to improve Dufry’s brand recognition, understand better our customer needs with different profiles and so on,” says Fagundes. “To mention a few examples, in Brazil, we now have a base of more than 830,000 customers that receive marketing e-mails from Dufry. We also further expanded online services such as reserve-and-collect, a tool that offers convenience, exclusive discounts and the benefit of promotional prices, among other advantages. Finally, we increased our customer loyalty with RED by Dufry – an invitation to loyalty program in Brazil, which has more than 100,000 participants already, targeting high-spending frequent flyers.” He mentions that the company is currently implementing a Business Operating Model (BOM) across the Brazilian operations, introducing best practices and standardizing procedures, driving further efficiencies.
lia, Canada, Japan and the United States. “With the electronic system, which also includes work trips, there is an expectation of a 25% increase in the number of tourists from these countries arriving in Brazil,” says Fagundes.
Duty free concerns
The duty free industry in Brazil is quite different from that in other countries, because airline passengers are mainly domestic. “On average, close to 90% of customers at our arrival stores are Brazilian,” says Fagundes. “In the past few years the local political and economic situation deteriorated, and only recently we have started to see some signs of recovery. Market signs of a healthier and growing economy should contribute to further encourage people to travel more, be it for business or leisure. Also, a more stable currency encourages consumer spending. We continue to see a decrease of currency volatility, and we expect the exchange rate to keep stabilizing based on future prospects for the political and economic situation.” According to some specialists, almost a third of Brazilians intend to travel in the next six months, with more than a half of those intending to travel by air, Fagundes notes. “Last December, the number of international flights to Brazil increased by 8.5%. In the third quarter of 2017, revenue of tourism companies grew by 4.3%.”
Dufry is consistently focused on expanding and improving retail space, and Brazil has held much of the company’s attention in the past few years, given events such as the World Cup and Olympic games and also the numerous airport improvement projects. “Dufry signed important long-term contracts with the main Brazilian airports,” says Fagundes. “Since then we have been improving and adapting our shops, often adding unique concepts and always following our customer’s needs and desires.” The contract renewals and extensions secured business for many years in important cities such as Rio de Janeiro, São Paulo, Brasília and Campinas (Viracopos airport). “These contracts confirm the trust landlords have put in us,” says Fagundes. “Most of the contracts expanded the retail space to existing duty free travel retail shops and added new shops at the airports. One of the major expansions in Brazil was related to RIOgaleão airport, in 2016, where we now operate close to 11,000 square meters of retail space. This includes Departure and Arrivals stores, and also our concept ‘destination shops.’”
Dufry’s plans include further enhancement its core portfolio of products, including perfumes and cosmetics, wine and spirits, confectionery, fashion and accessories, by adding more brands as well as a wider product mix. “We want to make our customers feel special through an entertaining and world class shopping environment, proudly representing brands and offering new experiences, being able to deliver things that are not accessible in the local markets,” says Fagundes. To accomplish this, the company works on its partnerships with important brands, offering exclusive products, launches and special packaging. Upcoming developments in the Departures area of Terminal 3 in Guarulhos will allow for more movement in this direction, says Fagundes, with more space dedicated to electronics, increased luxury brand boutique offerings and an improved sense of place with a dedicated shop featuring local elements and the most traditional Brazilian products.
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Dufry’s stores in Cancun’s newly opened Terminal 4 offer New Generation Stores
After a few years focused on acquiring and creating new stores, travel retail giant Dufry is beginning to transform the industry from within; the New Generation Store transformation is coming to life in targeted stores around the globe, most recently in Cancun
ufry Group’s growth since its purchase of The Nuance Group and World Duty Free in 2014 and 2015, has been monumental. In 2016-2017, in Latin America alone, Dufry opened new or renovated stores in Santiago de Chile, Lima, Bogota, Mexico City, Guadeloupe, Rio de Janeiro and Cancun, and this was following two years of building and rebuilding in Brazil. In November, Dufry opened seven new stores in Cancun’s newly opened Terminal 4, totaling 2,540 square meters of retail space, including its 1,900-square-meter duty free New 34 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Generation Store (NGS). The NGS concept features extensive and innovative use of digital applications in order to increase passenger communication and drive sales. Dufry opened its first NGSs in Melbourne, Australia, and Madrid, Spain, and the travel retail giant plans to bring this concept around the world. Zurich, Heathrow T3 and Buenos Aires Ezeiza are the next in line, according to Rene Riedi, Dufry’s CEO Latin America. “We will certainly continue to roll out the NGS store concept wherever it makes sense and where it will add value.”
Facing the challenge
The internet has helped to create a challenging environment for global retailers, both duty free and others. Shoppers are extremely knowledgeable about prices and products, and retailers have had to adjust and evolve. “With the New Generation Store, we wanted to transform the travel retail shopping experience into something exciting and memorable by engaging with
New Generation Stores feature extensive and innovative use of digital applications in order to drive sales
our customers throughout the whole shopping process,” says Riedi. “The NGS allows better communication with our customer through the use of digital technology and offers brands an enhanced platform to promote novelties, for example.” Riedi says there is a definite need for Dufry’s new NGS concept. “Despite operating partially in a protected retail environment, we feel the growing influence from e-commerce and high street,” he says. “The NGS concept addresses three core principles: communication, entertainment and attractiveness. It aims at transforming the overall shopping experience, making it unique and experiential.”
A personalized experience
With the new concept, Dufry is better able to interact with more passengers, attract them into the store and offer a more personalized shopping experience through digital communication. Tablets and new digital screen equipment will allow store-customer communication to be more flexible. One innovation is that the language and message can adapt to different nationalities, which will be decided upon according to scheduled arrival and departure flights. Messages tailored to the specific preferences of the everchanging passenger profile will increase the communication impact, with the ultimate goal being increased sales. The high degree of customization will be especially important for brands as a way to connect customers with this digital atmosphere through integrated audio and advertising.
First of its kind
The renovated Cancun store offered an optimal opportunity to introduce this concept to the Americas. “It happened that Cancun Terminal 4 was the first major development/renovation on the list after the launch of the NGS,” says Riedi. “That being said, Cancun is also a major airport in Latin America. This is a relevant tourist destination, with an interesting and sophisticated mix of customers from the US and Canada. To that extent we are happy we were able to open our first Americas NGS in this location.”
36 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Buenos Aires, the next Americas store to undergo this NGS transformation, will have to wait until authorities have given full approval, but it will be coming as soon as possible. As a matter of course, Dufry refurbishes and upgrades its stores every five to seven years, so stores that are earmarked to become New Generation will not have very long to wait. And even those that will not be NGS will still be continually upgraded, to stay up-to-date and make use of new income-generating and customer-pleasing innovations. “The last renovation of significant size was the one in Lima, Peru, which was inaugurated in August 2016,” says Riedi. “With the renovation we were able to grow the space and convert the store in a true walk-through store.” Riedi is unable to comment on any new contracts in the works, but in addition to the new concept innovation, he says the company is currently working on introducing a new, modified operating model. “The introduction of the new business operating model is important following the incorporation of six operations from the World Duty Free acquisition,” he says. “The project includes also the harmonization of the IT systems by creating a uniform IT platform by country and region.” These back-room changes invisible to the customer’s eye have been paramount in the successful transition after the acquisition.
New space, busy airport
With over 21 million passengers in 2016, Cancun International Airport saw 9.3% growth over 2015. It is the second busiest airport in Mexico, following Benito Juarez International Airport in Mexico City. The airport is easily accessible from almost every major city in the world as major international airlines and charters offer direct or daily connecting flights to Cancun. In total, Dufry operates about 6,300 square meters of retail space in Cancun International – comprising both duty free and duty paid: six stores totaling 1,700 square meters in Terminal 2; three stores totaling 2,080 square meters in Terminal 3, and seven new stores totaling 2,540 square meters of retail space in Terminal 4. The new stores in departures include the duty free NGS, a Last Minute store and a general duty free shop. In duty paid departures, Dufry opened a perfumery boutique, a Last Minute shop, a MAC store and a Victoria’s Secret store. The duty-free shop of Terminal 4 is a walk-through shop featuring a strong sense of place through design elements emblem-
atic of the Mexican culture. The store presents two main theme areas: The “Essence of Mexico,” located in a premium position in the store center, offering a selection of local products including Tequila, Mezcal, wines and other Mexican alcoholic drinks, and the “Taste of Mexico,” where local confectionery such as chocolates, natural vanilla, gourmet coffee, hot sauces such as habanero, jalapeño and chipotle, worm salt, biscuits and Mexican dulce de leche are offered, among other specialties.
RED by Dufry is the company’s loyalty program, which has been very successful. Until this point it has been available only in Brazil and Mexico from a Latam perspective, but Riedi says this will change in 2018. “Our main focus in 2018 is on the transformation of the customer service by means of the introduction of the Dufry Red loyalty program in all our main operations, the expansion of the pre-order service and the in-store digitalization as part of the NGS concept development,” he says. “The main objective is to take advantage of the available technologies and increase the interaction with our customers in terms of quality and frequency.”
Dufry has recently opened duty free stores on board the Joy, NCL’s first ship based year-round in Asia
38 THE AMERICAS DUTY FREE & TRAVEL RETAILING APRIL 2018
Another channel in which Dufry is making large footprints is the cruise industry. While the company had already been active in a few ships, over the past two years the channel has been earmarked for growth. At the beginning of 2016 Dufry operated duty free stores on-board nine Norwegian Cruise Line (NCL) cruise ships, and by the end of 2017 the total portfolio had grown to 17. “In 2016 and 2017, we opened duty free stores on board the Escape – a new vessel launched by NCL – we were awarded four ships of Pullmantur and two ships of Carnival Cruise Lines,” says Riedi. “And now we have opened duty free stores on board the Joy, NCL’s first ship based year-round in Asia.”
Cruise ships offer a different shopping environment than airports on many levels, and that presents a unique opportunity for retailers and brands. Whereas in airports, retailers have only a short time to attract passengers and convince them to make a purchase, in cruise ships a customer might spend hours in the store, and may come back over multiple days. Riedi says this provides an interesting environment for brands. While the dwell time may be increased on ships, space tends to be more limited. “There is normally not enough space available to expose the brands or carry an extensive range as we do at airports, but the newer ships are larger in size and have been designed with a larger commercial area,” says Riedi. “For example, NCL’s Joy has a commercial area in excess of 2,000 square meters, which is absolutely comparable with a mid-size airport.” Given the differences in floor space and dwell time, the category mix on ships is also quite different from that at airports, says Riedi. “In general watches and jewelry are the key categories on ships, while perfume & cosmetics are the dominant categories at airports,” he says. Dufry Cruise Services is making inroads in Asia, which is an especially attractive and growing market, with highspending guests. “Working with NCL’s Joy in China led us to develop a cross-regional collaboration with our colleagues in Asia,” says Riedi. “Today, the day-to-day operation of the onboard stores is handled by our colleagues in Asia with strategic input from the cruise ship competence center in Miami.” He concludes: “Our ambition is to become an important player in the cruise ship business.”
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The renovated Cancun store offered an optimal opportunity to introduce the New Generation Store concept to the Americas I have placed one image within text and highlighted
Después de algunos años de enfoque en la adquisición y creación de nuevos establecimientos, el gigante minorista de viajes Dufry comienza a transformar la industria desde dentro. La transformación de NGS cobra vida en tiendas selectas de todo el mundo, y más recientemente en Cancún
l crecimiento de Dufry’s Group desde su adquisición de The Nuance Group y World Duty Free en el 2014 y el 2015, ha sido monumental. Durante el período 2016-2017, en Latinoamérica solamente, Dufry inauguró o renovó tiendas en Santiago de Chile, Lima, Bogotá, Ciudad de México, Guadalupe, Rio de Janeiro y Cancún, después de dos años de construcciones y reconstrucciones en Brasil. En noviembre pasado, Dufry abrió siete tiendas nuevas en la recién inaugurada Terminal 4 de Cancún, para un total de 2,540 metros cuadrados de espacio comercial, incluyendo 1,900 metros cuadrados de la tienda New Generation Store (NGS). El concepto NGS consiste en el uso extensivo e innovador de aplicaciones digitales para incrementar la comunicación de los pasajeros y estimular las ventas. Dufry inauguró su primera NGS en Melbourne, Australia, y en Madrid, España, y el gigante minorista de viajes tiene en proyecto introducir el concepto en todo el mundo. Las próximas en crearse estarán en Zúrich, la Terminal 3 de Heathrow y Ezeiza, Buenos Aires, según René Riedi, Director Ejecutivo de Dufry para Latinoamérica. “Pondremos en marcha el concepto de tienda NGS donde tenga sentido y donde incorpore valor”, explica.
40 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Hacer frente al desafío
La internet ha contribuido a la creación de un entorno complejo para los minoristas globales, tanto duty free como los demás. Los compradores son extremadamente conocedores de precios y productos, y los minoristas tienen que adaptarse y evolucionar. “Con New Generation Store, quisimos transformar la experiencia de compras minoristas de viaje en algo atractivo y memorable, participando con nuestros clientes en todo el proceso de compra”, afirma Riedi. “La NGS facilita una mejor comunicación con nuestro cliente mediante el uso de tecnología digital, y les ofrece a las marcas una plataforma ampliada para promover novedades, por ejemplo”. Riedi enfatiza en la existencia de una necesidad definida del nuevo concepto NGS de Dufry. “A pesar de operar parcialmente en un entorno minorista protegido, sentimos la influencia creciente del comercio electrónico y el sector detallista”, dice. “El concepto NGS se enfoca en tres principios fundamentales: comunicación, entretenimiento y atractivo. Además, se propone transformar la experiencia general de compras, haciéndola original y experiencial”.
Dufry opened its first New Generation Store in Melbourne, Australia, and Madrid, Spain (in picture), and the travel retail giant plans to bring this concept around the world
Una experiencia personalizada
Con el nuevo concepto, a Dufry le resulta más fácil interactuar con más pasajeros, atraerlos a la tienda, y ofrecer una experiencia de compras más personalizada mediante la comunicación digital. Las tabletas y los nuevos equipos de pantalla digital propiciarán la comunicación tienda-cliente, para que sea más flexible. Una innovación consiste en que el lenguaje y el mensaje se pueden adaptar a nacionalidades diferentes, lo cual se decidirá en dependencia de los vuelos de entrada y salida programados. Los mensajes elaborados de acuerdo a las preferencias específicas del perfil siempre cambiante del pasajero, incrementarán el impacto de la comunicación, con el objetivo principal de incrementar las ventas. El alto grado de personalización será especialmente importante para las marcas, como forma de conectar a los clientes con su atmósfera digital, mediante el audio y la publicidad integrados.
La primera en su clase
La tienda renovada en Cancún ofrecía una oportunidad óptima de introducir este concepto en las Américas. “Sucedió que la Terminal 4 de Cancún era la primera de desarrollo/renovación más importante de la lista después de la incorporación del concepto NGS”, agrega Riedi. “Dicho esto, Cancún es también un aeropuerto notable en Latinoamérica. Es un destino turístico relevante, con una mezcla interesante y sofisticada de clientes de los Estados Unidos y Canadá. Debido a lo anterior, nos hace felices haber podido inaugurar nuestra primera NGS de las Américas en este lugar”. Buenos Aires, la próxima tienda de las Américas donde se realizará esta transformación en NGS, tendrá que esperar a que las autoridades den su aprobación total, la cual llegará lo más pronto posible. Como es costumbre, Dufry remodela y actualiza sus tiendas cada cinco a siete años, por lo cual las tiendas seleccionadas para transformarse en New Generation no tendrán que esperar demasiado. E incluso las que no serán NGS se actualizarán continuamente, para estar al día y hacer uso de innovaciones que generan ingresos y complacen al cliente. “La última renovación de tamaño significativo se hizo en Lima, Perú, y se inauguró en agosto del 2016”, prosigue Riedi. “Con esa renovación, pudimos incrementar el espacio y convertir la tienda en un auténtico establecimiento de tránsito continuo”. Riedi no puede hacer comentarios referentes a nuevos contratos en proceso, pero además de su explicación de la innovación de nuevo concepto, revela que la compañía está 42 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
trabajando en la introducción de un modelo de operación nuevo y modificado. “La introducción del nuevo modelo de operación comercial es importante, después de la incorporación de seis operaciones de la adquisición de World Duty Free”, explica. “El proyecto también incluye la armonización de los sistemas informáticos, creando una plataforma uniforme por país y región”. Estos cambios internos invisibles para el cliente han sido esenciales en la transición exitosa después de la adquisición.
Nuevo espacio, aeropuerto activo
El Aeropuerto Internacional de Cancún, que recibió más de 21 millones de pasajeros en el 2016, experimentó un crecimiento del 9.3% con relación al 2015. Es el segundo aeropuerto más activo de México, después del Aeropuerto Internacional Benito Juárez de Ciudad de México. El aeropuerto es fácilmente accesible desde casi toda ciudad importante del mundo, pues las principales aerolíneas internacionales y vuelos contratados ofrecen conexiones directas o diarias a Cancún. En total, Dufry opera unos 6,300 metros cuadrados de espacio comercial en el Aeropuerto Internacional de Cancún, entre tiendas duty free y con pago de aranceles: seis tiendas que totalizan 1,700 metros cuadrados en la Terminal 2; tres tiendas para un total de 2,080 metros cuadrados en la Terminal 3, y siete tiendas nuevas que totalizan 2,540 metros cuadrados de espacio comercial en la Terminal 4. Entre las nuevas tiendas de la sección de salidas están la NGS duty free, una tienda Last Minute, y un establecimiento duty free general. En el área de tiendas con pago de aranceles en la sección de salidas, Dufry inauguró una boutique de perfumería, una tienda Last Minute, una tienda MAC, y otra de Victoria’s Secret. La tienda duty-free de la Terminal 4 es de tránsito continuo, con un sólido sentido de lugar, con elementos de diseño emblemáticos de la cultura mexicana. El establecimiento presenta dos áreas temáticas principales: la “Esencia de México”, ubicada en posición preferencial en el centro de la tienda, que ofrece una selección de productos como Tequila, Mezcal, vinos y otras bebidas alcohólicas mexicanas; y el “Sabor de México”, donde se ofrece confitería local como chocolates, vainilla natural, café gourmet, salsas picantes de habanero, jalapeño y chipotle, “sal de gusano” y dulce de leche mexicanos, entre otras especialidades.
Expansión del programa de lealtad
RED by Dufry es el programa de lealtad de la compañía, que ha tenido un gran éxito. Hasta el momento solo está disponible en
Brasil y México desde la perspectiva latinoamericana, pero Riedi asegura que eso cambiará en el 2018. “Nuestro enfoque principal en el 2018 es la transformación del servicio al cliente mediante la introducción del programa de lealtad Dufry Red en todas nuestras operaciones principales; la expansión del servicio de pedido anticipado; y la digitalización dentro de las tiendas como parte del desarrollo del concepto NGS”, destaca. “El objetivo principal es aprovechar las tecnologías disponibles, e incrementar la interacción con nuestros clientes en términos de calidad y frecuencia”.
Un canal destinado a crecer
Otro canal en el cual Dufry está marcando amplias huellas es la industria de cruceros. Si bien la compañía ya ha tenido actividad en algunos barcos, en los dos últimos años el canal está destinado a crecer. A comienzos del 2016, Dufry operaba tiendas duty free a bordo de nueve cruceros de Norwegian Cruise Line (NCL), y para finales del 2017 el portafolio total aumentó a 17. “En el 2016 y el 2017, inauguramos tiendas duty free a bordo del Escape – nueva nave de NCL – se nos otorgaron cuatro barcos de Pullmantur y dos de Carnival Cruise Lines”, añade Riedi. “Ahora hemos abierto tiendas duty free a bordo del Joy, primer barco de NCL destacado todo el año en Asia”.
Los cruceros ofrecen un entorno de compras diferente a los aeropuertos en muchos niveles, y eso constituye una oportunidad única para minoristas y marcas. Mientras que en los aeropuertos los minoristas solo disponen de poco tiempo para atraer pasajeros y convencerlos de que compren, en los cruceros el cliente podría dedicar horas a visitar la tienda, y podría regresar en múltiples ocasiones. Riedi asegura que esto constituye un entorno interesante para las marcas. Pero, si bien el tiempo de permanencia se incrementa en los barcos, el espacio tiende a ser limitado. “A menudo no hay espacio disponible suficiente para exponer las marcas o presentar una extensa gama como en el caso de los aeropuertos. Sin embargo, los nuevos cruceros son más grandes en tamaño, y han sido concebidos con un área comercial más extensa”, añade Riedi. “Por ejemplo, el Joy de NCL cuenta con un área comercial superior a los 2,000 metros cuadrados, absolutamente comparable a un aeropuerto mediano”. Dadas las diferencias en espacio comercial y tiempo de permanencia, la mezcla de categorías en los barcos también difiere ampliamente de la existente en los aeropuertos, según Riedi. “En general, los relojes y las joyas son las categorías principales en los barcos, mientras que los perfumes y los cosméticos son las categorías dominantes en los aeropuertos”, dice. Dufry Cruise Services se está introduciendo en Asia, un mercado especialmente atractivo y creciente, con huéspedes de alto nivel de gastos. “El trabajo con el Joy de NCL en China posibilitó el desarrollo de una colaboración interregional con nuestros colegas en Asia”, añade Riedi. “En la actualidad, la operación cotidiana de las tiendas a bordo es realizada por nuestros colegas en Asia, con ayuda estratégica del centro de competencia de cruceros en Miami”. Y concluye diciendo: “Nuestra ambición es convertirnos en un factor importante en el negocio de cruceros”. www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING RIT_ADF_Sakura_Slowdown_94x275_V1HRLC.indd 1
TRG Duty Free
Leading-edge tech emporium kicks off in Texas
TRG Duty Free opened to the public on December 20 with a celebratory event featuring DFW’s senior leadership team, including CEO Sean Donohue, Executive Vice President of Revenue Management Ken Buchanan, Vice President of Concessions Zenola Campbell, and Assistant Vice President of Concessions Michael Baldwin; plus CBI Retail Ventures’ CEO Steve Flory, worldrenowned sculptor James Surls and VIPs
Americas Duty Free explores the impressive new TRG Duty Free space at Dallas Fort Worth International Airport, which is the largest and most technologically advanced duty free store in the Western Hemisphere
by HIBAH NOOR
exas-based retail development company CBI Retail Ventures has unveiled its largest airport outlet to date – a new 19,000 square feet, twolevel TRG Duty Free store inside Dallas Fort Worth International Airport’s (DFW) Terminal D. The new TRG Duty Free space is also the largest and most technologically advanced duty free store in the Western Hemisphere, the Fort Worth-based company said. TRG Duty Free opened to the public on December 20 with a celebratory event featuring exclusive tours and appearances from DFW’s senior leadership team. They included CEO Sean Donohue, Executive Vice President of Revenue Management Ken Buchanan, Vice President of Concessions Zenola Campbell, and Assistant Vice President of Concessions Michael Baldwin; as well as CBI Retail Ventures’ Chief Executive Officer Steve Flory, world-renowned sculptor James Surls, media members, and other VIPs.
“The new state-of-the-art TRG Duty Free offers travelers an unparalleled experiential shopping environment that masterfully integrates world-class retail, exclusive high-end local brands, VIP concierge services, cutting-edge technology, and world-renowned art all in one location,” said CBI Retail Ventures’ Flory.
The space features statement artworks and monumental sculptures by world-renowned artist James Surls
The two-level store boasts two elevators, four staircases, and two mezzanines, US$2 million-worth of dynamic digital displays, state-of-the art control systems, and interactive technology with multilingual content. Two integrated hold room spaces for adjacent American Airlines gates incorporate modern seating clusters, charging stations, 50+ iPads with interactive apps, and elevated workstations, while two free and open-to-the-public luxury lounges provide a “club-like” atmosphere to all travelers. The space also features 240-feet mez-
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zanine railings embedded with gold, silver and glass as well as statement artworks and monumental sculptures by worldrenowned artist James Surls. Two “helipads” that utilize air space serve as landing zones for the large-scale sculptures. Other firsts include an Armani Exchange fashion store located inside the secure space of an airport and the first Ulysse Nardin watch boutique located within a duty free environment in a North American airport. Tasting bars are integrated into the retail area for product sampling and
International luxury beauty brands offered in-store include Estée Lauder, La Mer, Lancôme and Chanel
demos, and VIP concierge service stations provide informational assistance and specialty services.
Exclusive goods from local brands
The roster of international luxury brands offered in-store span the best in beauty, fashion and watches. They include Estée Lauder, La Mer, Dior, Lancôme, Prada, Hermes, Ralph Lauren, Carolina Herrera, Paco Rabanne, Gucci, Marc Jacobs, Bulgari, IWC, Tom Ford, Marc Jacobs, Armani, YSL, Chanel, Burberry, D&G, Omega, Tom Ford, Calvin Klein, and Hugo Boss. Exclusive goods from iconic local brands are also available, such as TX Whiskey, Bohlin trophy buckles and accessories, and Askinosie Chocolate.
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TRG Duty Free
Free include Vancouver-based SmartDesign Group, one of the world’s top airport design consulting firms; Fort Worthbased Innovative Strategies; and Texasbased Charles Bush Consulting.
A leader in retail design
A semi-circular immersive promotional pod is filled with floor-to-ceiling seamless digital monitors for videos, advertisements, and brand launches
A semi-circular immersive promotional pod is filled with floor-to-ceiling seamless digital monitors for videos, advertisements, and brand launches. Sustainable design elements include low-profile raised flooring, 100% highefficiency LED lighting, LED technologypowered digital displays, and a daylightoptimized building footprint with high-performance glazing systems. “We are proud to not only have developed the largest duty free store in the Western Hemisphere, but also have designed a first-of-its-kind immersive store experience at DFW Airport,” said Flory. “The end result reflects the convergence of entertainment and retail, as well as the coming together of digital and physical experiences. This truly marks the pinnacle of DFW Airport’s goal of being a world-class global superhub. It is a blend of international couture, state-of-the-art technology, and luxurious services – all while capturing the spirit and beauty of modern Texas.” TRG Duty Free is the brainchild of two experienced and diverse business innovators who teamed up to create TRG Duty Free Joint Venture: Flory, CEO of Fort Worth-based retail development company CBI Retail Ventures, and Benny Klepach, CEO of Miami-based Duty Free Air and Ship Supply Company (DFASS), the world’s largest inflight duty free specialty retailer. Flory and Klepach previously owned and operated Buckaroo Duty Free at DFW Airport, which was the predecessor of TRG Duty Free. Other partners involved with the creation of TRG Duty
Speaking exclusively to Americas Duty Free about the development process of the new space at DFW, Flory explained that construction commenced in February 2016 on three duty free stores located in the north and south retail villages in Terminal D. TRG opened those stores for business in September 2016. Construction on TRG’s flagship store got under way in April 2016, and began trading on December 20, 2017. TRG is also currently building one additional store at DFW called Whiskey Flight. Flory confirmed that the TRG joint venture itself was established after Klepach and Flory met in 2004 and later
Two free and open-to-the-public luxury lounges provide a “club-like” atmosphere to all travelers
The liquor section features the top international brands as well as iconic Texan brands such as TX Whiskey
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formed Buckaroo Duty Free, which operated duty free stores at DFW airport from 2005 until September 2016. Flory said his company, Columbia Brokerage and Investments (CBI), already has experience in duty free. The company, which is owned and operated by Flory, has been a leader in retail design, construction, development, and management for 33 years. CBI currently manages multiple retail related entities including CBI Retail Ventures III, which is a partner in TRG Duty Free Joint Venture. CBI was previously involved in Buckaroo Duty Free, which operated for 11 years at DFW Airport prior to TRG Duty Free Joint Venture commencing business at DFW Airport. In 1995, CBI entered the airport concession business in a joint venture with TGI Friday’s, which operated multiple restaurants in all terminals at DFW Airport from 1996 until 2017.
A digital marketplace
takes shape by HIBAH NOOR
Fast-growing global online platform MyDutyFree connects duty free operators and shoppers thanks to powerful and easy-to-use digital tools
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yDutyFree, based in the CIS, has built a pioneering global duty free marketplace for retailers, airports, and consumers, aiming to connect retailers and customers. Katerina Furtak, CEO, Mydutyfree emphasizes that the system is easy to use, both for duty free operators and for shoppers. “For duty free businesses we are a fast and effortless way to go online. Within a week we prepare an online catalog with goods according to the store’s product range list and integrate a shop to our system. “Along with a catalog and pre-order option on the MyDutyFree website, our customers get advantage from infrastructure: our partners, marketing channels, and the most important – our existing user base. Since most frequent travelers go to different destinations, they will use the service they are used to in different locations. Thus, connecting MyDutyFree to a duty free business, the customer also receives clients who are familiar with MyDutyFree and are ready to make purchases. “For travelers we are a convenient service for duty free shopping: they can choose and pre-order goods, and get their purchases before the departure without waiting.”
More than 11,000 products
MyDutyFree launched in the end of 2015, and within two years the company has achieved 1,500 orders monthly, with 1,000,000 views per month, and €100 (US$123) average receipt. It carries more than 11,000 products in catalogs, boasts 25,000 app installations and 20,000 registered users. The most popular product categories are spirits and tobacco, perfumery, and cosmetics, but there are also gourmet foods and sweets, accessories, toys, and electronics sections. The firm operates in four CIS countries, with 11 airports and six border shops in its client roster. Now it is expanding outside the CIS with the focus on Middle East and Africa first. “We’ve established strong partnerships with global companies: MasterCard, S7 Airlines, TUI and others,” says Furtak. MyDutyFree has seen growth in 2017 compared to the previous year, and the numbers are impressive. Successful orders have surged by 509%, turnover (in euros) has jumped 526%, user registrations have climbed 636%, sessions are up 277%, and app downloads 210%.
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Allowing operators to withstand competition
Furtak believes the duty free industry is ripe for change, particularly in the area of price transparency. “Duty free is still one of the most closed and conservative businesses,” she says. “It is still difficult to find clear and relevant information regarding duty free’s product range and prices. Unlike all other stores, duty free is available to the customers only for a limited period of time: 30-60 minutes before departure. So it is important for customers to know in advance if they would find particular products at the store and how much they would spend. So the biggest deficiency in the duty free industry is its lack of presence online. In our opinion, it could drive down the popularity of duty free shopping. The fact is that nowadays we are so used to solving all our problems and questions online it seems strange if duty free is not available online.” Online marketplaces such as Amazon are the biggest competitors of the duty free industry, Furtak believes. “They can offer advantages duty free can’t: direct access to information on prices and product range as well as delivery to the door and availability of shopping at any time. So along with great competition from online marketplaces and users’ common habit of looking for everything online, there is another trend in customer behavior: planning of purchases and spending. The current format of the duty free business, when people can choose and purchase only in the store, does not fully meet customer’s need of planning and saving time.” And this is where MyDutyFree comes in. “Our goal is to allow duty free businesses to keep up with current shopping trends and be able to withstand competition.” When consumers purchase products through the MyDutyFree website, data is collected that can help retailers. The company can track individual clients’ order and search history. Using this data, it can create charts of customers’ habitual destinations, frequency of travel as well as of their shopping preference. In the future, this could allow MyDutyFree and retailers to create predictions 50 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
for each particular customer and suggest relevant goods at the approximate time of their next trip. For the whole customer base, data can be collected on shopping cart split, shopping trends, demand fluctuations throughout the year or depending on destinations, and defining which goods are often bought together. “We can determine top destinations and top products, collect customer feedback on their shopping experience for each store. We can also help to track the efficiency of sales, promos and special offers,” she says. MyDutyFree has two sources of revenue: duty free operators, brands or similar advertising partners. The company charges duty free operators a fee, and this can depend on the level of sales made via the service. The whole fee system is flexible and is negotiated with each particular shop depending on the size and requirements of the store. Revenue is also generated from brand advertising. The company offers various packages that include different options for advertising on its website. They can include placing of promoted product in top positions of the catalogue, placing banners, blog articles, newslettering, and promotions on social networks.
Product delivery to lounges
MyDutyFree’s merchandise pick-up points are usually one of the cash registers at the shop, not specially developed kiosks, as Furtak explains: “This way we make our launch at the store as simple and quick as possible for both us and the shop, since we don’t have to find a place, build a kiosk and create the whole infrastructure. We put branding at the dedicated cash register, but it also can be used for the usual sales.” The firm is considering installing separate pick-up points in airports that won’t be located inside a shop. One option is delivery to the lounges, where visitors could choose goods, place an order and get their purchase delivered directly in the lounge. MyDutyFree’s website has a number of highlights. It features marketplace functionality, which allows customers access to vari-
ous shops at the same locations (one airport but different duty free shops managed by different operators). This allows customers to compare offers and prices in different shops and choose the best. Another feature is the Shared Basket. This allows travelers to share their shopping cart, so their friends could choose goods in duty free. They pick the products on the website and add them to already existing pre-order of their friend and MyDutyFree user. This feature aims to combat duty free’s disadvantage that shopping there is available on-site only. For businesses the company provides flexible and adjustable dashboards with sales data and analytics. Using this tool, its customers can not only track sales, make efficiencies and obtain other important data, but also to predict customer behavior. It takes one week to integrate a shop into the MyDutyFree system, and the process is “very easy” for the retailer, says Furtak. After the agreement between the retailer and MyDutyFree is reached, the firm asks the retailer to send a list of products they want to see on the website. Usually, most of the products are already in the database. Together with the retailer the company sets up a simple synchronization system to keep the information on prices and stock updated. Connecting a new shop also includes designing branding for pick-up points, staff training, and preparing a marketing plan. Furtak is satisfied with the company’s progress so far. “All the retailers and partners we started co-operating with during 2017 have already stated their willingness to connect other locations or to extend their co-operation,” she says.
Expansion into the Americas
After the company’s operations have become strong in the Middle East and African markets, the company will consider expanding into the Americas market. “We’ve chosen this strategy after studying the duty free sector in the Americas: duty free stores are not very popular among the citizens of these countries, and the major part of customers are visitors from other countries. So expansion to the Americas is basically just following the needs of our existing customers: people who travel and get used to using our service in other countries will also expect to access it in the Americas.” The other target market is duty free on cruise ships. “Since this kind of traveling is popular in the Americas, particularly in US, we see it as a great opportunity for our growth,” he says. Meanwhile, the focus for 2018 is continued expansion and extended service. “We are going to start co-operating with lounge operators so that passengers can choose goods and have them delivered without leaving the lounge.” The other major initiative MyDutyFree will develop is packaging solutions for airports, which is a new branch of the company’s service. In addition, the company is working on optimization and better visualization of data for retailers’ dashboards and customer feedback. “Viral tools and developing social networks is another thing we are going to focus on. It’ll help us to grow the audience exponentially,” enthuses Furtak.
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Baja Duty Free
The Gateway Store in San Ysidro recently went through renovations that offers shoppers a contemporary shopping environment.
An optimistic future for
Baja Duty Free by JAS RYAT
Irene Rojas, Marketing Manager & Elisa Castro, Vice President of Retail at Fairn & Swanson Inc., reveals how corporate developments, renovations and brand awareness will lead to a buoyant 2018 for its US/Mexican operator Baja Duty Free
The Baja Duty Free store at San Ysidro land port of entry is one of the busiest land border crossings worldwide
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lisa Castro, Vice President of Retail at leading North American duty free wholesaler and retailer Fairn & Swanson Inc, is confident about 2018 for its subsidiary Baja Duty Free, which operates stores in San Ysidro, Otay Mesa, Tecate, Calexico, El Paso, Laredo and Eagle Pass, all located on the US/ Mexican border. Almost 28 years old, Baja Duty Free, which has nine locations along the Southern Border, has faced peaks and valleys. 2017 proved to be a challenging year as the political climate between the two countries garnered a feeling of unease. Consumers were facing more border checks and increased security at Customs, which led to previously crowded shops now suffering a drop in sales. The political climate was not the only factor. Castro explained that the devaluation of the Mexican Peso, combined with competition on both sides of the border from the domestic market – particularly the big-box stores – made for a tough market.
Baja Duty Free
However, Castro is optimistic for 2018. Baja Duty Free’s parent company, Fairn & Swanson, recently announced Stacey Kehr as its new Vice President of Cruise & Wholesale. Kehr brings over two decades of leadership experience in the duty free industry. Castro feels structural changes within Fairn & Swanson, like the appointment of Kehr will definitely lead to “change for the good”. Another reason for a brighter 2018 is the successful collaboration with global spirits leader Diageo. Diageo opened a new shop-in-shop inside the Baja Duty Free store at one of the San Ysidro land port of entry, which is one of the busiest land border crossings in the world. The renovation, led by retail-focused design and production agency, BLOOMMIAMI, created a contemporary environment that features Diageo’s flagship brands such as Johnnie Walker, Buchanan’s, Baileys and Don Julio. The modern space is engaging and interactive, explains F&S Marketing Manager, Irene Rojas: “It makes such a big impact. We have experienced an increase in sales. There is a
permanent hostess in the area promoting the brands. The customers enjoy having more of a collaborative experience as the promotions are presented via a tasting bar and iPads, all allowing for better interactions with the brands.” As the concept has worked positively, Diageo is planning on opening a second store-in-store concept in collaboration with Baja Duty Free in early 2018 in the area of Calexico, California.
Although a small percentage of Baja Duty Free’s customer base is made up of millennials, the core customer is more mature. This is what differentiates land borders versus airports, according to Irene Rojas, Marketing Manager for Fairn & Swanson. “The Southern Border stores are different from the airports as we don’t deal as much with people coming from different countries, in terms of visitors. A lot of the people that cross the border here are commuters – people that come to the United States because they work in the United States, they go to school or they
Baja Duty Free collaborated with Diageo, allowing for a contemporary shop in shop format
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bring their kids to school, so their daily activities take place in the United States. Then, at the end of the day, they go back to their home, which is on the Mexican side,” explains Rojas. As a result, Baja Duty Free has to execute its marketing program in the same manner. Rojas continues: “Our marketing is so broad: we have young people on their phones, but we also have a big percentage that is older and more mature. In terms of advertisement, it is more important to us to just keep sending out the message. We have a loyalty program that 90% of our customer base belongs to.” Baja Duty Free believes a mix of traditional advertising, loyalty programs, print and radio, plus social media apps, is a combination that works for its target audience. As Mexico heads into an election year in July 2018, there is always room for uncertainty. However, Baja Duty Free continues to barrel through it all with its renovations, corporate changes and brand awareness, possibly heading towards a peak year in 2018, concludes Rojas.
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horizons by RONNIE LOVLER
A display at London Supply’s Puerto Iguazú complex, which was a delight for Christmas shoppers at the store during a recent holiday season
London Supply plans to open its new complex in Argentina’s southern Patagonia region in the first half of 2018 and readies for another dynamic year of ‘retailtainment’ offerings in Puerto Iguazú
ondon Supply is expanding its reach in 2018, moving further south in Argentina with the planned opening of its duty free retail complex in the Rio Gallegos free zone in the country’s Patagonia region. Meanwhile, the company continues its northward gaze with upgrades and enhancements to its ‘retailtainment’ offerings that are a staple of its store in the Puerto Iguazú free zone, near the world-famous Iguazú Falls on the Argentine-Brazilian border.
This rendering gives an idea of what London Supply’s soon to be opened complex in Rio Gallegos in southern Argentina will look like
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In a recent interview with Americas Duty Free, London Supply’s Commercial Director Magdalena Ducos said an Argentine government resolution approved in January is allowing the company to quickly move ahead with its Rio Gallegos project. London Supply has a 30-year contract with the state to operate and manage the entire Rio Gallegos Free Zone in addition to its own retail operations there. The complex will focus on consumers in Argentina and Chile, who are accustomed
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One of the ‘retailtainment” events at London Supply’s Puerto Iguazú complex, this one sponsored by Chivas Regal
to doing much of their duty free shopping in Punta Arenas in neighboring Chile. Ducos said the company expects “to be able to start operating in the first half of the year on a 1000-square-meter site,” which will offer consumers the opportunity to purchase traditional duty free products like perfumes, cosmetics, fashion items and accessories, luggage, liquors, tobaccos and a wide assortment of food products.
But while London Supply is excited about its expansion in southern Argentina, it is hardly neglecting its operations along the country’s northern border with Brazil. During the summer tourism season, much of the London Supply action was at its store in Puerto Iguazú, with a very special show for Carnival in tandem with Ballantine’s. When Americas Duty Free talked with Ducos, she was getting An aerial view of London Supply’s Puerto Iguazú complex
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revved up for what at the time was the upcoming Carnival experience that she said would “offer an external dome of electronic music, which only those customers who join the program will be able to access.” Special games were also implemented during the week. Ducos said London Supply wanted to start the year in Puerto Iguazú “with an event that marks the level of those that will continue throughout all the festive dates of the year. And as always, our customers must wait until they arrive to discover what surprises await them.” It will be hard to surpass the exciting events customers found in the Puerto Iguazú store in 2017, some of which may repeat this year. Events included an Easter Show with Lindt, the Chivas Regal Ages show, with more than 20 dancers on the stage, and a light show synchronized with Christmas music sponsored by Patrón tequila during the holiday season. Additionally, special events were offered in association with
London Supply’s Duty Free Plus Program, which rewards loyal customers for their patronage. These events offered opportunities to participate in tastings and attend lectures about liqueurs, wines and foods that pair well with those beverages. “We also do tastings with different products, trying to mix and match across categories,” Ducos said. “We mix wines with chocolates, liqueurs with tea, and delicatessen with infused beverages.” Other events designed for customer appeal include make-up and hairstyling sessions with exclusive gifts.
The busiest crossing
There is good reason for London Supply to pay so much attention to its Puerto Iguazú store. The crossing that connects the cities of Puerto Iguazú in Argentina and Foz do IguaÇu in Brazil is the border crossing with the highest passenger traffic in Argentina, with an average of 13 million travelers each year, Ducos said. “Because it has Iguazú Falls, which is one of the wonders of the world, it generates a global tourist traffic of enormous dimensions for the region,” Ducos said. “This means there is always an expectation for a lot of visitors, which makes Iguazú somewhat independent of regional economic variability.” London Supply has other things on its plate for 2018, which includes reaching out more to the Argentine domestic market. “We started 2018 with brands such as Lindt, Patrón, Distilleries Bottega, Danzka Vodka, Wonderful Pistachios and Ophir, among others. This helped give us a different way of reaching out, with the standards that brands require and with a level of commercial, logistics and operational management that positions the brands in the market.” Unlike other operators, however, London Supply is not seeking to expand into online commerce, preferring to remain focused on the in-store experience. “Our trade is face to face, because we are not a duty free shop at the airport. In our case, most of our clients plan the visit to our store as a part of visiting the tourist destination, and plan the necessary time for it.” This approach to business appears to be working for London Supply. A look at the Rio Gallegos complex during its construction phase
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I Snapshots from IAADFS 2017 COURTESY OF IAADFS
All change for the
Summit of the Americas IAADFS President and CEO Michael Payne reveals the thinking behind the major program changes for the 2018 Summit of the Americas and confirms that the event will move to a new location from 2019 by HIBAH NOOR
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n an exclusive interview with Americas Duty Free magazine, IAADFS President and CEO Michael Payne speaks openly about the first-ever Summit of the Americas, which will be held from March 18-21 at the Orlando World Center Marriott in Orlando, Florida. The new-format show for 2018 is the result of the previously announced partnership between IAADFS and ASUTIL, which sees one single annual event jointly organized by the two industry bodies going forward. The first Summit of the Americas includes ASUTIL-style conference sessions for two hours each morning while maintaining the successful supplier exhibition format of previous IAADFS tradeshows with extended opening hours. Speaking to Americas Duty Free in the run-up to the Summit, Payne explained: “This year what we are trying to accomplish is to bring an ASUTIL-style program, with speakers over several days into the meeting format. We’re trying to organize the right mix to combine the executive learning sessions for part of the mornings and then the exhibit halls and other networking and social opportunities. We extended the trade floor hours in the afternoon to ensure adequate time for all appointments. More and more people have asked for content and education in addition to having a tradeshow, so we are trying to bring those two together.”
Summit of the Americas
The Exhibit Area is open for extended hours this year: from 10:30am to 6pm on Monday and Tuesday, and from 10am to 5:30pm on Wednesday.
Show location to move in 2019
Payne also revealed that the Summit of the Americas events in 2019 and 2020 will move to the more centrally located hotel in Orlando, which will feature more private meeting rooms for exhibitors. “We are staying in Orlando but moving to a different property,” he said. “It’s a large property that has the space we need and has more meeting room facilities. A number of companies want to supplement their booths with meeting rooms where they can have private meetings.
Time for networking
And in a further change to previous IAADFS shows, this year’s event will include the addition of a buyers’ lounge. The lounge will be located in an area outside of the trade hall where buyers can take a break when needed. Payne said: “We haven’t provided a space in the past, but we will put this into effect on Monday and Tuesday where buyers can sit down between appointments. On Wednesday we will turn that area into an opportunity for people to schedule appointments and meet with each other.” This will allow non-exhibiting suppliers to meet with buyers. Importantly, they must be registered to participate and don’t expect this to impact the business on the Tradeshow floor given the limited hours. This networking time – a popular feature of previous ASUTIL events – will take place from 10am to 3pm by appointment only. This year’s speaker line-up for the new Executive Conference Sessions will feature Dufry Group CEO Julián Díaz, Kian Gould, Founder and CEO of AOE, a pioneer of airport omnichannel retail activities, will address the theme: ‘Digitally Disrupted or Digitally Involved’. And Lewis Allen, Director of Environments at Portland Design, will address the topic: ‘When Different isn’t Good Enough: Better Shopping for Tomorrow’s Airports’. Additional sessions will include datadriven insights centered on the Americas region for conference-goers. The Executive Conference Sessions take place on Monday, Tuesday, and Wednesday mornings (8:30-10:30am on Monday and Tuesday, and 8:30am to 10am on Wednesday).
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Summit of the Americas
“Another key point is that it is a block away from shops, restaurants, bars, and other activities. One of the complaints for years about the Marriott is that it is isolated. People want to be able to walk out the door and go somewhere. Also, I think people are getting tired of being in the same spot.” Payne added that the Summit organizers would continue to look at other show location opportunities, both in the US and externally. “It would be best for now to stay in central Florida,” he continued. “It works for the suppliers. That’s important because it’s costly to ship their displays around. They have a new, big international terminal being finished at Orlando Airport, so there are going to be more direct international flights. We’ve looked at other locations but the associated costs, airlift, convenience and other factors led to the decision to remain in Orlando for now and that is where we are going to be for the next couple of years.”
Working closely with ASUTIL
Speaking about the joint organization of this year’s show, Payne said the IAADFS
team had been working together “very closely” with ASUTIL Secretary-General José Luis Donagaray and his team since the partnership decision was made. “So far I’m very comfortable with how this has gone. The proof will be in the actual implementation of the show itself but I think everybody has been working together very well. We basically have a team call every week.” In terms of exhibitors, Payne confirmed that a lot of companies had returned to the show this year, along with some new firms. “There are several perfume houses that haven’t attended for a bit that are committed to be back,” he said. The category mix is similar to past events, with cosmetics, chocolates, spirits, and accessories continuing to be the main categories. Turning to the financial performance of the Americas, Payne seemed pretty confident about the region’s overall sales performance compared to last year, despite the hurricanes that have devastated parts of the Caribbean. “I think it’s definitely a more positive feeling this year than last,” he said. “If you
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look at the numbers throughout the Americas and what the predictions are, they are strong, but certainly there are pockets where the economy might be less strong than other places. That’s a positive sign for us. Some areas have obviously been impacted by the hurricane season and they won’t do as well, but overall the Caribbean area is experiencing an expansion of the cruise ship duty free business and shopping is all very positive. And almost every day I open some new story about an airport that’s expanding or building more stores. It certainly has picked up compared to last year. The economies are expanding. The numbers are generally up for everybody.” Payne cited recently completed airport developments in Dallas, Los Angeles, San Francisco, Denver, and new operations at New York JFK, Atlanta, and Miami. Also, he pointed to expansion in Mexico that’s going forward, and also Brazil. “There are lots of places where people are putting money into infrastructure.” Positive words indeed from Payne as the first Summit of the Americas finally comes to fruition.
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Frontier Duty Free Association
End of an era and new beginnings Winds of change are expected in Canada with a new outlook on improvement of the annual Frontier Duty Free Association tradeshow
FDFA President Abe Taqtaq making a speech during the gala dinner at last year’s FDFA convention
by WENDY MORLEY
Abe Taqtaq with Charlotte Bell, President & CEO of Tourism Industry Association of Canada
he Frontier Duty Free Association (FDFA) has been going through some substantial changes this year. Recently we spoke with President Abe Taqtaq about the board’s decisions and actions, and what the future might look like. Notably, the organization will have only three mandates from this point on: 1. Increase membership, 2. Government relations, and 3. The annual convention. After the FDFA Conference in 2016, the FDFA Board could see that a transformation was required. That, in addition to the question of whether to cancel the conference altogether and join IAADFS and
ASUTIL at the Summit of the Americas caused the FDFA Convention Committee to be formed, chaired by Tania Lee, of Sarnia Duty Free. Transformation is clearly the correct word to use for the resulting decisions, some of which were apparent this year and many of which are still to come. It’s obvious from speaking to Lee that an enormous amount of thought has gone into the new format. A few times over the course of this year’s event, board members made cryptic statements like: “It’s so great that the last year under this format went so well.” Indeed, it did go well. There was an
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increase by 7% of buyers for land border stores over 2016, at 44 vs 41, and an increase by 6% of buyers overall, at 55 vs 52, and this was despite both a store closure and an illness which kept away one important buyer. While the number suppliers in suites/private rooms remained steady, there was a 6% increase in trade floor booths, at 35 vs 33, and almost without exception the trade floor operators were pleased with the activity. The floor was busy this year, with buyers constantly present. For the first year in memory, buyers were often heard discussing new and interesting things they had seen. This was due in no small part to the setup, with attendees having to walk through the trade floor to access the food for breakfast and lunch. Brilliant. Also, high windows let in natural light, and the setup was inviting. The trade floor did not feel cavernous, as has often been the case.
The future of the convention
Despite this success, this year was the final one under the traditional formal. As of 2018, there will be no longer be a trade show floor. “It was great that this final year was such a success so we could end that format on a high note,” says Lee. But as with the FDFA itself, she says the convention tried to be too many things. The result is a format that shows an enormous amount of thought and also demonstrates
Tania Lee, board member of FDFA and VP of Sarnia Duty Free attends FDFA’s opening cocktail
that the association truly listened to what suppliers and buyers both had to say. The following is a basic idea of the future format, though there may be slight changes. Under the coming format, new suppliers will apply to the FDFA in advance. Chosen companies will be invited to present at the semi-annual event. This will give new suppliers a huge opportunity to speak to all buyers at once. Regular suppliers prefer to use suites and appreciate the ability to meet with buyers one on one, but they didn’t like the length and cost of the event. So in future, the supplier suites will continue at the annual event in November, but the categories will be split: Liquor will have two days, Monday and Tuesday, and P&C and other categories will have Tuesday and Wednesday. For the most part, attendees prefer to be in a major city. For the next three years, the event will take place at the historic and beautifully renovated King Edward hotel in downtown Toronto. The dates are: Nov 3-7, 2018; Nov 9-13, 2019; Nov 14-18, 2020.
ous decline, and this is of great concern. Simon Resch, General Manager of the Emerson Duty Free Shop and FDFA Board Treasurer, minces no words. “The biggest challenge for all border duty free operators in Canada is tourist volume on rubber tires,” he says. Noncommercial vehicle arrivals at Emerson show a bleak picture, declining 32% between the years 2000 and 2016. And that number is positive compared to the decline across the country overall, which stands at an incredible 52% during the same period. “While we have seen a slight improvement since 2014, it’s pretty easy to see the correlation between the drop in tourists and the drop in sales,” says Resch. FDFA Board Vice President Philippe Bachand, Directeur Général of Philipsburg Duty Free in Quebec, says that while his sales figures are good, going up approximately 5% in 2017 over 2016, the percentage of US travelers at his border crossing is down considerably from its height. “Our Canadian customers are good, but if we want to be more successful, we have to attract the US customer,” he says. Tania Lee agrees with this assessment to some degree, but says another big concern is getting across the bridge. “People are uneasy about traveling across the border with the US travel ban, and people of color in particular have unease about dealing with border guards and the possibility of racial profiling,” she says. Given the exchange rate of the Canadian dollar, one would think the number of US travelers crossing into Canada
might increase. There are signs that this is slowly happening. “Currently in our store in Sarnia the split is 65% Canadian 35% American,” says Lee. “This is an improvement; our customers used to be 75% Canadian, but it should improve more.” She says it’s better to have a higher percentage of Americans because their spending is higher. “Whereas Canadians might buy one bottle of liquor, for example, Americans buy two, three or four.” While Canadians are always on top of the exchange rate, she says, Americans don’t pay as much attention and so lag a little behind. Sarnia Duty Free sales are up 3% over 2016. The liquor category has the highest growth, at +5.5%, but Lee says P&C is also strong, and food and confectionery is growing. A number of border retailers, including Sarnia Duty Free, have been strategically considering their marketing. Lee says they have been focusing on digital, especially targeted to very local – clickthrough rates are amazing, says Lee – but also regional, from Detroit to KitchenerWaterloo. The store also uses radio and billboards to reach its market. Sarnia has also focused a great deal of effort on social media, in particular partnering with suppliers to offer contests to followers, and bring them back to the site. Land border retailers in Ontario are excited at the possibility that they may be able to buy direct from craft liquor producers, and these individuals were popular on the trade floor in Montreal. But the LCBO has yet to confirm that this will be possible.
Simon Resch, General Manager of the Emerson Duty Free Shop and FDFA Board Treasurer with Amanda Pick, CEO of the Missing Children Society of Canada (FDFA official charity for 2017)
The land border industry
While most Canadian land border retailers speak of a decent year in 2017 so far, with approximately 5% growth over 2016, traffic from the US has been on a continu-
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
growth by RONNIE LOVLER
Outlook is good for regional duty free and travel retail industries as investments grow and businesses expand, with economic recovery in LATAM and the Caribbean recovering from impact of 2017’s devastating hurricanes José Luis Donagaray, Secretary General ASUTIL
atin America and the Caribbean are basking in the glow of a positive economic outlook for 2018, a development that looks likely to spill over into the regional travel retail and duty free industry. The “big two” of Latin America – Brazil and Argentina – are finally showing signs of economic and political stability, and positive news from those two nations has a spillover effect throughout South America. The Caribbean, meanwhile, is recovering from the impact of two hurricanes in 2017 with various campaigns being undertaken simultaneously to show the world that the region is open for business, even in Puerto Rico and the U.S. Virgin Islands, two of the islands hardest hit.
The first Summit
This year two organizational industry pillars, the Association of South American Free Shops (ASUTIL) and the International Association of Airport Duty Free Stores (IAADFS) have joined forces to put on their debut Summit of the Americas, hoping to take advantage of the positive outlook. Michael Payne, President and CEO of IAADFS, told us the Summit emphasizes the excellent prospects for a stronger regional duty free and travel retail industry. “We think the Summit will help focus the industry on the importance and value of the region and provide a forum to bring everyone together. It’s important that the industry stay focused and unified on the issues impacting the business. I think the Summit can play a role in that regard,” Payne said. “There is a synergy here,” said ASUTIL Secretary General José Luis Donagaray. “The message is very clear. You will have all the brands and the buyers. You will save money and time. This is about doing business.”
Donagaray was also enthusiastic about the economic upswing in Brazil and Argentina, the two regional giants. “Overall, the region is doing fine,” he said. “We had a lot of movement of tourists from Brazil and Argentina. We have an increase of passengers and sales in duty free. Things are much better than in 2017. There is a lot of movement of tourists inside and
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outside the region. The economy is doing well so tourists are traveling a lot more.” In fact, what’s happening in Brazil and Argentina is reflecting a global trend of economic growth. Data from the Conference Board at the US Bureau of Labor Statistics shows all the world’s major economies are growing, for the first time since the global 2008 recession. The International Monetary Fund (IMF) expects the national economies to grow by at least 2.8% in Argentina and just under 2% in Brazil. Alejandro Sosa, President of Y. LucasCalcraft S.A. in Uruguay, a consistently astute observer of regional developments, is also pleased by what he sees. “Fortunately, we are feeling the improvement in the region. We believe that Argentina is on the true path of recovery, and Brazil is recovering in spite of political factors.”
For his part, Donagaray expects the regional duty free retailers to benefit from Argentina’s recent decision to increase the tax-free allowance for its citizens from US$300 to US$500, making it possible for them to purchase more duty free goods and pay less tax. The country’s Revenue Administration announced the decision earlier this year in a move that coincided with the southern hemisphere’s summer holiday season. “You can buy more in the duty free shops when you arrive in the country,” Donagaray said. “You can buy more expensive products.
Michael Payne, President and CEO of IAADFS
There are more opportunities for a lot of sales in new products.” Donagaray also indicated that similar increases in duty free allowances in other countries in the region have already occurred or may be forthcoming. In Uruguay, the allowance increased from US$500 to US$650 in 2017, he said. “We expect the same thing will happen in Brazil at the end of the year. There is a global movement to increase the allowance.”
and Ricola. Also, after having been present in the accessories business with sporting goods, the company is now re-entering that arena with Biaggi and Bombata luggage. “Fortunately, we have been able to expand our business in Latin America,” he said. “Additionally, we have received the first order of an airport duty free in Central America. We have expectations of expanding in that region; it presents interesting opportunities.” And after all, interesting opportunity is what the duty free and travel retail industry is all about. Sosa mentions a new ferry service between Uruguay and Argentina. “The Colonia Express is a new option for passengers and also for the sale of duty free products,” he said.
In short, the region is busy. Operators like Motta International and Dufry are opening more airport duty free stores in the region. In Argentina, a new duty free zone is to open this year in the southernmost part of the country under the management of London Supply. Siñeriz Shopping, in Rivera on Uruguay’s border with Brazil, plans to open three new restaurants this year.
There’s another duty free change forthcoming in Brazil, when later this year, for the first time, duty free stores will be allowed to operate on the Brazilian side of that country’s borders with Uruguay, Argentina, Bolivia and Venezuela. “This presents a new challenge,” Sosa said. “On the one hand, more sales opportunities can be generated, on the other hand, will we be dividing the cake among members of the same consuming public where there already are border stores in neighboring countries.”
Yet clearly many of the region’s duty free and travel retailers are expanding their offerings as the economy improves. In a sign of the times, Sosa’s company, a supplier of confectionary and fine foods, is taking on new brands like Anthon Berg
(Left) Alejandro Sosa, President, Y. Lucas-Calcraft S.A
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In the Caribbean, the aftermath of Hurricanes Irma and Maria is still being felt, particularly in those islands that were hardest hit like Barbuda, the British and U.S. Virgin Islands, Dominica and Puerto Rico. But recovery efforts are going full speed ahead with the aim of making the international community at large and tourists in particular aware that travel to the islands is not only wanted, but very much needed.
IAADFS made a US$10,000 donation after the first hurricane struck. Industry-wide there has been an ongoing campaign to bring tourists to the islands, according to IAADFS’ Payne: “For islands not negatively affected by hurricanes, the air and cruise ship sectors are doing very well. The campaigns that focus on ‘we are open for business’ are working.” To give a boost to Puerto Rico, one of the destinations hardest hit by the hurricanes, the Caribbean Hotel & Tourism Association hosted its annual Caribbean Marketplace event there earlier this year. Puerto Rico’s official government corporation, the Puerto Rico Tourism Company, is hard at work. “Our island is officially open for tourism and ready to welcome you,” the tourism company said in a statement on its website, SeePuertoRico.com. From Patagonia to Puerto Rico, no one is staying down because of hard times in the past.
ARI North America
in The Loop
Multiple renovations lie ahead for the Montreal International Airport. All of the shops will eventually have more of a contemporary feel, featuring luxury brands
The Loop Duty Free recently opened their doors at Québec City Jean Lesage International Airport (YQB).
Award-winning operator ARI North America is living up to its promise of “Experience is Everything” at both its new and revamped stores across the region by JAS RYAT
er Rianta International (ARI) North America, one of the most successful businesses in the travel retail industry, is starting 2018 on a high note, having received several prestigious accolades at the Frontier Duty Free Association’s Gold Standard Awards in 2017. ARI was honored with Best Canadian Airport Duty Free Company and the Outstanding Airport Duty Free Store Employee Award. ARI operates five stores across the Americas and the Caribbean, located in Montreal, Québec City, Winnipeg, Halifax and Barbados. Montreal remains its largest operation with over six million international passengers traveling through in 2017 alone. The newest store, The Loop Duty Free, opened in Québec City Jean Lesage International Airport (YQB) in December 2017. The new duty free store quadrupled in size, from 100 square meters to 400 square meters. It features an array of luxury products, from makeup, perfume,
Jackie McDonagh, General Manager, Aer Rianta International, is ‘delighted’ to open a new store in partnership with Jean Lesage Québec City Airport
sunglasses and accessories to a wide selection of wines and spirits. “We are delighted to be opening a beautiful new store in partnership with the Jean Lesage Québec City Airport,” enthused Jackie McDonagh, General Manager, Aer Rianta International. “The design specifications of this store are the most up-to-date to enhance the customer experience. It is particularly exciting to be introducing international brands such as Chanel, Lancôme, Dior, and Givenchy and a “sense of place” offer by introducing Bizou [jewelry and watches] and fine Québec food products. Passengers will have a vast range of whiskies to choose from in our Whisky Collection that are ideal for the collector and passengers who are gifting. We look forward to a long and successful partnership with Jean Lesage Québec City Airport.” Looking ahead, multiple renovations are scheduled throughout the existing Montreal international shop, including furniture and floor layout upgrades to maximize space and the introduction of new brands to improve the customer offering. The categories involved in these renovations include perfume and cosmetics, food and confectionery, souvenirs and liquor. The renovations are expected to enhance the shopping experience with better lighting and improved customer flow. The upgrade also seeks to offer customers an expanded selection of items including new brands that are current and in demand, explained McDonagh.
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Customer purchasing habits
As a customer-centric retailer, ARI conducts a Global Insights Programme which provides it with an in-depth understanding of what its shoppers want and orientates the retail offer to best meet these needs ARI’s renovations are proving to be a good investment. This past year, ARI noted that sales were up 11% and the average ticket was 4% higher than 2016. These strong numbers show that sales were ahead of the passenger traffic figures. In its 2017 research, ARI witnessed an increase in impulse shopping in Montreal. Buying gifts remains a key driver for shoppers, particularly among US, Chinese and European passengers. The core shoppers continue to be female and those traveling beyond North America. The core shopper in Barbados is female and local or British and American. Passengers to and from Canada were the fastest-growing group in terms of passenger numbers in December 2017. Passengers appeared to be spending less on liquor, tobacco and confectionery, and perfume and cosmetics at the end of 2017, but more on the fashion category, noted McDonagh. ARI, now employing over 3,000 people worldwide, aims to stand behind its promise: “Experience is Everything”. 2018 will continue to be another year in which the company will continue to renovate and evolve to meet its shopper needs, McDonagh concluded.
One of the entrances to Siñeriz Shopping. At left is the bazaar area with a 12-square-meter LED screen in the background
A step beyond by RONNIE LOVLER
Immigration and customs services, gourmet dining and a world of fun for children are just some of the possibilities at Siñeriz Shopping’s Uruguay border location in Rivera
ustomer service is an important aspect of the success of Siñeriz Shopping, in Rivera on Uruguay’s border with Brazil, but the company’s offerings don’t end there. Siñeriz offers consumers almost anything they could desire, all under one roof in its 24,000-square-meter complex with 10,000 square meters of duty free shop-
ping. In addition to world-class shopping, customers will find immigration services, a playground for the kids and fine dining. The company’s philosophy is to try to anticipate consumer wants and needs, even before the consumer is aware of those desires. In an exclusive interview with Americas Duty Free, Siñeriz Shopping Com-
A view of the offerings available to consumers at Siñeriz Shopping
mercial Manager Hilmi Abdullah Neto suggests that approach is why 2017 was such a good year for them and why the company expects 2018 to be just as good, if not better. “We do not have 8,000 wine labels simply to have a large winery, but to be wine specialists,” he says. “We do not offer 2,000 square meters of perfumes and cosmetics just to have an impressive exhibit, but to be able to bring a good, extensive offering of the most important brands in the world.” Selection is key to the company’s offerings. “Whether looking for wines, perfumes or something else, our objective is that the shopper feels he or she is in a specialized place – that we have everything they need and also items they did not expect to find,” Abdullah Neto adds.
Corners offer increased sales
It is easy to see that approach at work with Siñeriz Shopping’s recent implementation of dedicated “corners” for three categories of items — beer, chocolate and Uruguayan products. With each of these corners, Siñeriz aims to draw in the consumer with unique displays. The big winner was the beer corner, which worked because beer was set apart from other beverages like wine and champagne, according to Abdullah Neto. 78 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Please visit us in the San Antonio Room during the Summit of the Americas
only restaurant in the Rivera border area where it makes sense to book a reservation. For customers who want their dining experience to be easier on their pocketbooks, other choices include crêpes and coffee at Fragola Café, or fast food at Burger King. Recently the company opened a Uruguayan “chiviteria,” where chivitos, something like a Philly cheesesteak sandwich, are available. Abdullah Neto says Siñeriz Shopping has plans to open two or three new restaurants in 2018.
On display is the new beer corner at Siñeriz Shopping. More than 200 labels are offered, organized by country and types of beer
“It gave the category the importance it needed, and sales went up accordingly,” he says. “We always keep on hand a minimum number of 200 different labels, organized by category and by country.” Equally successful was the corner for Uruguayan specialty products, which not only highlighted items that are uniquely Uruguayan, but also “gave visitors a better notion and ease in the purchase of local products, such as dulce de leche (caramels), wines, olive oil and the traditional local confectionary called ‘alfajor’,” says Abdullah Neto. Establishing a separate corner for tea and coffee also allows the store to feature coffee-related products, from appliances such as coffee makers to foods that pair with coffee, such as biscuits and chocolates. This offers extraordinary opportunity for upsale.
The magical land of Siñeriz Shopping offers even more for the visitor. Visiting families will be thrilled to find a 400-square-meter play area that looks like a pirate ship, where the young ones can have a good time. And if too much activity has the family longing for a rest, there’s a movie theater. Because so many people now bring their pets along when they travel by car, Siñeriz Shopping now has specially designed shopping carts where people can place their pets and take them along while they shop. Shoppers from Brazil have been drawn to the complex since the opening last year of the new Integrated Border Control area within Siñeriz Shopping. Shoppers never have to leave the Siñirez confines once they touch ground in Rivera. The Uruguayan Ministry of Tourism also has an office there.
Continued success But while the fact that border services are housed under the Siñeriz Shopping roof benefits the company, it also is good for Rivera as a whole, Abdullah Neto says. “We do not think of unified immigration between Brazil and Uruguay as a business, but as a service,” he explains. “The tourists who passed by here (before) had many difficulties with the heat, with the lack of structure and comfort, mainly for the children.” Travelers going through customs and immigration now have services including 24-hour guarded parking, a full food court, a supermarket and large, clean bathroom facilities, as well as a convenient place to do their immigration paperwork, Abdullah Neto says, adding that now more visitors are staying at hotels at the border, instead of staying at hotels on the way to their destination as they did previously. “So besides the commerce, hotels, gas stations and restaurants, the whole border area has benefited.”
Fine dining is also an option at Siñeriz Shopping. La Perdiz, considered the top restaurant in Montevideo, now has a second restaurant there. It is probably the
In the center, the chocolates corner is featured. Behind it is the foods section
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The company’s commercial success is a major reason Siñeriz Shopping is not concerned about future competition from the Brazilian side of the border now that, for the first time, Brazil will allow duty free shops to operate there. “Changes always generate great opportunities,” Abdullah Neto says. He adds that recent challenges are what led Siñeriz to its leadership role in the travel retail in the region. This means Siñeriz Shopping is not content to rest on its laurels and is looking forward to the year ahead. “We have large projects in the works for change and modernization. Year after year we are changing and adapting to the changes in consumption and trends for a better shopping experience for consumers,” Abdullah Neto says. “We are always very optimistic about the future; even when a crisis insists on settling in, we look for opportunities,” he says. In his view, 2018 will “undoubtedly be the best year in recent history” for Siñeriz Shopping, not only because of the favorable economic and political environment in the region, “but also because of the consolidation made step by step that assures we are the duty free leader of the region.”
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Caribbean Tourism Organization
ahead After a strong start to the year, the Caribbean tourism industry was dealt a major blow with September’s devastating hurricane activity. Despite this, the region still ended with positive tourist growth in 2017 and is poised in the right direction for 2018
ince 2009, when the financial crisis of the previous year strongly affected travel, the Caribbean’s tourist numbers have been on a constant and consistent upswing. Despite the devastating hurricanes of 2017, this trend continues, according to the Caribbean Tourism Organization’s (CTO) Secretary General Hugh Riley and Director of Research Ryan Skeete at the Caribbean Tourism Performance Report news conference, held in February of this year. “We are delighted to report that Caribbean tourism reached another milestone in 2017, surpassing 30 million stay-over/ tourist visits for the first time and reaching an estimated US$37 billion in total visitor spending,” said Skeete, at the conference. “This good news came despite the devastating September hur-
ricanes. The performance in 2017 was primarily supported by sustained economic growth in all of our major source markets.” During the first half of 2017, stay-over arrivals had been heading for an overall +4.8% growth rate, but as the hurricanes had a major impact on second-half stayovers, the annual increase ended up at +1.7%. This percentage represented 30.1 million visits, making this the first year ever that tourist visits have reached over 30 million. “This marks the eighth consecutive year of growth,” said Skeete, admitting that this was slower than the average global growth rate of 6.7%.
As has been noted by those in the duty free industry, while the Caribbean as a whole might be doing well, this is far from consistent across the region. Several countries reported double-digit increases in 2017. These include Saint Lucia (11%), Belize (10.8%), and Bermuda (10.3%). The hurricane-impacted countries recorded sharp decreases, however, ranging from -18% to -7%. The US Territories (-7.9%), the Dutch Caribbean (-6.6%) and the Organization of Eastern Caribbean States (OECS) (-3.6%) reported declines, while the grouping dubbed “Other Caribbean,” which comprises Cancun, Cozumel, Cuba, the Dominican Republic, Haiti and Suriname, and which accounts for almost half of all arrivals to the region, recorded an increase of 6.0%.
Tourist arrivals to the Caribbean reached and surpassed 30 million for the first time ever
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by WENDY MORLEY
Arrivals from the Caribbean’s largest source market, the US, grew by approximately 0.5% to reach an estimated 14.9 million visits to the region in 2017. While not a particularly strong improvement year-on-year, the number remained substantial and the country is in no danger of falling from its lofty first-place height. The European market offered the largest increase, by percentage. Visitors from this region totaled 5.8 million, an improve-
The Caribbean’s three major source markets showed growth in 2017, and this trend is set to continue for 2018
ment of approximately 6.2% over 2017. “This increase came in spite of terrorist attacks in some countries, and the continuing Brexit negotiations and the related uncertainties,” said Skeete. Canada is the region’s third strongest market, and growth from that country was strong. After a decline in 2016 of 3.1%, visits in 2017 grew 4.3%. “The country’s strong economic performance and increased seat capacity to the region helped support this recovery,” said Skeete.
Cruise vs airports
The Caribbean is the world’s busiest cruise region, and growth in that area continues. Cruise passenger arrivals set a new landmark in 2017, despite the hurricanes, reaching an estimated 27 million visits to the region, which is 2.4% higher than recorded numbers in 2016. Arrivals by cruise grew 4.6% in the first half of the year, with a slight contraction post-hurricanes. After a sharp decrease in September of -20%, growth returned from October through December. Arrivals to the region by air were in line with arrivals overall. While the first half of the year was strong, September’s hurricanes caused significant disruption for airlines during the final quarter of 2017. As a result, seat capacity fell by 7.2% in the fourth quarter, according to OAG, an air travel intelligence company. Overall seat capacity for the year increased 1.7%, which demonstrates an especially strong first half.
Outlook for 2018 and beyond
Already 2018 is showing to be a banner year for the region, and global economic conditions are expected to be favorable. All of the major tourist source regions for the Caribbean are projected to grow strongly and oil prices are expected to remain relatively low. These factors bode well for tourism in the Caribbean. Rising geopolitical tensions, the persistent threat of major terrorist attacks and the heightened risk of extreme weather events are expected to have a negative impact, however. The CTO is consequently projecting that tourist arrivals will increase between 2% and 3% in 2018. CTO Secretary General Hugh Riley cautioned that rebuilding, developing and sustaining the infrastructure and the image of the Caribbean is an immense task. “Resources will need to be developed, and realistic attention
All indicators are up for Caribbean tourism leading into 2018
will need to be paid to the length of time it takes to rebuild an economy and repair a brand seriously affected by natural disasters,” he said. He also suggests that tourism be taken more seriously. “Our first order of business as a region is to stop treating tourism as some sort of casual pursuit,” he said. “Tourism is a serious business. It employs, directly and indirectly, 13.7% of the people in the Caribbean. It delivers foreign exchange every time a plane lands and a cruise ship docks. It reduces unemployment and delivers massive amounts of tax dollars to our national treasuries.”
Timeless Desires Affordable and space-efficient watch concepts with a fashionable Italian retro-feel. Lambretta loves travelling the world on board Airlines & Ferries and hanging out at Airports.
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www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Ready. Set. Satori
Satori brought to life a winter wonderland Grey Goose vodka campaign at Toronto Pearson Airport this past December
by JAS RYAT
Satori Communications Group explains how building an enlightening out-of-store experience is as easy as 1, 2, 3
rand activation agency Satori helps brands connect with consumers to create a memorable experience. The company has discovered a niche market within travel retail that allows it to offer consumers the premium level of activations they are looking for in their journey. “We are more than an agency you hire to represent your brand,” declares Satori Managing Partner, Kelly Edmunds. “We are a partner that works with you from the beginning to create excitement for your brand in and out-of-store.”
Build your team
Satori passionately believes that building the right team brings fluidity to the process and creates an organic success story. “Creating an out-of-store atmosphere can lead to a lot of moving pieces,” says Edmunds. “Satori collaborates with the airport, the operator, your client team and your agency partners to align objectives and seamlessly execute them under a strong project manager.” Satori works closely with partners like the Greater Toronto Airports Authority (GTAA) at Toronto Pearson Airport to create opportunities for engaging customer experiences like the campaign they rolled out for Grey Goose vodka in Terminal 3 this past December. The campaign engaged travelers by creating a mountain chalet-style ambience in which to unwind and sample a seasonal cocktail from Grey Goose. The themed area was
furnished with branded fittings and theatrical props, including cozy chalet-style seating, deck chairs, log tables, mountain signage and flickering lanterns – and not forgetting a giant snow globe photo activation that brought the intimate atmosphere to life. Tina Williams, Business Development, Partnerships & Advertising, Toronto Pearson comments: “Working in partnership to create a one-of-a-kind Grey Goose experience was a success not only for the brand, but for Toronto Pearson. By creating an immersive and interactive experience for our passengers and expanding that experience to our retail and restaurant partners, it was a proven success for all. In its goal to be the best airport in the world, Toronto Pearson will continue to raise the bar and work with partners like Satori to get us there.”
Expand your reach
Satori seeks to create a fully immersive experience by aligning brands with other vendors in the terminal. For the Grey Goose Alpine Chalet, Satori partnered with food & beverage operator OTG to add three Grey Goose cocktails to its cocktail menu during the promotion, again offering touch points along the traveler’s journey. The digital aspect of these activations also plays a strong role. Satori incorporates on-site digital media to ensure brands are seen throughout the terminal. “Being creative with your screens and
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Satori’s ambassadors are a well trained extension of the brand experience they provide
driving awareness of your activation will help bring another layer of exposure,” states Edmunds. Lastly, it’s vital to offer the unexpected, says Edmunds. “Out-of-store experiences are the perfect place for duty free and travel retail exclusives. Work with the operator to ensure a seamless purchase experience for the customer on-site and be sure to educate the in-store associates with the offers so they can drive customers over to your activation,”.
Put the right face forward
Satori is a big believer in hiring ambassadors as opposed to staff. “An ambassador lives and breathes your brand. This resonates with consumers as they build a relationship with the brand. Part of developing your ambassador is making the training an experience, “explains Edmunds. To this end, Satori brings in the experts, creates the ambience and incorporates role play to create an authentic experience. It also focuses on helping the team grow by managing, mentoring and offering on-going training to create a consecutive success story.
THEY SEE A DEPARTURE GATE WE SEE A GATEWAY TO EXPERIENCE
w w w. s a t o r i c g i .c o m
shops under scrutiny by HIBAH NOOR
Travel retail researcher m1nd-set has released its latest duty free business intelligence, based on 11,000 faceto-face interviews at airports across the Americas
Regarding the path to purchase, 40% of respondents say they had decided to buy a duty free product before leaving for the airport
esearch specialist m1nd-set has released the latest air traffic data for the different regions, as well as a forecast for the next 12 months. Additionally, the company has revealed the latest insights from its Business 1ntelligence Service (B1S), based on 11,000 face-to-face interviews at airports across the Americas. According to m1nd-set’s data, the top 10 airports for international traffic in North America last year (2017) were, in order: New York JFK (29.9 million passengers in 2017, achieving a year-onyear rise of +4.3%, with a forecast for an increase of +0.2% in the next 12 months),
m1nd-set Owner and CEO Peter Mohn
Toronto (23.5 million/+7.1%/+4.1%), Los Angeles (20.3 million/+11.7%/-0.5%), Miami (17.2 million/+5.2%/+1.3%), San Francisco (11.3 million/+10.4%/-7.2%), New York Newark (10.9 million/+6.6%/+9.9%), Chicago O’Hare (9.99 million/+10.1%/+3.6%), Vancouver (9.8 million/+9.9%/+5.7%), Montreal (9.1 million/+8.1%/+3.2%) and Houston Intercontinental (8.2 million/-1.7%/-2.2%). The top 10 airports for international traffic in Mexico, Central America and the Caribbean last year (2017) were, in order: Cancun (13.7 million, achieving a year-on-year rise of +8.8%, with a forecast for an increase of +6.1% in the next 12 months), Mexico City (11.8 million/+12.5%/+3.9%), Panama City (9.7 million/+3.4%/+2.1%), Punta Cana (6.2 million/+1.1%/+10.3%), Havana (4.0 million/+43.1%/-26.3%), San Jose (4.4 million/+11.9%/+8.3%), Santo Domingo (3.9 million/+7.7%/-1.9%), Montego Bay (3.8 million/+5.3%/+16.3%), San Jose del Cabo (2.9 million/+19.3%/-4.7%), and Guadalajara (3.3 million/+3.8%/+6.4%). The top 10 airports for international traffic in South America last year (2017) were, in order: Sao Paulo Guarulhos (10.8 million, with a year-on-year increase of 3.5%, and a forecast upswing of +8.5% in
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the next 12 months), Santiago de Chile (8.0 million/+14%/+12.3%), Buenos Aires (8.8 million/+2.1%/-1.0%), Lima (7.9 million/+7.9%/+12%), Bogotá (7.8 million/+3.6%/-2.7%), Rio de Janeiro (4.1 million/-3.6%/+11.6%), Buenos Aires Newbery (2.2 million/+28.8%/+10.7%), Caracas (3.2 million/-30.4%/-22.1%), Quito (2.3 million/-8.3%/-6.3%) and Montevideo (1.9 million/+11.9%/+11.2%).
Favorite categories in duty free
Turning to m1nd-set’s latest insights from its Business 1ntelligence Service (B1S), based on 11,000 face-to-face interviews at airports across the Americas, the top 12 duty free categories visited in airport shops across the Americas were: perfumes (with 52% of people visiting the category), alcohol (29%), confectionery (29%), souvenirs and gifts (28%), clothing and accessories (21%), make-up (20%), skincare (19%), electronics (18%), jewelry and watches (14%), tobacco products (10%), media (9%) and toys (7%). The top reasons people gave for visiting duty free shops in the Americas were price advantage (29%) and to browse around (29%). More than a quarter of respondents (28%) said they wanted to see if there were any promotions, while
DF categories visited in airports in the Americas
23% were seeking a gift for someone. One-fifth (20%) wanted to kill time before their flight. Nearly 20% had a purchase in mind, while 15% said they always shopped. Fourteen percent were looking for a treat for themselves, and 13% were attracted by the shop. Only 10% were attracted to the store by a promotion outside. m1nd-set’s research also showed that most duty free buyers in airports across the Americas planned their purchases. However, only 10% had pinpointed a brand already, and 12% knew the exact product they wanted. About one-fifth (21%) of people bought a product on impulse. As for the purchasing drivers, onethird of people (33%) said they bought the product because there was a clear price advantage, with 32% saying they thought it was good value for money. Nearly one-third (27%) said they couldn’t find the product at home, while 25% cited convenience. Other reasons to buy were that the product was suitable as a gift (24%).
Some (17%) cited that it was a treat for themselves and 16% said they purchased the product because it was on promotion. Regarding the path to purchase, 40% of respondents said they had decided to buy a duty free product before leaving for the airport, with 8% deciding on the way to the airport. Some 14% decided to purchase in the airport but before going into the store, and 32% said they had made the decision in the store itself after looking around. Of these, 4% said they bought a product in-store after listening to advice given by staff, and 3% bought in-store after buying another category. The research also revealed that 24% of duty free shoppers take notice of touchpoints before arriving in the shop. Top touch points were while booking the trip (cited by 36%), inflight magazines (38%), billboards/posters at the airport (36%), discussing with friends and relatives (36%), duty free store website or app (29%), ads in magazines (28%),
website ads/online banner campaigns (21%), inflight sales catalog (21%), official brand’s website or app (17%) and articles in magazines (14%). Overall, most people saw the touchpoint online. Half saw the touch point on billboards/posters, 39% via traditional media, and 42% cited “other.” More than half of respondents (55%) who interacted with staff said they were influenced to buy a product, with 29% saying the staff helped them choose and 10% saying they would not have bought the item without advice. As for the barriers to purchasing duty free goods in the Americas, the main ones were no motivating promotions or sales, cited by 41%. The other main barriers included, high prices compared to home (cited by 30%), not attracted by the products (27%), no new or interesting products (22%), unwilling to carry more items (19%) and high prices compared to their destination (19%). Almost a tenth of respondents (9%) were unsure about Customs regulations.
Moment of DF purchase decision – Airports in the Americas
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Safe Skies luggage locks offer travelers an option that airports will not cut off
Safe Skies has the market on lock Safe Skies luggage lock brand shares how a major victory in court is the key to its future by JAS RYAT
Safe Skies luggage locks’ unique technology has eight International Agreements with security agencies
afe Skies, the luggage lock specialist, has entered 2018 with a major court victory, as the US Appeals Courts in Charge of Patents held that Safe Skies patents could be infringed by Travel Sentry, another luggage lock developer. The US Patent Office also agreed to grant another patent that directly covers dual-function locks the Transportation Security Administration (TSA) has approved. The ruling came after Safe Skies founder David Tropp had been embroiled in a court battle for years in regards to an infringement patent with its competitor Travel Sentry. Currently checked luggage must carry TSA-approved locks so they can be unlocked by a master key at Customs in the US.
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Locks that are not TSA-approved can be broken off if they warrant inspection. The Federal Circuit’s recent decision reaffirmed that companies cannot avoid responsibility for patent infringement by having different entities perform the steps of a patented method. Currently, Safe Skies has eight International Agreements with security agencies, namely the US Transportation Security Administration, the UK’s HM Customs & Excise, Swiss Government, German Government, Australian Government, New Zealand Government, Canadian Air Transport Security Agency and Israeli Airports Authority.
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THE SUMMIT Innovative tobacco brand Mazaya is gearing up for success in the Americas market, due to the huge take-up of the shisha trend among trendy millennial consumers
To attract shoppers, Mazaya stages experiential promotions and activations
M Mazaya’s Candy Drops Molasses is made from premium French tobacco and comes in colorful packaging
Mazaya’s Two Apples flavor is a firm favorite among consumers – and for the company’s CEO, Nisreen Otaibi
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azaya, the shisha brand that is taking the travel retail industry by storm, has announced exciting plans for its debut attendance at Orlando’s Summit of the Americas. The Mazaya brand was launched in 2010 by the fast-growing Jordanian tobacco company Alzawrae. Through Mazaya, Alzawrae aims at revolutionizing the production of tobacco-molasses, presenting to its customers a diverse and innovative selection of high quality products, distinguished by their unique ingredients that include pure honey, natural food grade flavors and premium quality French tobacco. Pioneers in the production and supply of high-end tobacco-molasses and innovators in hookah technology to international quality standards, Mazaya has expanded its presence from three markets to 30 markets in just five years and seeks to expand the base of its success globally. Nisreen Otaibi, CEO of Mazaya, reports that the Amman-based company has been doing very well in duty free shops for the past years, achieving high
Exhibition last October, which was a very successful event for the brand, as awareness has grown over the years. Additionally, new business deals are now in the pipeline due to its participation. Otaibi believes Mazaya has a distinct point of difference in comparison to other shisha tobacco brands, as she explains: “Mazaya has always been known as the modern shisha molasses, in terms of our colorful packaging, exotic flavors/mixes, innovative new products and shisha accessories. In addition to that, the ingredients we use include French premium tobacco leaves and food grades for our flavors. All of those factors have helped Mazaya to gain a competitive advantage over other brands.” Currently, the company has three production plants: one in Jordan and two in the UAE. Otaibi herself certainly savors the shisha experience. “I enjoy having shisha, whether I am out with my friends at a shisha bar or having it at home for relaxation. My favorite is the Two Apples flavor, which is one of the classical flavors. But I also enjoy having our exotic yummy mixes – Electric Dream, for example.”
year-on-year sales growth of 70% to 80% with the main duty free operators during 2017. Adding to that, Mazaya is now listed in key duty free shops, including Jordan, Dubai, Lebanon, Iraq/Najaf, Kuwait, Qatar, Iran, Egypt and Bahrain. A new listing has also been confirmed at Sharjah, and further new business deals are under way.
A joyful shopping experience
Otaibi’s vision for Mazaya in duty free is clear. “Our duty free strategy involves expanding our duty free base by new listings, along with strengthening our current listings through two main aspects: our B2B presence, by supporting the operators; and the B2C aspect, which will be achieved by providing a valuable shopping experience to our consumers. We always seek to contribute in providing a joyful and valuable shopping experience to our consumers. We do this by implementing the constant price/GWP promotions we have, along with our experience-led promotional areas that we usually establish.”
Otaibi is convinced Mazaya’s tobacco products will do well in the Americas, due to the trends in consumer behavior across the region. “Shisha is now a trendy social activity that many people love to experience,” she enthuses. “People use shisha for many reasons, including socialising, entertainment and relaxation. All those factors have helped in making shisha a global phenomenon rather than a Middle Eastern activity. The shisha category in the American domestic market is growing dramatically, making it a mature category there. Therefore demand for shisha in duty free shops will increase, once the products are available. Mazaya is known for its modern flavors and packaging, including classical and exotic flavors and mixes, which fit with the consumer behavior and needs in the American market. Because shisha is considered as a trendy activity, many millennial consumers have been keen to experience shisha and try out the new flavors/mixes – and even create their own mixes, she adds. Mazaya attended the TFWA World
Mazaya set to impress in Orlando
Mazaya will be exhibiting for the first time in Orlando at the Summit of the Americas (booth 800), where it will also be offering a shisha service to visitors looking to relax and unwind in the sun (Cypress Patio 2). In other exciting news, new flavors have joined Mazaya’s extensive range, including Two Apples Bahraini, with various pack sizes available to travel retail. Alongside the tobacco, Mazaya can also supply prestigious glass shishas in various sizes, along with its handy portable size shisha that is targeted at consumers looking to experience this growing trend for the first time. “We see a lot of potential for our business in the Americas,” says Rawan Elayyan, Mazaya’s Brand Manager. “The popularity of shisha in the Americas is greatly on the rise, with more teens indulging in the pastime as a way to socialize with friends. We very much look forward to making our debut in Orlando, meeting new potential business partners, and enjoying the various social events the Summit of the Americas has to offer.”
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Enjoying the IAADFS 2015 cocktail party (from left): Jean-Jacques Bona, Patricia Bona, Antoine Bona, Laetitia Bona Piedra, Gabi Medeiros Humbles and Guillaume Bona
A team with a mission celebrates
As the beauty distributor marks its 30th anniversary, Americas Duty Free sits down with Essence Corp’s owners Patricia and Jean-Jacques Bona to find out what makes the company tick
ssence Corp is celebrating 30 fabulous and productive years in business during this year’s Summit of the Americas. The company’s senior executives have identified the key milestones that have made the Miami-based fragrance distributor what it is today – a family-owned business with core philanthropic values. Today, the top management team consists of Jean-Jacques Bona as President; Patricia Bona – Vice-President; Antoine Bona – Executive Sales Director; Guillaume Bona – Executive Sales Director; Laetitia Bona Piedra – Executive Director Administration & Finance; and Gabi Medeiros Humbles – Executive Director Marketing. According to Patricia and Jean-Jacques Bona, 2003 was a milestone with three major events: “We became the regional office of Clarins for the next 10 years, we opened our own warehouse in Miami, and tripled its surface in 15 years, and we welcomed the second generation, first with our son Antoine, then our nephew Guillaume and our daughter Laetitia.” In 2012, the company created a strong marketing department with dedicated brand managers, headed by Gabriela Medeiros Humbles as Executive Marketing Director. And in 2016, the company diversified its activity in becoming a local distributor in Panama and Colombia. Here, Americas Duty Free asks Patricia and Jean-Jacques Bona to reveal the secrets of the company’s success.
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by HIBAH NOOR
Patricia and JeanJacques Bona are pictured in their Miami office
Americas Duty Free: How do you feel on your 30th birthday? Patricia and Jean-Jacques Bona: We feel proud of our achievements and confident that the next generation will keep on growing the business during the next 30 years. And as we are personally getting older, we appreciate this stage of life as a new adventure. This is the time of our (and of our company’s) life for engaging in new opportunities. ADF: How did you start your company? P & J-JB: We founded Essence Corp in 1988 in Miami following the path of our Paris, France-based family company, Guillo & Bona S.A. which operated as an agent, and focused only on the Caribbean. We had two missions in mind: first, to strengthen our presence in the region to support our expansion across the travel retail markets of the Americas. Second, to become a distributor. ADF: Are you satisfied with your achievements? P & J-JB: One should never be entirely satisfied and always seek to do better… But the truth is that we are extremely pleased, not only of our growth in sales and of the success of our brands, but also of looking at the team we have built, led by the younger generation: talented, optimistic and successful. ADF: What level of growth are you expecting in the next 2-3 years? P & J-JB: We expect 10% yearly average growth: 7% organic and 3% coming from new brands. Both are very important. We want to see our partner brands grow in sales and market share, but we are also always looking for new prospects, opportunities, challenges. It is the most satisfying feeling to take the responsibility of a new brand and carry it to the next level.
What Essence Corp’s longestserving employees say:
The Essence team’s annual corporate run (pictured in April 2017) benefits The Miami Project to Cure Paralysis
The Essence team’s Miami Rescue Mission took place in January 2016
ADF: What challenges made the company stronger? P & J-JB: During these past 30 years our main challenge has been the globalization at brand level which made us lose some independent brands when they were acquired by established groups. These setbacks have not prevented us from keeping on growing thanks to the success of newcomers – brands such as Montblanc, Versace and Victoria’s Secret, which we handle in the whole travel retail market. In the Caribbean, we were able to grow our portfolio of distributors with established groups such as Shiseido, Puig, Clarins, Hermès and LVMH. In the local markets of North America, we maintained our involvement by changing our modus operandi: from agent we became supervisors of local distributors on behalf of some brands. We also decided in 2016 to become a local distributor (for Panama and Colombia).
Natalia Vergara, Senior Financial Analyst with 29 years at Essence Corp: “When I started back in 1988, there was very little technology, unlike today. I have seen the company grow exponentially in 29 years. The Bonas not only taught us new things, but kept us up to date with the industry. Essence Corp continues to impress me every day.” Beatriz de Vegas, Market Coordinator with 17 years at Essence Corp: “I remember Mrs Bona telling me that everyone who joined the company never wanted to leave. Some 17 years later I have come to realize how prophetic her words turned out to be. It’s a testament to their core values and I feel an immense pride to be a part of it. I look forward to the next 30 years!” Gabi Medeiros Humbles, Executive Director Marketing with 16 years in Essence Corp: “It has been an amazing experience of professional and personal growth simultaneously with the incredible growth of the company. Essence has always made me feel like family and has given me wonderful opportunities and cherishable moments. My mission here has always been to inspire teams and individuals to feel about this company as if it were their own. I’ve helped many others grow and fall in love with Essence Corp the same way that I have. I believe that their values and leadership make this company and all its employees proud to be at the TOP.” Picture taken at last year’s IAADFS 2017 cocktail party (from left): Antoine Bona, Patricia Bona, JeanJacques Bona and Guillaume Bona
ADF: Are you sticking to the beauty segment? P & J-JB: In 2010, we decided to focus on cosmetics and fragrance brands. We were successfully involved for 10 years in the accessory and watch segments but we decided to specialize in one category to optimize our level of service. ADF: How will you be celebrating 30 years? P & J-JB: We blew the 30 candles of our birthday cake with our staff during our internal seminar in January and shared with them our achievements and goals, and our vision for the next 30 years. We will continue to make every effort to impact lives, through constant office team work and service to the community. We have a strong commitment of giving back: one cannot imagine better feeling and better celebration.
ADF: What is your secret to a successful 30 years? P & J-JB: Hard work and loving every minute of it. Loyalty to our brands and to our customers. Assembling a professional team with strong priorities. Always being curious with a constant will to learn and to improve. Keeping our family values and business vision in focus and passing it on to the next generation.
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Model shown: May in Shiny Abolone
Building momentum with a focused team Following a successful launch, Costa Sunglasses is going after more premium travel retail accounts across the US, Caribbean islands and Latin America
onty Montan-ez, Director of Global Travel Retail at Costa Sunglasses, is representing the company at the 2018 Summit of the Americas show with a clear intent to expand the business across the Americas. Costa, the manufacturer of polarized sunglasses for life on and off the water, made its travel retail debut at the 2016 IAADFS show with a distinct, premium proposition and unique collection of performance sunglasses, all featuring Costa’s patented 580 color-enhancing lenses. The US brand’s proprietary multi-patented technology – which the company calls “HD for the eyes” – filters out harsh yellow light to reduce glare and enhance reds, greens and blues for optimal color contrast. After the launch, Costa was successfully established in premium travel retail accounts across the US, Caribbean islands and Latin America, namely Top Brands International, Duty Free Air & Ship Supply (DFASS), and Hot Look. Since then, Costa continues to build momentum in the channel.
expand the business across the Americas. Michelle Gullette, International Marketing Manager, joined Costa in November 2017 to focus and elevate Costa’s presence in the travel retail channel. “The travel retail environment is the perfect fit for Costa, offering knowledgeable staff who can share our story and technological features and provide a shopping experience that will express the full power of the brand,” says Montan-ez. “Our vision is to capitalize on the awareness Costa has in the US and extend this loyal following to new territories, especially tourist destinations where our water lovers are sure to explore and can experience the benefit of our Costa 580 technology.” Costa has dedicated significant resources to place custom store-in-store environments in strategic retail locations throughout the Americas. Says Gullette: “Our marketing focus for 2018 is winning at retail. This multi-channel approach is designed to help retailers build and elevate brand awareness of Costa, as well as deliver a rich consumer experience at Customized Costa store-instore in Glasgow, Scotland
A focused team for travel retail Montan-ez, Director of Global Travel Retail for the brand, joined Costa in October 2016, and represents the company at the 2018 show, aiming to
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point of sale. To date, Costa has deployed more than two dozen customized retail experiences, including Hard Rock Punta Cana, with more on the horizon throughout the Americas.” Montan-ez adds: “We’ve identified key travel retail locations for building the Costa brand, including throughout Florida, Mexico, and the Caribbean. Our goal in five years is to build a global platform for Costa as the performance sunglass brand for water lovers, everywhere. We’ll accomplish this by delivering the best brand experience at point of sale, offering innovative new products featuring the clearest lenses on the planet and through exceptional retail partnerships. We’ve secured partnerships with Dufry Group and Duty Free Americas, further reinforcing our focus on the Americas in 2018.”
Acetate Del Mar collection
Inspired by the sea, the new 2018 Del Mar collection will be exhibited at the Summit of the Americas. The collection features an acetate sunglass offering of four styles, all made with premium materials, including Costa’s signature mineral lens (580G). The collection features unique colorways, modern shapes, and broad appeal for the travel retail consumer. The May model features a classic square oversized shape with feminine appeal in four distinctive colors. Aransas is a unisex frame, also offered in multiple colors. The Del Mar collection is rounded out by Sarasota and Del Mar. All Del Mar collection frames are made from hypoallergenic, Italian acetate and feature German-made coated hinges. Diamondcut “C” mother-of-pearl temple logos and custom core wires with a topographic pattern add premium details. The Del Mar collection launches April 1, 2018 and will retail at US$249.
swing JuE Wong, Global CEO of Moroccanoil, shares her longterm and ambitious vision for the beauty brand with Americas Duty Free by JAS RYAT
JuE Wong, Global CEO of Moroccanoil, brings experience and ambition to Moroccainoil’s well seasoned team
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017 was a big year for lifestyle beauty brand Moroccanoil. Not only did the company celebrate 10 years of success, it also hired experienced brand-builder JuE Wong as Global CEO of Moroccanoil to add to the already established team. This all comes at an essential time as the brand introduces its Moroccanoil Beauty Division to a channel in which it already has a commanding lead. Wong started in the financial sector as a commodities and foreign exchange trader in the first 10 years of her career. Her financial training, combined with economics and arts background, laid the foundation for her current position. As her role at Moroccanoil began, she brought with her one key phrase: Optimize growth without mortgaging the future. What exactly does this mean to her new team? “This means driving strategic brand growth with an omnichannel approach, incorporating three key distribution channels that each play a critical role in propelling the business forward to generate,” explains Wong. She wants to focus on building credibility through professional distribution channels, equity through retail distribution, and revenue through online and social commerce platforms.
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Moroccanoil Beauty Division is an organic extension of the brands multi-channel approach
Morrocainoil, vetran in the oil-infused hair care game is ready to expand their portfolio
JuE’s mantra for success
Think big. Start small. Scale fast. This is one of Wong’s fundamental mantras. She is a true believer in hiring the right people and then letting them excel. “The team should have the freedom to be successful in their respective area of expertise, with available support if needed,” she says. That said, Wong describes herself as a tough taskmaster. “I do not believe in giving ‘A’ for effort – to me, the reality of the business world and achieving the desired results is key.” Wong has a proven track record with this dynamic approach. Wong recognizes that she has a very strong and seasoned team that has been running the duty free portfolio. She wants to listen and fully gear the strategy to help the brand scale as fast as it can. However, 2018 is not about opening as many doors as possible – quite the contrary. Wong wants to perform more strongly by becoming an anchor brand wherever it is present. In doing so, Moroccanoil can become a material partner to the travel retail operators it works with and ultimately its end consumer in duty free.
A digital vision
Ease of use has always been key to Moroccanoil’s duty free range. Moroccanoil’s Beauty Division was a natural extension of this, based on consumer needs. Wong says: “We are a consumercentric organization in that we are very clear that the masters at Moroccanoil are the people who support us, from trade to consumers. However, there is so much more we can bring to the hair care category, and we are going to bring forth the best technology and innovation as we continue to upgrade our existing line.” Wong recognizes the power of the brand’s oil-infused products in the duty free arena and would like to strengthen this while expanding the portfolio at the same time. Wong is also spearheading the company’s digital media transformation in an effort to increase the brand’s digital presence. Her main areas of focus are e-commerce, website, social media, digital innovation and media buying. “The focus will be to accelerate our e-commerce sales and website optimization to ensure a superior customer experience. We will continue to accelerate our
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social media presence with continued focus on digital innovation to advance engagement and ultimately conversion to sales,” explains Wong. This digital presence will also play a key role in creating experiences for the brand’s key demographic, the influential millennial shopper.
Consumers today are aware, Wong observes. “Not only do they want to know the quality of their products and where they come from, but they also want to know about how the product came to them,” she says. Many brands are now focusing heavily on their corporate social responsibility initiatives to ensure they are represented as an environmentally- friendly brand. “Moroccanoil is a brand whose values stay authentic to its reduction of carbon footprint in several different ways. The manufacturing plant in Israel has always been 100% powered with solar panels,” says Wong, who adds that the brand limits the use of secondary packaging to minimize paper usage and save trees. In 2017, the company was able to save 40% more trees in comparison to the previous year. Moroccanoil will also select sustainable ingredients and packaging moving forward. “We feel very gratified that more and more brands are moving into this consciousness. I believe collectively we can make a much more substantial difference than just what our company can do independently,” enthuses Wong. “In 2018 we can plan on seeing the brand work towards sustainable packaging, incorporating biodegradable ingredients in the formulations, increasing the company’s overall energy efficiency, reducing greenhouse emissions and distributing any excess personal care products to people in need around the world.” Wong and the entire Moroccanoil team have a bright horizon ahead. Since the team entered the duty free world in 2014 as the pioneer of oil-infused hair products, it has made solid headway with global expansion. With the brand already being established in many parts of the world, it will be interesting to see how the Moroccanoil Beauty Division will act as a game-changer in this multi-channel program.
BUCKLEY LONDON returns to Orlando with first men’s jewelry collection British jewelry brand Buckley London is introducing a men’s range to complement its new women’s design concepts and retail fixtures
uckley London is returning the Summit of the Americas in Orlando with an exclusive preview of its latest jewelry collections (stand number: 1131). As well as presenting the latest Spring/ Summer 2018 core collections, Buckley London will be revealing a number of brand new design concepts. The Buckley London For Him collection is Buckley London’s first-ever jewelry range designed for men and is predicted to be a hit with retailers and consumers alike. Showcasing a striking collection of trend-led bracelets, bangles and cufflinks, the collection brings together wrapped leather, stainless steel and polished metals alongside semi-precious beads and intricate skull details. The Buckley London For Him collection will be displayed in
specially designed packaging and retail display material, along with accompanying point of sale imagery. Buckley London offers British heritage-inspired designs in the style of fine jewelry, without the expensive price tag. Pieces such as the Royal Celebration collection have been Buckley London best-sellers for many years, and the brand is expanding on this success with the introduction of a new ring inspired by the engagement ring given to Meghan Markle by Prince Harry. The Meghan Sparkle ring will come beautifully presented in a commemorative gift box showing the wedding date of Prince Harry and Meghan Markle, 19.05.2018. As charm bracelets continue to rise in popularity, Buckley London will also add to its travel retail exclusive collections with fresh charm bracelet additions. The range includes on-trend Mexicanthemed charms, sea life charms inspired by cruise holidays, plus an update to the best-selling London charm bracelet. Also to be showcased for the first time at the Orlando show is a range of newly designed retail display solutions that Buckley London will bring to market in 2018. Amy Donlon, Head of Sales for Buckley London, said: “With an increased focus on our presence in the Americas, we are very excited to be returning to
Buckley is expanding on this success with the introduction of a new ring inspired by the engagement ring given to Meghan Markle by Prince Harry
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the Summit of the Americas this year. We will be unveiling a host of neverbefore-seen products, offering something different for our customers alongside our newest core collections, which stay true to Buckley London’s British heritage. There has already been a real buzz around the new collections and we very much look forward to being able to share these with customers for the very first time.” Established in 1989, Buckley London is a leading British jewelry brand that specializes in aspirational and attainable products for any occasion. Every Buckley London piece is designed by an in-house team of designers who create unique twists on the latest fashion trends while remaining true to the brand’s British heritage and quality. The award-winning brand has achieved numerous international accolades such as Best Costume Jewellery four times at the UK Jewellery Awards, Best New Inflight Product three times at ARC London and Best New Jewellery Product at DFNI. Buckley London is the designer of The Poppy® Collection. Since 2010, the partnership has enabled The Royal British Legion charity to raise over £1.3 million (US$1.8 million) through the sales of poppy brooches, which have been worn by a host of high-profile celebrities and influential figures such as the Duchess of Cambridge, Angelina Jolie and Lady Gaga. Buckley London supplies over 600 retail outlets worldwide, including 300 high street stores, 140 airlines, 100 airports and over 80 cruise ships.
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An eclectic mix of travel essentials Who wants to fly when these little travel luxuries will help you soar to your destination? 1
1. Bella Blanca by Oscar de la Larenta: This fragrance is the essence of the Oscar de la Renta woman. Always inspired by the designer’s passion for flowers, Oscar de la Renta designs are a testament to true beauty 2. Lancôme Génifique Sensitive: This fresh-activated formula soothes the skin, stimulates its youthful properties and strengthens it when it’s sensitive 3. Ricola Herbal Drops: These premium herbal drops are now available for individual consumption in 75g tin boxes containing 2.5g sugar-free herb drops in three tasty flavors
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4. Kroma Kabuki Brush: Beauty brand Kroma brings you this non-shedding high-performing brush. The hypo-allergenic brush is perfect for travel and makes application effortless 5. Tea Forte Matcha Collection: Tea Forte’s newly launched collection of healthy and energizing Matcha teas features new Matcha Single Steeps and a Ceremonial Matcha Bowl Set 6. B + D Eyewear Bridge Readers: These readers are an exclusive compact style and fit perfectly on every face shape. The case of this functional item can even be fixed to your mobile phone cover
7. Polo Ultra Blue by Ralph Lauren Fragrances: This ultrafresh and long-lasting interpretation of the top-selling Polo Blue scent blends citrus and crisp salt accord, for a refined, fresh and masculine fragrance 8. Sì Passione by Giorgio Armani: The Italian maestro’s reiteration of the signature Sì scent contains blackcurrant Jungle Essence nectar, combined with pear. The face of the new fragrance is actress Cate Blanchett 9. Lambretta Volta 39 watch: This new vintage-inspired men’s watch with a slim case, dome-shaped glass and slightly curved dial is a classic timepiece paired with leather straps, sleek mesh bracelets, and stylish perlon straps
10. Clinique Moisture Surge 72-Hour Auto-Replenishing Hydrator: A fast-absorbing gel-cream hydrator that delivers 72-hours of continuous moisture, even after washing your face. It improves the look of fine dry lines and flakiness 11. La Mer Moisturizing Cool Gel Cream: A water-fresh formula that drenches the skin with cool refreshment. Immediately upon application, the skin feels moisturized and conditioned, with a feeling of intense nourishment 12. Windsor Collection by Morgan & Oates: Woven in the UK using soft cashmere and wool yarn, this unisex scarf collection offers a range of lighter weight scarves in various colorways 13. Jam Shed Shiraz: This medium-sweet red blend is jam-packed with rich, opulent sweet red berry flavors, balanced with a subtle hint of vanilla and spice www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Spotlight On Exhibitors
Misaki takes on the Americas Katherine Sleipnes, IBBI President, is looking forward to Misaki is celebrating its 30th anniversary with a new logo representing Misaki at the Orlando show. “We are excited to that takes the initials of both its name and its home base – showcase the new Misaki Monaco travel retail exclusive sets, as glamorous Monaco. well as a self-select tower fixture. This allows us to sell all ranges Already present in over 30 countries, Misaki Monaco has of pearls, from highly accessible (US$35) products to cultured understood how to create a strong image throughout the world. pearls, depending on the retailer’s needs.” The brand has multiplied its solid partnerships in the travel retail She concludes: “We will have a team of eight representatives sector with Lotte, opening in Lotte World last year, as well as from IBBI present at the show to share the new Misaki with our Valiram, Eurotrade, Pavo Group and many others. The brand customers and wow them with the fact that Misaki Monaco is not is also present on airlines such as Air France, Lufthansa, China just pearls, but high fashion and high-quality jewelry with a hint Airlines, Korean Air and Aeroflot, and has been back onboard of pearl. We believe this is a winning combination.” Singapore Airlines since last September with two new products. Misaki continues to develop in the local markets with its all-new standalone concept. Misaki Monaco’s all-new standalone concept has Two boutiques have begun trading in begun trading in Beijing’s World Trade Center Beijing, and a kiosk is set to open in Dubai Festival City in March 2018. The brand will soon be inaugurating its first pop-up store in Nice Airport, a strategic positioning in the capital of the French Riviera. The opening is planned for April 2018. Having recently announced its partnership with International Brand Builders (IBBI) to represent the brand in the Americas, Misaki Monaco will be present at the Summit of the Americas in Orlando, confirming Misaki’s desire to expand into the Americas travel retail sector.
Infinity & Co set to shine in Orlando After a very successful debut in 2017, English brand Infinity & Co will return to Orlando to showcase its new 2018 collections (Cypress Ballroom Booth 833). Building on recent successes in both travel retail and domestic Latin American markets, the company will be launching new collections for both of its brands, namely its core jewelry brand Infinity & Co and carded sentiment brand Love X Infinity.
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Love X Infinity will launch over 100 new designs, each with a unique sentimental message, featuring initials, birthstones and a selection available with Spanish translations specifically for the Latin American market. Infinity & Co will launch seven new collections in Orlando featuring contemporary chokers and star, moon and clover profiles, all with hand-set detailing. The firm will also debut its men’s collections, which will be seen for the first time at the Summit of the Americas. With retail prices ranging from US$20 to US$80, affordable luxury is the inspiration that drives the brand, according to Infinity & Co Managing Director Samantha McDermid. McDermid said there had been an “incredible” reaction to the company’s debut in 2017. “We are delighted to back here in 2018 with a new booth and lots of new collections. For Infinity & Co, we will be introducing seven new collections — Zara, Faith, Lily, Anne, and Darcy — and we are very excited to debut our inaugural men’s collections Mackenzie and Cameron. We feel these are our strongest collections to date and really capitalize on our design strengths of fine ‘real’ jewelry handwriting at affordable prices. We are really looking forward to presenting them to our existing clients and hopefully a few new ones, too.” McDermid reported that the company had enjoyed a “really successful 2017.” Working with its Miami-based partner Astrid Steinhaeuser, she is hoping to build on this success in the Latin American region during 2018.
Go Travel introduces new accessories to protect against digital theft Go Travel, known best for its travel accessories, will introduce a new range of Radio Frequency Identification (RFID) protected wallets in 2018. RFID has been a convenience to the modern traveler by speeding up border control with RFID enabled passports, cruising through checkout using contactless payment cards or catching that last subway by being able to “tap and go” through the ticket barrier. However, the convenience has been overshadowed by increasingly sophisticated digital pickpockets stealing identities and skimming payment cards. Providing maximum protection in a palm-sized package, the new Go Travel RFID range safeguards all of a traveler’s sensitive information from being compromised. 2018 sees the introduction of three stylish new wallets, the Micro Wallet, the Slip and the Protector, which are designed to stop digital theft. Combining lightweight, robust, signal blocking fabrics with stylish urban designs, the new range is not just ideal for travel, it’s perfect for everyday life. The Micro Wallet protects against digital fraud and features a slim silhouette and lightweight design. The fabric stands up to vigorous travel and integrates an RFID shield to safeguard all of your sensitive, secure data embedded in contactless debit and credit card chips or even I.D cards. Multiple security features
Go Travel protects travelers with the Micro Wallet which saves them from falling victim to digital theft
make this wallet a must have item when traveling. The Slip is a micro-sized wallet that features a slim design and can be tucked away in pockets or purses. The outer layer conceals a signal blocking fabric that is adept at intercepting all data streams to keep you fully protected from RFID skimmers. It comes complete with a maximum-tack, high quality 3M sticker to attach it to a smartphone case. Finally the Protector is durable aluminum hard-shell card storage wallets that features an anti-slip outer and secure, snapshut closure conceal RFID protection which helps to shield your sensitive data embedded in bank card chips from identity theft and digital pickpockets.
ORLANDO FL. - STAND 727 - 18-21 MARCH, 2018
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Spotlight On Exhibitors
Live with good intent to enjoy The Rituals of Karma Rituals plans to unveil The Rituals of Karma-Skin & Sun Travel Exclusive during the Summit of the Americas this March. The range is designed to add a luxurious twist on skin and sun care. The concept behind The Rituals of Karma is based on the Hindu belief that living with good intent attracts good karma. Say good words, think good thoughts, do good deeds and if you
The Rituals of Karma-Skin & Sun Travel Exclusive is a range designed to immerse you in positive summer vibes all year round
stick to that, it will turn to you in the same positive way; in other words you reap what you sow. Organic white tea and ginkgo biloba are amongst the ingredients that set the tone for this range. The travel exclusive includes The Ritual of Karma After Sun Hydrating Lotion (50ml). This gentle lotion calms and soothes the skin after sunbathing and helps prolong a tan. These cooling ingredients are rapidly absorbed by the skin so that it feels hydrated. The Ritual of Karma Foaming Shower Gel (50ml) is a gelfoam formula enriched with white lotus and organic white tea. Its soothing foam with a delicate fragrance makes it ideal for the whole body. The Ritual of Karma Shower Scrub (70ml) is a gentle cleansing body scrub which transforms into a scrub shower cream when combined with water. The formula buffs away dead skin cells for an immediately softer, younger and more radiant skin, without drying it out. The floral aroma of white lotus combined with organic white tea offers a relaxing scent. And finally, The Ritual of Karma Sun Protection Face Cream SPF 50 (50ml) is a hydrating, water-resistant cream that is absorbed by the skin and protects against early ageing from UVA/UVB rays while promoting a tan. An advanced protection system contains a powerful-natural anti-oxidant complex based on organic white tea, natural vitamin E and ginkgo biloba. The Rituals of Karma-Skin & Sun Travel Exclusive will be available on April 2, 2018.
Radley London takes the clutch on North America ingly, however, as we enter new territories, we see that this ‘savvy British handbag and accessories brand Radley London is shopper’ is worldwide and the reaction and sales generated are expanding its travel retail business in North America after seeing double-digit growth in 2017. The brand’s partnership with retailer really positive as a result. We think it’s testament to the quality and variety of product available and the reputation the brand has, Dufry has resulted in openings in Seattle Tacoma International increasingly, worldwide.” Airport and Vancouver International Airport. These are the iniLyttel continues: “Our new GTR unit and North America tial locations announced as the brand demonstrates its strength locations demonstrate the ongoing strength and investment in in travel retail. our travel retail business. The openings in North America give Vancouver International Airport welcomed a branded shopus further confidence in our investments and plans and complein-shop in January, featuring the gold edition of the global travel retail unit. The shop will carry Radley’s SS18 handbags and acces- ments the business’ recent success launching in Macy’s and QVC USA. We’re very excited to see where it takes us as a sories along with the brand’s Travel Retail Exclusive Collection. business next.” Following a successful launch in Macy’s and with QVC USA, Radley London will roll out a store in Concourse A and in the Dufry-operated South Terminal main store in Seattle Tacoma Airport. Hayley Lyttel, International Travel Retail Manager, explains the brand’s shopper: “She appreciates quality and wants her accessories to be just as hard-working as she is. As a cherished British brand, we naturally generate a lot of sales in these international travel outlets from British shoppers on-holiday: our Travel Retail Exclusive range, designed around functionality and, by its namesake, exclusive to the Travel Retail industry, gives our British customers Radley London plans to expand their prosperous handbag and accessories brand to North America something more from the brand. Interest-
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Please visit us at Summit of the Americas at our booth 1031 !
Candy Tin new collectable item in the iconic Goldbear shape
The Hershey Company
HERSHEY bulks up for travel retail The Hershey Company uses its retail store success to find a parallel in global travel retail by JAS RYAT
2018 will mark the launch of the Nuggets Travelers Collection
The Travelers Collection travel-exclusive portfolio is Hershey’s entry into the informal gifting arena
he Hershey Company enjoyed a very eventful 2017. The US confectionery giant launched its Travelers Collection travel-exclusive portfolio during the TFWA World Exhibition in October and closed the year with the November opening of a Hershey Chocolate World emporium in Times Square, New York. The new location in the US city offers experiential platforms such as bulk dispensing, destination items and personalization options that will eventually enter the travel retail channel this year. Aside from its entry into the informal gifting space, Hershey is set to showcase new items, including Kisses, Reese’s and Hershey’s Miniatures, at this year’s Summit of the Americas show. Steve Bentz, General Manager, World Travel Retail, explains: “We’ve seen great success to date and look to continue to expand on this collection going into 2018 with the launch of our Nuggets Travelers Collection item. In addition, we will show our new Hershey’s Premium Chocolate Collection gift box and Kisses Special Message shareable four-pack novelty
item at the Summit of Americas.” Going forward, the brand wants to focus on exclusive products, he says. The brand will also look to Hersheyowned stores to translate its unique offering to consumers in the travel retail channel. The company is looking to bring to the travel retail channel bulk dispensing, destination products and personalization with what it calls “right-sized” versions. These experiential platforms have already proven to be a success at Hershey’s domestic retail locations.
Unboxing an opportunity
The Hershey Company has worked closely with Counter Intelligence Retail (CIR), the travel retail specialist that provides research and market intelligence to brands, over the last several years. Bentz comments: “From a packaging and materials perspective, we are focusing on the gift box format for our innovation strategy in 2018. Our research studies show that the box format scores above average as a required packaging format for gifting items. We felt there was an opportunity to further expand our travel retail exclu-
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sive offerings in the gift box format and enhance our offerings across pouches, boxes and tablets.” The company continues to work with CIR on a global study of the confectionery channel that will be released later this year. The study will provide Hershey with six years of consumer information and research to help structure future activities. Packaging is another part of the equation many confectionery brands are focusing on this year. Brands want to reduce their carbon footprint by minimizing the environmental impact of their day-to-day operations. “More than a century ago, our founder, Milton Hershey, established some of the most progressive operating standards of his time, including our company’s first recycling center to reuse manufacturing waste in the 1930s,” notes Bentz. Hershey wants to build on this legacy by using a “25 by 25” goal. The group intends to reduce its greenhouse gas emissions, water use and waste by 25% by 2025, based on 2015 levels. The goal is to reduce packaging waste by more than 25 million pounds in weight by 2025, based on 2015 levels. 2017 saw the Hershey brand being launched into new markets, introducing experiential platforms into the travel retail channel that were based on Hershey’s domestic stores and launching the Travelers Collection. These activities really seek to highlight the continuation of the brand direction as it uses its innovation and resources to stay viable in travel retail’s changing marketplace.
The Lindt 300g Gold tablets are a example of the in-house innovation produced with premium-quality ingredients
Lindt & Sprüngli
Lindt tells a different story by JAS RYAT
How Swiss chocolatier Lindt & SprÜngli managed to stay ahead in the confectionery category by implementing The Lindt Difference Philosophy
Peter Zehnder, Head of Lindt Global Duty Free, explains how customer feedback is crucial to help their brand improve through the years
lthough the confectionery category has the highest conversion rate in travel retail, there still seems to be a notable disconnect with consumers not entering duty free and travel retail shops. Swiss chocolate brand Lindt is seeking to tackle this challenge by implementing The Lindt Difference Philosophy to aid in all steps of its production and innovation process.
The Lindt difference in sourcing
Today’s consumer is well-informed, Lindt believes, and to this end, the company has since its beginnings put its money behind the quality of the products its customers buy. Lindt & Sprüngli is one of the few manufacturers to produce chocolate from bean to bar. This enables the firm to foster sustainable behavior along the entire value chain. Because high-quality cocoa beans are the foundation of its chocolates, the company wants to know where those beans come from and what the workers’ conditions are on the ground. Lindt & Sprüngli controls every step of the production chain, from the selection of the finest cocoa varieties through to the finished product. This is one of the most fundamental elements of a sustainable and traceable cocoa bean supply chain, according to the company. Thus the implementation of a sustainable sourcing model: the Lindt & Sprüngli Farming Program.
The Lindt difference in product innovation
An important part of Lindt’s Difference Philosophy can be seen also in the fact that a lot of the cacao production process is still done in-house at Lindt & Sprüngli. The company roasts and grinds all its beans and other ingredients such as nuts in-house. It selects high-quality ingredients and uses its Maitre Chocolatiers’ creativity to launch new innovations. Lindt’s travel retail portfolio is almost 100% travel-exclusive and characterized by many new products each year. 2018 will feature innovations such as the Lindt Swiss Masterpieces Diamond Edition, the Lindt Swiss Masterpieces Coconut Edition, the Lindt Swiss Strawberry Edition (exclusive to Dufry), the Lindt Travel Souvenir Collection and three new 300g tablets. Lindt also produces the LINDOR line, which is known for the combination of a hard shell chocolate with a soft core, ending with a velvet-smooth finish.
The Lindt difference in customer relationship
Lindt believes in building lasting and successful customer partnerships based on trust and a sustainable approach. Its partnerships with retailers have proven very successful and are characterized by achieving goals set by both partners.
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The Lindt difference in the Americas
Lindt hires region-specific teams to thoroughly understand the customer needs in that area. This helps with customizing the brand’s message conveyed through brand ambassadors in airports. Strong visual merchandising, passenger consultation and the biggest selection of premium chocolate gifts have made the brand very popular in Latin America, with high market shares at the region’s biggest airports, especially in Brazil. In the US, the business has continuously been built with investments in the training of local sales staff and high attention to detail in airports. Peter Zehnder, Head of Lindt Global Duty Free, explains how listening to customer feedback was among the factors that have helped Lindt become a global leader in the category. “Our dedication to listening to and implementing the feedback of customers, has helped us improve year-on-year.” As a result of The Lindt Difference Philosophy, Lindt has been ranked best-in-class supplier in the confectionery category based on customer needs, innovation and partnership by the 2017 Advantage Report Global Travel Retail. The Advantage Report is an annual study based on both quantitative and qualitative research.
Moments Share a Moment with the World's Best Rum Cake
Godiva Wonderful City Dreams takes you around the world in every bite Art becomes life as Godiva’s Wonderful City Dreams, a collection of chocolates created by five of Godiva’s Chef Chocolatiers to honor the cities in which they live, becomes reality at the 2018 Summit of the Americas (stand number: 823). The Wonderful City Dreams nine-piece and 18-piece collections take consumers on a culinary experience around five of the most famous cities in the world. Chef Thierry Muret was inspired by a slice of caramel cheesecake synonymous with his city, New York, creating a smooth cheesecake mousse with a fine crumble in a blond chocolate couverture, decorated it with a graphic of the Statue of Liberty. Representing Shanghai, Chef Philippe Daue has created a pure white chocolate ganache with lychee and roasted hazelnut nibs. Chef Yannick Chevolleau tunes in from Tokyo and has created a caramel, orange and Yuzu milk chocolate ganache, which is slightly sour, and decorated with an illustration of Japan’s iconic parliament building. Chef Jean Apostolou has selected the iconic red doubledecker bus as the decoration for his white chocolate piece filled with strawberry and violet ganache, which represents the eclectic mix of traditional and modern that is London. Brought you from Brussels, Chef Ilse Wilmots was inspired by the classic Godiva heart to create a dark chocolate filled with a robust caramel-flavored hazelnut praliné ganache,
Winning travelers over one cake bite at a time Tortuga Rum Cake Company is excited to return to the Summit of the Americas tradeshow this year. The 33-year-old company, based in the Caribbean, brings with it the highlyanticipated 2018 launch of Tortuga Rum Cake Bites, along with its top-selling and world-famous rum cakes, including the Golden Original, Coconut and Chocolate flavors, as well as confectionery goods.
Tortuga Golden Original Rum Cake is the top seller for the brand
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Wonderful City Dreams is a collection of chocolates that pays homage to the most famous cities in the world
refined with crunchy Bresilienne caramelised nuts. The pure chocolate and light praline, for which Godiva has been famos for generations, represents the essence of Belgian chocolate craftsmanship. Godiva collaborated with Pénélope Bagieu, a renowned French illustrator and comic artist, to create The Wonderful City Dreams gift box. The new Godiva Gold Discovery six-piece and 12-piece collections inspired by the popular Godiva Gold assortment will also be showcased at the trade show. The collection features ganaches, pralines, mousses and caramels, including new recipes and restyled favorites, presented in a contemporary gold gift box embossed with the signature ‘G’, the Lady Godiva emblem and tied with a gold satin ribbon.
Tortuga is the winner of leading cruise publication Porthole Cruise Magazine’s “Best Cruise Souvenir” award for 13 years. The brand is found in all major Caribbean airports, seaports and many major North American airports and travel destinations. The brand’s new Tortuga Rum Cake Bites are bitesized versions of the Tortuga Golden Original Rum Cake, and aim to capture an authentic taste of the Caribbean. They include the highest quality ingredients and a fiveyear-old, oak barrel-aged Tortuga Gold Rum. Ten bites are individually wrapped to lock in the freshness inside a premium giftable travel retail package. The company’s main focus for 2018 is to continue its relentless pursuit of complete distribution within the travel retail market by opening new doors with key strategic partners and having higher visibility at point of sale at airports in both North America and the Caribbean. This will provide Tortuga’s customers with more innovative and new options, it believes, while presenting an enhanced branded look-and-feel. Tortuga Golden Original Rum Cake is the top seller in all three sizes: 4oz, 16oz, and 32oz. The 16oz cakes are best-sellers across the board, followed by the 4oz variety six-packs, 4oz Coconut Rum Cake and 4oz Chocolate Rum Cake.
CONFECTIONERY NEWS CONFECTIONERY NEWS
Haribo raises profile in the Americas to drive growth The happy world of HARIBO is set to brighten up the inaugural Summit of the Americas duty free show in March. HARIBO will, for the first time, have its own booth in the exhibition hall (#1031), furnished to welcome existing and future customers in comfort and to showcase its wide range of jelly treats and candies. On display will be the celebrated HARIBO party packs and sharing bags, premium gifts and little treats, many of them exclusive to travelers. Included in the assortment will be items produced specifically to suit the tastes and Food and Drug Administration (FDA) requirements of the United States and a collection designed for the wider Americas market. Highlights of the offer will be the iconic, collectable, bearshaped HARIBO Goldbear Candy Tin in a choice of bright colors - red, green and yellow - and the cute HARIBO Travel Bag. Three versions of the Goldbear Candy Tin will be available: standard, Halal (permissible under Islamic law) and FDA-compliant 96g versions, each filled with mini-bags of the ever-popular Goldbear jellies. Made from wipe-clean plastic with a zip fastening and shoulder strap, the HARIBO Travel Bag is packed with mini-
Valrhona’s positive brand message will resonate in America French chocolatier Valrhona has seen major developments over the last few years in Europe, Asia, and the Middle East and is now ready to share this success story in the Americas. The company will be joining its sister firm, República Del Cacao, at the Summit of the Americas to promote their gourmet chocolates and the story behind them. Valrhona brings its gourmet chocolate success story to the Americas in 2018
HARIBO Travel Bag is packed with mini-bags of HARIBO bestsellers
bags of HARIBO bestsellers - Goldbears, Happy Cola, Starmix and Tropifrutti - making an ideal gift. The pouch assortment remains the core of the sharing category for both regions, with the South American range extended to seven flavor combinations with the addition of the new Phantasia, Tropifrutti and the latest Peaches assortments.
Valrhona’s story began in 1922 with passion, commitment and excellence as its values. These three values have paved the way forward, allowing it to push back the boundaries of creativity and flavor. As the company says in its own words: “We do this in the way we select and cultivate cocoa. We do this when we make our chocolate and expand the aromatic palette. We do this by passing on flavor and savoir-faire.” Valrhona is also focused on its 2018 Corporate Social Responsibility plan called Live Long. This CSR program will ensure the company is able to face the category-specific challenges that the future will bring. The plan has four main parts: First, through long-term partnerships, Valrhona aims to preserve aromatic cocoa and support cocoa-producing communities. Second, Valrhona wants to halve its environmental footprint by 2025 by working to improve the environmental impact of the products throughout their lifecycle. Third, the company seeks to foster vocations. This means drawing on its heritage of gastronomic expertise to pass on skills and knowledge to today’s artisans and to inspire the pastry chefs of tomorrow. And fourth, Valrhona wants to create a sustainable business model with its stakeholders, whether helping clients to put sustainable practices into place, creating a company in which staff are happy to work, and even defining its collective vision for 2025. This CSR program is meant to touch all levels of Valrhona’s business, and eventually to help expand the business globally.
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Flor de Caña
Flor de Caña connects the past to get to the future
The base of the San Cristobal volcano is where Flor de Caña is distilled. This location lends itself organically to the story behind the brand
Award-winning Flor de Caña premium rum has been named the number-one rum on the planet. Americas Duty Free discovers why by JAS RYAT
lor de Caña, Nicaragua’s super- premium rum whose brand icon is the volcano, is the country’s number-one exported product. This year the brand plans on awakening visitors at the Summit of the Americas by introducing its new coffee liquor Spresso, along with its Family Reserve edition. Spresso is a coffee liquor with an intense black color that is made from seven-year-old rum. It is made with 100% natural syrup, and it doesn’t contain any caffeine.
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The Family Reserve edition is new to the travel retail market. Previously only sold in the high-end resort Mukul in Nicaragua, the brand has now been introduced to Nicaragua’s duty free channel.
The main focus for Flor de Caña this year is to expand within key channels in duty free. “Key channels in duty free are where we want to focus and showcase the brand in 2018. We want to make sure we showcase the brand,” explains Mariana Sanabria, International Marketing Manager. This past July, Flor de Caña partnered with Miami International Airport (MIA) Concourse D for an activation that highlighted its rum collection. The two-month activation allowed travelers to sample the premium rum, experience the brand’s history and enjoy the visual mosaic representing Nicaragua’s highest and most active volcano, the San Cristobal. This successful interaction with travelers was important as MIA has nearly
Flor de Caña 18-year-old is an ultra premium rum that takes almost two decades to produce
15 million passengers from Latin America and the Caribbean traveling through yearly. The MIA activation gave the brand major exposure and was a great experience for travelers, Sanabria says. Flor de Caña expects to apply this same precedent to activations in the US throughout 2018. The main goal is to be featured in as many restaurants and bars in the airport to really capture travelers, she explains. Although generally well known in Latin America, South America and the Caribbean, the brand wants to focus on the European and US markets in the coming years. William Grant is its main distributor in the US market.
substance. We offer great quality. The rum is 100% naturally aged and it’s crafted in Nicaragua inside small white oak bourbon barrels at the base of a volcano. In the end, you get a refined product. Most importantly, our process is eco-friendly because our process of distilling is done with 100% renewable energy.” This story resonates with shoppers, giving this rum a tangible story that gives depth to the brand, she notes. Today, the best-seller in duty free is Flor de Caña 7 Year Gran Reserva. It’s considered a starting point for an aged rum as it’s compatible in cocktail recipes as well as a great sipping rum. Sanabria points out that this rum is not intimidating to new drinkers and offers great value for their money. 2017 was a year that amplified the rum’s reputation in the duty free and travel retail industry. The International Wine & Spirit Competition named Flor de Caña the number-one rum producer in the world, while the Huffington Post mentioned the brand as the top rum on the planet. The brand was also awarded 2017 Best Rum of the Year at the International Rum Conference in Madrid. What does all this mean for the award-winning rum? Sanabria is optimistic about 2018. Flor de Caña is supporting an activation at New York John F. Kennedy International Airport in mid-February, followed by another major activation at Cancun International and Mexico City International airports in March. This is all part of a plan to ensure a solid foundation that strengthens its reputation as the number-one rum on the planet.
Flor de Caña offers 25-year-old, premium rum that was named “2017 Best rum of the Year” by the International Rum Conference in Madrid
Right now, Flor de Caña is honing in on the business millennial demographic group. “Business millennials are traveling right now. They are not just traveling for business, but staying afterwards for pleasure. It’s a very big potential client for us, in terms of trying new things, getting into super-premium rums. They want something different than what they’ve already had, something that offers a different taste with high quality,” explains Sanabria. This is where Flor de Caña can really connect with this demographic, she believes. The brand has a rich history and attributes the quality of its rum to Nicaragua’s tropical climate and the proximity to the base of the San Cristobal volcano. Sanabria comments: “We have a story to tell. We have a brand with a 125-year-old history. This target is looking for brands that have
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Empowering the alcohol category
through collaboration Mohit Lal talks about brand building, enhancing customer relationships and corporate structures as a new organization for the global travel retail channel is established at French liquor group Pernod Ricard Maison Perrier-JouĂŤt welcomed travelers at Miami International Airport Terminal D Departures to take part in the digital installation that took place this January
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Pernod Ricard Global Travel Retail Chairman and CEO Mohit Lal
Pernod Ricard Global Travel Retail is unveiling high-impact activations like the Absolut Uncover Sleeve to capture the attention of travelers
The Jameson Deconstructed Series demonstrated how the brand wants to engage travelers through digital campaigns, combining both social and progmmatic media
n a significant move that took effect on July 1, 2017, Pernod Ricard has consolidated its three regional travel retail organisations – Asia Pacific, EMEA and Americas – into a single global entity, headquartered in London. Global travel retail represents the second largest market for our group and the new structure aims to ensure better collaboration with the brands internally and retail partners externally. Our global organization is supported by marketbased business units, charged with driving top-line growth and maximizing value creation through their proximity to the markets. We have upweighted certain parts of the business to ensure we are building a future-facing team, especially when it comes to marketing, traveler and shopper insights, and digital. As a company, we see global travel retail as very resilient and are confident of its future. The organization we are building is a clear reflection of what we think this channel can bring in terms of added value in the years to come. We’re now 10 months in and have generated a lot of positive energy already.
With our retail partners, we have seen a lot of consolidation in the past 10 years, but that hasn’t always been mirrored by us speaking to them with one voice or one approach. In the past, we would say. “This is our structure and this is how we work.” This has changed. Our approach to customers is now designed to be flexible; we seek to understand how they operate and then adapt our structure to them. Our interactions are moving away from only looking at the immediate future to a much broader perspective and a longer time horizon of doing business together. The opportunity that airports represent to build brands was not fully exploited in the past. Having reorganized, we now aim to do this strategically in two ways: we can generate commercial value, selling product in this channel and seize this as an opportunity to build brands. It’s not about activating every brand, everywhere. Travelers are different in their behavior, knowledge and brand experience, hence our brand strategies and initiatives are prioritizing traveler types and their specific needs across the globe. We have developed a strong understanding of
different traveler segments, focused on their travel behavior and expectations. This allows us to engage with them across multiple touchpoints on their journey. Digital plays a key role in targeting the travelers and connecting with them in real-time with bespoke messages. This is particularly important, as 80% of travelers are connected via mobile devices. Mobile is therefore a fundamental touchpoint in driving travelers to store. We have explored technologies such as virtual reality, interactive screens and social media platforms to engage travelers in a targeted and meaningful way and increase footfall to the store. This approach is helping us connect a growing new generation of travelers. Our approach is focused on the strategic need to drive footfall into stores, and ultimately conversion. We have observed that this differentiated approach not just drives business into our brands but also drives positive momentum for the category. You are not only taking your share of the pie but also enlarging the pie. We are testing and learning all the time and seeing what can happen.
www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
SPIRITS IN THE AMERICAS
Expect the unexpected from William Grant & Sons at this year’s Summit of the Americas William Grant & Sons returns to Orlando this year for the Summit of the Americas where it will be presenting to buyers the latest products in its diverse portfolio of premium spirits (booth 100). The Glenfiddich Experimental Series was designed to inspire unusual and unexpected variants. The series has seen the launch of two initial releases: the Glenfiddich IPA Experiment and Project XX. The Glenfiddich IPA Experiment marks the world’s first single malt Scotch whisky finished in India Pale Ale (IPA) craft beer casks. Glenfiddich Malt Master, Brian Kinsman created the Glenfiddich IPA Experiment in collaboration with a local Speyside craft brewer. They worked together to create an IPA that would season the whisky casks. Brian is the pioneer behind this new single malt Scotch whisky that is filled with zesty citrus and tangy hops from the oak casks that had previously held a bold Speyside IPA. In the process of Glenfiddich crafting a new whisky for the Glenfiddich Experimental Series, the pair also created a brand new IPA craft beer. Project XX is the result of a collaboration between 20 whisky experts and Glenfiddich’s Malt Master, Brian Kinsman. Also highlighted is Tullamore D.E.W. XO Caribbean Rum Cask Finish, a blended Irish whiskey. On the nose, the notes of vanilla and oak overlaid with citrus, ripe bananas and delicate spice bring you a sense of the Caribbean.
Bottled at an ABV of 43%, Tullamore D.E.W. XO Rum Cask Finish is a triple distilled, triple blend, triple wood matured, Demerara rum cask finished whiskey. William Grant & Sons GTR Managing Director Ed Cottrell comments: “The team in North and South America has worked amazingly hard against a challenging backdrop and it’s really paid dividends. Now we’re back with an incredibly exciting Project XX is part of the Glenfiddich program for 2018 headed Experimental Series that will be featured as by the launch in the Ameripart of the William Grant & Sons portfolio cas of both the Glenfiddich Experimental Series and Tullamore D.E.W. XO Caribbean Rum Cask Finish, both of which visitors to our stand in Orlando will be able to sample.” The William Grant & Sons booth will include a fun, experiential element where visitors are able to enjoy a taste of the brand activations which will be used in key airports this year, as well as discuss strategy for portfolio brands.
Haleybrooke strikes a deal with Ellustria’s Snow Queen Organic Vodka Haleybrooke International (HI) announced that it has reached an agreement with Ellustria Ltd. to help build its travel retail business for Snow Queen Organic vodka worldwide. Ellustria’s super-premium Snow Queen vodka is fully organic, based on organic wheat and is bottled in France. The smooth spirit is achieved using traditional but very effective and high quality distillation processes. The filtration system is based on age old techniques combined with only the best materials from family owned suppliers. Over the years, Snow Queen has won over 35 international awards and most recently the Spirits Business Gold award in the Global Luxury Masters. Managing Director, Roman E. Park for Ellustria Ltd. Said: “We are looking forward to working with Haleybrooke International and introducing Snow Queen to duty free. Snow Queen has undergone a substantial rebranding in the last year, where not only the bottle design but also the country of production has been changed. The time has now come to continue Snow Queen’s legacy into unexplored territory and
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to further make our products available for the duty-free consumer.” Patrick Nilson, President of Haleybrooke International said: “We are excited about launching the new re-positioned Snow Queen Organic Vodka in the Travel Retail channel which is the perfect place for super premium products”. Snow Queen Organic Vodka will be selling in duty free at US$39 for the 1 liter size. For more information please contact Patrick Nilson firstname.lastname@example.org, +1 (845) 981-7240 or Roger Thompson email@example.com , +1 (203) 322 9691 or visit http://www.ellustria.com
Snow Queen vodka is fully organic, based on organic wheat and bottled in France
SPIRITS IN THE AMERICAS
Behn introduces Danzka The Spirit in North America travel retail
Danzka The Spirit, shown here on display at a Heinemann location, has its sights set on the Americas for 2018
Waldemar Behn will be carrying forth the momentum of premium vodka Danzka The Spirit globally into the first Summit of the Americas. This will be in combination with its full portfolio of premium spirits (Booth 223). Originally unveiled during TFWA World Exhibition in Cannes in 2016, Danzka The Spirit has entered markets in Europe, Russia, Middle East, and Asia and showed a great response in Australia with Sydney Heinemann last November. Regional Director Americas Tito Gonzalez says the company is preparing for the launch of Danzka The Spirit, follow-
ing the great success the company is having with the Danzka Original in Latin America, where the company has been running high-profile promotions since the start of the year. “We have achieved excellent results from our exciting and high-profile POS activations with Dufry in Uruguay in January, in Rio de Janeiro and Sao Paulo, Brazil, during January and March, and in Ezeiza and Aeroparque airports in Buenos Aires, Argentina in February,” says Gonzalez. “We are looking forward to similar success in May when we launch activations with Dufry in Lima, Peru and Santiago, Chile,” he adds. First up for Danzka The Spirit in the Americas is the US duty free market as the brand kicks off with Dufry US in the second quarter of the year. Behn is also partnering with Chase International to support the launch of Danzka The Spirit in the US travel retail channel. Tito Gonzalez will continue responsibility of North America Duty Free in addition to his Latin and Caribbean role and Global Sales Director Torben Vedel Andersen will hereafter focus his efforts on Middle East and Asia. “This is a good bye and thank you to a lot of great friends in the Americas after almost 30 years in the Americas duty free” Andersen commented. Waldemar Behn will also be featuring its alliance partner Pallini Limoncello at the stand. The alliance -named Family Brands Alliance – was unveiled in Cannes this past October.
Tito’s Handmade Vodka gets the green light to expand in South America After years of sustained economic growth and rapid development, Tito’s Handmade Vodka, is set to expand across both domestic and travel retail markets in South America in 2018. In partnership with their regional distribution partner, Webb Banks, Tito’s will be launched in Chile and Peru, collaborating with local distributer, Viňa Santa Rita and Perufarma. The initial launches will be followed by other markets as the year progresses. In collaboration with regional duty free distributor Edrington Travel Retail Americas, Tito’s has agreed to a new partnership with Dufry and is set to launch in Brazil, rolling out later into Argentina, Chile, Peru and Uruguay. This collaboration builds on existing retail partners, including UETA, DFASS, Bernabel, London Supply and Motta, already operating in seven Latin American markets. In the Chilean domestic market, Tito’s will be introduced in both the on- and off-trade. The premium and luxury spirits sectors are growing and the discovery of craft spirits is in its infancy, presenting an opportunity for Tito’s to establish itself as a leader in this segment. Viña Santa Rita Marketing Director, Eulogio Guzman Urzúa comments: “We are glad to announce our alliance with Tito’s Handmade Vodka, a pioneer in the US craft spirits movement. As the #1 premium vodka in the United States, its addition makes our portfolio one of the most powerful in the mar-
ket. Chile is heavily influenced by US culture; we therefore hope to replicate that success here.” Perufarma Director of Marketing, Lourdes Gonzales says: “From Peru’s status on the world culinary stage, craft spirits are emerging, in particular in Lima itself where the movement has the perfect opportunity to advance. We are therefore delighted to introduce Tito’s, the embodiment of craft, and look forward to it playing an active role in developing the movement.” Managing Director of Tito’s International, John McDonnell, explains: “South America represents a big opportunity for Tito’s. The region’s economies are in good health and although craft is not as developed in South America as North America, word is spreading fast. WEBB Banks is in negotiation with other distributors in the region and further alliances will be announced shortly. Tito’s Handmade Vodka, a craft vodka from Austin Texas, is set to expand its footprint throughout South America
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According to the most recent IWSR data, the Patrón acquisition will make Bacardi the numberone spirits player in the super-premium segment in the US
The family-owned company may have become famous for its rum, but the name Bacardi is now associated with some of the top global spirits brands, often appearing in GTR campaigns across the Americas region by WENDY MORLEY
s Bacardi is the largest privately owned spirits company in the world, it can hardly be surprising that new announcements often spring from its head office in Bermuda. Once associated exclusively with rum, Bacardi’s portfolio has grown so extensively that this is now far from the case. In 2014, the company announced it would begin focusing a great deal of energy on its whiskies, especially those with age statements – a move bucking the industry trend at the time. In late 2014, the company launched its Dewar’s Fine Whisky Emporium in travel retail. This has proven to be a real hit, and the locations have continued to increase globally. Since that time, Bacardi has released a number of acclaimed single malts from Aberfeldy, Aultmore, Craigel-
The Grey Goose holiday campaign at Toronto Pearson airport in December had exceptional results
lachie and Brackla distilleries, and in Cannes last year the company introduced Teeling Irish Whisky as part of its growing portfolio.
outside store on the airport concourse, will be increasingly important in 2018,” he says.
Building on success
High consumer confidence in the US combined with its strong dollar has meant good organic growth in the cruise market, according to Biggs. “Advance bookings are strong and there’s increased capacity, so we will be continuing our support and investment in the channel.” It’s no secret that Latin America has been weak in recent years, but most companies are seeing improvement in the region, and Bacardi is no exception. “Economically, there are some general signs of improvement versus a year ago,” says Biggs. “Colombia is showing especially good growth, boosted by the opening of additional terminal space at Bogotá shared by DFASS and Dufry and in the existing Motta space. We are also seeing improvements in demand from Brazil around our whisky, vodka and gin portfolios.”
Plans for the coming year in the Americas will build on the success of the company’s large-scale campaigns in 2017, says Geoff Biggs, Regional Director Americas, Bacardi Global Travel Retail. These include the Grey Goose holiday campaign at Toronto Pearson airport in December and the Dewar’s Fine Whisky Emporium at Frankfurt, which the company will be developing for Miami International Airport this summer. “These campaigns delivered tremendous engagement with existing brand lovers and recruited new interest,” says Biggs. “They drove footfall and double-digit sales uplift with travelers who were intending to shop the spirits category and, significantly, converting those whose curiosity with the campaign inspired them to make a purchase.” Biggs says the company will focus on delivering more of this type of shopper engagement, especially in the US, where incoming passenger numbers are dropping. “The importance of driving interest and conversion in areas of high footfall, both inside and
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Caribbean and LATAM
An important acquisition
Perhaps the biggest news to come from Bacardi recently, however, is that the company has acquired Patrón. While the acquisition is too recent for Bacardi to give any details on future plans, Mike Birch, Managing Director, Bacardi Global Travel Retail, says the team is very excited: “Patrón is a fantastic brand in a strong category, with particular appeal in the Americas.”
E X T R A O R D I N A R I LY U N M I S TA K A B LY
P U R E.
C A N A D I A N.
P A S S I O N A T E L Y C R A F T E D F R O M R E A L C A N A D I A N I C E B E R G S. I C E B E R G . C A
P LEAS E D RINK RE S P O NSI B LY. PR ODUCT OF CA N A DA . 40% A LC. /VOL.
brass ring by WENDY MORLEY
Edrington has been working with a clear vision toward claiming its rightful place in travel retail and beyond, and The Macallan Quest Collection is this year’s grand step in the right direction
rom the creation of the GTR department in Singapore, to distribution agreements and acquisitions, to the hiring of a new Managing Director for the channel and the refiguring of regions, it’s fair to say some pretty major changes have taken place at Edrington in recent years. The Macallan Distillery has been undergoing an incredible transformation and will open later this year. And, as was announced at an inspired event at the spectacular Villa St. George in Cannes, the company has launched a new travel retail range with The Macallan Quest Collection.
Busy first year for new MD
“It’s been an incredibly busy year, with a number of highlights,” confirms Igor Boyadjian, the company’s Managing Director of Global Travel Retail. “One of the first developments after I joined was the acquisition of Edrington Webb Travel Retail Americas (EWTRA). This marked a new era, establishing a fully owned and integrated Global Travel Retail business unit. This significant stepping stone will allow us to be more coherent and consistent in our global strategy with key partners and retailers.” Boyadjian says the feedback on the Quest Collection has so far been excellent. “It’s been nearly a decade since the previous core range was launched, so we felt the time was right to accelerate The Macallan’s growth in travel retail by injecting some fresh impetus,” he says. “We are giving travelers and The Macallan connoisseurs an entirely new range to explore, delivering excitement and differentiation while continuing our commitment to crafting the ultimate luxury spirit. Our retail partners are incredibly enthusiastic, and we look forward to bringing the new range to life in-store through our partnership-driven approach.”
Juan Gentile, Edrington’s Senior Vice President, Latin America Domestic & Travel Retail Americas, says The Macallan Quest 126 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2018
Vice President Juan Gentile at the launch of The Macallan Quest Collection in Miami, where key customers and local press were treated to the brand’s storytelling and a guided tasting
Collection experiential launch event in Miami provided an excellent platform to bring to life the storytelling behind this new range for its retail partners in the Americas. “Key customers and local media were treated to an illuminating introduction to the range from Ken Grier, The Macallan’s Creative Director, followed by a guided tasting from our Americas Brand Ambassador Joe Cabassa,” he says. Impactful launch activations and promotions for The Macallan Quest Collection are planned across the Americas, particularly in key markets such as North America, Brazil and Mexico. “Performance in the Americas has been strong,” says Gentile. “Currencies have finally stabilized after two years of strong depreciation. As a result of this stabilization, key markets in the duty free channel are rebounding, including Brazil and Argentina. Overall most markets are showing economic growth, and we expect that purchasing power will continue to increase.” Gentile says the premium spirit segment is growing in the Caribbean. “We are capturing share with a number of key brands, including Brugal and The Macallan. The Caribbean has delivered double-digit growth over the last year, with particularly strong performance in Puerto Rico and Dominican Republic. We also have a strong presence on some key cruise lines, which supports our growth.” While The Macallan Quest Collection might be the current focus in GTR, Edrington will continue to support other key regional and international brands such as Glenrothes, which has recently returned to the Edrington portfolio, The Famous Grouse, Brugal and Highland Park, which will see a major update in 2018.
new resolution Global liquor group Beam Suntory explains how combining its bourbon portfolio into one global category solution for retailers is the key to success in 2018 by JAS RYAT
eam Suntory recently redesigned its Jim Beam Black packaging to reflect the unification of the entire Jim Beam bourbon portfolio. Although the liquid inside remains unchanged, the exterior reveals a new, premium look, offering a harmonization across the flavored product range. Jim Beam Black will be one of the celebrated jewels at this year’s Summit of the Americas, the company says. Beam Suntory will continue to emphasize its bourbons in 2018. This year it will highlight its Bourbon Legends category concept to help consumers discover all the products, from flagships such as Jim Beam to the craft category of Maker’s Mark. Americas Duty Free spoke with Carole Soulard, Americas Travel Retail Trade Marketing Manager for Beam Suntory, to discuss the overall brand focus in this upcoming year. “For 2018, we are looking to expand further our Bourbon Legends footprint in Americas travel retail.
Carole Soulard, Americas Travel Retail Trade Marketing Manager for Beam Suntory, is optimistic about the expansion of their Bourbon Legends footprint in Americas travel retail
We have started this process in the past couple of years and really started kicking it into gear in 2017. We are building category solutions in partnership with our retailers in order to educate and guide the consumer within the bourbon category, which has been one of the fastest-growing for the past couple of years,” she explains.
A challenging year in some areas
2017 was a challenging year for the Americas. Natural disasters, such as floods, fires and mudslides, disrupted businesses, and this has affected Beam Suntory’s operations in some areas. But the group worked quickly with partners and customers across the board to address the issues and bring back a state of normality, with positive results. The company helped communities hit by these environmental disasters with recovery efforts for the earthquakes in Mexico, and the catastrophic hurricanes in the Caribbean through donations to the Red Cross. It has also helped on ground level by rebuilding communities in Saint Croix in the US Virgin Islands. The group also acknowledges that adapting to market trends is the answer to expanding its market share. Retailers are looking at not only growing single brands, but full categories. This is where Beam Suntory has the upper hand, says Soulard. Its category solution for Bourbon Legends, from classic Kentucky bourbons to small-batch brands, aims to elevate the status of bourbon in the minds of the consumer.
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Beam Suntory will showcase the new Jim Beam Black packaging at the Summit of the Americas
“The program educates and engages consumers on our portfolio and encourages them to expand their bourbon repertoire by demystifying the category, differentiating our whiskey from the competition and creating a unified global presence for our brands,” she says. “Bourbon Legends offers an opportunity to merchandise our range of bourbon and the flexibility to showcase the whole lineup or a few key brands.” The Summit of the Americas will be an important show for Beam Suntory. The group has been expanding its business through Latin America, as Soulard explains. “There are a lot of opportunities and our products are so very well suited to the taste buds of this region.” It appears that the amalgamation of IAADFS and ASUTIL will really be the perfect event for Beam Suntory as it seizes the opportunity to expand its global presence by highlighting its brands’ contemporary heritage.
THE WORLD’S MOST
In Kentucky, buffalo carved a pathway followed by early American pioneers. On the spot where the buffalo migration route crossed the Kentucky River, this National Historic Landmark has been making legendary bourbon whiskey for over 200 years. Today, Buffalo Trace crafts the best collection of bourbons and whiskies in the world by honoring tradition and embracing change.
VISIT US JUST OUTSIDE THE TRADE SHOW FLOOR AT OUR PREMIUM CRAFT SPIRITS BAR DISTRIBUTED BY: EDRINGTON TRAVEL RETAIL AMERICAS FOR DUTY FREE, SAZERAC IN LATIN AMERICA LOOK US UP ON THE WEB AT WWW.SAZERAC.COM
Please Drink Responsibly • ©2018 Sazerac Company Inc., Louisville, KY • Alcohol by Volume Varies by Product
In addition to providing bikes to the community, Nederburg’s Qhubeka bicycle assembly plant provides skilled, nontraditional work for women, led by internationally trained master mechanics Beverley Roode and Janine van Beulen Johnson, both South African
GIVING BACK WITH BICYCLES
Through its partnership with not-for-profit organization Qhubeka, Distell’s Nederburg winery makes a difference in the greater community
hose in the spirits industry are accustomed to thinking of Distell as a company that, through its Amarula brand, expends a great deal of effort and expense working to help save the African elephant from poaching and, thus, extinction. But Distell’s charitable existence does not begin and end with elephants. The company’s most famous winery, Nederburg, situated in Paarl, has recently partnered with Qhubeka, a South African organization that builds and provides bicycles to people with transportation needs, enabling more children to go to school and more adults to go to work. Qhubeka has distributed over 79,000 bicycles since its inception in 2005.
The Nederburg assembly plant
The Nederburg winery is home to Qhubeka’s first bicycle assembly plant in the Western Cape. The plant is headed by South Africans Beverley Roode and Janine van Beulen Johnson, both internationally trained master bicycle mechanics. In addition to building and donating much-needed bicycles to the community, the Nederburg facility also employs a group of previously unemployed local women in this non-traditional role. One of the community members employed by this plant is Feroska Sitter. Sitter has had a challenging life since her first pregnancy at the age of 16, and now supports three children. Through Qhubeka, she is training as a bicycle mechanic under Roode and Johnson.
by WENDY MORLEY
This has not only offered her employment, but rewarding employment that will improve the lives of her own children as it improves the lives of those in the community at large.
So far, over 1,200 bikes have been assembled at Nederburg, and the facility will soon produce 150 bicycles per week. Before being given a bicycle, recipients are required to take bicycle safety and maintenance courses, and the bikes come with basic maintenance kits, to promote self-sufficiency. Three neighborhood-watch organizations were given the first 50 bicycles built at Nederburg, allowing members to cover more ground, increasing their effectiveness. Previously, patrols had been done on foot.
Nederburg in a new arena, cycling, one of the fastest-growing sports in the world for participants and spectators.” Making sense from a business perspective is one thing, but Distell and Nederburg have a strong history as supporters of charity initiatives that give back to the communities. Bradshaw says this cycling project has helped take the company into a new realm for the greater good. “When you can literally see the impact of a project like this, it enriches your life personally. It certainly does mine. And it energizes me to do more and to encourage those around me to get involved, adding to the momentum. In the process, we give more meaning to our own lives,” she says. “Nederburg’s aim with the partnership is to give back to communities as an investment in the future.”
The NederburgQhubeka connection
“When Nederburg was approached in 2015 to become the premium wine partner of the Team Dimension Data pro-cycling squad, riding for Qhubeka, it made eminent sense for us to get on board,” says Robyn Bradshaw, Nederburg’s global marketing spokesperson and Amarula’s familiar face in GTR for many years. “We could add our support to an exciting initiative that would build African pro-cycling talent, we could help to advance the very worthy cause of Qhubeka, which uses bicycles to move people forward, and we could raise the visibility of
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Through Nederburg and Qhubeka, bikes are provided to community members to help them get to work or school. Here, master mechanic Bev Roode provides maintenance tips; this instruction is necessary before a bike goes to its new owner
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Sazerac Fireball Whiskey, one of the many brands represented by Sazerac, has quickly become a cult favourite amongst travelers
educates consumers on
bourbon basics The premium craft trend is having its moment in duty free and travel retail. Sazerac is serving the perfect mix of brands to help capture this global trend by JAS RYAT
azerac, a company that may best be known as “America’s first cocktail,” now boasts many brands under its umbrella. The American-owned group has geared up to educate consumers about American bourbon and how it translates to the premium craft trend that is taking place globally. Americas Duty Free spoke to Ken Chapman, Regional Sales Manager Caribbean/Latin America & Global Duty Free at Sazerac, about the company’s plan to capture travelers’ attention with unique products at the right price. “We want people to enjoy great savings on our brands like Paddy Irish Whiskey, or grab an extra bottle of Fireball Whiskey to gift to someone when they arrive at their final destination. Fifty percent of travel retail is purchased for just that: a gift for that special someone, friend or family member,” explains Chapman. The main push for the brand this year is fueled by the launch of Southern Comfort Black. The newest 80-proof addition to the Southern Comfort line-up will be launched in the travel retail market before it hits the Latin American domestic market. Chapman explains the importance of customers interacting with Southern Comfort Black in airports and borders shops. “It will give customers a chance to taste a new American whiskey from an iconic brand that has been around for over 100 years” he says. The launch is set for February in US duty free stores and will expand to Europe, Asia and Latin America over the next six months.
The demand for bourbon has grown in the duty free market, and Sazerac is feeling the ripple effect of the whiskey wave. Sazerac has seen its retail shelf space expand from single facings to multiple facings in recent years. The Latin American market has seen major success with Fireball Whisky expanding into multiple duty free locations, such as Argentina and Brazil. The brand has really gained traction in the duty free arena, resulting in customers wanting to save money on their inbound duty free purchases or for a gifting opportunity. Sazerac has also taken on the valuable task of educating consumers, as the company believes a customer that understands the product is more likely to purchase it. The firm has invested heavily in a bourbon education program available to duty free customers on Royal Caribbean ships called the Bourbon Excursion. “It’s a chance for a customer to learn about the bourbonmaking process and the different types of bourbons out there. We want customers to understand the difference between a Scotch, Tennessee whiskey or a Kentucky bourbon. With our multiple tasting opportunities and education classes, our market share will grow itself,” enthuses Chapman. Kevin Richards, Senior Marketing Director, Whiskeys and Speciality Brands, also touches upon the loyal fan base that Southern Comfort has developed over the years. Sazerac continues to engage with these consumers to rejuvenate the brand with elements such as improved packaging and enhanced merchandising. Richards explains: “Younger consumers are
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Southern Comfort Black, the newest 80-proof addition to the Southern Comfort line-up, will be front and center during the Summit of the Americas show in March
increasingly travel-oriented, and we want to ensure the right mix of products for our new and loyal consumers.” He continues: “It has been critical that we re-establish a sense of place and authenticity; it is a vital part of the Southern Comfort story. The ‘Spirit of New Orleans’ campaign captures the soul and vibrancy of our hometown, New Orleans. We feel the spirit of this city will resonate with new whiskey drinkers, offering a compelling point of difference, and we are investing heavily in transporting our story and New Orleans via digital channels.” Although Sazerac is still challenged with allocation issues, it is offsetting this by focusing heavily on its distilling warehousing operations, most notably at its Buffalo Trace Distillery in Kentucky, where the Distillery is planning to spend US$1.2 billion in expansion work over the next 10 years. This is one of the many ways the brand is investing in its future. Sazerac is focused on what lies ahead and making sure it is able to educate and expand to fully capture its global audience.
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International expansion Ron Abuelo has clearly broken free of its Panama confines, creating new rums and new marketing campaigns that are successfully infiltrating the global market by WENDY MORLEY
ny visit to Panama is almost certain to be punctuated with a taste of Ron Abuelo. “In our home market of Panama we are of course very strong; we are category leaders,” says Ricardo March, Vice President of Sales. But the brand’s reach has extended far beyond the borders of Panama. Sales have been strong throughout the Americas. “Mergers and acquisitions of distributors and importers made 2017 an especially difficult year to introduce brands in the US in particular,” he says. “Despite this, we were able to increase in strong double digits – by 18% in the US and 22% globally.” South America has always been a good region for Ron Abuelo, and never more than now. “South America continues to show great promise, with positive growth numbers. Last year, we partnered with new importers in a few markets in the south cone,” says March. “Bolivia is an especially good market for us, and we see great promise in Chile and Peru, where opportunities for our premium variants continue to arise.”
Last year Ron Abuelo introduced the Finish Collection; inspired by the whisky industry’s innovations, the company finished its rum in three different casks. The Collection sold out immediately, putting the best kind of pressure on Ron Abuelo to create more. “The response has been a surprise for all of us,” says March. “Interestingly, certain finishes are more popular in certain markets. In Latin America, for
Ron Abuelo’s Finish Collection, released last year, caught the company off guard with its immediate success. The 20cL three-pack has already been released in the Panama market, and will soon be offered in Europe and the US
example, Tawny and Oloroso are preferred because of the Spanish influence. In the United States, however, Napoleon is strong because customers are familiar with Cognac.” Following the immediate success of the Finish Collection, the company decided to create a 20 cl three-pack, which should do especially well in travel retail. “So far, it has been launched only in Panama, but with very good results,” says March. “We plan to roll out this SKU to other markets such as Europe and the US in the first semester of 2018.”
The global trend in spirits has been quality, and in keeping with this trend Ron Abuelo has seen good results with its more exclusive offerings. “Centuria continues to be our top-of-the-line rum, our family reserve, with encouraging results in many markets around the world,” he says. “Also, our 12 Años has
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seen continued growth numbers across many markets, principally led by the European region.” The newest step for Ron Abuelo has been the creation of a cohesive marketing plan, called “Inspiring Generations Since 1908.” This cohesion was apparent in the company’s first global advertising campaign “Character is timeless,” for Ron Abuelo 12 Años. “This has been a very important step for the brand, and we are seeing results,” says March. “After ‘Character is Timeless’ we launched our Finish Collection campaign, ‘A New Adventure in Rum’ in more than 11 markets. We foresee more global promotions and campaigns in the coming months.” The company has also invited 40 mixologists from around the world to Panama to create the perfect cocktail list with a global influence. “It’s going to be an amazing experience, and also an opportunity to show to the rest of the world the beauty of Panama,” says March.
â€œDrinking too much makes you poorly, drinking poorly is even worse, drink a little, drink in style, drink Molinariâ€?. Angelo Molinari, 1968
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Bonfils Some of Capitoul’s award-winning wines, aging at the chateau on the edge of both the Pyrenees mountains and the Mediterranean
Bonfils’ chateauxhotels offer guests the feel of a fairy tale
Superior provenance With a multi-generational tradition of growing the best grapes and making the best wines, Bonfils is bringing the south of France to the world by WENDY MORLEY
he Languedoc region is not especially well known outside of France, but that is a shame. Languedoc is the single largest wineproducing region in the world, and is responsible for more than one-third of France’s total wine production. This beautiful southwest region, which borders the Mediterranean, runs from Provence to the Pyrenees mountain range and Spain. Its wine history runs deep. The first grapes in France were planted here in fifth century BC, soon spreading and ultimately spawning the wine tradition in the rest of the country. The combination of soils in the region along with the Mediterranean climate make Languedoc perfect for growing a large number of different grapes — international varieties, Rhone varieties and others unique to the region — making Languedoc a superior location for producing wine blends with singular taste characteristics. This region has the country’s lifeblood coursing through its earth, and for the Bonfils family, one of France’s most wellknown multigenerational winemaking families, this land, its vineyards and its chateaux form the lifeblood that courses through their veins.
Superior grapes, superior wines
The Bonfils story is both ancient and modern. In 1870, Honorine Bonfils became the first woman in French history to receive the prestigious French Order of Merite Agricole in recognition for her pioneering work in viticulture, and thus began the legacy of grape growing and winemaking, which has only grown from one generation to the next. The Bonfils viticulture is so renowned that the family sells grapes to many well-known wineries. The family focus has always been on growing the very best grapes and creating the very best wines, and this continues today. All Bonfils wines are estate-grown, vented, and bottled at the Domaines, Chateaux. Bonfils wines have won more than 500 medals in the last five years, including awards by the most prestigious magazines and institutions in the industry. And now, the family-owned company has decided to bring these award-winning masterpieces to the rest of the world.
Dedicated commitment to GTR
“The authentic story of the family, the vineyards, the wines and the chateaux come together to create the perfect French ‘Art de Vivre’ [art of living] atmosphere,” says Lorena Andreu, the company’s
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GTR Marketing Director. In global travel retail, the focus will be on three Chateaux hotel and wineries, each with an incredibly beautiful chateau that welcomes guests and offers the ultimate in a French-Mediterranean experience: Les Carrasses, Capitoul and Chateau St. Pierre de Serjac. “In addition to offering our incredible award-winning range, we are creating a GTR-exclusive collection of wines, to be released in the spring,” says Andreu. These wines will not only have GTR-exclusive packaging, but they will have been chosen and created specifically for the channel, offering something unavailable elsewhere. The wines are already strong in travel retail in France and throughout South America, and are available domestically in 40 countries globally.
The Bonfils chateaux
Along with vineyards, the family began acquiring chateaux in the mid-20th century. These historic buildings are being beautifully, lovingly and tastefully renovated. The chateaux feature prominently on newly designed labels currently rolling out, in addition to other marketing material that will be used throughout the GTR channel.
Tried and true brand partnerships Drinks distributor MONARQ has strengthened its brand portfolio while continuing to excite consumers in the Americas with its “true brand” approach by MARY JANE PITTILLA
ONARQ, the drinks distribution and marketing group, is continuing to evolve its product portfolio to meet current market needs. The company has recently signed with the iconic craft beer brand Brooklyn Beer and has a few other important new partnerships in the works, according to Managing Director and Owner Robert de Monchy. The firm’s mission is to bring colorful brands to the Americas region, in line with its logo, which features the monarch butterfly’s vibrant pattern. MONARQ’s corporate office is in The Netherlands with its regional headquarters and warehousing in Miami, US, and commercial and marketing offices in Mexico City and Santiago, Chile. Describing its current portfolio, which includes the market-leading, Dutch-brand behemoth Heineken, de Monchy says: “We carry a unique portfolio of leading international premium and super-premium alcoholic beverages. Most of them are category leaders, some of them craft or boutique. We are selecting ‘true brands’, either being truly innovative or with great heritage.” Despite the terrible hurricane season in the Caribbean, MONARQ’s existing brands have been performing well across the Americas over the past year. “During 2017 our business again grew double digits, despite the political implications, devastating hurricanes in the Caribbean and earthquake in Mexico,” he says.
higher quality. They are also looking for true brands that they can mentally support and identify with. This reflects in the growth of local products such as tequila, mezcal, pisco and craft beer. The tendency towards high-quality brown spirits, such as single malts, unique (New World) whiskies, bourbon and, lately, cognac, fits perfectly well in this trend.” In addition, he notes that super-premium gin is growing and “slowly overtaking from vodka. Vermouth is also on the rise, mostly due to the mixology trend.” MONARQ continues to stage exciting brand promotions and activations. “Amongst others, we will soon be running a number of Heineken promotions in duty free,” de Monchy confirms. “During
the May-June period we will be running a special in-store promotion themed around UEFA Champions League soccer.” To keep up with its fast-expanding business, MONARQ has been busy hiring, as de Monchy explains: “Business can only grow as fast as the organization can lead, hence we always invest in excellent people. We have recently expanded the MONARQ Mexico team to four people and are in the process of further expanding to seven employees this year. We are also expanding our customer service team, recruiting another Area & Duty Free Manager in the Miami office and a central marketing manager at our headquarters.” Regarding the upcoming Summit of the Americas, MONARQ has decided not to exhibit this year, but is set to return in 2019. “As MONARQ is an active member of the IAADFS, we will be actively participating again with a delegation of our team,” says de Monchy. “We have, however, decided after 10 continuous years not to return as an exhibitor this year. We will be carefully analyzing the new conference set-up with the intention to return with our booth to the new venture in 2019.”
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“Less is more” in premium liquor consumption
Turning to consumer trends in the spirits industry, de Monchy confirms the general shift to more upscale, premium consumption: “The overriding trend in the drinks industry follows the general consumption trend, probably best described as ‘less is more’. Consumers tend to drink less but of
During the May-June period, MONARQ will be running a special in-store Heineken promotion centered on UEFA Champions League soccer
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www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING
Marie Brizard Wines & Spirits
in the Americas Now represented in US and Caribbean Duty Free markets by Chase International, Marie Brizard Wines & Spirits is poised for major expansion during 2017
arie Brizard Wines & Spirits (MBWS) brands will exhibit in Orlando this year for the Summit of the Americas against a backdrop of strong sales and business builds across the Americas in 2017, both in domestic and duty-free markets. Its brands include: Marie Brizard liqueurs, Gautier Cognac, Sobieski Vodka, William Peel Blended Scotch Whisky and, new to travel retail, Fruits & Wine by Moncigale.
Last year Marie Brizard liqueurs relaunched in the US with a totally new brand identity; more contemporary and bold packaging supported by a new “Are you liqueurious?” activation campaign. At the end of 2017, six new flavors were added to this globally iconic brand, including Elderflower, Yuzu, Jolie Cherry, Pink Grapefruit, followed by Finesse Orange and Banana (in early 2018) strengthening a portfolio that continues to ride high on the wave of the cocktail trend. To this end, Marie Brizard is teaming up with the USBD (US Bartenders Guild) to educate bartenders on the brand in eight key states throughout 2018. The new flavors, along with the iconic L’Originale Anisette, can be seen and tried in Orlando, along with the multiple award-winning Gautier Cognac range. This year sees Gautier’s distribution expand to five new states in the US. In a very competitive category, Sobieski remains the 9th imported vodka.
2017 saw MBWS brands grow strongly with Shopping China in Paraguay. William Peel Scotch Whisky has seen substantial growth of 80% in sales, while Sobieski Vodka and Marie Brizard liqueurs are both up by 20%. William Peel Double maturation, William Peel Honey and William Peel Spicy Shot all launched in 2017 and are enjoying great momentum on the borders. “William Peel is proving
to be rather a star performer,” says MBWS Global Travel Retail Director Kevin Baker. “It’s really finding a niche; as well as its excellent performance with Shopping China, the brand is performing very well in Iquique Chile with Vierci which has listed both Double Maturation and Honey expressions. This year will see us launch William Peel into Mexico, along with Sobieski Vodka and Fruits & Wine, plus several other South American countries including Colombia, Honduras, Nicaragua and Dominican Republic. We’re very hopeful that this will lead into some key airport listings for the brand within the region.” Fruits & Wine by Moncigale is a new line for MBWS in the Americas. This 11-flavor strong range of fruit infused wines sells over a million cases in France and, with fewer calories and a lower alcohol content than Rosé Champagne or traditional wines, is carving a niche as an anywhere, anytime refreshing drink. This year sees it making a first appearance with Compania de Indias on the Uruguay/ Brazil border at Rivera. Travelers using the same border can also now purchase Sobieski vodka and Marie Brizard liquers at the Mabo Sineriz outlet.
The whole MBWS portfolio has been growing strongly in Trinidad & Tobago with a 152% jump thanks to the great appeal of the new Marie Brizard bottles, together with the ongoing success of Sobieski Vodka, William Peel Blended Scotch Whisky and Fable wines. Marques Del Puerto Rioja Wines were launched in January 2018 and first results are already encouraging. To build awareness and profile in the country, MBWS will be the official sponsor of the Famous Trinidadian carnival band - Fantasy Carnival & Entice - with Gautier Cognac, William Peel Blended Scotch and Sobieski Vodka this year. Elsewhere in the Caribbean, Marie
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Marie Brizard Wines & Spirits introduces Fruits & Wine by Moncigale to travel retail
Brizard Syrups are now distributed in Barbados, together with Fruits & Wine which – following a great performance by White Sangria – will now have White Peach also listed.
Here the emphasis has been on building brands in the domestic market which creates a strong base from which to approach Canadian travel retail outlets – both at airports and on the US border. The LCBO (Liquor Control Board of Ontario) listed both Gautier Cognac XO and VSOP in 2017 and is to extend that with Marie Brizard liqueurs and Gautier Cognac XO Pinar del Rio for the 2018 Christmas season. MBWS brands can be seen on the Chase International Booth #1215
Halewood extends its reach with Dead Man’s Fingers Halewood Wines & Spirits expands its portfolio with an edgy small batch spiced rum brand Dead Man’s Fingers. The founders of the Rum & Crab Shack in the British seaside town of St. Ives, Cornwall created the Dead Man’s Fingers Spiced Cornish Rum in 2015 and has since built a cult following. The spirit is inspired blend of Caribbean rums resulting in an exceptionally smooth taste, with notes of saffron cake, sweet sherry, caramel, vanilla and cinnamon, nutmeg and orange. Neythan Hayes, the founder of Dead Man’s Fingers, said: “We believe we’ve produced a liquid that is as good as any established or contemporary spiced rum out there. While we have achieved success to date through a handful of on and off-trade listings, Halewood’s distribution structure will drive growth and allow more people to enjoy it as much as we do – this is what we’re really excited about.” As a result of the Tiki cocktail trend becoming more popular in the global bar scene- consumers are requesting premium rums. The acquisition of Dead Man’s Fingers is a timely move by Halewood, which has made great strides in the past few years to offer a range of products at various prices to the trade and consumers. Stewart Hainsworth, Group Chief Executive at Halewood Wines & Spirits, commented: “Our business strategy of investing in premium artisanal spirits is paying huge dividends. We place great importance on the authenticity and quality of the brands” Dead Man’s Fingers (ABV 37.5%) becomes the fourth brand in Halewood’s premium rum portfolio, which also includes the award-winning Rum Sixty-Six, Liverpool Rum and Sadler’s Peaky Blinder Spiced Rum. Dead Man’s Fingers is the newest premium rum to be acquired by Halewood Wines & Spirits
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Tequila Corralejo’s best performer is the aged, double distilled 99,000 Horas Anejo
Tequila Corralejo scores a hit in Cancun Demand for tequila has strengthened over the years, and the premiumization trend lends itself well to this Mexican spirit. One brand that stands tall in a busy category is Tequila Corralejo. Consumers are drawn to the artistically designed bottles filled with 100% agave tequila from Mexico. Tequila Corralejo is made at the Corralejo Distillery in Penjamo, Guanajuato. It is unique in that it uses the Charentais method of distillation, which is normally used to make French cognac. This is what gives the spirit its authentic and distinctive taste. Fraternity Spirits, founded in 1994, represents a portfolio of premium drinks, including the flagship Tequila Corralejo. CEO Raffaele Berardi explains how the brand is a natural fit in key Latin America and Americas duty free/travel retail markets, with Cancun being the best-performing location in the last 12 months. What is today’s consumer looking for when searching for the perfect tequila? “We are still seeing an interest in aged tequilas and unique presentations,” explains Berardi. Corralejo’s best performer is the 99,000 Horas Anejo, an aged tequila double-distilled in the traditional Corralejo Charente method using copper and column stills. The tequila comes in a round bottle and is perfect for drinking neat or mixed into a cocktail. Berardi explains that Fraternity Spirits is looking forward to a good year ahead. “We expect a growth of 6% in 2018,” he enthuses. There will be new listings to look forward to and special duty free editions on the way. He adds that it’s important to stay ahead of the curve in an already competitive arena. Tequila Corralejo is known as a premium product, but there is always an opportunity to upgrade the quality of the presentation. “Innovation in the presentation is key for our success and is part of the brand’s DNA,” he explains. Tequila Corralejo plans to continue to work on travel retail special editions and focus on in-store activations to elevate its exposure. Tequila Corralejo is a front-runner in quality and aesthetic appeal with the authenticity of its Mexican roots to back it up. This recipe for success resonates with the millennial shopper, believes Berardi. The tequila market still has room to grow, especially outside of the Americas market, but Fraternity Spirits is up to the challenge.
Duty Free & Travel Retail Summit of the Americas March 18-21, 2018 â€“ Orlando, Florida
Patrick Nilson +1 845 981 7240 firstname.lastname@example.org Roger Thompson + 1 203 322 9691 email@example.com
Visit us at booth # 207 Summit of the Americas
Perfetti Van Melle’s
Femke van Veen Where were you born and raised? In Zevenbergen, The Netherlands
If you attended post-secondary school, what did you study? International Business
Are you married? Do you have children? I have an Ecuadorian husband and we live in The Netherlands with our two kids, one is 3 years old and the other is 6 years old What is your favorite movie? I love all kinds of movies, except horror ones, but nowadays I mostly love watching Disney movies with my kids What is the last book you read? Thursday’s Children, Nicci French
What would you choose as your last meal? Ecuadorian ‘ceviche de camarón’
Your favourite drink? A glass of Chianti Classico Riserva is definitely amongst my favorite drink
Do you have a pet (or more than one)? If so, what animal and name? We have a dog named Otis and a cat named Lilly. Do you prefer country or city? I truly love the balance between both-the fun and excitement of the city and the peacefulness of the countryside. But if I need to choose – the city. What is your favourite place to vacation? My husband and I love to explore new places but we do have a special connection with Tuscany, Italy where he proposed to me
What’s the first thing you do in a new place? Go for lunch/dinner in a local restaurant If you could choose any place in the world to live, where would it be? Buenos Aires, Argentina (for a period)
Which living person do you most admire? I admire all people who truly make time to take care of others in need
Do you have a passion in your life (or more than one)? What? In my private time I love to cook for family and friends
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Which historical figure do you most admire? In primary school I gave a presentation on Mahatma Gandhi and his way of living has always inspired me Where and when were you happiest in your life? It’s difficult to highlight only one period. Periods like when I was living abroad, when I went backpacking around the world, when I got married and when I became a mother are all extremely special. But I constantly try to get happiness out of daily life since I believe this is true happiness What in the world would you most like to change? Child abuse
What about yourself would you most like to change? Be less of a control freak
What is the most important piece of advice anyone ever gave you? EQ is as important as IQ
What is something about you that most people would find surprising? I’m not as serious as I might appear
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