The Americas March 2020 Duty Free & Travel Retailing by Paramount Publishing Ltd.

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DUTYFREEMAG.COM MARCH 2020 · VOL 30 · NO 1

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COVID-19: Travel industry counts the cost p. 12 Argentina crisis looms large p. 40 FDFA’s Abe Taqtaq A p.12 Canadian land border p.22 p. 44 FDFA exhibitors p.34 Smart retail solution for Brazil

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Letter from the Editor

COVID-19:

Temporary new normal?

ho knew that 2020 was going to throw us a curveball? Every year we tackle an old or up-and-coming challenge but the beginning of this year has been unsettling. This year’s main disrupter isn’t a war or economic instability, it is a global health pandemic. COVID-19 is oblivious to borders, religious beliefs and race, which is why it has taken a toll on our lives. At time of writing, the number of coronavirus cases has eased in China and South Korea, but now Europe – especially Italy and Spain– are reeling from the effects of the outbreak with a lockdown in force for the whole country, which has triggered flight suspensions. More recently, the US has banned entry to travelers who are not citizens or permanent residents except Canadians. Their Canadian neighbors are practicing the same rules and, in this case, with the exception of Americans. There is no denying the travel industry has taken a hit as COVID-19 continues to wreak havoc on airline passenger traffic, affecting thousands of industry workers. On the heels of both Duty Free & Travel Retail Summit of the Americas show and TFWA Asia Pacific Exhibition & Conference in May being canceled, it’s important to focus on reassurance as the industry weathers another storm. Speaking about the decision to cancel the Orlando show, IAADFS President and CEO Michael Payne shares: “Essentially all of the feedback after the announcement has been supportive. For many it came as a relief because they were in limbo. Many companies said it was a smart thing to do as they are now faced with a travel ban.” The decision-making process was carefully calculated and thoughtfully executed. Payne and board members held numerous formal and informal conversations with exhibitors, suppliers and industry colleagues. They also evaluated research from the Centers for Disease Control and Prevention, World Health Organization and the Florida State Department of Health, before agreeing to cancel the fair. The Americas region has proven its ability to bounce back time and time again. Says Payne: “The travel industry as a whole is resilient. In our case, if you have more of a global footprint, these issues affect one region more than another. The Americas is resilient in part because many of the companies are global in nature and are able to spread the impact a bit from region to region. The virus makes that harder but still should help many companies. Overall the industry does a great job trying to maintain itself.” He continues: “The cruise industry may have a bit of an image challenge. The Caribbean was doing well in part because of all the booming cruise business. There is likely to be some impact on that. The cruise business is a key contributor to growth and expansion in the Caribbean market in South America.” Payne remains excited about the future of the show. The 2021 Summit of the Americas will be held at Palm Beach Convention Centre, located in West Palm Beach, Florida. “I think people will continue to travel,” concludes Payne. “However, luxury travel and corporate travel are crucial. I don’t think the need or desire to travel will go away. The question is, what do you do to survive? We will have to weather the storm.” Amid the current turbulence, which will undoubtedly impact world economic growth, we will continue to bring you the most important industry news and support our partners as much as possible during this difficult time. Kindest Regards,

HIBAH NOOR Editor-in-Chief hibah@dutyfreemagazine.ca 4 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

MARCH 2020 · VOL 30 · 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 2020, Vol 30. No. 1. Printed in Canada. All rights reserved. Nothing may be reprinted in whole or in part without written permission from the publisher. © 2020 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.dutyfreemag.com PUBLISHER Aijaz Khan aijaz@globalmarketingcom.ca EDITORIAL DEPARTMENT EDITOR-IN-CHIEF Hibah Noor hibah@dutyfreemagazine.ca DEPUTY EDITOR Jas Ryat jas@dutyfreemagazine.ca SENIOR EDITOR Mary Jane Pittilla maryjanepittilla@hotmail.com WRITER Laura Shirk laura@dutyfreemagazine.ca SENIOR WRITER Rebecca Byrne rebeccabyrne10@yahoo.com.sg ASIA CORRESPONDENT Elena Owyong owyongelena@gmail.com AMERICAS CORRESPONDENT Ronnie Lovler ronnie@dutyfreemagazine.ca ART DIRECTOR Jessica Hearn jessica@globalmarketingcom.ca

CIRCULATION & SUBSCRIPTION MANAGER accounts@globalmarketingcom.ca

The best shopping destination Dufry keeps evolving to sustain its position as the worldâ&#x20AC;&#x2122;s leading travel retail expert. We are now bigger than ever, more global, and more strategic. We go above and beyond, offering a large variety of brands and an unparalleled understanding of our customers. And allâ&#x20AC;Ś in the best airports, in 65 countries, and at over 2,300 stores on five continents.

Letter from the Editor

COVID-19:

¿nueva normalidad temporal?

¿Q

uién iba a saber que el 2020 iba a darnos una sorpresa tan desagradable? Cada año enfrentamos un reto existente o nuevo, pero el inicio de este ha sido realmente inquietante. El factor principal de perturbación de este año no es una guerra ni tampoco la inestabilidad económica, sino una epidemia global. El COVID-19 no conoce fronteras, creencias religiosas ni razas, razón por la cual nuestras vidas tienen que pagar un alto precio. En el momento de redactar esta nota, la cifra de casos de coronavirus ha disminuido en China y Corea del Sur, pero ahora Europa – especialmente Italia y España– es extremadamente afectada por los efectos del brote viral con un cierre impuesto de esos dos países al exterior, que ha provocado suspensiones de vuelos. Es innegable que la industria de viajes ha sufrido un duro golpe en la medida que el COVID-19 sigue haciendo estragos en el tráfico aéreo de pasajeros, afectando a miles de trabajadores del sector. Luego de la cancelación de la Cumbre Duty Free y Minorista de Viajes de las Américas, y la Exposición y Conferencia TFWA de Asia del Pacífico que debían realizarse en mayo, es importante enfocarnos en garantizar que la industria pueda salir airosa de otra tormenta. Michael Payne, Presidente y Director Ejecutivo de IAADFS, ha dicho lo siguiente acerca de la decisión de cancelar la feria en Orlando: “Esencialmente todas las opiniones después del anuncio han sido de respaldo. Para muchos resultó un alivio porque estaban en una especie de limbo. Muchas compañías afirmaron que era la medida más inteligente ahora que están afectadas por la prohibición de viajar”. El proceso de la toma de decisión fue cuidadosamente calculado, y ejecutado a la perfección. Payne y los miembros de la junta directiva sostuvieron numerosas conversaciones formales e informales con expositores, proveedores y colegas de la industria.

También evaluaron investigaciones de los Centros para el Control y la Prevención de Enfermedades, la Organización Mundial de la Salud y el Departamento de Salud del estado de la Florida, antes de acordar la cancelación de la feria. La región de las Américas ha demostrado una y otra vez su capacidad de recuperación. Así lo afirma Payne: “La industria de viajes en general es resiliente. En nuestro caso, si se tiene una presencia global, estos temas afectan a una región más que a otra. Las Américas son resilientes en parte porque muchas de las compañías son globales por naturaleza, y son capaces de difundir un poco el impacto de región a región. El virus dificulta esa labor, pero aun así debería ayudar a muchas compañías. La industria en general está haciendo un excelente trabajo tratando de mantenerse a sí misma”. “La industria de cruceros puede haber sufrido un cierto reto de imagen. El Caribe estaba funcionando bien debido en parte al negocio floreciente de cruceros. Es probable que haya algún impacto en ese aspecto. El negocio de cruceros contribuye en gran medida al crecimiento y la expansión del mercado caribeño en Suramérica”, añade el ejecutivo. Payne sigue entusiasmado por el futuro de la feria. La Cumbre de las Américas 2021 se llevará a cabo en el Centro de Convenciones de Palm Beach, ubicado en West Palm Beach, Florida. “Creo que la gente seguirá viajando”, concluye Payne. “Sin embargo, los viaje de lujo y los viajes corporativos son cruciales. No creo que desaparecerán la necesidad o el deseo de viajar. La pregunta es: ‘¿Qué haces para sobrevivir?’. Tendremos que capear el temporal”. En medio de la actual turbulencia, que ejercerá sin dudas un impacto en el crecimiento económico mundial, seguiremos ofreciéndoles las noticias más importantes de la industria, y respaldaremos a nuestros colaboradores lo más posible en estos tiempos difíciles.

Mis más cordiales saludos,

HIBAH NOOR Editor-in-Chief hibah@dutyfreemagazine.ca

6 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

Contents

WHAT’S INSIDE

Lead Stories 12 COVID-19 Update

COVID-19: Travel industry counts the cost The COVID-19 pandemic has hit the travel industry hard in the first quarter of 2020, but there are signs that the situation is beginning to ease

16 Dufry Group

Dufry addresses COVID-19 Dufry chief speaks out on COVID-19 as company achieves 3% organic growth in 2019

20 Entering Asunción

Exclusivity in Asunción Top Brands International expects to open its exclusive airport store at Paraguay’s gateway airport in the third quarter of 2020

24 Expansion in Panama

Motta hatches plans for Panama Motta International is gearing up for expansion at the long-awaited new terminal in Panama’s Tocumen International Airport

28 Corporate Responsibility

A sustainable journey Americas Duty Free discusses corporate responsibility with Dr Jennifer Cords, Director Corporate Affairs of German duty free operator Gebr Heinemann, and Nadine Heubel, CEO of Heinemann Americas

40 Argentina’s Economy

Argentina crisis looms large Economist Carlos Melconian spells out the details of Argentina’s economic difficulties and their impact on the duty free business

44 Distribution on Brazil Border

A Smart retail solution Following the establishment of the new Lojas Francas (duty free stores) along the border of Brazil, three enterprising executives have set up a company offering brand distribution services and more

Features Dufry Americas rises to the challenge 30 Duty Free Americas gives back 32 Stores take root on Brazil border 38 ForwardKeys collaborates 46

Canada closes borders 48 The celebrity revolution 50 Sitting pretty at Miami International 56

Contents

WHAT’S INSIDE

Lead Stories 58 Air Canada

Air Canada takes the digital route Canadian flag carrier Air Canada is getting closer to its customers in high-tech new ways

62 2020 Duty Free Readers' Choice Awards

Deadline nears for entries to Duty Free Readers’ Choice Awards The deadline to enter the annual Duty Free Readers’ Choice Awards for regional industry excellence is fast approaching, with all submissions due on April 15

78 Cruise Terminal

The Caribbean’s largest travel retail facility comes to life Regency Group unveils its newly developed Colon 2000 Cruise Terminal

80 Women’s Leadership and Gender Equality

The very Essence of gender equality Dynamic entrepreneur Patricia Bona, who heads with husband JeanJacques family-owned beauty products distributor Essence Corp, shares her view of women’s leadership and gender equality

86 Travel Blue

Meet the team: Travel Blue Group Americas Americas Duty Free introduces you to Travel Blue Group Americas as its parent company spreads the reach of three accessory brands across the globe

96 Rum Report

The rumifications of a diverse portfolio Classifying rum by style could leverage category growth, according to several leading suppliers

100 Champagne Lanson expands

Lanson makes sparkling progress Champagne Lanson is being rejuvenated by its new President, François Van Aal, who reveals exciting plans for the venerable brand

104 Tobacco

JTI navigates ever changing duty free channel Haythem Bouchuiguir, JTI Worldwide Duty Free Americas General Manager, makes official debut at Summit of the Americas

Features Toronto Pearson wins 64 Baja Duty Free turns 30 68 FDFA works together 70 ASUTIL plans second conference 74 Caribbean tourism rebounds 81 Le Specs cracks GTR 82

Editor’s Picks 84 Quintessential Brands’ strategy 90 Gold Bar Whiskey rush 92 The right tool for sweet success 94 MONARQ’s sustainable mission 98 Questionnaire: Denz Van der List 106

COVID-19 Update

COVID-19: T R AV E L I N D U S T R Y COUNTS THE COST

ACI says that the loss of global airport revenues is approximately equal to the total annual revenues of two major European or Asian hubs combined

The COVID-19 pandemic has hit the travel industry hard in the first quarter of 2020, but there are signs that the situation is beginning to ease by HIBAH NOOR

he travel retail industry is in the midst of unprecedented uncertainty with the cancelation of two key trade shows: Duty Free & Travel Retail Summit of the Americas in March and TFWA Asia Pacific Exhibition & Conference in May. The new decade has brought with it the COVID-19 pandemic, which has spread across the world, deeply impacting the travel and tourism industry. At time of writing, we’re in the third month of the year and here is where the beleaguered travel industry stands.

While the impact of the COVID-19 pandemic was initially marginal and limited to those airports with air services to affected countries in Asia, its extension into Europe is resulting in airports across the continent now facing a crisis. In this scenario, Airports Council International (ACI) World forecasts that global airport revenues will be down at least US$4.2 billion in the first quarter of 2020 compared to pre-COVID-19 forecasts. The loss is approximately equal to the total annual revenues of two major Euro-

12 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

pean or Asian hubs combined, the organization said. ACI previously estimated that global revenues would reach close to US$39 billion, with the expected decline based on traffic trends under COVID-19 and constant unit revenues.

Non-aeronautical revenue hit

Most of the loss in revenues is expected to occur in the Asia Pacific region, with a difference of US$3 billion in projected revenue. An estimated loss of US$1 billion in Europe makes it the second most affected region. ACI noted that all regions will see a revenue impact from the loss of East Asia passengers. Non-aeronautical revenue will be strongly impacted by the COVID-19 epidemic, ACI said. Chinese passengers in particular “tend to generate comparatively high revenue for retail concessions

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COVID-19 Update

ACI World Director General Angela Gittens

and other non-aeronautical services”. ACI noted that non-aeronautical revenues are usually seen as an “additional cushion” during economic downturns, but the heavy impact on them will “create a wider effect for airports worldwide”. The forecasts were published on March 10 in an advisory bulletin on the predicted global economic impact of COVID-19 on the airport industry, which ACI said would be “pronounced”. At the global level, ACI estimates that airport passenger traffic volume for the first quarter of 2020 will be down at least 12 percentage points compared to what it previously projected. Asia Pacific will be most affected, with passenger traffic volumes down 24 percentage points compared to previous ‘business as usual’ forecasts for the first quarter of 2020. Europe and the Middle East are also expected to be significantly impacted by reductions in traffic. North America is expected to see similar declines in the second quarter of 2020, as ACI noted recently-announced service reductions in the region, with more expected in the coming weeks. “In addition to the official bans and restrictions on travel, sharply reduced business and leisure travel, there is a general travel confidence issue causing consumers to pull demand forward, events being canceled, and businesses reducing their normal activity,” ACI said. ACI Europe earlier forecasted a 13.5% year-on-year drop in regional passenger traffic in the first three months, and a 7.5% decline for the full year. ACI World Director General Angela Gittens commented: “The airport industry recognizes that all stakeholders of the aviation ecosystem are heavily impacted by the COVID-19 outbreak, and that strengthened cooperation between

Olivier Jankovec, Director General of ACI Europe

airports, airlines, and regulatory authorities is needed as the industry responds to the outbreak. “The sudden shock represented by the COVID-19 outbreak is affecting passenger and cargo traffic worldwide, markedly in Asia Pacific and significantly reducing airport revenues. “Airports rely heavily on airport charges to fund their operating and capital costs and operators find themselves under intense pressure during periods of traffic decline. Airport revenues must be sufficiently protected to ensure safe and sustainable operations. Measures to limit the collection of airport charges would be ill-advised.”

European shock

News that the Italian government had put Italy in lockdown sent shockwaves through Europe’s airport industry. Beyond Italy, the situation for airports was rapidly deteriorating throughout Europe, according to ACI Europe. Olivier Jankovec, Director General of ACI Europe, called the COVID-19 outbreak “a shock of unprecedented proportions for our industry”, saying: “Airlines are drastically cutting capacity and canceling air services as they respond to falling demand resulting from loss of confidence, changes to corporate travel policies, and governmental measures which directly or indirectly restrict mobility in their efforts to contain the spread of the virus. As a result, the COVID-19 epidemic is turning into a shock of unprecedented proportions for our industry. Apart from Italy, we cannot rule out that airports elsewhere might at some point also need relief measures to address cash flow pressures and keep fulfilling their role as critical infrastructure. This will require the support of governments and the European Commission.”

14 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

ACI Europe forecast a loss of 67 million airport passengers in the first quarter of 2020, representing a 13.5% drop in airport passenger footfall compared to a business-as-usual scenario. Overall, Europe’s airports would service 187 million fewer passengers in 2020, representing a decrease of 7.5% in a year which was predicted to see 2.3% passenger growth in a business-as-usual scenario. In financial terms, ACI warned of a loss of €1.32 billion in revenues in Q1 alone compared to a normal financial quarter, as a result of lower aeronautical revenues, lower commercial (non-aeronautical) revenues, and foregone revenues from ground handling and other services. In line with the WHO (World Health Organization) COVID-19 recommendations to states, ACI called on governments only to consider travel bans and other measures interfering with air connectivity as a very last resort and for the shortest period of time.

Israel and Iran in lockdown

In the Middle East, the airport industry is braced for a significant decline in traffic. Amid growing fears over COVID-19, Israel was in virtual lockdown from March 9, after the government imposed a restriction requiring all incoming travelers, no matter what their nationality or where they were arriving from, to selfquarantine for a period of 14 days. Meanwhile, for many Iranians, life has been put on hold as COVID-19 proliferates like wildfire through their closed country. Iran has recorded one of the highest death tolls outside China and a rapidly growing number of cases, and the government has been taking action to deal with the crisis.

Situation in China and Korea eases

There are signs that the situation in Asia appears to be easing. New infections continue to dip, both in badly-hit China and South Korea. Chinese President Xi Jinping visited the quarantined city of Wuhan on March 10 for the first time since the coronavirus was identified there, reflecting confidence that the epidemic’s spread had been largely contained within China. There are signs that life in China is slowly returning to normal with a loosening of the lockdown. Could we be seeing some normalcy on the horizon? The world watches and waits.

Dufry Group

Julián Díaz, CEO, Dufry Group

Dufry addresses

COVID-19 Dufry chief speaks out on COVID-19 as company achieves 3% organic growth in 2019 by MARY JANE PITTILLA

ufry Group has reported a 1.9% increase in turnover to reach CHF 8,848.6 million (US$9,274.5 million) in 2019. In the retailer’s results announcement, CEO Julián Díaz welcomed the strong annual result but spoke out about the effect of the COVID-19 pandemic on business this year. He said: “At the beginning of 2020, we saw a further acceleration of the business. Then COVID-19 impacted our operations where we have exposure to Asian customers as well as in locations directly impacted by the phenomena. We have immediately implemented several worldwide initiatives to accelerate sales; to secure cash generation through renegotiations of rents and with brands, and to reduce costs through actions at thirdparty cost levels and with employee reorganizations. Currently it’s still challenging to estimate the impact for the full year.”

He said the group’s organic growth performance accelerated in January 2020, but in February performance was negative, reaching -7.3%. In February, Europe and Africa performed slightly negatively; Asia Pacific and Middle East reported negative growth at double-digit level; North America was negative at single digit, while Central and South America featured positive growth. Year-to-date until end of February organic growth was -2.3%; and year-to-date until March 8 organic growth was -3.8%. The company has set up a special committee at the Global Executive Committee level and implemented an action plan to secure cash flow generation, drive sales and safeguard profitability. The action plan is monitored weekly and includes initiatives to accelerate sales volumes, maintain gross profit margin levels, reduce personnel and other expenses as well as renegotiate rents.

16 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

In total, these initiatives are expected to generate savings of CHF 60 million (US$62.9 million) on a consolidated full-year basis at adjusted operating profit level. In addition, measures to offset cash flow impacts have been launched, expected to generate in total a contribution of CHF 40 million (US$41.9 million) in the full year. He said that Dufry Group did not anticipate any liquidity problems during the crisis. He continued: “Provided that the situation improves in the second semester and considering that the third quarter is the most important for the company, Dufry expects to reach a negative, single-digit organic growth performance for the fullyyear 2020, based on current information.”

Financial results

Dufry reported a 1.9% increase in turnover to reach CHF 8,848.6 million

Dufry Group

(US$9,274.5 million) in 2019. Organic growth for the year stood at 3%, with like-for-like growth contributing 0.6% and net new concessions adding 2.4%. In the fourth quarter, all divisions reported positive organic growth, resulting in a group performance of 3.1%, supported by a healthy like-for-like growth of 2.2%. As part of its business development strategy, Dufry refurbished over 41,600 square meters to support like-for-like performance and opened and expanded some 33,900 square meters of gross retail space. This includes new shops in Russia, Mexico and the US and shops across 19 new ships. Dufry also signed new contracts for close to 14,900 square meters of additional retail space to be opened during the next two years. In November 2019, Dufry closed the acquisition of the 60% stake of RegStaer Vnukovo. In October, its subsidiary Hudson had already started to consolidate the newly acquired Brookstone shops in the US.

Europe and Africa

Turnover in the Europe and Africa region was CHF 3,850.9 million (US$4,036.3 million) in 2019 from CHF 3,828.2 million one year ago. Organic growth in the division reached 5.8% in the year and 7.5% in the fourth quarter. The like-for-like contribution remained strong during Q4, reaching 6.1%. The UK and especially Spain continued to deliver solid performance for the year. The implementation of the pilot projects across five Spanish airports, including several commercial initiatives and best practices, were very successful, the company said, showing improving sales during the whole year. Greece and especially Turkey maintained their positive momentum in 2019, delivering a solid growth. Other locations such as Malta, Italy and Finland also posted positive growth. Africa saw a stronger performance in most operations, with Morocco, Kenya and Egypt growing double digit in the year.

Asia Pacific and Middle East

Turnover reached CHF 1,274.9 million (US$1,336.3 million) in 2019 from CHF

1,153.6 million in 2018. Organic growth for the year stood at 10.8% supported mainly by the contribution of new concessions in 2019. Like-for-like performance improved during the year, reaching 8.3% in the fourth quarter. Eastern Europe posted positive performance, supported by Russia and Serbia. Asia Pacific posted double-digit growth, mainly driven by Hong Kong with the successful opening in the MTR high-speed railway station, as well as the strong performance seen in Macau and the positive growth in Cambodia and China. Australia also posted solid performance for the year, supported by the opening of new shops in Perth. The Middle East posted good performance, with solid growth in India, Sri Lanka and Sharjah.

North America

Turnover amounted to CHF 1,935.8 million (US$2,029 million) compared to CHF 1,884.4 million in 2018 and organic growth was 1.8% in the year. The North American operation has been performing strongly for many years and in 2019 the duty paid business confirmed its resilience despite some temporary challenges, Dufry said. The duty free segment was negatively impacted by lower spending from Chinese passengers during the first nine months, but showed signs of a recovery in the fourth quarter of 2019.

Central and South America

Turnover stood at CHF 1,536.1 million (US$1,610 million) in 2019 versus CHF 1,617.0 million in 2018. Organic growth in the region was -6.3% in the year with performance in the fourth quarter turning positive at 0.2%, mainly supported by the implementation of commercial initiatives. During 2019, performance in South America remained challenging, impacted by local currency devaluations, namely in Brazil and Argentina. Performance in Mexico was positive throughout the year, reaching solid results especially during the fourth quarter. The Dominican Republic posted positive growth, while the Caribbean was healthy along the year, supported by the cruise business. Dufry noted the two changes in legislation approved by the Brazilian government during 2019 – the ability to open border shops and the increase in the arrival duty free allowance – which will

18 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

support organic growth in this important market in South America. Commenting on the results, Díaz said: “2019 was characterized by an ongoing acceleration of organic growth, which supported by our marketing initiatives and new concessions increased to 3.0% in line with our mid-term average guidance. “Organic growth has been benefiting from both solid contributions from new concessions and like-for-like growth, which has turned positive in Q3 reaching 1.3% and increasing to 2.3% in Q4. This performance was driven by several initiatives such as the implementation of the new commercial platforms as well as our ongoing refurbishment program covering 41,600 square meters of retail space, mainly in Spain, Sweden, Jordan and Turkey. “Regarding business development, we added some 33,900 square meters of gross retail space in 2019, including the opening of new shops in Russia, Mexico, Kuwait, Brazil and several ships. We also already signed around 14,900 square meters to be opened in 2020 and 2021 in existing and new locations across the globe. “In the context of further expanding our business going forward, in 2019 we achieved several milestones such as the acquisition we performed in Russia, consolidating our position in the country, and the two acquisitions in the United States through our Hudson subsidiary. Here we created additional growth opportunities allowing us to expand both in duty paid and duty free, while at the same time accelerate the penetration of the important airport F&B market. “Last but not least, we successfully extended the AENA contract for up to five years covering all the airports in Spain. I am looking forward to rolling out to further locations in Spain our successful commercial initiatives and best practices already tested across five pilot airports to accelerate performance even more. It’s worth noting that this implementation will not need any significant capex investment. “Moving forward, we will see the contribution of our new concessions, which we have added organically and through M&A in 2019. Therefore, we are optimistic about Dufry’s ability to deliver mid- and long-term sustainable growth and solid cash flows with our resilient business model.”

Entering Asunción

These artistic renderings give an idea of what the look will be for Top Brand’s Luryx Duty Free story at the Silvio Pettirossi International Airport in Asunción

Exclusivity in Asunción Top Brands International expects to open its exclusive airport store at Paraguay’s gateway airport in the third quarter of 2020 by RONNIE LOVLER

20 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

op Brands International will begin construction in April of its Luryx Duty Free stores that will make up its exclusive duty free operations at Silvio Pettirossi International Airport in Asunción, Paraguay. The Panama-based company won the 10-year contract at Paraguay’s main airport earlier this year in a bid that strengthens the company’s presence in South America. The Paraguay win comes just months after Top Brands acquired Neutral Duty Free, the largest duty free chain in Uruguay. In a series of exclusive interviews with Americas Duty Free, Top Brands International President Danny Yohoros says the company is already meeting with airport authorities on the Silvio Pettirossi International Airport project. “We have exclusivity in the duty free category for the entire airport and expansion of the airport,” Yohoros said. In other words, with the 10-year-operating contract it was just awarded, there will be no other duty free presence at Silvio Pettirossi International Airport. “Construction will take place in the second quarter and we will be opening the store in the third quarter,” Yohoros adds.

BIG PACK One pack six worlds of pleasure. Pure goodness!

Entering Asunción

Construction of the stores will take place in the second quarter of 2020 and will be opening in the third quarter

“We had meetings with the airport authorities together with our architects and it was a very workable transition in terms of what is going to be happening. The airport is collaborating with us and we are collaborating with the airport.” Yohoros says the project will open with a 1,300 square meter walk-through store at the Departures level, with a second phase in Arrivals of approximately 500 square meters. “The stores will be very creative and very much in the design vanguard with new technology," he adds.

More categories

Yohoros notes that Top Brands is working with Argentine architect Monica Ariaudo on the Paraguay project. “She is a very experienced person, especially in the duty free business. She has done many airports around Latin America and we are going to do some very exciting things there.” The company will be investing about US$5 million in the project. Yohoros reviews plans for stock at Asunción’s future Luryx airport stores. “We are planning to carry all the usual duty free categories like liquors, perfumes, cosmetics, wines, etc.” he says. “But we’re also including additional categories like clothing, fashion, electronics and so on, to give a complete assortment of products to passengers going through the airport.”

22 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

Yohoros says Top Brands became interested in Paraguay a few years ago when they realized it was one of the few airports in South America where other large operators did not have a presence. That was when they went in and purchased Bright Star, their current airport shop. “So we had the experience of working there. We saw it as a growing airport that would be increasing traffic, so we decided to invest,” he says. With its purchase of Neutral in July 2019, Top Brands began to have a major presence in Uruguay. The Neutral by Luryx stores in Uruguay, as the stores are now known, are located in Artiguas, Rivera, Bella Union, Rio Branco, Aceguá and Chuy, with two stores in Rivera and Chuy, all along that country’s border with Brazil.

Leadership position

“We have learned a lot from existing stores, and we have taken a lot of ideas in order to improve them,” he adds. Top Brands also plans to implement a loyalty program later this year. “Our customers will be able to purchase in any store and in any country and be able to use their points in our stores. Definitely, there will be a lot of synergy,” Yohoros says. “We are working on the campaign to be able to launch in the third quarter. It has taken a while because we have to take into consideration many factors to launch in all the countries where we are present. So, we have to think in terms of all countries and their regulations,” he explains. Top Brands previously had a small store at Asunción’s main airport, along with two other operators, but when the Paraguayan government decided it wanted to grow and renovate its retail and airspace at the airport with the goal of becoming more of a hub, Top Brands jumped into the bidding fray. “We had contracts on a year-by-year basis and the government decided to make a call for an open tender,” Yohoros says. “They decided it is going to be a very big investment… and they decided to choose only one operator to build a walk-through store and to give the contract on a long-term basis, a 10-year contract. They did the open bid and we made a good proposal and business presentation and a good concept. We won the competition. They chose us.” Yohoros says the store will create new employment opportunities at the airport for local citizens, with the expectation that many of those working at the small duty free stores currently operating will find jobs with Luryx.

Top Brands has named Marcelo Montico as CEO of its nine-store chain of Neutral by Luryx duty free stores in Uruguay. Yohoros says Montico was chosen to lead the Neutral effort because “he is a person with full experience and know-how who has been working in Uruguay for seven years.” Yohoros says he was impressed by Montico as a competitor and wanted to bring him on board. Before joining Neutral, Montico had set up his own distribution company to help operators seeking to break into the regional duty free business on the Brazilian side of the border. He joined Neutral in January. “I feel very honored by the confidence placed in me by the Top Brands Group in appointing me to lead an organization like Neutral,” Montico tells Americas Duty Free. “The current context of our industry in the region forces us to manage the business with a very high dose of creativity and determination, and all of us who make up this work team are committed to achieving the efficiency that the group requires and that will allow us in the medium term to recover the leadership position in the sector. “I am convinced that, with the support of our business partners, the quality of our team and the financial strength of the Top Brands group as support, we will achieve it,” Montico adds. Yohoros says Montico is already getting very involved with the business. “We are making sure we have an adequate assortment of products to recuperate from the losses sustained in the last years,” Yohoros notes. Along those lines, Yohoros announces that an agreement was recently signed with the jewelry company Pandora on an exclusive basis at the Neutral by Luryx stores in Uruguay. Additionally, Yohoros says the chain will have shop-in-shops for MAC cosmetic products at its Neutral stores in Rio Branco and Chuy. Also coming up will be the establishment of a loyalty program for Neutral by Luryx customers. “This will attract new customers,” Yohoros says. “There will be many different exciting things that we will be bringing to the table.” With all its operations, Top Brands now has a presence in Panama, the United States, Belize, El Salvador, Costa Rica, Colombia, Chile, Paraguay, Bahamas, Cuba, St. Thomas, Tortola, French Guiana and Uruguay, employing more than 1,000 people worldwide.

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Expansion in Panama

Motta’s Attenza store at the international airport in Bogota, Colombia is a big draw for travelers

Motta hatches plans for Panama MOTTA INTERNATIONAL IS GEARING UP FOR EXPANSION AT THE LONG-AWAITED NEW TERMINAL IN PANAMA’S TOCUMEN INTERNATIONAL AIRPORT by RONNIE LOVLER

The storefront of this Attenza Duty Free store in Tocumen International Airport appeals to shoppers before they catch their flights

24 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

otta International will be opening three new traditional duty free stores under its Attenza Duty Free brand at Panama’s Tocumen International Airport later this year. The operator’s presence in the new Terminal 2 will include one large main store, just outside the immigration area, and two smaller stores as well as specialty boutiques. The company also has a popup store in the new terminal. Construction work on the stores is expected to begin sometime before the end of the first semester of 2020, once the airport authorities finish their review, according to Ignacio Lasa, Motta’s Commercial Vice President, who shared the information in an exclusive interview with Americas Duty Free. “We expect the stores to be given to us for construction by the end of the first semester so we can open sometime in the second semester of 2020,” Lasa said. “But right now, we have no specific date.” The main store will be 1,014 square meters in size and will be visible to passengers as soon as they go through immigration, Lasa said. That store will also have an entrance toward the main corridor facing the departure doors. In addition to the smaller stores, Motta will open specialty stores for Adidas, Tory

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Expansion in Panama

A view of an Attenza Duty Free store in Tocumen International Airport

Burch, which offers women’s accessories, and other high-end brands, Lasa added. “The idea is for these stores to be very attractive to customers, not only those departing, but to the in-transit passengers at Tocumen,” Lasa said, referring to the airport’s status as a hub and a point of connection for Latin America. “Motta International has done a careful analysis of the company’s long experience with Latin American travelers to design our stores in a tailored manner to serve these customers and provide the service that Attenza stores promise,” he added.

Other operations

Motta is also looking at opening some smaller stores in the Saint Oscar Arnulfo Romero y Galdámez Airport's expanded area in San Salvador, by end of year. And the retailer is continuing its duty free operation in Trinidad and Tobago. “Although the learning curve to operate in this Caribbean country has been a challenge, we finally have the crew and the administrative control we wanted to achieve,” Lasa said. But still Motta’s primary focus remains in its home country of Panama, where the expansion of Tocumen is expected to boost Motta and other travel retail operations. “Panama has a reputation as a shopping destination, but Tocumen International Airport has been in need of

a much-needed expansion for some years now,” Lasa said. “More store space, more service areas, better and more modern facilities, and bigger corridors no doubt will help the passenger going through the Hub of the Americas to feel more comfortable and attracted to visit these new stores and have a pleasant traveling and shopping experience,” he added. Motta also gives its customers a chance to shop online with its Attenza. net website, now a six-year-old venture.

26 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

“We offer a special discount to clients who decide to make reservations online and we are thinking of expanding our offer to include more electronics,” Lasa said. “In 2019, after much work and detail with our partners, we were the first to have Chanel on our website. We are looking forward to continuing to work with our partners to offer more products and services online.” Motta operates stores in Bogota and Cali in Colombia, Nicaragua, Quito, Ecuador and Trinidad & Tobago. For more information, visit attenza.net.

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Corporate Responsibility

A SUSTAINABLE

journey by HIBAH NOOR

AMERICAS DUTY FREE DISCUSSES CORPORATE RESPONSIBILITY WITH DR JENNIFER CORDS, DIRECTOR CORPORATE AFFAIRS OF GERMAN DUTY FREE OPERATOR GEBR HEINEMANN, AND NADINE HEUBEL, CEO OF HEINEMANN AMERICAS

To reduce plastic bag consumption, participating Heinemann Duty Free shops sell reusable plastic bags and donate the proceeds to marine conservation organization OceanCare

Americas Duty Free: What is Gebr Heinemann’s vision for corporate responsibility (CR)? Nadine Heubel: Corporate responsibility is a journey. ‘The Heinemann Way’ means to constantly rethink ourselves and our approach towards responsibility and sustainability. We always ask ourselves: What can we do better or differently in the area of corporate responsibility? Jennifer Cords: We are not alone on our journey. We want to be part of a sustainable value chain in which we work closely with our suppliers and partners, collaboratively setting and performing to high environmental and social standards and championing best practices in the market. As a retailer, we are in the middle of the supply chain and have a large sphere of influence, starting with the supplier of the products through logistics and duty free shops through to the customer – perfect for influencing others and getting inspired from those who are ahead. ADF: Has this changed much since Max Heinemann was appointed CEO? JC: No. As a family company, Gebr Heinemann is thinking in long-term generational life cycles, rather than short-term business life cycles. Thus, sustainable management has been part of the company’s DNA since the early days. Last year, Gebr Heinemann celebrated its 140-year anniversary.

28 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

ADF: How much time goes into these CR initiatives? JC: Corporate responsibility has many facets at Gebr Heinemann, not least because of the company’s global reach, with business operations in more than 100 countries in the complex travel environment. The company also brings together different cultures, standards and opinions. So it is really a complex matter at Gebr Heinemann that deserves our entire dedication. We are therefore building a fully dedicated team at the headquarters that will act as a CR Center of Expertise, providing advice to all our most diverse regions and employees and taking responsibility for and managing global activities relating to corporate responsibility. ADF: Are there any specific initiatives that are carried out by Nadine’s team in the Americas? NH: Indeed, Heinemann has brought not just its business to the Americas, but also its values, including its CR approach. Staying true to the Heinemann maxim to ‘think global, act local’, we focus on our local natural and workplace environment as well as our local community to contribute to the UN Sustainable Development Goals. Key initiatives for the workplace are concerned with professional development programs and sustainable leadership as well as diversity and equal opportunities. These include, for instance, our US$20,000 aviation scholarship in partnership with the Airport Minority Advisory Council (AMAC) Founda-

Nadine Heubel, CEO, Heinemann Americas

Dr Jennifer Cords, Director Corporate Affairs, Gebr Heinemann

tion. The scholarship will cover educational and related costs for three women and/or minority students who wish to enter the field of aviation. ADF: What are some CR achievements? NH: Heinemann Americas has put a package of health promotion measures for our employees in place, including healthy food offers and corporate sports groups. Recycling and waste reduction has also been top of mind at Heinemann Americas since October 2018, when we launched an initiative which saw the introduction of recycling bins throughout the office and an information campaign centered on practical recycling measures that employees can take. JC: To make a global statement, we joined the United Nations Global Compact in 2018 committing to make its 10 principles a core part of the company’s corporate strategy. First and foremost, we’ve addressed most of the issues that are affecting our society and industry, and we’re looking for ways to create awareness and to optimize our company. This means: reduce the use of disposable plastic throughout the organization; sharpen environmental standards for marketing activities, promotions, retail design and indirect procurement; promote regionality through local designs and products; promote responsible consumption; identify human rights risks in the supply chain and take measures to avoid them; and identify and reduce CO2 emissions. ADF: You’ve reduced waste by 70% in the last few years. Can you elaborate? JC: Gebr Heinemann and the marine conservation organization OceanCare came together in 2017 to develop a joint initiative to reduce the amount of plastic waste in the oceans. Our common goal is to promote the conscious use of resources and the reduction of plastic bag consumption in airport shops. In participating Heinemann Duty Free Shops, we provide reusable plastic bags at a price of €0.30 (US$0.33). The proceeds are donated to OceanCare.

Heinemann Americas’ staff visit the Lotus House Women's Shelter in Miami, an organization it supports that’s dedicated to improving the lives of homeless women, youth and children

After the successful pilot phase in the 14 Heinemann airport shops in Germany and Austria, the cooperation is being extended to other locations. In January 2018, it was launched in Bratislava and Ljubljana, followed by Budapest and Copenhagen in 2019. In the first year of the cooperation alone, the number of plastic bags issued at the participating sites was reduced by a total of around 70%. From the beginning of the cooperation with OceanCare in 2017 until the end of 2019, we raised almost €500,000 (US$544,000) for OceanCare. ADF: Who is the driving force behind CR at Heinemann? JC: Everyone along our influencer chain! And that includes all of the 8,000 employees around the globe. Luckily, the topic is a matter of personal commitment for the owners and the management. It is deeply rooted in the company’s culture. ADF: What are your ambitions for 2020? I understand that you’re not just limited to reducing plastic waste – you’d also like to reduce general waste. JC: Plastic reduction and waste reduction in general are important initiatives and puzzle pieces that we’d like to further develop in 2020. In addition, we think and rethink how we can continue to contribute to the UN Agenda. We have learned a lot through the UN Reporting Line and we will consistently set KPIs and define a Sustainable Development Goals compass. This is the umbrella for all our different initiatives and a very important guideline for our daily work by taking ecological and social risks and opportunities into account in every economic decision. ADF: What do you think the travel retail industry should be doing to contribute to CR? JC: It is never enough. We are on the right track, but there is still plenty of room for improvement for our entire industry. We are all facing similar challenges – but also opportunities! NH: The key topics of sustainability and responsibility should be on the agenda of every company in the duty free industry; we have to address these together and proactively. For instance, we should make a positive contribution to the public discussion by developing a collective stance on issues like flight shame, plastic packaging and environmental questions associated with cruise ships. We are excited to be on this journey together along with our partners, colleagues and travelers around the world. www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Dufry Americas round-up

DUFRY AMERICAS RISES TO THE CHALLENGE

Dufry's new duty-paid shop located in the domestic departures lounge of Terminal 2 at Belo Horizonte International Airport

Rene Riedi, Dufry’s Divisional Chief Executive Officer Central and South America, talks to Americas Duty Free about a tough 2019 and the exciting opportunities ahead Americas Duty Free: How was 2019 and what are your expectations for 2020? Rene Riedi, Divisional Chief Executive Officer Central and South America, Dufry: 2019 in Latin America was a year best characterized as the year of political changes, social unrest and economic crisis. While Central America and in particular Mexico and the Caribbean were performing well, in South America the situation remained challenging. We believe 2020 will be a better year and the economies are forecast to recover modestly in light of still-possible external headwinds and domestic policy uncertainties. Having said that, there are a couple of initiatives that will have a positive impact on our business such as the increase of the duty free allowance in Brazil from US$500 to US$1,000 at airports as well as the introduction of a 30% credit card tax in Argentina for all purchases paid by credit card abroad. Provided the currencies do not have much volatility mainly in Brazil and Argentina, we may see consumer confidence bouncing in all affected economies and retail sales growing. It is also important to highlight that, due to the low value of the Argentinian peso, we see already a surge in inbound tourism, mainly from the neighboring countries.

30 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

ADF: What are some new developments for Dufry in the Americas? RR: Early in 2019 we completed a full refurbishment of the main duty free Departures store at Ezeiza International Airport in Buenos Aires. The store was converted into a New Generation Store, of which we have now three in South America. We expanded the Arrivals duty free store in Santiago de Chile and refurbished the main duty free store in the international Departures hall, adding new brands and product lines and making the entire retail offer more attractive. One of the main projects last year was the opening of the Terminal 2 store at Mexico City International Airport which has been open to the public since the end of October. This new store gives travelers a world-class retail offer, with a wide range of products from the world’s best known brands. Staying in Mexico, we converted the store at Guadalajara International Airport into a walk-through store. We reinforced the sense of place aspect to reflect the heritage of tequila and mezcal. In Brazil, we inaugurated our long-awaited border duty free shop, located in the city of Uruguaiana in the southern part of the country. We also signed a new contract with Florianopolis

Dufry opened the Cava del Vino, a specialized shop dedicated to Chilean wine in Commodore Arturo Merino Benítez Airport

Dufry opened the Cava del Vino, a specialized shop dedicated to Chilean wine

Dufry’s first Brazilian duty-free border store in Uruguaiana opened in mid-2019

International Airport, expanding our operations, which includes two duty free shops and one duty paid. ADF: Can you give me an update on the Brazilian border stores? RR: Our Uruguaiana border shop was inaugurated in August last year and since then we have been going through a learning curve to further improve our operation in this new market. Product assortment has been the main focus area where we are working hard to adapt the portfolio and at the same time to attend even better to our customer’s needs. ADF: What are your expansion plans in Brazil (airports and border stores)? RR: Dufry is continuously assessing the opportunities in Brazil, in order to expand our presence and further consolidate our leadership in the travel retail sector of the country. ADF: What do you foresee for the Americas duty free industry in the next five years? RR: Latin America’s economies have always shown ups and downs, and this will not change. It is very hard to say what will happen. One thing is for sure, dealing with Latin American countries means to be always prepared for surprises, which will

hopefully be more on the positive side, as we saw last year with the new regulations on border shops and the allowance increase. One bright spot for the duty free industry is the progressing privatization of the airports across the continent, and along with that the investment in airport infrastructure to expand the capacity and improve the quality of service. We predict an increase in the importance of low-cost carriers throughout Latin America, a trend that is much more advanced in other parts of the world and which still offers room for growth in most countries of Latin America. In this scenario, it is important to highlight the potential development for the domestic airports in Brazil with further expansion of Dufry Shopping and Hudson stores, where both businesses have been proving to be very robust and resilient. Last but not least, we would like to mention Dufry´s digital platform solutions, which will drive our growth in the next few years. One is RED by Dufry loyalty program (236 locations and 46 countries as of FY 2019), which offers benefits and discounts to its members. The other is the Reserve & Collect service (over 170 locations and 44 countries as of FY 2019), which allows customers to pre-order their favorite items from home and collect them at the airport, thus ensuring they save time and money. ADF: How are you preparing for the effect of the coronavirus on your Americas and Brazilian operations? Does Dufry have a protocol for this situation? RR: Dufry has a global coronavirus protocol in place and is ready to act at any time. We are monitoring the situation on a daily basis, and update the protocol regularly as needed. However, we also need to align any actions and initiatives with the local airports, other landlords and local health authorities in every single location, to best match and meet local needs.

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

â&#x20AC;&#x201A;DFA Golf Tournament

Falic brothers (from left) Leon, Simon and Jerome present cheque for US$350,000 to Don Eachus, Director of Development at Joe DiMaggio Children's Hospital Foundation and Memorial Foundation

Giving back Duty Free Americas swung into action with hundreds of suppliers to raise money for charity at its annual golf tournament by HIBAH NOOR

uty Free Americas flexes its philanthropic muscles by organizing an annual golf tournament in aid of a different charity each year. This year, the 6th Annual Duty Free Americas Golf Tournament took place in the elegant setting of the Trump National Doral Country Club in Miami, Florida, on February 6, in aid of the Joe DiMaggio Childrenâ&#x20AC;&#x2122;s Hospital Foundation. More than 350 people attended from across the industry, with vendors from many categories, including liquor, beauty, confectionery, sunglasses and watches. Several members of the family also tried their luck on the golf course, namely Miro, Joseph, Dov and Samuel Falic. Co-sponsored by DFA and the Falic Family Foundation, the event raised an

32 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

Tocumen International Airport, Panama

The Venetian Macao

Miami International Airport, USA

Rio Branco, Uruguay

JFK International Airport, USA

DFA Golf Tournament

impressive US$350,000. The sponsors were among the top industry names and prestigious brands. Diamond sponsors were Diageo, Edrington, Moet Hennessy, Pernod Ricard; Platinum sponsors: Altria, Campari, Diplomatico Rum, Clarins, Webb Banks, Zimpex; and Gold sponsors: Bacardi, Beam Suntory, Brown-Forman, InnoTri, Labatt and Sazerac. There were also Silver and Bronze sponsors, along with other donations made by suppliers. “This year we chose Joe DeMaggio, being that it is a local hospital and has an amazing children’s department for all types of issues. It is also only one of two hospitals in Florida that do children’s heart transplants,” said Leon Falic, President, Duty Free Americas. To appeal to more people, the event has also offered tennis for the last several years since some participants prefer playing tennis over golf. As well as sport, the packed event schedule included breakfast, lunch, spa appointments, a cocktail party, a dinner reception and a silent auction.

34 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

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Brazilian border business

Stores take root on Brazil border Retailers on the Uruguayan and Argentine side of the border are adjusting to the competition from Brazil by RONNIE LOVLER

he economic landscape along the Brazilian border has changed drastically in the last year since the Brazilian government permitted operators to begin establishing stores along the Brazil side of the border. But despite the initial flurry of activity in the second half of 2019 when the first stores opened, for now things have slowed down, according to Carlos Loaiza Keel of Uruguay’s Chamber of Free Shops. “These months have not been especially expansive, but we hope to hear about new openings for the first half of 2020,” he says. In an exclusive interview with Americas Duty Free, Loaiza Keel explains that the kickoff locations were likely selected because of the long-standing duty free activity across the border in Uruguay. “The success of the system on the Uruguayan side of the border was recognized from the beginning by its promoters,” Loaiza Keel says. “In addition to that, in the Brazilian state there are several population centers with high purchasing power near the border, which generates an appetite for market players. “We expect, however, that new stores will be opening at other border points,” he adds.

Duty free stores have been operating for years in Uruguay and Argentina in cities with close proximity to the border in Brazil. Until now, Brazilian shoppers had to cross the border to do their duty free shopping. The new law will allow land border duty free stores to open in Brazil in any of 32 Brazilian cities bordering Argentina, Paraguay, Peru, Colombia, Bolivia, French Guiana, Uruguay, Guyana, Venezuela and Suriname. So far, nearly all of the duty free stores that have opened have been in the state of Rio Grande do Sul, with the exception of Sky Duty Free and Duty Free Americas (DFA) in Paraná, home to Iguaçu Falls. There are a number of stores in Uruguaiana, including DFA and the Dufry Group. The first stores to take advantage of the new law were two small Brazilian businesses which opened stores in Barra do Quarai and Jaguarão, both towns near the border with Uruguay in July.

Considerable sales

With the ability to shop in their own country, fewer Brazilians may be visiting Uruguayan and Argentine duty free shops, although Loaiza Keel says it is too soon to make a judgment call. “At the

38 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

Carlos Loaiza Keel of Uruguay’s Chamber of Free Shops

moment the impact is difficult to estimate, since sales on the Uruguayan side have been hit by the exchange difference and the decrease in consumption of Brazilians. “However, we know that border free shops on the Brazilian side have had considerable sales in these first months of operation and that obviously could have been a sale for a Uruguayan free shop,” he adds. Brazilian Customs officials approved a US$1,000 duty free allowance for its nationals shopping at the border duty free stores that took effect January 1, the same allowance permitted for shoppers at airport duty free stores in the country. But the Brazilian action has created inequalities for its competitors in Uruguay and Argentina. “In Uruguay there has recently been a change of government, and of ideological tendency,” Loaiza Keel says. “President (Jair) Bolsonaro has shown affinity with the new Uruguayan government, but we will not know if that is reflected in better understanding and concrete results for our regime (in Uruguay) until they take action.” For Argentina, however, the border duty free business and the impact of Brazilian border stores is the least of its worries. Argentina is now in the midst of an economic crisis that includes a need to restructure its debt and to contend with an inflation rate that is over 50%.

Inauguran tiendas duty free en frontera brasileña Los minoristas en lados uruguayo y argentino de la frontera se están adaptando a la competencia de Brasil

l contexto económico a lo largo de la frontera brasileña ha cambiado drásticamente durante el último año, desde que el gobierno de la nación suramericana permitió a los operadores la operación de tiendas en el lado de la frontera de Brasil. Pero a pesar del ajetreo inicial de actividad en la segunda mitad del 2019 luego de la apertura de los establecimientos, en la actualidad la operación ha disminuido su ritmo, según manifiesta Carlos Loaiza Keel, Secretario General de la Cámara de Empresarios de Free Shops y Afines del Uruguay. “Estos meses no han sido especialmente expansivos, pero esperamos tener noticia de nuevas inauguraciones para la primera mitad del 2020”, afirma. En una entrevista exclusiva concedida a Americas Duty Free, Loaiza Keel explica que las ubicaciones inaugurales de tiendas fueron seleccionadas en base a la actividad duradera del comercio duty free al otro lado de la frontera, en Uruguay. ”El éxito del sistema en el lado uruguayo de la frontera fue reconocido por sus promotores desde el inicio”, añade Loaiza Keel. “Además, en el estado brasileño existen varios centros poblacionales con alto poder adquisitivo cerca de la frontera, lo cual genera un apetito por operadores del mercado”. “Sin embargo, esperamos que se inauguren nuevas tiendas en otros puntos fronterizos”, agrega Loaiza Keel. Las tiendas duty free han estado operando durante años en ciudades

de Uruguay y Argentina bien cercanas a la frontera con Brasil. Por tanto, los brasileños tenían que cruzar la frontera para hacer sus compras duty free. La nueva ley propiciará la operación de tiendas duty free terrestres en cualquiera de las 32 ciudades brasileñas fronterizas con Argentina, Paraguay, Perú, Colombia, Bolivia, Guyana Francesa, Uruguay, Guyana, Venezuela y Surinam. Hasta el momento, casi todas las tiendas duty free inauguradas están en el estado de Rio Grande do Sul, con la excepción de Sky Duty Free y Duty Free Americas (DFA) en Paraná, donde están ubicadas las Cataratas del Iguazú. También hay varios establecimientos en la municipalidad de Uruguaiana, como DFA y Dufry Group. Las primeras tiendas en beneficiarse con la nueva ley fueron dos pequeños negocios brasileños que abrieron tiendas en Barra do Quarai y Jaguarão, ciudades cercanas a la frontera con Uruguay, en julio del año pasado.

Ventas considerables

Al contar con la posibilidad de comprar en su propio país, pocos brasileños visitarían las tiendas duty free uruguayas y argentinas, aunque Loaiza Keel expresa que es demasiado pronto para dar una opinión concreta. “En este momento el impacto es difícil de estimar, debido a que las ventas en el lado uruguayo han sido afectadas por la diferencia cambiaria y la disminución en el consumo de los brasileños”.

“Sin embargo, sabemos que las tiendas libres de frontera en el lado brasileño han reportado ventas considerables en sus primeros meses de operación, y que, obviamente, podrían haber sido ventas para una tienda libre uruguaya”, añade. Los funcionarios de la Aduana Brasileña aprobaron la concesión de US$1,000 por concepto de compras duty free de US$1,000 en tiendas de frontera a sus ciudadanos. La medida se hizo efectiva el primero de enero de este año, y es similar a la cifra permitida a quienes compran en tiendas duty free de aeropuertos en el país. Sin embargo, la ley ha creado desigualdades para sus competidores en Uruguay y Argentina. “En Uruguay se ha producido recientemente un cambio de gobierno y de tendencia ideológica”, explica Loaiza Keel. “Y aunque el Presidente (Jair) Bolsonaro ha mostrado afinidad con el nuevo gobierno uruguayo, no sabremos si eso se reflejaría en una mejor comprensión y resultados concretos para nuestro régimen (en Uruguay) hasta que pasen a la acción”. En el caso de Argentina, el negocio duty free de frontera y el impacto de las tiendas afines en Brasil es una preocupación menor. El país se encuentra actualmente en medio de una crisis económica que incluye la necesidad de reestructurar su deuda, y una tasa de inflación que supera el 50%.

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Argentina’s Economics

Argentina

crisis looms large

Economist Carlos Melconian spells out the details of Argentina’s economic difficulties and their impact on the duty free business

Second from left: Economist Carlos Melconian during last year’s Brazilian border conference organized by ASUTIL

by RONNIE LOVLER

rgentina’s multi-billion-dollar debt has put the new center-left government underwater financially as the regime’s leaders struggle to put the country on an even economic keel. President Alberto Fernandez has made restructuring the country’s debt a priority and is now trying to work out the details to find a middle ground to resolve decades of financial crisis, while putting creditors on notice as well. Economist Carlos Melconian, a former President of the National Bank of Argentina, told Americas Duty Free in an exclusive interview that the difficulties Argentina now faces are not so much a new phenomenon as a continuation of years of economic decline. “The Argentine economy is going through a long crisis with a structural background (that includes) 14 years of high inflation since 2007, nine years of economic stagnation since 2012, a strong fiscal imbalance, a permanent capital outflow and a total export break,” he says. “It is a crisis that encompassed several governments of different orientations. Macro difficulties led to the imposition of strict exchange controls and it is in the middle of a renegotiation of the public debt,” he adds.

Spiraling inflation

Argentines are aghast over spiraling inflation and increasing unemployment and were hardly surprised when the International Monetary Fund (IMF) determined that the country really was in an economic bind. Now the IMF agrees with the Argentine government that the only way out of the morass is to restructure the country’s debt. The IMF issued a statement February 19 after wrapping up more than a week of talks with government officials. The statement described the meetings as “very productive”, but said the debt had “deteriorated decidedly” compared with the last IMF analysis made in July 2019 and concluded that Argentina’s debt was “unsustainable”. “Staff is of the view that the primary surplus that would be needed to reduce public debt and gross financing needs to be at levels consistent with manageable rollover risk and satisfactory potential growth is not economically nor politically feasible,” the IMF said in a prepared release. “Accordingly, a definitive debt operation – yielding a meaningful contribution from private creditors – is required to help restore debt sustainability with high probability,” the IMF said. In other words, creditors will take a hit. 40 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

Argentina currently carries a debt of US$311 billion, according to the government website.

Less travel abroad

In a speech to the Argentine Congress in mid-February that coincided with the IMF visit, Economy Minister Martin Guzman said, “In order to grow, Argentina needs to relieve itself of this suffocating debt." But can it? “The size of Argentina's public debt is not the main problem but the cost of it, the strong concentration of maturities in the short term, which are mostly in foreign currency,” Melconian explains. “In macroeconomic terms, the relevant debt is around 50% of GDP: part is with private bondholders and part with international organizations (mainly the IMF). Without a fiscal surplus, without economic growth, with a high debt cost and strong short-term maturities, the debt becomes unpayable,” he adds. Melconian believes a debt restructuring is mandatory. “Yes, or yes, an extension of the terms and surely a reduction in interest rates should be negotiated,” he says. Historically, as Latin America’s second largest nation after Brazil, Argentina has been a key player on the regional economic scene. If things went awry in Buenos Aires, the impact was felt across borders, or as the saying went in neighboring Uruguay, “If Argentina sneezes, we get a cold.” But that is not necessarily the case any longer, according to Melconian. “The problems of the Argentine economy inevitably have an impact on the rest of the region, although in a much more limited way than in the past,” Melconian says. “Most of the neighboring economies have a reasonably stable macroeconomic framework that neutralizes tensions and uncertainty that comes from Argentina.” Still, there is no question Argentina’s economic crisis is having an impact on the regional duty free and travel retail industry, if for no other reason than the uncertainty means Argentines are traveling less. “After the exchange crisis that led the dollar in Argentina from 20 to 80 pesos in less than two years, the long recession, and the restrictions to access the official exchange market, Argentina's tourism abroad has decreased,” Melconian says. “In 2019, the demand for dollars to travel abroad was reduced by half and by 2020 it will surely reduce again. “Conversely, and if these macro conditions are maintained, it is possible that more foreign tourists will arrive in Argentina. We will have to monitor this dynamic over time,” he adds.

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D R I N K R E S P O N S I B LY

Argentina’s Economics

Se profundiza la crisis en Argentina Economista Carlos Melconian revela detalles de las dificultades económicas en Argentina y su impacto en el sector duty free

a deuda de miles de millones de dólares de Argentina ha causado grandes dificultades en el aspecto financiero al nuevo gobierno de centro izquierda, que se debate en ubicar al país a un nivel económico estable. El presidente Alberto Fernández ha priorizado la restructuración de la deuda nacional, y está tratando de manejar detalles para encontrar un punto común en la solución de décadas de crisis financiera, mientras pone al tanto a los acreedores sobre la situación. El economista Carlos Melconian, ex presidente del Banco Nacional de Argentina, dijo a Americas Duty Free en una entrevista exclusiva, que las dificultades enfrentadas actualmente por la nación no constituyen tanto un nuevo fenómeno, sino una continuidad de años de deterioro económico. “La economía argentina pasa por una larga crisis con un antecedente estructural (que incluye) 14 años de alta inflación desde el 2007, nueve años de estancamiento económico desde el 2012, un fuerte desbalance fiscal, un escape permanente de capital y una ruptura total de exportaciones”, explicó. “Es una crisis que abarcó varios gobiernos de orientaciones diferentes. Las macro dificultades condujeron a la imposición de estrictos controles de cambio, y está en medio de una renegociación de la deuda pública”.

Inflación en espiral

Como los argentinos están aterrorizados por la inflación en espiral y el creciente desempleo, no les causó sorpresa que el Fondo Monetario Internacional (FMI) determinara que el país está realmente en apuros económicos. Ahora el FMI coincide con el gobierno argentino en que la única manera de salir del atolladero económico es reestructurar la deuda económica nacional. El 19 de febrero, el FMI dio a conocer una declaración después de más de una semana de diálogo con funcionarios de gobierno. La misma describió las reuniones como “muy productivas”, pero afirmó también que la deuda “se había deteriorado decididamente” en comparación con el último análisis del FMI de julio del 2019, y concluyó que la deuda “no es sostenible”. “El personal del FMI tiene la visión de que el superávit primario que se necesitaría para reducir la deuda pública y las necesidades de financiamiento bruto a niveles consistentes con un riesgo de refinanciamiento manejable y un crecimiento del producto potencial satisfactorio no es económicamente ni políticamente factible”, expresó el MFI en un comunicado de prensa preparado al efecto. “En consecuencia, se requiere de una operación de deuda definitiva, que genere una contribución apreciable de los acreedores privados, para ayudar a restaurar la sostenibilidad de la deuda con una alta probabilidad”, añadió el informe del FMI. En otras palabras, los acreedores serán obviamente afectados. En la actualidad, la deuda de Argentina totaliza US$311 mil millones, según el sitio web del gobierno.

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Menos viajes al extranjero

En un discurso ante el Congreso de Argentina a mediados de febrero, que coincidió con la visita del FMI, Martín Guzmán, ministro de economía, afirmó: “Para crecer, Argentina tiene que aliviarse de su deuda sofocante”. Pero, ¿podrá hacerlo? “La dimensión de la deuda pública de Argentina no es el problema principal, sino el costo de la misma, la sólida concentración de vencimientos a corto plazo, que son fundamentalmente en moneda extranjera”, explicó Melconian. “En términos macroeconómicos, la deuda relevante equivale a alrededor del 50% del Producto Interno Bruto: parte en manos de obligacionistas privados, y parte en las de organizaciones internacionales (sobre todo el FMI). Sin un superávit fiscal, sin crecimiento económico, con un alto costo de la deuda y fuertes vencimientos a corto plazo, la deuda se hace impagable”, prosiguió el economista. Melconian estima que la restructuración de la deuda es obligatoria. “Sí, o sí, se debería negociar una extensión de los términos y seguramente una reducción de las tasas de interés”, afirmó. Históricamente, Argentina, la segunda nación más grande de Latinoamérica después de Brasil, ha sido un factor importante en el entorno económico regional. Si hay problemas en Buenos Aires, el impacto se siente más allá de las fronteras, o, como se suele decir en la vecina Uruguay: “Si Argentina estornuda, nosotros nos resfriamos”. Pero, según Melconian, esa situación ya no es necesariamente la misma. “Los problemas de la economía argentina tienen inevitablemente un impacto en el resto de la región, aunque de una forma mucho más limitada que en el pasado”, agregó Melconian. “La mayoría de las economías vecinas tienen una estructura macroeconómica razonablemente estable, que neutraliza las tensiones y la incertidumbre procedente de Argentina”, añadió. Sin embargo, nadie duda de que la crisis económica en Argentina está ejerciendo un impacto en el sector duty free y minorista de viajes regional, y, sino por otra razón, la incertidumbre equivale a que los argentinos están viajando menos. “Después de la crisis cambiaria que llevó el dólar en Argentina de 20 a 80 pesos en menos de dos años, la larga recesión, y las restricciones para tener acceso al mercado oficial de cambio, el turismo argentino al extranjero ha disminuido”, destacó Melconian. “En el 2019, la demanda de dólares para viajar al extranjero se redujo a la mitad, y en el 2020 se reducirá nuevamente, sin lugar a dudas”, pronosticó Melconian. “Contrariamente, y si se mantienen estas condiciones macroeconómicas, es posible que lleguen más turistas extranjeros a Argentina. Tendremos que observar detenidamente esta dinámica con el paso del tiempo”, concluyó el economista.

â&#x20AC;&#x201A;Distribution on Brazil Border

A Smart

R E TA I L S O L U T I O N Following the establishment of the new Lojas Francas (duty free stores) along the border of Brazil, three enterprising executives have set up a company offering brand distribution services and more by HIBAH NOOR

Smart Sales Manager Daniel Benedetti

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new company called Smart has been created by professionals with more than 20 years of experience in the travel retail industry to distribute products to the Mercosur trading bloc’s border duty free stores. “Our focus is to be the best option in distribution services, providing the support that each retailer needs to grow and gain efficiency to reach the full potential of all brands,” says Marcelo Montico, one of the founders of the Montevideo-based company, alongside Guillermo Balseiro and Javier Balseiro. The idea of starting work on this exciting business project emerged as result of the synergy and experience of the company's founders, who recognized this as a big opportunity. The company’s target market is the Mercosur border stores, and the establishment of the new “Lojas Francas" (duty free stores) along the border of Brazil. Smart Sales Manager Daniel Benedetti said this provides an “unbeatable possibility” to reach more than 60 million consumers by offering a superior shopping experience with an attractive saving level. Benedetti points to Smart’s logistics efficiency, which ensures a direct service to the retailer when market demand requires. The company has its own distribution network with coverage of 80% of the potential market.

Maximum potential

Smart offers what it calls a “360 service”. This includes business plan execution and monthly sell-in distribution and reporting by city and POS; SKU by city and PO; and SKU experience in the POS where it adds value. “We understand that the business strategy has to be aimed at achieving the highest level of efficiency in reaching the objectives of each brand and its maximum potential,” says Benedetti. The company seeks to obtain profitability by achieving a constant increase in spending, by offering consumers an “unmatched” shopping experience.

For suppliers, Smart offers three major pillars to add value to brand performance, namely: business plan execution aimed at achieving retail value; the right product in the right place at the right time; and logistics efficiency/distribution. Smart’s founders already have experience in the development of business plans, ensuring the monitoring of stocks by retailer and SKU and the implementation of push and pull strategies to avoid problems with shelf life goods. The company offers an efficient logistics structure, with a 20,000 square foot warehouse in Zona America (Montevideo - Uruguayan free zone) for the reception of merchandise, deconsolidation and subsequent shipping with international freight to the different retailers, with deliveries every 20 days. The turnover time depends directly on the type of product. For example, Amarula liqueur has a useful life of three months and rotates more quickly than other drinks. Business partners have access to its digital order platform and order tracking where brand owners can see online where their merchandise is, deliveries to each retailer and sales by POS and by SKU. Furthermore, Smart’s sales force is based in Uruguaiana (Brazil) and Montevideo (Uruguay), offering a direct relationship with the retailer and supporting the management of the category on a daily basis.

Retail design

Smart has already garnered an impressive array of brands for distribution, covering a broad range of products and services. They include Amarula, Highland Park, Frangelico, The Glenrothes, The Famous Grouse, Fundador, Brugal, Gallo, Bodega Rutini Wines, Cinzano, Osborne, B-52 energy drinks, and Philips shavers. The roster of retailers carrying the products in Brazil’s Lojas Francas includes Dufry Uruguaiana, Duty Free Americas Uruguaiana, New York Duty Free Shop in Uruguaiana, Central Duty Free Shop Uruguaiana and Global Duty Free Shop in Dionisio Serqueira, in the state of Santa Catarina in southern Brazil. In addition to distribution, Smart offers retail design services. “We have the technical capacity and industrial infrastructure to be able to design, manufacture and execute any furniture requirement for the different product categories that make up the offer in travel retail, from the construction of temporary furniture for special animations to the materialization of custom spaces reaching the highest standards of quality and execution,” explains Benedetti. To deliver on its promise of value-added services, the company can serve its business partners in the region and at major airports in America and Europe, providing the security and reliability of a DDP (delivered duty paid) service. Once the installation process is complete, Smart provides suppliers with a detailed photographic report with the execution of the work carried out and a confirmation from the retailer that it is to their satisfaction. Smart is not only targeting stores in Brazil, but also aims to be a global service provider. “For this reason, anywhere in the world can be our goal,” says Benedetti. Currently, it is working with all the Brazilian border shops, as well as customers around the world who need its services. For example, South Atlantic Ship Supplies uses Smart to supply its cruise ships.

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Data Sharing

collaboration ForwardKeys concludes landmark agreement with IATA and ARC to provide data on global air travel

ravel analytics company ForwardKeys has concluded a landmark agreement with the International Air Transport Association (IATA) and Airlines Reporting Corporation (ARC) to include their global ticketing data in its portfolio of products and services. Through this agreement, ForwardKeys will now provide global air travel data that includes the world’s most comprehensive air transaction dataset from ARC and IATA. The new relationship will help ForwardKeys expand its current offerings to customers in the tourism industry. IATA is the global trade association representing 290 airlines comprising 82% of global air traffic. It also operates the Billing and Settlement Plan (BSP), which facilitates and simplifies the selling, reporting and remitting procedures of IATA-accredited travel agencies in 181 countries and territories, excluding the US.

ARC is an industry leader in air travel distribution and intelligence. It provides channel-agnostic tools and insights to enable the diverse omnichannel retailing strategies of its customers. In 2019, ARC settled US$97.4 billion in transactions between airlines and travel agencies, representing more than 302 million passenger trips. Its flexible settlement and retailing solutions, innovative technology and comprehensive air transaction data helps the global air travel community connect, grow and thrive. ForwardKeys will now receive a regular feed of global ticketing transaction data settled by IATA and ARC for travel agency bookings – including online travel agencies (OTAs) – as well as direct airline transactions. Customers will be able to search and query against all the segmentation and profiling criteria they are familiar with on the ForwardKeys platform.

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Additionally, ForwardKeys will now greatly benefit from being able to offer its customers more granular segmentation of the data as well as access to a more comprehensive historical dataset. Olivier Jager, CEO, ForwardKeys said: “This moment is like the completion of a jigsaw puzzle; we can now see the whole picture in complete detail rather than just part of it. Of course, I am excited for us because it strengthens our USP, but I am also excited for our customers because they will receive even more reliable market intelligence which will help them make better decisions.” “Our mission is to serve our customers with versatile access to the right piece of information at the right time to help them understand and predict travelers’ impact on their business – and this announcement today represents a major enhancement to that capability,” he added.

Strawberry Mo1½ oz Tito’s Handmade Vodka 1½ oz sparkling water ¾ oz fresh lime juice 2 tsp sugar 6-10 mint leaves 5 fresh strawberries, muddled

Gently muddle mint leaves and strawberries in a shaker tin. Add Tito’s Handmade Vodka, sugar, fresh lime juice and ice. Shake well and pour everything into a rocks glass. Top with sparkling water and garnish with a mint sprig and lime slice.

Canadian borders

Canada officially closing borders

to non-citizens and non-permanent citizens by JAS RYAT

Canadian Prime Minister Justin Trudeau closed borders to stem the spread of COVID-19. Exceptional circumstances calling for exceptional measures.

rime Minister Justin Trudeau addressed Canadians at a press conference today amidst the spread of COVID-19 outbreak and the measures that the Canadian Government is taking to protect its citizens. Key messaging from the Ottawa speech included closing its borders to people who are not Canadian citizens or permanent residents of Canada. Trudeau explained this did not include diplomats, US Citizens and air crew. Following this, he said airlines will

ban anyone who is showing symptoms of the virus from getting on a plane. A basic health check will assess those traveling, “means anyone who has symptoms will not be able enter Canada,” he said. Finally, as of Wednesday March 18, only four airports will be receiving international flights, Pearson International Airport, Vancouver International Airport, Montreal Trudeau Airport and Calgary International Airport. “Domestic flights and flights from the US, Mexico and the Caribbean will not be affected, and that

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the measures do not apply to trade or businesses,” explained Trudeau. The PM also discussed support programs for Canadian travelers, and stressed to avoid non-essential travel. “If you are abroad, it’s time to come back home,” he said. “If you have just arrived, you must self-isolate for 14 days.” He closed by underscoring the power of social distancing. “However, social distancing does not mean stop talking,” he said. Trudeau maintained that everyone should care for each other at this time, only buy what you need and stressed that in Canada, “we are lucky to have outstanding health care officials. At the same time our Government is doing everything they can do to keep our people safe.”

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First-At-Sea Offerings

THE CELEBRITY REVOLUTION

Point B is a curated destination shop exclusively on Celebrity ships

Starboard Cruise Services is focusing on sustainable fashion, unique pop-up experiences and first-atsea offerings as part of a pioneering retail program onboard Celebrity Cruises

tarboard Cruise Services and Celebrity Cruises have introduced new retail offerings onboard the cruise line’s game-changing Celebrity Silhouette, as part of what they call “The Celebrity Revolution”. Celebrity Silhouette is the cruise line’s fourth ship to be transformed as part of Celebrity Cruises’ US$500 million investment in ship-wide upgrades that will continue across the fleet through 2023. Following the ship’s dry dock, the ship will travel through the Caribbean, Mediterranean and South America. With almost 6,500 square feet of retail space, the newly reimagined Celebrity Sil50 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

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First-At-Sea Offerings

houette’s retail highlights include brands debuting on Celebrity for the first time and exciting new retail concepts supporting Celebrity’s immersive destination experiences – all designed to engage and delight cruise guests. “We are extremely pleased to continue our longstanding, 14-year partnership with Celebrity Cruises with The Celebrity Revolution and introduce Celebrity Silhouette’s reimagined shopping experience to guests,” said Lisa Bauer, Starboard’s President and CEO. “We are excited for Celebrity’s guests to enjoy discovering new brands, destination-centric product offerings and engaging shopping experiences onboard.” Brian Abel, Celebrity Cruises’ Senior Vice President of Hotel Operations, said: “The Celebrity Revolution presented an opportunity to mark a real sea change in our onboard offerings. We wanted an enhanced focus on sustainable fashion and merchandising, unique pop-up experiences, and even more first-at-sea offerings with brands that exemplify our

modern luxury positioning. In collaboration with Starboard, we have accomplished this and more.”

New destination shop

Guests are invited to take home memories of their journey at the ship’s specially curated destination shop, Point B. Created exclusively for Celebrity, Point B marks its unveiling on Celebrity Silhouette, bringing the ship’s destination to life with apparel, handbags and fashion jewelry from brands authentic to the region. For the Caribbean sailing season, guests will find modern fashion jewelry from Tagua; Marcela Cofre home decor; and Porto Marino handmade bags. Point B will rotate its offerings according to the ship’s itinerary.

First on Celebrity Cruises

Luxury vintage brand, What Goes Around Comes Around, offers Celebrity Cruises’ guests the opportunity to choose from a curated selection of the world’s most sought-after designers,

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including Louis Vuitton, Chanel and Gucci handbags, along with – a first on Celebrity Cruises – Chanel jewelry and Hermès scarves. Lemlem, an artisan-driven brand founded by supermodel Liya Kebede, offers a collection of resortwear, shoes and handbags made entirely in Africa. Lemlem makes its Celebrity debut on the ship. Other Celebrity firsts include Tarbay, a collection from Venezuela that features handcrafted fine jewelry, along with Tao Company Jewelry by Vanessa Arcila, known for its raw emeralds and preColumbian designs. Celebrity Silhouette’s new pop-up shop concept offers a unique shopping experience with a rotating collection of products around an engaging theme. Sail the Ocean Blue, the first shop, is inspired by the ocean and features different shades of blues across a variety of categories, including accessories, handbags and apparel. The theme will change every three months.

Count on Pearson to make your airport experience our priority. Because our journey toward becoming the best airport in the world starts with the service we provide during your journey.

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Airport Lounges

Sitting pretty at Miami International by RONNIE LOVLER

The Turkish Airlines Lounge in Concourse E at Miami International Airport is open 24 hours

ver-busy Miami International Airport (MIA) is introducing additional perks to make travel even more comfortable with the expansion of its lounge offerings. Turkish Airlines will be opening its second lounge at Miami International Airport in April and Delta Air Lines is planning improvements to its Sky Club here as well in 2020. American Express recently finished upgrades and renovations to its Centurion Lounge and LATAM Airlines also just concluded the expansion of its lounges.

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Turkish Airlines is opening a brandnew business lounge at Miami International Airport, while Delta and others are upgrading their offerings

“The lounges are all seeing strong demand from their customers and are expanding to accommodate that demand,” said Miami-Dade Aviation Department Communications Director Greg Chin in an exclusive interview with Americas Duty Free. “After beginning its Istanbul-Miami service in 2015, Turkish Airlines has chosen Miami for the location of its fifth lounge outside of Turkey and only its second in North America, after Washington D.C.” The Turkish Airlines Lounge in Concourse E is open 24/7 and serves Priority Pass members, a boon to many of those traveling to and from Latin America, as this is the main departure point for those traveling south of Miami. The airline’s Business Lounge, which is still under construction, will be in Concourse J, the departure and arrival point for Turkish Airlines’ daily service to Miami. It is expected to resemble the airline’s lounge in Istanbul, which includes a piano and a small museum as part of the decor.

One of a kind

In January, LATAM Airlines opened its newly renovated VIP Lounge in Miami, the only one of its kind in North America. “We applaud the investment by LATAM Airlines to upgrade its only VIP Lounge location in North America,” said Lester Sola, Director and Chief Executive Officer of the Miami-Dade Aviation Department, who attended the official reopening. “As one of our largest airline groups, LATAM will now provide an even more appealing lounge experience for the millions of passengers it serves annually at MIA.”

American Express’ Centurion Lounge offers an exclusive experience at Miami International Airport for its platinum card holders

The Centurion Lounge, a perk exclusively available to American Express Platinum card holders, is a particular feather in Miami International Airport’s cap since the lounge is only available in a handful of US airports. In Miami, the lounge offers special features that include gourmet cuisine designed by James Beard award-winning chef Michelle Bernstein, as well as a full premium bar and a wine bar. But Turkish Airlines is garnering a lot of excitement because its presence in Miami brings a touch of the exotic to the airport. “Turkish launched a daily passenger service in 2015, followed by a weekly all-cargo service from Istanbul in 2018,” Chin said. “And now with the opening of two passenger lounges, that signifies a strong commitment to the Miami market. “Istanbul is one of the world’s fastest-growing passenger hubs, so having one of Turkish Airlines’ only [business] lounges in the world is another major milestone in our expanding connections with Europe and the Middle East,” he added. Thousands of passengers are using the airport lounges on a daily basis. According to data from lounge executives that Chin shared, the Centurion Lounge serves an average of 1,500 daily; Avianca, 1,000; Turkish Airlines, 550 (from the one lounge opened at the time of writing); and LATAM, 490. MIA is particularly interested in offerings that appeal to Latin American travelers, who account for a bulk of the airport’s customers. According to airport statistics, in terms of international traffic, the top five user markets are travelers from Brazil, Colombia, Mexico, Cuba and the Dominican Republic. MIA served 45.9 million passengers in 2019, an increase of nearly one million passengers over its total in 2018. MIA offers more flights to Latin America and the Caribbean than any other US airport, is America’s third-busiest airport for international passengers and boasts a line-up of more than 100 carriers. Other airlines with lounges in Miami include Colombia’s Avianca and flag carrier American Airlines.

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Air Canada

A I R C A N A D A TA K E S T H E D I G I TA L R O U T E

Canadian flag carrier Air Canada is getting closer to its customers in high-tech new ways

by HIBAH NOOR

ir Canada is giving travelers more reasons to fly thanks to a number of initiatives in the pipeline. In 2019, Air Canada, together with its Air Canada Express regional partners, carried over 51 million passengers, a 1% increase on 2018. And last year, Air Canada Rouge, the carrier’s leisure airline, served more than 10 million passengers, representing an impressive 23% upswing vs. 2018. Air Canada operates direct passenger services to more than 220 destinations on six continents, while Air Canada Rouge

offers flights to over 90 destinations around the world. The airline launched several exciting new routes in 2019: Toronto-Vienna, Montreal-Sao Paulo, and Vancouver-Auckland. New routes recently launched on Rouge include Montreal-Bordeaux, Toronto-Quito, and Ottawa-Varadero. In terms of who is traveling with Air Canada, most Canadians use the airline’s services, as it is Canada’s largest airline and the largest provider of scheduled passenger services in the Canadian market, the Canada-US transborder market, and in the international market to and from Canada.

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Andrew Yiu, Vice President, Product, Air Canada

In order to better identify its customers, Air Canada has a new Customer Relationship Management (CRM) initiative that is gradually being implemented across all of its systems. “This CRM process will benefit us in many ways, and most importantly will allow us to communicate with and market to our customers more effectively,” says Andrew Yiu, Vice President, Product, Air Canada.

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13.01.20 11:26

Air Canada

For inflight duty free, the best-selling routes in 2019 were between Canada and London, Frankfurt, Beijing and Hong Kong

Duty Free pre-order focus

Air Canada offers an inflight and preorder Duty Free boutique to all customers traveling on eligible international flights. Duty free sales are managed by 3Sixty Duty Free, its inflight duty free operator. “Over the past few months duty free sales have tracked well,” reveals Yiu. “This sales performance is slightly less than the same period last year, but this is due to less available stowage space onboard for the duty free products. We are now encouraging passengers to pre-order their duty free merchandise in advance of their flight, which gives them additional benefits.” He adds: “In addition to the traditional way of offering our duty free onboard, we are starting to explore additional ways that we can offer duty free to our customers through the various customer touchpoints and digital channels. It’s all about giving our customers more choices and the opportunity to personalize their journey.” Liquor and tobacco are predictably the top-selling categories, and the following are the best-selling brands: Johnnie Walker, Marlboro, Crown Royal, Baileys, La Mer, L’Occitane, Estee Lauder, Hermes, Ray-Ban, Hugo Boss, Swarovski and Desigual. For inflight duty free, the best-selling routes in 2019 were between Canada and London, Frankfurt, Beijing and Hong Kong. For pre-order duty free, most orders are placed by Asian customers for

its Asian flights, including China, Hong Kong, Korea, and Japan. In general, Air Canada customer demand is strong for a duty free boutique shopping service. Air Canada has several incentive programs in place to motivate its flight attendants to sell more duty free products. Its crew are given a commission on total sales for every flight, and they are also encouraged via the Handheld Sales Devices to exceed sales targets on their particular flight, which automatically enters them into contests to win prizes. In addition, at year end the carrier recognizes top duty free sellers at each crew base. At various times in the past, it has conducted contests where the top-selling crew can win Nespresso coffee machines, Fitbits, gift cards, and jackpot cash prizes.

Green programs

Sustainability is an important area of focus for Air Canada. The airline is involved with many green/environmental proAir Canada’s duty free sales have performed well over the past few months

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grams. For example, it is always looking at reducing emissions, through biofuel and other offset options; it is reducing singleuse plastics onboard; and is implementing ways to improve the customer experience onboard regarding waste reduction and waste management. The company is looking to get IEnvA-certified (IATA Environmental Assessment Program), which relates to integrating environmental considerations into all of its employees’ work locations. It is also working on being in full compliance with all applicable government environmental regulations such as hazardous waste, storage tanks reporting, stewardship, etc. Looking ahead, Air Canada’s fleet is set to expand further. The flag carrier has 45 A220-300 aircraft on order from the Airbus/Bombardier partnership (one recently delivered). There are 26 B737-8 aircraft deliveries on hold for now from Boeing, and 11 B737-9 aircraft deliveries also on hold from the US aircraft manufacturer.

A C Q U A D I PA R M A .C O M

2020 Duty Free Readers' Choice Awards

A RE

Deadline nears for entries to Duty Free Readers’ Choice Awards

W S’ A CHOICE

The deadline to enter the annual Duty Free Readers’ Choice Awards for regional industry excellence is fast approaching, with all submissions due on April 15

alling all retailers and suppliers. We invite you to submit your entry for our second annual Duty Free Readers' Choice Awards. These digital awards recognize and celebrate operators and suppliers in the industry in three regions: the Americas, Gulf-Africa and Asia. Entry for the awards is through self-nomination, free of charge. Please note, we will accept ONE submission per company. THE DEADLINE FOR ACCEPTING ENTRIES HAS BEEN EXTENDED TO APRIL 15, 2020. CATEGORIES: Best CSR Initiative Best Travel Retail Exclusive Best Product Under US$100 Best Phygital Airport Activation Best Customer Service Initiative OUR JUDGES: A panel of experienced industry judges will shortlist the finalists and our readers will vote for the winners. Three finalists will battle it out in each category for each region. This year’s judges are: Gulf-Africa region: Michael Schmidt, Senior Vice President – Retail Support, Dubai Duty Free; Rita Chi-

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diac, Corporate Affairs and Communications Manager - Worldwide Duty Free, Japan Tobacco International; and Candice Medina-Tantoco, Marketing Director, International Duty Free Shops - Morocco. Americas region: Antoine Bona, Executive Sales Director Travel Retail & Local Markets, Essence Corporation; Rene Riedi, CEO for Division 4 of the Dufry Group of Companies; Dov Falic, Head Liquor Buyer, Duty Free Americas. Asia region: Aude Bourdier, VP, Marketing Director Global Travel Retail & Developed Asia Pacific, BrownForman; Zulhikam Ahmad, General Manager of Malaysia Airports (Niaga) Sdn Bhd; and Ashish Chopra, Deputy Chief Executive Officer, Delhi Duty Free Services. The judges will be looking for a complete submission based on uniqueness, potential, quality and appeal. Under each heading we will require a few sentences pertaining to your entry. The total submission should not exceed 500 words, including two relevant images. Alternatively, send us a 60-second video of you showcasing the initiative/product via Dropbox. Your entry – whether it is a product or initiative – must have been launched or active between February 2019 and February 2020. We’re looking forward to receiving your entry to the 2020 Regional Duty Free Readers’ Choice Awards by April 15.

MEET THE JUDGES GULF-AFRICA

MICHAEL SCHMIDT Senior Vice President â&#x20AC;&#x201C; Retail Support, Dubai Duty Free

RITA CHIDIAC Corporate Affairs and Communications Manager - Worldwide Duty Free, Japan Tobacco International

CANDICE MEDINA-TANTOCO Marketing Director, International Duty Free Shops - Morocco

THE AMERICAS

DOV FALIC Head Liquor Buyer, Duty Free Americas

ANTOINE PHILIPPE BONA Executive Sales Director Travel Retail & Local Markets, Essence Corporation

RENE REIDI CEO for Division 4 of the Dufry Group of Companies

ASIA

ZULHIKAM AHMAD General Manager of Malaysia Airports (Niaga) Sdn Bhd

ASHISH CHOPRA Deputy Chief Executive Officer, Delhi Duty Free Services

AUDE BOURDIER VP, Marketing Director Global Travel Retail & Developed Asia Pacific, Brown-Forman

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

â&#x20AC;&#x201A;Toronto Pearson International Airport

TORONTO PEARSON NAMED BEST LARGE AIRPORT in North America for third year in a row by JAS RYAT

Toronto Pearson is once again named Best Large Airport in North America in the Airport Service Quality Program

In true Canadian fashion, Toronto Pearson International Airport celebrates a hat trick win fueled by passenger experience and transportation development

anada's Toronto Pearson International Airport was named "Best Large Airport in North America serving more than 40 million passengers" by Airports Council International (ACI) World, again this year. The win comes as part of ACI World's Airport Service Quality (ASQ) program, which recognizes airports across the globe that deliver the best customer experience in the opinion of their own passengers. "Becoming the first North American Airport to win three years in a row in the 40 million passenger and above category reflects Toronto Pearson's commitment to enhancing the passenger experience," said Deborah Flint, President and CEO, Greater Toronto Airports Authority. "We want to thank our passengers for voting for us once again, and we want them to know we're continuing to work on improving their travel journey."

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The multi-million-dollar investment to help connect transportation to Toronto Pearson Airport champions strengthening partnerships to build more transit, resulting in economic growth and creating jobs throughout the region

In 2019, Toronto Pearson added several new features to help improve the airport experience, including: 26 new retail stores, restaurants and other services, including enhanced Duty Free shopping, such as Chanel, Furla and Hugo Boss, new exciting restaurants, such as The Hearth Kitchen Market and Vino Volo, and a partnership with Rogers Communications which includes premium Ignite TV lounges in both terminals allowing travelers to catch their favorite shows on the Rogers Ignite TV service. New accessibility features such as assisted changerooms for passengers with mobility restrictions, new post-security screening pet relief areas and Aira, a smartphone app that helps

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Toronto Pearson International Airport

Toronto Pearson recently added new duty free shopping outlets to enhance traveler experience

passengers who are blind or low vision navigate the airport independently. These are part of an overall focus on providing more choice and ease in the passenger experience for persons with disabilities. Expanded flight services to India, Italy, the United States, Mexico City and the Philippines, as well as new direct flights with Air Canada to Quito, Ecuador and WestJet to Barcelona, Spain. The ASQ program is the world's leading airport customer experience measurement and benchmarking program, measuring passengers' satisfaction across 34 key performance indicators. In 2019, more than half of the world's 8.8 billion travelers passed through an ASQ airport.

Investing in connecting

But Toronto Pearson is just as concerned with how people get to the airport as they are with providing them world-class service when they get there. Toronto Pearson recently committed an additional $40 million in support of Eglinton Crosstown connection to airport. The announcement entails its intention to partner with Metrolinx, a Crown agency that manages and integrates road and public transport in the Golden Horseshoe region of Ontario, Canada, to advance the technical work necessary to extend the Eglinton Crosstown West from Renforth to the airport. This $40 million commitment represents another tangible step forward to bring important transit connections to Canada’s mega hub airport and build a regional transit network, anchored by a new regional transit centre (RTC) at Pearson – dubbed Union Station West. This commitment follows the Ontario-Toronto transit agreement and Premier Doug Ford’s announcement of four pri-

A substantial investment in transportation to Toronto Pearson will ensure ease of connection for travelers using the mega-hub airport

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ority transit projects, including the Eglinton Crosstown West Extension. The Greater Toronto Airport Authority (GTAA) will pursue these additional works for the Renforth – Pearson portion of the line in partnership with Metrolinx, which will build on the GTAA-Metrolinx joint work program announced in April 2018. The GTAA is already investing $38 million in work currently underway, and this additional announcement will bring the total investment to a potential $78 million. The current GTAA-Metrolinx joint program continues work to improve rapid transit access to Pearson Airport. This includes exploring potential ground connections to the future Union Station West and surrounding Airport Employment Zone, a potential Kitchener GO rail corridor connection, and improved LRT and bus connections. “Significant improvements to our regional transit system are required for our region to be able to compete globally, and that is why we are making this financial investment to advance this work,” said Howard Eng, former President and CEO of the Greater Toronto Airports Authority. “We will continue to push for improved transit that connects to Toronto Pearson and the Airport Employment Zone as well as the creation of Union Station West.” “As part of our Plan to Build Ontario Together, our government is making the single largest capital investment in new subway builds in Canadian history,” said Ontario Premier Doug Ford. “We welcome the GTAA’s multi-million-dollar investment to help connect the Eglinton Crosstown West Subway Extension to Toronto Pearson Airport. Today’s announcement is another clear example of how our government is strengthening partnerships to build more transit, faster—spurring economic growth and creating jobs throughout the region.”

W White and refined in appearance, Raffaello surprises with a delicate combination of different layers: a crunchy white almond, surrounded by velvety smooth cream in a crispy wafer shell, covered with coconut flakes. Raffaello unveils its new travel edition pack aiming to present a thoughtful gesture that is sure to be appreciated as an expression of sincere feelings and emotions.

This novelty is already available at the best Duty Free stores.

Baja Duty Free

B A JA D U T Y FREE TURNS

The Calexico border crossing location in California was opened in 1999

Here, we celebrate the major milestones Baja Duty Free has achieved over three decades

by JAS RYAT

aja Duty Free is celebrating its 30th anniversary in partnership with customers, vendors and staff through a year-long campaign to highlight its accomplishments. The wellestablished duty free business opened its first location December 1989 in San Ysidro, California, and has expanded to nine locations over the years. Irene Rojas, Marketing Manager of parent company Fairn & Swanson, spoke with Americas Duty Free to commemorate the occasion. Rojas – herself a 19-year veteran of the operation – offers valuable insight on the firm’s longevity. “We plan to have a full year of celebrations through 2020. We have developed a new logo to showcase the anniversary and have partnered with suppliers to offer different incentives for customers,” she enthuses.

Baja’s beginning

The original owner and founder of Baja Duty Free, Wolfgang Uhlig, was well versed in the ship chandling and cruise ship business in Oakland, California. This allowed Uhlig to use his existing partnership with vendors to diversify into new ventures, eventually opening the first Baja Duty Free location in San Ysidro. December 1989 marked the first store opening. At this time there were only two duty free stores in the area, Baja Duty Free and UETA, which is now owned by Duty Free Americas.

The original 1,200 square feet store was established in a small shopping center closed to the San Ysidro-Tijuana border crossing with four to five employees and selling only core duty free items – spirits, tobacco and fragrances. In 1994, Baja Duty Free decided it had outgrown that location and moved to the current address, just across the street. The new location is 5,500 square feet, generating more business, employing more staff and also acting as a warehouse. “In 1997 there was an opportunity to open a store in Texas in the area of Eagle Pass (103 miles from Laredo). In 1999 we opened another location in California at the Calexico border crossing. Following this, in 2002 we opened two locations, one of our biggest stores, the Gateway store, and then a few months later we opened the first pedestrian store, the Trolley store, both located in San Ysidro,” explains Elisa Castro, VP of Retail. Throughout the years we opened stores in the border crossings of Laredo and El Paso, Texas and in California in Otay and Tecate.

next few months, the company plans to offer online contests, scratch tickets, spin the wheel entries to customers to offer additional savings and prizes. Says Rojas: “What we wanted to do with this celebration was to spread the celebrations through the year and all the different store locations. Every quarter different locations will have live music and different offerings to the customers. This allows more opportunity to keep going with the momentum we have gained.” The celebrations also mark support from longstanding partnerships like Diageo, Heineken, Essence Corp, Proximo and others to continue offering great products and incentives to increase spend. Rojas shares her insight to the secret of longevity. “We have a great team. We have people that have been here for 30 years, like our VP of Retail, Elisa Castro, who has been here since day one. Also, we have built a reputation based on trust, reliability and mutual respect with suppliers. Without them we will not be able to offer customers the assortment of brands we carry in the stores.” Looking to the future, Baja Duty Free plans to continue to maintain its relationships with core partners and adapt its business to align with market trends to ensure another decade of success

Secret of longevity

“What we are doing to celebrate the 30th anniversary is partnering with our suppliers in order to offer different incentives to customers, from GWP, raffles to special prices. Baja Duty Free has also teamed up with different media from different cities to promote live broadcastings where we have live giveaways,” says Rojas. In the

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Irene Rojas, Marketing Manager and Elisa Castro, VP of Retail, have been with the company from early on-making them part of Baja’s celebration story

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FDFA Update

The

Frontier ahead by JAS RYAT

The Frontier Duty Free Association plans to take part in another Hill Day to highlight the importance of the duty free industry in the Canadian economy

In this interview, Frontier Duty Free Association’s Executive Director Barbara Barrett champions the power of working together

eading into her third year as Frontier Duty Free Association’s Executive Director, Barbara Barrett shares her outlook for an optimistic future for the Canadian duty free industry’s annual FDFA convention with Americas Duty Free. Rightfully so, as increased attendance and positive feedback from suppliers and retailers have created a platform for growth and success within the closeknit convention. 2020 will focus on the importance of the association by ramping up advocacy efforts to increase value to the members. Barrett underscores the significance of protecting and enhancing the duty free industry in Canada and highlights its importance not only to the border communities it serves, but also to the Canadian economy as a whole. “We have set our goals for 2020 and will look to represent our membership by maintaining high-profile relationships and dialogue with government officials and fostering relationships with strategic industry stakeholder partners.” Barrett continues: “Most specifically, we are focused on protecting and growing the duty free industry in Canada. Our focus

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on our key government relations messages is vitally important to the success of our industry.”

#CashBackCanada

Barrett and the association will embark on another Hill Day at the end of April 2020 to meet with Members of Parliament, Senators, senior officials and decision-makers from all political parties including Cabinet Ministers, Members of Parliament and Senators. This follows up on the lobbying done on Parliament Hill in 2019 to bring back Canada’s visitor rebate program. This year’s meetings will encompass the position of the duty free industry as a prosperous and essential export sector that plays a key role in the Canadian economy. In addition, they plan on revisiting the topic of reinstating the visitor rebate program by taking a campaign approach. “It’s important to do that, particularly with this minority government. Most of our stores are in opposition ridings with the exception of a few. A lot of our advocacy last year was speaking to those MPs with stores in their riding. Although we still need to do that, particularly in this minority government, we need to focus on the Bloc Québécois, because their voice will be important when it comes to government decisions. There will be more focus on the Bloc Québécois and New Democratic Party, but we also need to focus on the Liberal Party of Canada, given that they are the majority.”

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FDFA Update

Barrett also touches on 2007, when Conservative Minister of Finance, Jim Flaherty, had originally axed the visitor rebate program. Although she cannot comment on the timeline of reinstating the program, she is optimistic about bringing it forward in partnership with valuable stakeholders. Says Barrett: “It’s a little counterintuitive as it was the Conservative government that cancelled the program back in 2007. However, it’s the Conservative MPs that we’ve also seen support from for it at this point. We really need for us to see it on the Liberal agenda; going forward it will take some work. We are working with our other stakeholders like the Retail Council of Canada and the Tourism Industry Association of Canada, and they’re really pushing for it. But it’s really going to take organizations like that. They are much larger than we are, so their voice is imperative.”

Onward and upward

The FDFA wants to embrace its success by increasing traffic and building tourism in the community it represents, essentially becoming a part of the tourism message.

Frontier Duty Free Association’s Executive Director Barbara Barrett explains why a unified membership equates to the success for all

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“A strong and unified membership is essential to the success of our association. From our annual convention, to our advocacy, to our membership programs, it all works better when we work together as one FDFA voice,” says Barrett. Although the committee has not firmed up concrete plans for the upcoming FDFA convention in November, Barrett is expecting another successful event. 2019 showed an uptick in new suppliers and positive feedback from delegates. “We hear from suppliers on a daily basis about the convention and how to become a member. We feel very positive about that. Obviously we would like to have every store be a member of the FDFA,” says Barrett. The new format features a mix of private meeting suites and networking areas, allowing delegates to navigate accordingly. She doesn’t envision any major changes to the 2020 format although the organizers will support minor tweaks to strengthen all facets of the show. The FDFA is comfortable with the venue at the Omni King Edward Hotel in Toronto and has extended its contract to 2021. Barrett says that keeping the show in Toronto has proven to work logistically and economically for attendees, but adds that she is always open for discussion to relocate: “I never say never.”

ASUTIL Conference

ASUTIL PLANS SECOND BORDER

CONFERENCE FOR 2020

Snapshots from ASUTIL’s Brazilian border conference held in Porto Alegre in 2019

Plans are already in motion to offer regional retailers and suppliers another opportunity to review and discuss the Brazil border business

ASUTIL Secretary-General José Luis Donagaray

by RONNIE LOVLER

he South American Association of Duty Free Stores (ASUTIL) will hold a second conference in 2020 to explore the overall situation for stores and operators doing business on the Brazilian side of the border. The first conference, held in Porto Alegre, Brazil late last year, just a few months after the Brazilian government allowed duty free stores to open for business, helped those present to gain a better grasp of what is involved in doing business on the Brazilian side of the border. And that’s why there is already a demand for ASUTIL to offer another conference. “It was very useful and enlightening for everyone who was there,” says ASUTIL Secretary-General José Luis Donagaray in an exclusive interview with Americas Duty Free. “Our main achievements were in sharing information, providing knowledge about the new border duty free system and facilitating contacts between operators, suppliers and the authorities.”

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ASUTIL Conference

Nearly 200 people attended the 2019 conference, organized with the aim of giving those interested in the Brazilian travel retail opportunities a chance to get up to speed before year-end and the Southern hemisphere holiday and summer vacation season. The venue has not yet been determined for this year’s conference. “That’s still being analyzed and discussed,” Donagaray says. “But it will likely take place in November.” Donagaray says ASUTIL is conducting a thorough review of the first border store conference to make sure the second conference is even more of a success. “Fortunately, we had nothing but positive reviews from those who attended,” he enthuses. “But one thing we will probably do this time around is allow more time for networking.”

Border boost

It was only last year that Brazilian authorities gave the green light for the border stores to officially open, even though

legislation allowing duty free stores to operate on the Brazilian side of the border had been on the books for years. Currently there are close to a dozen stores operating on the Brazilian side of the border, including Duty Free Americas (DFA) and Sky stores at Foz do Iguaçu. Uruguaiana is where the Brazilian duty free stores first kicked off and is where Dufry Group launched its first Brazil duty free store. Donagaray expects more stores will open throughout Brazil during the course of the year, something he thinks is actually helping the existing stores on the Uruguayan and Argentine side of the border. “Competition is a good thing,” he says. Of Brazil’s 5,568 municipalities, 32 are classified as twin cities. The Brazilian border stores are getting a boost from the recent decision to increase the allowance for Brazil’s land duty free stores to US$1,000, matching what is already in place at Brazilian airports.

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Colon 2000 Cruise Terminal

THE CARIBBEAN’S largest travel retail facility comes to life Regency Group unveils its newly developed Colon 2000 Cruise Terminal by JAS RYAT

The Colon 2000 Cruise Terminal offers travelers a premium shopping experience with new brand partnerships

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anama-based Regency Travel Retail has opened its refurbished Colon 2000 Cruise Terminal, strengthening its already diversified portfolio in the Latin American region. A soft opening was held late last year on December 27, 2019. The port is located at Manzanillo Bay, next to the entrance of the Panama Canal Atlantic sector. Regency is headquartered in Panama City, with subsidiary offices in Colombia, Peru, Ecuador, Paraguay, Central America and the Dominican Republic. Americas Duty Free spoke to Regency Travel Retail Director and Chief Operating Officer Ronny Basher who envisions Colon 2000 becoming the largest travel retail and entertainment facility in the Caribbean. “This being the first travel retail venture for the group, we have ensured every effort to show what the group as a retailer is capable of. It’s great sending suppliers and the press pictures and videos of the store, it’s even better to see all their reaction once they actually come and see it in person. They can hardly believe that we are really a top-level operation in our first stores. Just their reaction makes all the hard work we have all been doing for the last two years of preparation, planning and building worth it,” enthuses Basher. Regency Travel Retail owns and operates luxury and mid-tier retail stores in

Latin America and the Caribbean, while operating 540,000 square feet of worldclass bonded distribution and logistics facilities.

Premium space

The two ports, Colon 2000 and Cristobal, are said to attract over one million visitors a year from the Atlantic and Pacific Ocean, making it “the best location in the crossroads of the world”, according to the company. The 4,500 square meters of premium travel retail space in the terminal will offer duty free shopping, five-star hotels, restaurants, casinos and pubs. 1,000 square meters of this space will be a dedicated duty free cruise port store carrying all the major categories, along with luxury fashion products, watches and jewelry. Confirmed cruise operators using Colon 2000 include: Carnival, Royal Caribbean, Celebrity, Princess, Norwegian, Holland America, Seabourn Cruises, Azamara Cruises, Prestige Cruises, Regent Cruises, Crystal Cruises, Marella Cruises (UK), Tui Cruises (GR), AIDA Cruises (GR), MSC (various) and Carnival (UK). Zignum Mezcal and Mezcal Señorío, are two brands that have taken up residency at the new cruise terminal. During the 2019 Summit of the Americas, Commercial Director; International at Casa

AGP, Zignum Mezcal, Gustavo Valdor was approached by the Regency Team about the new project for the port of Colon. “This port receives several cruise ships a week and their idea was to develop a great personal shopping experience for the passengers. For our brands, Zignum Mezcal and Mezcal Señorío, this became an opportunity to further place our claim in the region; with Zignum Mezcal at the forefront, being the smoothest and most awarded Mezcal in the world; and with Señorío with its slightly smoky flavor, product of a blend of two distillations. This opportunity is a win - win for both our companies. Regency Travel Retail has built a very modern facility at the port, and making it very easy for the passengers to visit without any hassle,” shares Valdor. Although Regency Travel Retail wanted to coordinate a formal launch in March, the company decided to stay focused on sales and vendor partnerships. “We always have realistically high expectations; we are close to meeting them. We have a small handful of key brands that have just confirmed recently and we believe we will for sure reach our targets once we have them in the stores. The missing brands should help us grow around 20% more on existing turnover,” concludes Basher.

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Women’s Leadership and Gender Equality

The very Essence of gender equality Dynamic entrepreneur Patricia Bona, who heads with husband Jean-Jacques family-owned beauty products distributor Essence Corp, shares her view of women’s leadership and gender equality by HIBAH NOOR

atricia Bona has carved a successful niche at the helm of Essence Corp, the well-established family-owned distributor with more than three decades of beauty product expertise. Founded in Miami in 1988, Essence Corp has become a leading master distributor of fine fragrances and cosmetics for travel retail markets of the Americas and serves as a sales and marketing agent for local markets of Latin America. The company has grown to 72 employees, 57 of whom are women and 15 men. In an exclusive interview with Americas Duty Free, Bona talks about gender equality – and why both women and men are key to Essence Corp’s success. Americas Duty Free: Why is gender equality more important than ever? Patricia Bona: Today women have attained in most parts of the world equal rights, so there is no legal reason that equality does not apply. We cannot let the battle be reverted and lost. My grandmother, my mother, myself, and even my daughter campaigned and acquired different women’s rights: it was not so long ago. I want our granddaughters to know that their voice matters because equality in some cases is more the exception than the rule.

Essence Corp’s leadership team celebrates a Duty Free Readers’ Choice Award for Best Perfumes & Cosmetics Supplier in 2019

ADF: What do female employees bring to the table at Essence Corp? How do you celebrate gender equality at the workplace? PB: We work in the cosmetics industry; it is obvious that female employees bring a special insight on marketing and selling our products, or on training the predominantly female task force in the points of sale. But we like working collaboratively in teams with male employees. Together, they have a balanced approach to solve problems, and the outcome is generally much more productive and satisfactory. We don’t particularly celebrate gender equality; it is an everyday evidence at Essence Corp. But I must say that our male employees gladly pose in pink tutus for our Breast Cancer Awareness events! ADF: What are we missing out on by not maximizing the talents of both genders in the workplace? PB: We are missing half of the picture. The Yin and Yang, power and counterpower. We are hearing only one voice and missing the one that complements the other. We are out of tune. ADF: Travel retail is predominantly a male industry. Do you agree? Have you seen any changes lately? PB: I disagree: it might still be true in male-dominant regions of the world, or

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in male-dominant products, but today, even in the Middle East, the female force behind travel retail is strong, and the perfume and cosmetics industry is definitively dominated by women. ADF: What do we see that tells us we have room to improve our gender equality? PB: Boards and executive committees are composed mainly of males, although they are trying hard for equality, particularly with quotas. That leads to the reverse effect: a woman is often perceived to be called to sit on a Board “just because she is a woman”. ADF: What are (general or travel retailrelated) examples of times we have gotten gender equality right? PB: Mentoring young female employees: they often do not dare to ask for a promotion or a raise. They think they are not capable or that their family life will interfere with work. To close the gap, we need to identify and nurture their talent, promote them in senior roles, and make sure that they stay there.

United: Essence Corp’s team spirit is on display in Miami

Caribbean update

Sunny skies

AHEAD Caribbean tourism rebounds in 2019 after hurricanes

The destinations most impacted by the hurricanes in 2017 saw some of the highest rates of growth

aribbean tourism posted record arrivals in both stayover and cruise in 2019, sparked by a robust recovery in the destinations affected by hurricanes Irma and Maria in 2017. Stayover arrivals grew by 4.4% to reach 31.5 million. This outpaced the international rate of growth of 3.8% reported by the World Tourism Organization. Overall, the destinations most impacted by the hurricanes in 2017 saw some of the highest rates of growth, according to preliminary figures in the 2019 Caribbean Tourism Performance Report published by the Caribbean Tourism Organization (CTO). Sint Maarten grew 80%, Anguilla 74.9%, the British Virgin Islands 57.3%, Dominica 51.7%, the US Virgin Islands 38.1%, and Puerto Rico 31.2%. Meanwhile, cruise visits increased by 3.4% to 30.2 million, representing the seventh consecutive year of growth. The US was the best performing among the major stayover markets, registering an increase of 10% to reach a record 15.5 million visitors.

But Canada, one of only two main markets to have sustained growth in each of the last three years, was sluggish in 2019 at 0.4% growth, equivalent to 3.4 million tourist visits. The South American market declined by 10.4% to 1.5 million. The European market dipped by 1.4% from 5.9 million in 2018 to 5.8 million. The UK was down by 5.6% to approximately 1.3 million visitors. Intra-Caribbean travel increased by 7.4 per cent to reach 2.0 million. In a presentation of the report on February 26, Neil Walters, Secretary General (Ag) of the CTO, said: “In conclusion, 2019 was a great one overall for Caribbean tourism, based not only on the record performance by the region, but also for some individual destinations. These achievements were made despite several challenges such as global economic and political uncertainty and the impact of climate change leading to extreme weather events in some cases. “As we navigate 2020, concerns remain over the global economic, environmental, political and social uncertainty, including the US presidential election, the impact

of climate change, and extreme weather events and health threats/issues, especially the coronavirus, and how these could influence our performance.” Walters added that other factors such as less-than-adequate intra-regional air access and high levels of taxation may hinder travel. However, he noted that destinations are making improvements to their infrastructure and there is renewed investment regionally in tourism facilities for both air and sea travelers. For 2020, tourist arrivals to the 2017-hurricane impacted destinations should further normalize, Walters said, returning closer to the pre-hurricane levels. Other destinations are expected to show modest growth as the world’s economy is expected to expand by 2.5%, according to the World Bank, while the US economy – the region’s largest source market – is only expected to grow 1.8%. Based on the CTO’s preliminary estimates, tourist arrival levels to the Caribbean are projected to grow between 1% and 2% in 2020, with a similar rate of growth expected for the cruise sector.

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Le Specs enters TR

A perfect fit

F O R T R AV E L R E TA I L Australian sunglasses brand Le Specs shot to fame on the back of celebrity endorsement and is now intent on cracking the global duty free market by MARY JANE PITTILLA

Le Specs’ Situationship cat eye style is a midsized fit that suits all face shapes

ince 1979, Le Specs has become renowned globally for its innovative sunglasses collections. With a reputation for trendy and directional frames, it has developed an international cult following and become a trendsetter in the global fashion market. The brand has been worn by some of the most recognized and influential personalities internationally, including Beyoncé, Rihanna, Gigi and Bella Hadid, Lady Gaga and Justin Bieber. Le Specs is currently sold in duty free stores in Europe and Oceania, and has proven to be one of the top-performing eyewear brands in both regions, according to Hamish Tame, Creative Director of Le Specs’ Australian brand owner Sunshades Eyewear Pty Ltd. Following the brand’s success in fashion boutiques and department stores in the US market, the time is now right for Le Specs to launch in the American duty free market, says Tame. “Le Specs’ ability to resonate with millennials and Gen Z consumers makes it the perfect brand for

incremental sales alongside the luxury duty free portfolio of brands.” Tame says there are a number of factors that make Le Specs suitable for travel retail. She believes the combination of Le Specs’ iconic designs, fashionability and value price point makes the brand unique across the eyewear market. Customer feedback indicates that Le Specs sunglasses are often purchased as an add-on item, or purchased as a secondary pair with luxury brands, which makes it the perfect fit for duty free and travel retail.

New alternate fit range

The latest Le Specs sunglasses collection, unveiled in January 2020, consists of futuristic and flashy frames inspired by early millennium Y2K style. Channeling Y2K’s ultra-modern and innovative approach to fashion, the Inferno Paradiso collection is defined by exaggerated silhouettes, sharp minimal lines and high-sheen finishes. Scorching tones of lava and bright red are splashed across the Bladestunner and Cyberfame’s

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sporty visor-style lenses. The That’s Hot frames pay tribute to Paris Hilton, the queen of early ‘00s style, in a series of brightly colored rimless rectangular frames, while So Fetch offers a pair of quintessentially oversized noughties frames with gradient lenses and chunky acetate frames. This season also marks the launch of a new, comfortable Le Specs alternate fit (alt fit) range. The alt fit styles have been specially designed for a diversity of face shapes, suiting those with low nosebridges, high cheekbones and wider faces. Tame explains: “This season is all about bolder looks, and the introduction of more comprehensive fits. As our business grows internationally, we have focused on the comfort and fit for all face shapes and sizes across both sunglasses and eyeglasses.” The new alt fit styles will be available across all Le Specs collections moving forward.

Editor's Choice

Cleared for

takeoff

Discover the plethora of new offerings travelers enjoy while forging their journey ahead

1. GINDIA: India's first craft gin from the house of Wild Tiger is now available in duty free. It’s an exotic mixture of 23 classic gin botanicals and hand-picked Indian botanicals including Himalayan juniper, Assam tea, green cardamom, clove and black pepper

2. Beblue Bijoux & Accessories:

4. Go Travel Ultimate Pillow:

Specialized in creating and producing private and co-branded jewelry lines, Beblue Bijoux & Accessories will be fashioning duty free exclusive collections that are 100% made and designed in Montreal, Canada using noble materials

Designed to provide 360-degree support, the new Ultimate Memory Pillow molds to the natural contours of the neck and chin. Fully adjustable tension straps at the front of the pillow enhance comfort

3. Godiva Coeur Iconique Limited Edition: Godiva’s latest gift boxes include a choice of two new, metallic-inspired designs that spark excitement. The line extension of the classic Coeur Iconique range brings a touch of freshness and fun to the chocolate portfolio

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5. La Petite: Manna Hydration brings travelers its newest innovation, featuring a slim bottle design, making it perfect for storing in a purse or backpack with ease. The silicone carry handle effortlessly rotates and unsnaps on one side, allowing it to attach to almost any bag

8 7

9 12

8. Mavala Repairing Night Cream:

6. KROMA Mineral Eyeshadow:

This rich cream contains active ingredients – hyaluronic acid, shea butter, silk amino acids – unique in a hand care product. It has a revitalizing effect for cell renewal, moisture retention and protecting skin, to prevent premature ageing

9. Greenall’s Wild Berry Pink Gin:

KROMA Eyeshadows, available in over 65 shades, are fragrance- and paraben-free, water-resistant and made for sensitive eyes. The long wear makeup can be used both wet and dry, as eyeliner, eyebrow or eyeshadow

This flavored gin contains no sugar and no artificial sweeteners. It combines blackberries and raspberries with its award-winning Original London Dry Gin to deliver a naturally flavored pink gin

7. Moroccanoil Treatment: This iconic treatment can be used as a conditioning, styling and finishing tool. Infused with antioxidant-rich argan oil and shine-boosting vitamins, this transformative hair treatment detangles and speeds up drying time

10. ZIGNUM Mezcal: ZIGNUM is one of the leading mezcals in Mexico and Mexican duty free, as well as the most awarded mezcal in the world. ZIGNUM Reposado is smooth and easy to drink and is now available in new packaging created by Quaker City Mercantile

11. Sōmrus Mango: Sōmrus Mango is one of the fastest-growing India-inspired lines of liqueurs in the world and one of the world’s most awarded cream liqueurs. Sōmrus is produced with all-natural flavors, contains no preservatives, and is gluten free

12. Twin Snakes: Travel retail exclusive HARIBO Twin Snakes is now available in a 700g resealable pouch. The pouch will contain sweet and sour combinations of fruit gum snakes: cherry & orange; apple & lemon; blueberry & blackcurrant. The zesty snakes can be eaten together or pulled apart to offer two wriggly snakes per serving

www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Travel Blue Group Americas

MEET THE TEAM:

Travel Blue Group Americas AMERICAS DUTY FREE INTRODUCES YOU TO TRAVEL BLUE GROUP AMERICAS AS ITS PARENT COMPANY SPREADS THE REACH OF THREE ACCESSORY BRANDS ACROSS THE GLOBE by JAS RYAT

K-based Travel Blue has evolved from a travel accessories business established in 1987 to the accessories conglomerate known today as Travel Blue Group. The group is composed of Travel Blue travel accessories, Lexingham mobile accessories and Z-Zoom eyewear. With more than 200 products sold in over 110 countries, the firm shows no signs of slowing down as it expands worldwide. We meet the key players in the Americas team:

GUILLERMO BENZAQUÉN, Latin America Managing Director Q: Tell us a little about your professional background. A: I am from Córdoba city in Argentina but living and based in Sao Paulo, Brazil for the last eight years. I worked in Argentina and Brazil for Anheuser-Busch InBev and then joined Samsonite. In 2017, I joined the Travel Blue Group (TBG). I have worked in the travel retail industry since 2008. Q: What is your vision for the Travel Blue Group in the Americas? A: Since I joined TBG, I have worked on the challenge of opening the Latin America market, further developing the travel retail business in the region. We now have operations in most key countries in the region. During the last two years we have built a very strong team in the region. We will continue increasing our business in the region and also introducing the new brands of the group. Q: Travel Blue Group has evolved from travel accessories to include eyewear and mobile accessories. What impact has this had on your business model? A: Our clients are very happy to add the new brands to their shops due to the high level of service and support we provide. Q: Why do you enjoy your role at the Travel Blue Group? A: It is a very exciting company. It offers an entrepreneurial environment in a global company and with a global team. We work in a company with solid values and we can see an everyday passionate atmosphere.

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E N J O Y R E S P O N S I B LY. P R O D U C T O F C A N A D A . 4 0 % A L C . / V O L .

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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.

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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.

Passionately crafted from real icebergs.

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Travel Blue Group Americas

FEDERICO MARIN, Area Sales Manager Latam Q: Tell us a little about your professional background. A: I started at Samsonite. I was in-charge of travel retail in Latin America, and when Tumi became part of the Samsonite group, I also took care of travel retail for the same region. I started working at Travel Blue Group in January 2018. I am based in Argentina and have worked in travel retail for over 10 years. Q: What is your vision for the Travel Blue Group in the Americas? A: Before I started working with TBG, I knew it was one of the main players of travel retail in Latin America. Since I joined the company, in only two years, I have seen the group grow, creating new brands, like Lexingham, and entering new markets. In Latin America, we are consolidating, both in travel retail and the local key markets, beyond the changing economic and political situations that are happening in the region. My vision about the group is that in the next two or three years, we will move forward very firmly, opening new markets. Q: Travel Blue Group has evolved from travel accessories to include eyewear and mobile accessories. What impact has this had on your business model? A: The truth is that for us, it was very important, but even more so for our clients. Now, they have a global provider, which in addition to offering travel accessories, can offer eyewear and mobile accessories. For them this facilitates much, the logistics, the administration and ensures a continuing post-sales service, by one well-established supplier, which is very important to them. We work for the satisfaction of our customers and the end consumer. Q: Why do you enjoy your role at the Travel Blue Group? A: Actually, there are three very important points. We are many people, in many different parts of the world and with different cultures, but who really work as a team. Another very important issue is the possibility of growth and development in this company, always growing, always with new product launches, brands and new markets. It is impossible to get bored, every day, it is a new challenge. And then, the support we have from the directors, who are always willing to listen, feel that you are part of it. In short, I am very happy to be part of this group. 88 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

CANDELARIA POURTALÉ, Global Brand Manager for the eyewear business unit of Travel Blue Group, Z-ZOOM Q: Tell us a little about your professional background. A: I’m based in Buenos Aires, but mostly traveling. I worked for Volvo cars and Astra Zeneca laboratories, then joined the travel retail industry almost 10 years ago. The first year I worked with B+D, taking care of the EMEA region, and the last years with TBG in a global position, working jointly with the LATAM team to develop the region. Q: What is your vision for the Travel Blue Group in the Americas? A: TBG has been growing strongly in the past few years with local offices and warehouses in the main countries of Latin America. The main development of Z-ZOOM Eyewear began two years ago, now with a presence in Argentina, Uruguay, Brazil, Paraguay, Mexico, etc, with ambitious plans to keep expanding the eyewear section in coming years. Q: The Travel Blue Group has evolved from travel accessories to include eyewear and mobile accessories. What impact has this had on your business model? A: I joined the company in the first steps of this new strategy model with Z-ZOOM, and the experience is that the customers and prospects are familiar with Travel Blue already, so this facilitates the approach and, as it is one company, this makes the internal processes smooth. The new mobile accessories range, Lexingham, is being very well received and contributes in a synergistic way to build the perfect supplier for must-have product ranges in the accessories category. Each brand concept was designed with its own identity. This is how TBG provides solutions and accompanies most travelers. Q: Why do you enjoy your role at the Travel Blue Group? A: Personally and professionally, to work in Travel Blue is fantastic, the atmosphere is excellent. The outcome of working so closely with teams and retailers all over the world, sharing best practices and experiences from each region, makes the growth fast, easy and a delightful journey.

-FABIOGUIDONI-

www.alfadutyfree.com 197 Northwood Court, Lexington, NC 27295, USA, Tel / Fax: (336) 775-2995, ahildreth@alfadutyfree.com

Quintessential Brands

The essential strategy backing

Small Batch Gin, Thomas Dakin, offers a premium trade up at airports for travelers looking to diversify their collections

Quintessential Brands Quintessential Brands has success on the mind as it tackles travel retail in the Americas

n the year ahead, Quintessential Brands (QB) has a very clear strategy for travel retail in the Americas, with a set of clearly defined focuses on the agenda. Sights are firmly set on making a big success of its premium craft gin brand, Thomas Dakin in airport retail. “In terms of where consumers are currently at in their ‘gin journey’ in this market, the brand offers a great premium trade-up on the brands they are currently consuming,” explains Oliver Storrie, Global Travel Retail Manager for Quintessential Brands Group. Thomas Dakin is a small batch gin with a rich heritage, handcrafted using the quality botanicals which are added by hand. It’s a craft gin and it’s these credentials that make it a great proposition for this market, where craft drinks are already hugely popular as a result of the craft beer sector. “Our Dublin Liberties Irish Whiskey range will also be a big focus for us in airport retail. The always aged, always premium range brings something completely new and unique to the Irish whiskey category and is therefore an exciting focus for us,” says Storrie. This luxury range of Irish whiskeys is created by Master Distiller, Darryl McNally, who brings a new perspective to Irish whiskey-making. The range includes Oak Devil (a 5 year old blended Irish whiskey), Copper Alley (a 10 year old Single Malt), Murder Lane (a 13 Year Old Single Malt) and Keeper’s Coin (a 16 Year Old Single Malt); all of which the firm is confident will perform well in Americas duty free given the increasing popularity of Irish Whiskey. Speciality Liqueur brand, Alizé, will be launching into airport retail in the

Americas later in the summer. The brand was originally founded in America and therefore has a strong affinity with consumers in this market, many of whom are already familiar to the brand.

Cruise Retail

As the fastest growing sector in travel retail, cruise lines play a vital part in the firm’s 2020 GTR strategy. In the Americas, its flagship gin brand, Greenall’s, will be a key focus for on-board pouring. Its offering will include our zero-sugar flavored gins, Greenall’s Citrus Grandis and Greenall’s Rosea Grandis. Both GTR exclusives, they have performed extremely well in other markets following a global media campaign earlier in 2019, which aimed to communicate their USP as some of the only flavored gins on the market to contain no added sugar. “Our premium small batch gin, Thomas Dakin, will also feature in onboard pouring where we will be creating ‘perfect serve’ suggestions, giving guests the chance to enjoy the perfect Thomas Dakin Gin & premium tonic, with our recommended garnish. This will help to showcase the brand’s premium quality, as well as the rich heritage story behind the brand,” explains Storrie. Finally, QB’s premium London Dry Gin brand, BLOOM, will be a focus for the Americas. Having launched with Starboard last year, both BLOOM London Dry Gin and BLOOM Jasmine and Rose Gin proved to perform well. The brand is unique in the fact it is a more delicate, floral gin, which makes it a great entry point for new gin drinkers. BLOOM Jasmine & Rose pink gin is also sugar-free, making it a great option for the more health conscious consumer of today.

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Bloom Jasmine Rose Gin is reflective of a delicate floral gin, perfect for those looking to discover gin

YOUR CO-PILOT IN CONFECTIONERY

Gold Bar Whiskey

Gold rush Gold Bar Whiskey continues to expand to become a leader in the duty free field, adding first-class sports partnerships to its marketing mix.

by JAS RYAT

he NFL’s San Francisco 49ers played in this year’s Super Bowl in Miami.More reason for San Francisco-based Gold Bar Whiskey to celebrate, as it was named the official whiskey of the NFL team this past August. The team boasts an iconic history and calls the state-of-the-art Levi’s Stadium home, making it a perfect partner for a first-of-its-kind spirits deal in the NFL. Gold Bar Whiskey made its debut in the duty free market in 2016. Retailer partnerships in North America include DFS, Duty Free Americas and International Shoppes, while the brand can be found internationally at Lotte Duty Free, Flemingo, Lagardere and Dubai Duty Free stores to name a few. Americas Duty Free spoke to Elliott Gillespie, President Gold Bar Bottle Company, to understand how its highprofile sports partnerships and the brand’s domestic success have translated into duty free sales. Travelers have become excited about this American whiskey brand in domestic markets and through traditional and digital media platforms in the country. “We deliver a unique offering both in terms of our whiskey expressions and our premium packaging. For passengers looking for a unique item and following the explosive growth in American whiskey, we offer a very exciting purchase option,”

shares Gillespie. “Our partnerships have definitely helped amplify the brand, creating more awareness. In our home market of San Francisco, our brand has become a go-to item from the city. This past fall NFL football season we collaborated with DFS to create exciting window and end cap displays”. The activation doubled sales and drove Gold Bar Whiskey to being the number one spirits SKU in the store.

In it to win it

The multi-year agreement with the 49ers has spearheaded the brand’s strategy to align with winning partnerships that exemplify premium brand fit. Recently Gold Bar Whiskey announced a major partnership agreement with the Vegas Golden Knights ice hockey team. With Las Vegas having an abundance of premium mixology accounts, Gold Bar was tasked with creating the Official Celebration Cocktail of the Las Vegas Golden Knights team. The cocktail and associated programming began rolling out in the domestic market in February, with duty free to follow.

Gold Bar Whiskey’s new designation as the official whiskey of the San Francisco 49ers was promoted across a variety of marketing channels and events

programming, which according to Gillespie is “working very well”. Gold Bar is currently sold in off-premise on Carnival Cruise Line (Harding Retail and Starboard), Princess Cruises and in on-premise on Celebrity ships. The Celebrity vessels have had success with a bar cart activation that plays well in the onboard casinos, allowing guests more intimate interactions with the brand. The brand is represented in America by Chase International. Enthuses Gillespie: “We recently completed an exciting 90 activation with Harding Retail onboard nine Carnival Cruise Line vessels. Our activations included branded demo bar spaces and enhanced POS, digital screen exposure and brand tasting events – supported by onboard teams and all the energy of the holidays. It was basically a complete takeover.”

Cruise control

Gold Bar Whiskey’s branding aligns perfectly with luxury pleasure-filled experiences, making it an ideal fit on cruise lines. Guests seeking unique premium experiences are enticed by on-premise

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Gold Bar Whiskey offers retailers an exciting new proposition of premiumization

The Finest Quality Tobacco

THERE IS MORE TO LIFE WHEN IT COMES TO INDULGENCE IN LUXURY. W W W. G U L B A H A R T O B A C C O . C O M

â&#x20AC;&#x201A;Confectionery Tools

THE RIGHT TOOL FOR SWEET SUCCESS by JAS RYAT

It takes a mixture of determination, experience and a touch of ingenuity to bring a product to market. But if you really had to pinpoint one element that underscores the success of your product, what would it be? Americas Duty Free asked confectionery brand managers to pick only ONE of the following tools to market their products for the remainder of the year and explain why.

1. Packaging

2. Selling experience

3. Price point

Jan Pasold Managing Director Global Travel Retail, Ritter Sport

Tool: Packaging Reason: For the first time, Ritter Sport has developed the new Cocoa Selection Deluxe, a travel retail product with the focus on design and on premium packaging. The objective of the product is to create curiosity among the consumers in-store and to get them in touch with it. Once the consumer holds the product in his hands, the QR code on the packaging allows him to discover the story of Ritter Sportâ&#x20AC;&#x2122;s sustainable cocoa and pure recipes. The product aims to move the purchasing decision of a consumer from a pure price-driven to a more conscious decision for a high quality and sustainable product. This is just a first step for Ritter Sport and there are several packaging projects for the travel retail exclusive assortment in the pipeline.

Femke van Veen Brand Manager Global Travel Retail, Perfetti Van Melle

Tool: Packaging Reason: Packaging remains the most important sales tool for Perfetti Van Melle, while offering something exclusively in the travel retail channel also qualifies for success in our channel. Packaging that is used for gifting purposes and/or having a reusable value are very important for us. Also, in terms of sustainability, we focus a lot on reusable items. If we combine these factors with a good price point and sales experience, this will drive success.

Berend-Jan van Egmond Global Travel Retail Manager, Cloetta

Tool: Packaging Reason: Our customers are becoming more critical about their purchases, especially when it comes to responsible and sustainable packaging. Focus on reducing our impact on the environment by using sustainable packaging is on our agenda, and we are aiming to reduce our use of plastic already this year. Also, with packaging we can create a unique brand experience and meet the expectations of the customers in travel retail to differentiate versus domestic.

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Miriam Richter Head of Marketing, LINDT Duty Free Lindt & Sprüngli

Tool: Price point Reason: According to numerous research in travel retail confectionery, price advantage is still the main purchase driver for the majority of travelers. In general, price is reflecting the value of the offer and is also treated differently by travelers dependent on their consumer need states, e.g. gifting products need to have superior packaging but consumers are also willing to spend more. So price and pack are always interlinked and none of it is a means of itself. What we observe is a general tendency of premiumization of the confectionery offer and an increased consumer focus on high quality for which they are also willing to pay a price premium. Moreover, the increasing number of millennial travelers is drawn into travel retail outlets by elevated experiences on the shop floor, so in sum premium packaging, a superior purchase experience and fitting, competitive and accessible price points are important to increase penetration for confectionery in travel retail.

Aisling Walsh Marketing Director, Butlers Chocolates

Tool: Packaging Reason: If I had just one tool at my disposal, I would focus on creating wonderful packaging. To stand out on-shelf and create interest from new and existing customers, packaging needs to be very strong. Focusing primarily on price can result in short-term sales but doesn’t build a loyal customer base. The price has to be the right one, of course, but the power of packaging as an incredible sales tool cannot be underestimated and needs careful consideration at all times.

Jose Paez Americas Business Development Manager, Mars Wrigley ITR

Tool: Selling experience Reason: Tough choice, but if only one was available, I would go for selling experience. Confectionery brings the fun to travel retail and we do this via experiences. A great example of this is what we are doing with our recently launched M&M’s Blocks in the US. We decided to go big on experience, leveraging on the power of our beloved characters, designing a great promotion around it and placing them in eye-catching displays. So far, results look promising, and both retailers and passengers are smiling.

Andreas Reckart Vice President Region Middle East & Travel Retail, Ricola AG

Tool: Packaging Reason: If given the choice, I’d definitely go for packaging based on firsthand experience. Travel retail is mostly about offering the same products that travelers are purchasing in a domestic environment but in a different, ideally upgraded packaging. This worked very well for us at Ricola when we re-launched our travel retail assortment back in 2017 / 2018, for example with our sugar free herb drops in 75g tins. In our domestic markets we never use any tins so when we launched them in travel retail the response was overwhelming.

André Haunsø Kampmann Product Marketing Manager, Anthon Berg

Tool: Packaging Reason: No matter how good a product is, poor packaging can keep it from selling. Price point and selling experience are also important factors, but the first impression and the first touchpoint that the consumer meets with our brand is through the packaging. The consumers make assumptions on a product’s price point before they see the price tag. Once they’ve made those assumptions, they look at the price and decide either “this is a really good value” or “I can’t believe they are charging that much for this.” Your product's increase in desirability and perceived value can help you charge more for it. www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

Rum Report

rumifications The

of a diverse portfolio by JAS RYAT

Guyana-based El Dorado rum exemplifies an English-style rum made from molasses

CLASSIFYING RUM BY STYLE COULD LEVERAGE CATEGORY GROWTH, ACCORDING TO SEVERAL LEADING SUPPLIERS

J.M V.S.O.P. is an example of a French-style rum, or rhum agricole, that is created by aging rhum for three years

um has certainly come a long way from its days of swashbuckling pirates. The rum category is now peppered with premium rums backed with rich provenance and age statements. This is in line with the continued trend of premiumization in duty free. Consumers and retailers alike seem to be well entrenched in whiskey categorization, such as single malts, Irish and bourbon. But how does a retailer approach diversification when it comes to the rich rum category? “There is a lot of diversity in rum. I am on the side of breaking the rum category into these three principal segments: English, Spanish, and French because of the ancestral contribution to these styles and the influences on the characters and profiles of the rums. Absolutely, a retailer needs to carry a good selection from each of these three styles of rum,” explains Benjamin Jones, Managing Director Spiribam North America. Jones represents Spiribam, a North American subsidiary of the makers of Martinique’s Rhum Clément and Rhum JM, St. Lucia’s Chairman’s Reserve Rum, Bounty Rum and Admiral Rodney Rum. He is a stout believer that diversifying rum based on the style of production, English, Spanish or French, would help retailers not only deliver authenticity, but help reshape the general public’s perception of what rum really is. The three styles Americas Duty Free lists below give readers a breakdown of where to start and general differentiations to appreciate.

styles of rum on the market and unique due to its dry character with a terroir-driven flavor profile. The typical flavor profiles for this French style of rum, according to Jones, is “earthy, savory, beany, notes of fresh cut grass, and aromas of grilled tropical fruit for the white rums; and burnt orange zest, chewy leather, aromas of mahogany, and toasted vanilla bean with the aged rums.” There are a variety of styles, starting with unaged white rums, younger aged rums, to very long-aged vintage rums. AOC Martinique rhum agricole is described as the single malt of the rum category, or the Champagne of the rum category due to the distinctive profile of the spirit and the very strict rules and regulations associated with the production (the appellation d’origine controlee).

French

Spanish

A French-style rum, or rhum agricole, is made with fresh pure sugar cane juice as opposed to molasses. Headquartered in Martinique, Jones represents rhum agricole, one of most distinctive 96 THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH 2020

Spanish rums are generally produced in Spanish-speaking countries or islands. They tend to be a lighter style and are usually distilled from molasses, resulting in a sweeter liquid.

The Spiribam Rhum Wheel breaks the rum into three principal segments, allowing for a simplified understanding of the category

tation and heritage attributable to our geographic origin.” The El Dorado range demonstrates the defining characteristics of Demerara Rum: fruity floral notes, and estery aromatics. “Demerara Rum has very unique characteristics in terms of its aromas, flavour profile, and mouth feel – there is a heavy presence of fruity and floral aromas and flavors”, says Patrick. El Dorado features a diverse range of rums – from light to medium to heavy-bodied, including a unique collection of blended aged rums ranging from 3yo to25yo, unblended pure single-distillate rums, and a variety of limited releases and specialty rums.

The gentrification of rum?

Cihuatán, represented by Christoph Henkel, Co-Founder and Manager at InnoTRI, is a Spanish-style rum that is positioned in the premium or ultra-premium segment. The style is defined through its medium to dark, sweet and complex flavor profile which comes mainly due to the long ageing process. Cihuatán is El Salvador’s first exported rum, and Cihuatán Obsidiana is exclusive to travel retail. The design and packaging communicate the brand story and launches are supported through colorful and exciting activations. “Cihuatán combines modern design with traditional craft and ancient heritage. The Mayan culture plays a huge role in the development of each product. In Náhuat, the Mayan language, Cihuatán means ‘the land beside the sleeping woman’. Nowadays Gabriela Ayala, the master blender, is guarding the secrets of the brand and shapes all new products of Cihuatán,” shares Henkel. Cihuatán also combines craft and premiumization in its products. The annual limited editions, started in 2018 with Nahual and Nikte in 2019, are collector’s items. 2020 will continue this trend with the new limited edition as well as the company’s first XO, to be launched in May 2020.

English

English-style rums are made from molasses rather than cane juice, resulting in aromatic or floral flavors. One of the most recognizable English rums is Guyana-based El Dorado rum. El Dorado represents over 300 years of Caribbean rum crafting, producing English-style rums made from molasses. It subscribes to the minimum aged rum standard; this means that the age on the bottle is the age of the youngest rum in the blend. This is different from the Solera system where the age shown is that of the oldest rum in the bottle. Says Schemel Patrick, Demerara Distillers Brand Communications Manager: “With our original distilling equipment and heritage stills, we have combined the traditional with the technology of today, capturing every ounce of our rich history in the full expression of El Dorado rums. We have a wide range of Demerara Rums. Ours rums have a quality, characteristics, repu-

There is a big opportunity for retailers to diversify their offerings to capture a segment of consumers that want to upgrade or experiment with their traditional dark spirit. Breaking down the category in three segments can help provide retailers with the opportunity to offer the most diversity on an otherwise limited shelf space. The question now remains: Are consumers ready to step away from the beloved rum and Coke and trade up? “Even though there is a visible shift away from the rum and Coke segment, this will always exist to some extent, but the premium and ultra-premium segment is growing at a nice pace. We also see that, in general, lovers of other dark premium spirits such as Cognac or aged whiskeys are attracted to the rum category,” says Henkel. He continues to stress the importance of offering options in the travel retail experience. “All duty free consumers like choices, uniqueness and value – so the offer should comprise all styles but always try to deliver best in class.” This sentiment is echoed by both Patrick and Jones. Both agree presenting the right portfolio that offers the right mix of product can help drive sales. “There are more and more vintage aged rums and diversity with cask finishes. We are seeing more interest from the whiskey, Cognac, and tequila consumers who are appreciating Martinique rhum agricole because of the attractive features and benefits of this style of rum. This category is reshaping the general Spanish-style Cihuatán Obsidiana public’s perception of what rum lets the packaging communicate its brand messaging and provenance really is,” enthuses Jones. www.dutyfreemag.com THE AMERICAS DUTY FREE & TRAVEL RETAILING

MONARQ Group

MONARQ’s sustainable mission Leading drinks distributor and marketer, MONARQ Group, talks consumer needs, premium brands and climate change by LAURA SHIRK

escribed as a one-stop shop for alcoholic beverages distribution and marketing in the Americas, MONARQ Group is continuing to introduce innovative concepts that focus on evolving consumer needs and sustainable brand equity. Priding itself on being ahead of the curve, a core value of the company is what it calls “spexcution”: speed in execution. Last year, MONARQ entered into a regional distribution partnership with Brown-Forman, and the group now represents the US liquor giant’s portfolio on 16 Caribbean islands. Looking to expand on MONARQ’s corporate philosophy of building premium drink brands in the region, the goal of the partnership is to firmly establish Jack Daniel’s as the brand of choice in these markets – both in domestic and duty free retail. Defining Jack Daniel’s as a truly authentic Tennessee whiskey, the team notes that the brand perfectly coincides with its DNA. Along with recently introducing Jack Rye to the markets, MONARQ is scheduled to launch Jack Apple in the coming months. Continuing to report a successful year, the company experienced double-digit growth with the Heineken brand in 2019. MONARQ says distribution expansion and in-store activations with a number of new duty free retail accounts (mostly at borders and ports) serve as contributing factors behind the significant growth. Coming up, the team will introduce Mexican beers, Dos Equis and Sol to the region’s duty free channel. Although MONARQ is working with Heineken to introduce Heineken 0.0 and further explore the low/no alcohol trend, the company is currently expanding its portfolio into the ready-to-drink (RTD) category. Top of the list is Bravazzi Hard

Italian Soda and Rosé Spritz, a blend of Californian rose wine, sparkling water and natural flavors. In addition to the liquid, the packaging of both products is designed to appeal to the millennial consumer. Tapping into the demand for premium non-alcoholic craft beverages (an alternative to “drink when you are not drinking”), the company added Bundaberg Brewed Drinks to the mix. Based in Australia, Bundaberg completes its premium spirits portfolio by offering a range of all-natural, GMO-free and wellbalanced mixers. With many of MONARQ’s consumers located in the Caribbean, the group is concerned about the intensification and impact of the catastrophic hurricane season. Due to the effects of climate change, it’s expected that business partners and their friends and families will continue to suffer. With this in mind, MONARQ obtained its carbon neutral footprint through Climate Neutral Group as a first step in the group’s contribution to reduce climate change. The carbon emissions that MONARQ produces will be compensated and

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invested in emission reduction projects, which combine energy, environment and developmental solutions into sustainable business opportunities in developing countries. This coming year, MONARQ will compensate its CO2 emissions by contributing to the Rio Preto-Jacundá Extractivist Reserve (RESEX) in Brazil. This is a REDD+ (Reducing Emissions from Deforestation and Forest Degradation) project. “REDD+ is a voluntary climate change mitigation approach, designed to incentivize developing countries to halt deforestation. In addition, the mechanism can help fight poverty while conserving biodiversity and sustaining vital ecosystem services,” says Nicoline van Woerkum, International Marketing Manager – Drinks Distribution & Marketing Group, MONARQ. Determining to work not only for the present, but also for the future, MONARQ is invested in striving to be a responsible company and play its part as climate change and other environmental issues take center stage on a global scale.

2020 FDFA Convention

CANADIAN DUTY FREE â&#x20AC;&#x201C;

A STRONG TOMORROW King Edward Hotel, Toronto, Ontario November 9 - 12, 2020

Champagne Lanson

Lanson makes sparkling progress Champagne Lanson is being rejuvenated by its new President, François Van Aal, who reveals exciting plans for the venerable brand

rançois Van Aal, the President of Champagne Lanson since January 2019, has big ambitions for the 260-year-old Champagne brand – not least in the Americas duty free and travel retail market. Before taking the helm at Lanson, the French executive previously worked for spirits group Rémy-Cointreau for 23 years, holding successive positions in marketing, sales and profit center management in the US and then in the Europe, Middle East and Africa region. He is using his experience to revitalize Lanson, touching all areas of the company. Van Aal sees a “huge opportunity” for the house in Americas travel retail. He explains that in the domestic market, the brand is becoming better known every day; it has its own subsidiary in the US and is slowly building distribution both on-trade and retail. Central and South America is also seen as offering “significant potential”, he says, and the brand already has distribution in selected markets including Brazil, Uruguay, Paraguay, and Guatemala. “Our travel retail business in Americas is still very young but we are now working with 3Sixty Duty Free and Dufry, which will really project us into the Americas business,” he says. “We are confident this is the start of a very positive time ahead for Lanson.” Turning to what makes the brand unique, Van Aal points to Lanson’s rich history, which dates back to 1760, and its family heritage. The company is located in Reims, the capital of the Champagne region, with its own secret garden – Le Clos Lanson. From this plot of just one hectare, it produces limited-edition

Launched in 2018, Lanson Green Label Champagne is produced using organic grapes grown exclusively on an estate vineyard located in the Marne Valley

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The Cihuatán valley’s secrets and legends are now revealed through our rum. Discover Cihuatán Obsidiana , an exclusive traveler’s edition rum inspired by the legend of the Mayan goddess Itzpapalotl, protector of travelers and guardian goddess of Obsidiana, an enigmatic Mayan stone.

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Champagne Lanson

cuvees with “rare and unique characteristics; no other Champagne house can lay claim to this,” he says. He also points to Lanson’s expertise. With access to more than 100 different crus, over 50% in Grand Crus and 1er Crus, it combines traditional techniques with modern technology and methods that have seen €20 million (US$22 million) investment over the past eight years. Furthermore, Lanson employs its own vinification methods and boasts one of the finest vintage collections in Champagne, dating back to 1904 with vintages from 1976 available for sale. Importantly, Lanson is also committed to more sustainable viticulture through its own biological vineyard and by supporting its growers through a certified approach. It is one of the few large international Champagne houses to offer an organic Champagne in its range, Green Label. Lastly, Van Aal says the company is proud of its long-lasting relationships. It has held The Royal Warrant in the UK for 120 years and has been the Champagne partner of the Wimbledon tennis tournament for over 40 years.

Channel investment

Champagne Lanson is available in more than 80 markets worldwide through channels including many image-driven ones such as fine dining, on-premise, wine retailers and travel retail. Now, Van Aal’s ambition is to reposition Lanson, elevating it to what he calls its “rightful and relevant place in the Champagne hierarchy”. As a first step to achieving this, last year saw the first round of what will be 20 workshops to look at all aspects of the Lanson brand including production, commercial, marketing and communication. The aim is to extend the appeal of Lanson to a new age group. Its current consumers are typically aged 40-70 and, while they remain important, Van Aal believes it is critical to recruit younger consumers in the 30-40 age range. He describes his target market as “men and women across the globe whose lifestyles are in line with Lanson brand values”. In terms of travel retail, Van Aal is committed to investing in the channel globally and increasing Lanson’s footprint and distribution. The brand exhibited at last year’s TFWA World Exhibition for the first time in four years, and he

describes that as symbolic of the brand’s renewed commitment to ‘the sixth continent’. Lanson works with key operators such as Lagardere, Gebr Heinemann and Dufry and believes there is plenty of opportunity to expand its business across the globe. An important element François Van of this new strategy Aal, President of Champagne Lanson includes the introduction of “exciting new launches and activities that will really put travel retail back at the forefront of our business plans”, he enthuses. Lanson is targeting double-digit growth for global travel retail in 2020. “It’s an ambitious target, particularly in these current challenging times,” to go beyond the premium quality of the acknowledges Van Aal. “None of us cuvees – it demands a much wider vision predicted the impact of coronavirus. and involves practises built on strong and Nevertheless, long term we are confident sound foundations focused on ethics and of achieving our target and maintainthe fulfilment of modern societal expectaing a strong growth curve, notably in tions – of which environmental sustainthe Americas and in Asia, where we are ability is one important element.” optimistic that Chinese travel and spend To this end, the company has a dedipatterns will return to normal as soon as cated 15ha vineyard which is committed the current crisis is over.” to sustainable viticulture and used almost This year, Lanson is celebrating its as a laboratory to develop new and better 260th anniversary, and to coincide with environmentally friendly methods which this milestone, the company has launched can be replicated elsewhere. a new branding and advertising campaign Champagne Lanson’s Organic Green centered on the slogan ‘It’s All About Label was introduced to travel retail marLove’. Van Aal describes this as “love for kets to target the millennial demographic, the soil, for the terroir, of a job well done, the environmentally concerned and those a sustainable love, a love of sharing, of that wish to enjoy an organic, refreshing being together, of making people happy”. aperitif. Van Aal describes Green Label as Building on Lanson’s core values of a niche addition to the Lanson portfolio openness, kindness, humility, authenticand is “just one element of our Vision ity, elegance and the quality of its wines, 2020 renewed strategy for this distributhe campaign features hands delicately tion channel”. carrying a bottle of Lanson Le Black Label In travel retail, Green Label is availBrut, the house's flagship cuvée. able through Gebr Heinemann, Lagardere The 260th anniversary will also see the and Dubai Duty Free. “It is early days but introduction of new packaging visuals we are confident of the potential for the and new cuvees later this year, alongside a product, particularly if it is displayed as rationalization of the portfolio. part of an organic range; this is something we are discussing with our retail partners,” he says. Environmental protection Green Label was introduced to the One notable product in the portfolio is North American domestic market this Champagne Lanson’s certified Organic year and, importantly, is the only organic Green Label. Van Aal explains that enviChampagne to hold relevant certification ronmental protection is a major issue for to enable it to be marketed as such in the Lanson. “The excellence goals of ChamUS, reveals Van Aal. pagne in the world of sparkling wines has

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Patrick Nilson, +1(772) 213-8676 p.nilson@haleybrooke.com

Roger Thompson, +1(203) 322-9691 r.thompson@haleybrooke.com

Haythem Bouchuiguir debut

JTI navigates ever changing duty free channel

Haythem Bouchuiguir takes the reign as JTI Worldwide Duty Free Americas General Manager

Haythem Bouchuiguir, JTI Worldwide Duty Free Americas General Manager, makes official debut by JAS RYAT

ADF: Are you able to tell us a little about your professional background? HB: I have been in my current role as Worldwide Duty Free Americas General Manager since 2019. My experience with tobacco goes back to 2001 when I joined as Marketing Manager. In 2008 I was appointed Smoking Lounge Lead. In 2011 I was promoted to Marketing Director for Japan Duty Free and since 2013; I held my most recent role of Equity & Trade Marketing Director. I’ve now built up quite a few years in the duty free & travel retail Industry. ADF: Why is the Summit of the Americas a significant show for JTI Americas? HB: The Summit of the Americas is the show for the region and is a great opportunity for us to meet with our customers. ADF: Logic Compact, JTI’s vaping technology, has expanded its presence in the Middle East. Do you see a successful expansion of vape technology in the Americas with all the recent controversy surrounding the products? HB: At JTI we refer to Reduced-Risk Products (RRP) as the category of products we believe have the potential to reduce the risks associated with smoking. Our RRP strategy is centered on empowering informed consumer choice, so that’s providing a portfolio that includes both RRP and traditional smoking products. JTI’s RRP offering is being extended to

travel retail and is currently available in Japan, Ireland, Switzerland, France, Russia and UK. We are working with our customers to establish whether consumer demand for RRP like e-cigarettes is strong enough and what a good proposition for both the retailer and the consumer is. ADF: How do regulations around duty free sales in America differ from those in Asia and Gulf-Africa? HB: The regulatory framework around vaping products varies internationally and is an important topic of discussion in the media. As with other consumer goods, vaping should be subject to appropriate product safety requirements. However, excessive regulation could be detrimental to competition, innovation and consumer choice. ADF: JTI continues to spearhead the “Future of Brands’ movement in duty free and travel retial. What is the current situation regarding the impact of this message? HB: For JTI regulation is not a bad thing; it is excessive regulation that does not consider the global, unique nature of the duty free and travel retail industry’s business model that is threatening all categories, not just tobacco. There is more awareness of this threat now as we see this excessive regulation creeping into alcohol and confectionary.

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The duty free and travel retail industry has a powerful voice; together we are strong, non-aeronautical revenues are the lifeblood of the airport ecosystem. Airports, ports, borders, cruise and ferry companies are all part of national and international infrastructure and are important to national and regional economies. Our response must be to use the strong voice and argumentation to protect the travel retail industry; we are not against sensible and proportionate regulation, across any category. However, we must be better understood, we must be part of the dialogue, and we must be part of the solution, a solution that respects the travel retail business model. Knowing about regulatory trends and imminent regulation that could apply to travel retail is the first step! Being a member of national, regional and global travel retail associations is critical both in terms of awareness and engagement. ADF: How does JTI view the duty free channel? HB: The duty free channel is very much recognized and appreciated by JTI. The channel is the window to the world, an incredible opportunity for JTI to respond to the expectations of our consumers who want to find their brands for sale when they travel internationally.

Questionnaire

ALL ABOUT

Denz Van der List Q&A CabinZero Global Travel Retail Sales Director Where were you born and raised?

I was born in Bad Ischl, Austria, but I lived there for only about six weeks. I was raised in the Netherlands.

What motivates you in life?

My kids – to give them a bright and educated future.

What's the best thing that's happened to you this year/month/week?

The year has only just started so I’m sure there will be a highlight. Last month I was very proud that my children got great grades in their new school. They have only been in the new school for less than a month, so to see them adapt like this is great. Last week I visited an old customer of mine who was really good to see and to catch up with, alongside establishing a new account. They had their first delivery, so it was a good week.

What would you choose as your last meal?

A: I would have to choose between Thai and Indonesian. Maybe just a cold Heineken and bitterballen (Dutch meatballs). Tough, and I cannot choose!

What’s your favorite ’80s jam and why? A: Survivor – Eye of the Tiger, the song that’s played when my favorite football team comes on the field – FC Utrecht. I get goosebumps every time I hear it.

How would you rate your memory? 8/10.

What were you like in high school?

The best student in the class – not really. I had fun and good times and also sometimes even wish to go back, as at that time you

actually thought life was difficult. I guess every age has its pros and cons.

What do you think about when you’re alone in your car?

Usually work and opportunities. Can I squeeze in a quick call? I’m not often alone in a car to be honest and it is a good quiet moment. Although sometimes it’s also nice to think about nothing at all and just drive, listen to music and let the wind come in.

Are you more of a hunter or a gatherer?

Hunter – but love the social aspect of gatherer. I am always looking for new opportunities, how to make things happen in work, life, etc. I am definitely open for new experiences, cultures and adventures.

Do you prefer country or city?

Country. I like to explore and taste different cultures. Cities are usually metropolises. Sure, some places are unique and have things that other cities don’t have, but to really get a taste of the culture in a country, it is definitely countryside.

What is your favorite place to vacation? Anywhere tropical, sunshine and no jacket!

What do you work toward in your free time?

I hope one day to pick up my music and productions again. But I also love to watch sports and cook. My new smoker is a new tool I am using to experiment with preparing smoked foods, meats, fish, cheese and even desserts. Living in the boating capital of the world now might even work towards getting my own boat one day. Who knows?

What in the world would you most like to change?

That people become a bit more respectful of each other. In times where it’s needed people unite, but it would be great if this happened more often.

What about yourself would you most like to change?

Stress-less. I tend to sometimes overthink, overworry about things. Things will fall into

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place how they are meant to be, but I wish I could stress less about it.

What is the most important piece of advice anyone ever gave you?

That there is a life outside of work and that you need to enjoy that life to the fullest.

What is something about you that most people would find surprising?

I hate to be on a stage or in the spotlight, to be honest. Just getting a picture done for this interview was very uncomfortable… ha!

If you could know the absolute and total truth to one question, what question would you ask? Still pending, chicken or the egg?

If you had the opportunity to meet one person you haven't met, who would it be, why, and what would you talk about?

Probably back to my childhood. I used to be a big Ken Griffey Jr. fan when I played baseball. I remember visiting a game when I was about 14-15 years old and went alone to the US to watch him play a couple of games. He was a big inspiration to me when I played for almost 12 years. I guess we would talk about that, how he could hit the ball better than I could!