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Dufry’s major acquisitions p.

SEPTEMBER/OCTOBER 2011 • VOL 21, NO 3

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Monalisa shines p.

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Natural Gemstone p.

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Ingl ĂŠs y esp

E-cigarettes: The new alternative p.

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TFWA WE 2011

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Letter From The Editor

Emerging markets

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s we were going to press, Dufry’s breaking news came as a big bang.

The operator signed and concluded a US$957 million investment in South America, comprised of four key acquisitions. These acquisitions include Interbaires, the leading airport retailer in Argentina, along with airport retail operations in Uruguay, Ecuador, Armenia and Martinique, as well as a wholesale platform.

The new businesses add 21 shops to Dufry’s portfolio. The stores are located in 10 airports, and altogether take up a total retail space of around 13,500-square-meters. For details on these major acquisitions, read our top story.

On the topic of the booming Latin American region, the ASUTIL conference, held in its new time slot in June, concluded on a high note in sunny Cancun. The number of attendees and the overall experience was above all expectations, and attendees are already anticipating the next conference, which will be held in Iguazu, Argentina.

In new concept news, well known fashion accessory supplier Bijoux Terner has unveiled AdiXion. This stunning new retail concept presents a perfect solution for housing the company’s new brands under one roof. Debuting at the Miami International Airport, the store measures 47-square-meters.

I also want to make mention of Parbel’s strategies and new launches, which never cease to amaze. To be able to sit with the company’s CEO Javier Labarta and feel the passion he has for his popular brands was truly exhilarating. Parbel, L’Oréal Group’s Americas division, continuously breaks new ground and you can hear what Javier had to say on pages 68 and 69.

With all the positive vibes surrounding our issues, not to mention the launch of our Asia Duty Free & Travel Retailing TFWA edition, we are ready to enjoy the meetings and social events again!

See you in Cannes.

Kind regards,

The Americas Duty Free & Travel Retailing (ISSN 0962-0699) is published four times a year February/March, June/July, October, November/ December) 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.

Subscriptions: $200 for one year. Art and photographs will not be returned unless accompanied by return postage. The views expressed in this magazine do not necessarily reflect the views and opinions of the publisher or editor. September/October 2011, Vol. 21, No. 3. Printed in Canada. All rights reserved.

Nothing may be reprinted in whole or in part without written permission from the publisher. © 2011 Global Marketing Company Ltd. The Americas Duty Free & Travel Retailing 26 Pearl Street Mississauga, Ontario L5M 1X2 Canada Tel: 1 905 821 3344; Fax: 1 905 821 2777 www.dutyfreemagazine.ca PUBLISHER Aijaz Khan aijaz@globalmarketingcom.ca EDITORIAL DEPARTMENT EDITOR Hibah Noor hibah@dutyfreemagazine.ca CONCESSIONS, LIQUOR & TOBACCO EDITOR Ryan White ryan@dutyfreemagazine.ca ART DIRECTOR Patrick Balanquit patrick@globalmarketingcom.ca CONTRIBUTORS Andrew Brooks Zuhair Kashmeri Lorna Strickland-Cook James Ross ADVERTISING SALES

Hibah Noor Editor hibah@dutyfreemagazine.ca

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

ADVERTISING & MARKETING MANAGER Kim Carrera kim@dutyfreemagazine.ca CIRCULATION & SUBSCRIPTION MANAGER Deepa J deepa@globalmarketingcom.ca

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Letter From The Editor

Mercados en surgimiento

A

Al cierre de esta edición, llegaron últimas noticias de Dufry como un gran impacto: el operador firmó y ejecutó una inversión de US$957 millones en Suramérica, consistente en cuatro notables adquisiciones, entre las que figura Interbaires, el principal minorista aeroportuario de Argentina, conjuntamente con operaciones minoristas de aeropuertos en Uruguay, Ecuador, Armenia y Martinica, así como una plataforma mayorista.

Los nuevos negocios incorporan 21 tiendas al portafolio de Dufry. Las mismas están ubicadas en 10 aeropuertos, y en conjunto abarcan un espacio minorista total de unos 13,500 metros cuadrados. Para más detalles acerca de estas importantes adquisiciones lea nuestro artículo de fondo en este número.

En lo tocante al tema del florecimiento de la región latinoamericana, la Conferencia de

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ASUTIL, que se llevó a cabo en su nueva programación de junio, concluyó con gran éxito en la soleada Cancún. La cifra de asistentes y la experiencia en general estuvo por encima de todas las expectativas, y los participantes ya esperan la nueva conferencia, que se realizará en Iguazú, Argentina.

Con respecto a noticias de nuevos conceptos, Bijoux Terner, el conocido proveedor de accesorios de moda acaba de inaugurar AdiXion. Este sorprendente y nuevo concepto minorista presenta una solución perfecta para agrupar las nuevas marcas de la compañía bajo un solo techo. La tienda, de estreno en el Aeropuerto Internacional de Miami, mide 47 metros cuadrados.

También quiero hacer mención de las estrategias y nuevos productos de Parbel, que nunca deja de sorprendernos. Conversar con Javier Labarta, director ejecutivo de la compañía, y sentir la pasión que siente por

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

sus marcas populares me llenó de entusiasmo. Parbel, división para las Américas de L’Oréal Group, está continuamente a la vanguardia. Si desea enterarse de lo que nos dijo Javier, lea la entrevista en las páginas 68 y 69.

Con toda la vibración positiva que rodea a nuestros números, entre los que figura la presentación de nuestra edición de Asia Duty Free & Travel Retailing dedicada a la TFWA, ¡estamos listos para disfrutar nuevamente las reuniones y los eventos sociales futuros!

Nos vemos en Cannes.

Un cordial saludo,

Hibah Noor, Editora hibah@dutyfreemagazine.ca

VISIT US AT THE COTY BOOTH IN THE MARINE VILLAGE / FOYER 3 S3

SEPTEMBER/OCTOBER 2011 • VOL 21, NO 3

Contents 18 22 30

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IN BRIEF Shopping China celebrates the biggest border turnover ■ Ezeiza Airport’s Terminal C inaugurated ■ Carnival Corp. to open port facility in Dominican Republic in 2013 ■ Farecompare.com compiles list of airport security wait times

TOP STORY: DUFRY

Making good on a promise Dufry has previously stated the importance of emerging markets to its business plan and now backs it up with the purchase of major airport retail businesses in South America, Martinique and Armenia

OPERATOR NEWS: BRIGHT STAR

Always something new Americas Duty Free recently spoke with Bright Star about the importance of keeping its product mix fresh for travelers both in the air and on the ground

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

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OPERATOR NEWS: MONALISA

“A little help from my friends” About to celebrate its 40th anniversary in Ciudad del Este´s burgeoning travel retail sector, Monalisa says it owes its success to the friendships it has fostered over the last four decades

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OPERATOR NEWS: DFASS

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OPERATOR NEWS: BAJA DUTY FREE

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AIRPORT NEWS: CHICAGO O’HARE

Continued improvement CEO of DFASS Bernard Klepach tells Americas Duty Free that the first half of the year was fruitful for DFASS, both in terms of sales and partnerships

A good year With sales up in key categories and recent renovations bringing stores in line with an overall branding vision, Baja Duty Free expects continued success in the second half of 2011

Slings and arrows Chicago O’Hare’s redevelopment plans for Terminal 5 draw fire from Chicago Aviation Partners, pointing to a possibly lengthy delay in the planned renovations

VISIT US AT THE COTY BOOTH IN THE MARINE VILLAGE FOYER 3 S3

Discover the new scent of seduction

42 46 48

OPERATOR NEWS: DUTY FREE AMERICAS

Bringing luxury to Miami DFA opens four luxury boutiques at MIA, effectively cementing its place as the largest duty free retailer in North America

INDUSTRY NEWS: IAADFS

More questions than answers Michael Payne, Executive Director of IAADFS, discusses the region’s positive performance during the first half and contemplates what lies ahead for the rest of the year

CONFERENCE REVIEW: ASUTIL

An eye toward the future

La fuerza de los resultados de la economía latinoamericana en la Conferencia ASUTIL 2011 estuvo mucho más cerca del Paraíso que del Infierno

62 66

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BEAUTY BEAT: FRAGRANCES

The sweet smell of success This year’s fantastic new fragrance launches are sure to please even the most reluctant of consumers

BEAUTY BEAT: SKINCARE & COSMETICS

Looking your best Skincare and makeup suppliers continue to up the ante with a host of new products that promise to bring beauty to all traveling shoppers

COMPANY NEWS: PARBEL

Parbel hits the high notes Success in the Americas takes careful orchestration

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

La Prairie enters Hawaiian travel retail with a bang With a stunning flagship store at DFS Galleria Waikiki the company extends its personalized service

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The strength of the Latin American economy results in a 2011 ASUTIL conference that was a lot closer to heaven than hell

Con la mirada al futuro

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COMPANY NEWS: LA PRAIRIE

COMPANY NEWS: L’ORÉAL CONSUMER PRODUCTS DIVISION

L’Oréal Consumer harnesses growth in the Americas With multiple listings under its belt, L’Oréal zeros in on its strategies at point of sale

74 76 78 80

COMPANY NEWS: BIJOUX TERNER

Luring customers into AdiXion Bijoux Terner finds a perfect solution for housing its myriad brands under one roof

FASHION REPORT

Fashion forward Buckles, bows and belts: travel retail and its passion for fashion

PEARL NEWS

Natural gemstones Americas Duty Free speaks to three pearl experts to find out how these lustrous gems have the consumers spending

SUNGLASS REPORT

Shine on As more retailers tap into the potential of sunglasses, the sector’s already radiant glow is spreading

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100 84 86 90

CUFFLINKS NEWS

Contemporary cufflinks Two leading accessory brands deliver this elegant and much admired piece of men’s jewelry to the duty free market

WRITING INSTRUMENT REPORT

Making a mark The writing experience provides an intimate connection with customers

COMPANY NEWS: NESTLÉ INTERNATIONAL TRAVEL RETAIL

The perfect score The growth strategy for Nestlé International Travel Retail has all the bases covered

96 100 102

114 118

Portland Design transforms the retail experience by showing airport authorities, operators and suppliers how to think outside the box to generate revenues

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Leaders in cocktail culture share their views on the market

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TFWA WE LIQUOR PREVIEW

Best and brightest Americas Duty Free presents a guide to some of the many must-see wine and spirits exhibitors at this year’s TFWA WE

Sustainable business practices give Patrón another way to lead the pack

COMPANY NEWS: WEBB

Expanding horizons WEBB banks on its success in the Caribbean to open duty free doors farther afield

COMPANY NEWS: PERNOD RICARD AMERICAS TRAVEL RETAIL

Absolut-ly fabulous

COMPANY NEWS: DIAGEO

Grand slam Johnnie Walker Double Black promo “Experience the Flavour” promotion touches down at four Americas hubs

LIQUOR REPORT: HOLIDAY COCKTAILS

Masters of the mix

The growth of green

Pernod Ricard’s Enrique Girones discusses ABSOLUT ELYX, as well as a number of other brand initiatives set to make a splash in duty free during the second half

COMPANY NEWS: PORTLAND DESIGN

Different by design

COMPANY NEWS: PATRÓN

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COMPANY NEWS: WILLIAM GRANT & SONS

The dream team William Grant & Sons continues to invest in the travel retail channel through an all-star lineup of brands and personnel

COMPANY NEWS: GENERAL CIGAR

Giving them what they want Whether it’s large ring gauge cigars or smaller cigarillos, General Cigar is set to meet the varied needs of travelers in the second half with novel packaging and new product launches

COMPANY NEWS: BAT

Listening and responding The importance that BAT places on operator and traveler feedback results in a number of new innovations in both products and in-store furniture

COMPANY NEWS: J.C. NEWMAN

The spice of life J.C. Newman launches a variety of new products just in time for this year’s TFWA WE

New & Notable Chupa Chups Travel Tin ■ Tres Jolie Collection ■ Necklace Bolero

www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

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Shopping China has a total of 35,000-squaremeters of selling space spread across stores in Bolivia, Uruguay and Paraguay

In Brief

Shopping China celebrates the biggest border turnover

S

hopping China started its business in Paraguay in 1933 selling accessories and fragrances. Before long the business grew exceptionally and the company started importing various products as a means of better serving its customers. After many years of hard work the company consolidated itself as a point of reference for imported goods on the border with Brazil.

The vision of CEO of Shopping China Felipe Cogorno and his brothers has earned the company worldwide recognition from its customers and partners in the duty free industry. Indeed, a clear indication of Shopping China’s success is that fact that it has received three DFNI awards for Best Border/Downtown Travel Retailer in the Americas.

The company now operates in three countries—Bolivia, Uruguay and Paraguay—and offers its customers a variety of

more than 150,000 imported products. Often a must-stopshop for Brazilians, more than 2.5 million people visit the stores every year. In fact, Shopping China says that it topped competitors at the borders with Brazil in 2010, posting a total turnover for the year of US$500 million.

Cogorno cites dynamism as a quality that has allowed the operator to continually reach new heights. Shopping China recently added a new store in Salto del Guairá Paraguay, and is now working on a new project for a store in Uruguay, which he asserts will greatly improve the company’s position in the market.

In line with the growth in business at the borders, Shopping China has also increased the size of its warehousing facilities to match demand from customers across the company’s 35,000-square-meters of store space. As a result, Shopping China recently announced the opening of a new 27,000-square-meter warehouse in addition to its two existing warehouses in Paraguay.

Ezeiza Airport’s Terminal C inaugurated

S

eropuertos Argentina 2000 (AA2000) recently inaugurated the new Terminal C at Ezeiza Airport. President of Argentina Cristina Fernández de Kirchner, along with AA2000 President Ernesto Gutiérrez and Eduardo Eurnekian of Corporación América, were present at the event that marked the official opening of the Mercedes Sosa Terminal of Ezeiza Airport.

More than 2,000 people attended the inauguration, including numerous governmental officials. The completion of the terminal was the result of work performed by over 1,000 individuals over the span of 19 months, representing an investment of ARS600 million (US$145 million). AA2000 says the terminal is

16

a triumph of design, infrastructure and technology that boasts modern systems and stateof-the-art security.

“I’m very proud of this magnificent installation and the great infrastructural work done here,” said President Kirchner at the ceremony, “because when people enter or leave our country, it’s through the airport. This new terminal represents the development of the entire country.

“This wonderful terminal can now be enjoyed not only by Argentineans, but visitors to our country as well,” she continued. “I commend AA2000 for preparing not only for the present, but also for the future by envisioning the growth of tourism to Argentina.”

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Gutiérrez added: “Terminal C is the first stage in the creation of the new Ezeiza International Airport. When this project is finished, it will be one of the most modern airports in the world, with 145,000-square-meters available for 13 million passengers and 90,000 movements annually.”

Terminal C boasts 21,000-square-meters, 8 boarding gates, 2,500 new parking spaces, new luggage carousels, an increased number of security stations, 12 immigration desks, more than 600 seats, a new bridge above the runway and a modern firefighting and rescue system.

The entire airport project is expected to be completed in 2013.

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In Brief

Farecompare.com compiles list of airport security wait times

Carnival Corp. to open port facility in Dominican Republic in 2013

A

At press time it was reported in USA Today that Carnival Corp. has signed a memorandum of understanding to finance a US$65 million port facility and retail/restaurant/recreation complex aimed at cruise passengers west of Puerto Plata. Carnival will partner with the Rannik family, known for its shipping operations in the Dominican Republic, for the project. The initiative is said to include a docking facility at Maimon Bay that will accommodate two ships measuring over 1,000 feet long.

The space will include a transportation hub in addition to retail and recreation areas, according to Carnival, and is expected to open in Fall 2013. Carnival Corp. has an existing long-term deal with the Dominican government to rent the island of Catalina as a private island for its Costa Cruises.

It hasn’t been determined yet which ships or brands might visit the new Puerto Plata facility, and Carnival noted that further details will be announced at a later date. Carnival opened port facilities with retail complexes in Grand Turk in 2006; Cozumel, Mexico, in 2008; and Mahogany Bay in Roatan, Honduras. Originally, Grand Turk was opened for Holland America ships but is now frequented by seven brands and has become the third most popular of Carnival’s Caribbean ports after Nassau and Cozumel.

F

inding out the average airport security wait time is not as easy as it appears. The Transportation Security Agency used to have this information on its website, but they took it down in 2009. The Agency now has an app for passengers that can be accessed by smartphone or computer. The Customs and Border Protection Agency also has a web page that can fetch average security wait times for an airport for a given time period, but the data is incomplete.

Sometimes this information is listed on an airport’s website, and some airport security information is available from news stories on the web. However, there is no definitive, one-stop site to navigate in order to find out once and for all what the average security wait time is for any airport.

With that in mind, Farecompare.com has compiled a table of the 25 busiest US airports along with average TSA security wait times. Farecompare.com notes that the information was taken from a variety of sources.

While these averages may help you do your “big picture” travel planning, you are advised to keep up with current events that could affect security wait times, and avail yourself of more immediate security information via apps when scheduling travel days.

Airport

Atlanta

Hartsfield-Jackson Atlanta International Airport O’Hare International Airport Los Angeles International Airport Dallas/Fort Worth International Airport Denver International Airport McCarran International Airport John F. Kennedy International Airport Phoenix Sky Harbor International Airport George Bush Intercontinental Airport Newark Liberty International Airport Detroit Metropolitan Wayne County Airport Minneapolis/St. Paul International Airport Orlando International Airport San Francisco International Airport Miami International Airport Philadelphia International Airport Charlotte/Douglas International Airport Seattle-Tacoma International Airport Logan International Airport LaGuardia Airport Washington Dulles International Airport Baltimore-Washington International Thurgood Marshall Airport Salt Lake City International Airport Fort Lauderdale-Hollywood International Airport Honolulu International Airport

Chicago Los Angeles Dallas-Fort Worth Denver Las Vegas New York City Phoenix Houston Newark Detroit Minneapolis-St. Paul Orlando San Francisco Miami Philadelphia Charlotte Seattle Boston New York City Washington, D.C. Baltimore Salt Lake City Fort Lauderdale Honolulu

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Average Wait Time (min)

City

10 10 15 8 16 20 21 10 19 14 5 5 30 15 7 5 5 15 5 6 31 5 25 30 25

Alessandro Gassman

www.ferragamo.com

Top Story: Dufry

Making good on a promise

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o doubt the biggest news in the duty free industry of late is Dufry’s recent acquisitions in a number of emerging markets. Dufry notes that the businesses were acquired in four separate transactions and are comprised of Interbaires, the leading airport retailer in Argentina, Duty Free Uruguay, Duty Free Ecuador and other operations in Armenia and Martinique, as well as a wholesale platform.

The new businesses add 21 shops in ten airports with a total retail space of around 13,500-square-meters to Dufry’s portfolio. In the twelve months ending May 2011, pro forma combined turnover was US$395 million and EBITDA was US$96.5 million. The acquired businesses all have long-term concession contracts and more than 90% of sales are generated based on contracts with durations of more than 10 years.

Dufry paid a combined purchase price for all four transactions of US$957 million (CHF 766 million), of which US$285 million was paid as consideration for Interbaires. All transactions have been fully debt financed and Dufry structured an additional credit facility of US$1 billion.

High growth and strong concessions The Group noted that all four acquisitions made by Dufry focus on the fast-growing emerging markets and comprise attractive retail operations. In the first transaction, Dufry acquired Interbaires. The company operates duty free shops in the five main Argentinean airports, including the Ezeiza and Aeroparque airports in Buenos Aires, 22

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Dufry has previously stated the importance of emerging markets to its business plan and now backs it up with the purchase of major airport retail businesses in South America, Martinique and Armenia BY RYAN WHITE as well as the airports in Bariloche, Cordoba and Mendoza. It operates a retail space of 8,000-square-meters and in 2010 generated a turnover of approximately US$250 million.

The second transaction includes Duty Free Uruguay in Montevideo and Punta del Este and Duty Free Ecuador at the Guayaquil Airport, as well as other operations in Armenia at the Yerevan airport.

The total retail space in these operations is more than 5,500-squaremeters and turnover is approximately US$85 million.

Dufry also acquired two shops at the international airport in Martinique with a total space of 250-square-meters and selling the full range of duty free products.

The operations performed very well in the past years and have experienced double-digit growth to reach pro forma combined turnover of US$395 million for the twelve months ending May 2011. The businesses are also very attractive in terms of profitability, says Dufry: the pro forma combined EBITDA was US$96.5 million for the same period.

All operations have long-term concession contracts and the majority of sales are based on contracts with a remaining term of more than 10 years. The concession contract with the main Argentinean airport operator has a remaining duration of more than 15 years.

Consolidation of the travel retail leadership In 2010, on a pro forma basis and based on the 2010 average USD/CHF exchange rate, Dufry, including the four acquired businesses, generated a turnover of CHF3.0 billion (US$4 billion) and an EBITDA of

The new operations in Argentina, Ecuador and Uruguay will be managed together with Dufry’s existing South American operations (pictured is one of Dufry Brazil’s stores)

Strong synergies and EPS accretive

“Overall, the transactions will allow us to accelerate the next development phase of our Group and they strengthen our overall profile and development potential.”

Julian Diaz, CEO, Dufry

approximately CHF434 million (US$585.7 million). The expanded Group is present in 45 countries, operates 1,160 shops with a total retail space of 168,000-square-meters and has a workforce of approximately 13,500 employees.

“The transactions strengthen Dufry’s leadership in the travel retail industry globally and specifically in the fast growing emerging markets,” the Group says. “They also mark the next step in Dufry’s development by adding some excellent long-term contracts to the concession portfolio.”

New financial capacity and strong cash generation Dufry acquired 100% of the operating businesses in each of the transactions and paid a total purchase price of US$957 million. The transactions have been fully financed with debt and Dufry entered an additional committed 5-year syndicated bank facility, which has been structured to sit alongside the existing financing. The existing banking arrangements remain in place and their structure will remain unchanged.

The new facility has been underwritten by a bank syndicate comprised of BBVA, BNP Paribas, Credit Agricole, ING, Raiffeisen Bank International, Royal Bank of Scotland, Santander, Unicredit and WestLB. Through this financing, Dufry almost doubled its available credit lines by US$1,000 million (CHF 800 million) to a total of CHF 1,800 million. Thanks to the committed long-term financing combined with the high cash generation of the Group, all the transactions could be fully debt financed.

Dufry will integrate the businesses in the next twelve months and expects to generate cumulative synergies of approximately US$25 million over the next two years. Specifically, Dufry intends to merge the acquired wholesale company with its logistics platforms in the Americas.

Overall, the transactions are expected to be Basic EPS accretive from 2012 onwards and Core EPS accretive already in 2011.

The businesses will be integrated into the existing Dufry organization and the new operations in Argentina, Ecuador and Uruguay will be managed together with Dufry’s existing South American operations.

The Armenian operation will be managed through Region Eurasia. The operations in Martinique will be managed from Region Europe. Dufry will integrate the new businesses in the next twelve months and expects to extract synergies through increased top-line growth, improved gross margin through the consolidation of purchasing volumes, assortment review and expansion, review of the pricing policy as well as through improving processes in the back office functions.

Additionally, the merger of the newly acquired wholesale company with the existing logistics platforms in the Americas is expected to further leverage the improvements in the supply chain that were planned as part of the “Dufry plus One” and “One Dufry” initiatives and potentially generate additional synergies. Once completed, Dufry believes the new logistics platform will be one of the most advanced supply chain organizations in the travel retail industry.

Julian Diaz, CEO of Dufry, commented: “The companies that we were able to acquire are among the best in our industry: they are longterm contracts for attractive locations in fast growing emerging markets. They are also a 100% airport duty free business, which is perfect for implementing the Dufry business model to achieve synergies and to develop the business further.

“Dufry has led the consolidation process in the travel retail industry, being an important part of our strategy to further enhance our business model, and we have consistently emphasized that we intend to focus on emerging markets and on good long-term concession contracts. The acquired companies match these criteria perfectly.

“We will start to integrate the new businesses right away and we expect to generate substantial synergies of US$25 million over the next two years. We were looking to consolidate our logistics platforms as part of our ‘Dufry plus One’ and ‘One Dufry’ initiatives and the acquisition of the wholesale company gives a whole new dimension to this project. We will need to analyze this part in more detail but we are sure that we will be able to substantially strengthen and increase the scope of the existing logistics project through the newly acquired business.

“We have been able to put together an excellent long-term financing package and our focus during the next twelve months will be to generate cash and to deleverage. The strong cash generation of our Group as well as the newly acquired businesses combined with the substantial synergy potential should allow us to reduce our leverage very quickly.

“Overall, the transactions will allow us to accelerate the next development phase of our Group and they strengthen our overall profile and development potential. The acquisitions are also in line with our guiding principle to create value for our shareholders and the EPS accretion expected from 2012 onwards reflects this.

“To conclude, we are delighted about the successful closing of all four transactions and we would like to welcome the new employees to Dufry.”

On the following pages Americas Duty Free presents a retrospective of the impressive work done in Argentina, Uruguay and Ecuador

by Interbaires, Duty Free Uruguay and Duty Free Ecuador respectively during recent years. www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

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Top Story: Dufry

Luxury leanings

Offering luxury products across categories has always been a priority for Interbaires

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ong known for placing an attention to luxury retailing high on its list of priorities, Interbaires has made a point of making sure the ambiance of its stores, from the smallest to the biggest, reflects the exclusivity for which the duty free industry is known. In 2009, CEO of Interbaires Martin Leal told Americas Duty Free that consumers are looking for something far above average from their duty free stores.

“It’s very difficult for a store to embody luxury when it measures 60-square-meters,” he said. “For this reason, we’re thinking big in order to give the client more of an ample, luxurious space.”

Of course, Interbaires also has some smaller stores, but this hasn’t stopped the operator from bringing high-end brands into the mix, making sure customers are given the star treatment and working toward

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

“In the end, it’s about creating memorable experiences for clients.”

Martin Leal, CEO, Interbaires

generating increased loyalty among travelers. In 2010 Interbaires organized a number of events with some very prestigious brands, bringing key suppliers’ messages directly to a select group of valued customers. The lynchpin of the initiative was Interbaires’ Duty Free Point program, an important tool that rewarded frequent shoppers with points that can be redeemed in the stores. Furthermore, the events put on in conjunction with the points program allowed Interbaires to provide brand owners with customer information relating to shopping behavior, nationality, age, average spend and so on.

Interbaires also developed an exclusive VIP membership for a select 500 of its most valued clients. VIPs were invited to participate in the Winemaking Experience, a program organized in conjunction with Argentina-based winery Salentein.

Interbaires’ 2010 Winemaking Experience initiative is a perfect example of the attention to customer service displayed by the operator over the years

“In the end, it’s about creating memorable experiences for clients,” Leal told us while the initiatives were running. “In addition, we want to have the appropriate product to offer to a more demanding passenger. Of course, price is an issue, but assortment and quality is a must.”

Most recently in July, Interbaires opened a new store measuring 650-square-meters in Ezeiza Airport’s Terminal C. The new terminal, which opened at the same time, replaces Terminal B and caters exclusively to Aerolineas Argentinas.

Rodrigo Manceñido, Commercial Manager at Interbaires, explained the project: “Eventually, by the time renovations to the airport are complete in late 2013, Terminals A and C will be connected by a new Terminal B. For the moment we’re focusing on getting the layout and product mix right for the Argentinean passengers that will be coming through the terminal.”

When travelers pass through the terminal, they’ll also be passing through the new store as a result of its walkthrough concept. The store replaces three Interbaires locations in Terminal B and boasts about 25% more selling space than was available in the old stores. Interbaires has performed its fair share of research and it’s no doubt that Dufry— a company accustomed to performing its own detailed analyses—will

benefit from Interbaires’ focus on finding out what specific passenger profiles want and need.

“We are very careful when it comes to research, to the point where we examine trends ticket by ticket,” explained Manceñido. “We’ve done a lot of research since the older stores in Terminal B were opened. Some of the things we learned simply couldn’t be implemented in Terminal B because of the limits that the physical space imposed.”

Manceñido gave branding, layout and merchandising as three examples. While no details have yet been given with regard to what changes, if any, Dufry plans on making to the Terminal C location, Manceñido noted that it currently looks considerably different from some other Interbaires locations in terms of product mix given that it caters to Argentineans as opposed to Brazilians.

Given the popularity of installment plans with Argentinean passengers, Interbaires said before the acquisition that it would be focusing on very high-end products in the Terminal C store. Again, while no details relating to Dufry’s proposed changes have yet been released, the operator is well versed in implementing successful installment plans in other countries, suggesting that Manceñido’s views on the future of the Terminal C store may not be far off point from those of Dufry.

www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

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When opened in 2009, Duty Free Uruguay’s two new stores at Carrasco airport were dubbed “the perfect shopping experience” by General Manager Diego Arrosa

Top Story: Dufry

Staying ahead of the pack

D

uty Free Uruguay helped to usher in a new era of duty free shopping in late 2009 with the opening of two new stores in Carrasco Airport.

At the time, General Manager Diego Arrosa told Americas Duty Free that the locations would be “next-generation in every sense of the word.” Indeed, throughout the last two years the company has continued to make sure that the stores have evolved with the changing landscape of South American duty free.

In 2010 Duty Free Uruguay implemented a 12-month initiative called Plan +1 with the objective of increasing the capture rate. The plan covered everything from staff training to new brand launches, but perhaps the most innovative example of how Duty Free Uruguay made real steps toward increasing sales was the August 1, 2010 launch of their website. In the year since the website’s launch Duty Free Uruguay has seen great success in offering instore products for pre-order online.

During this year’s ASUTIL conference in Cancun, Arrosa gave us an update on business. “Although we’re still in the process of

reviewing our business over the last year, I can tell you that there are numerous things we can continue improving upon. Plan +1 was a success, but as we know the industry isn’t static. The key for us now is to focus on areas other than the capture rate by continuing to make goals that are ambitious but at the same time attainable.”

Another goal met and exceeded by Duty Free Uruguay this year was to keep ahead of passenger numbers at Carrasco. In 2010 Arrosa told us that it was important for him “to make sure our year-on-year sales increases double year-on-year passenger increases.” As of July, the operator was in talks with a major airline for an ongoing project to promote the Carrasco stores onboard the carrier’s aircraft.

While it’s unclear at this point whether the project will go ahead as planned, Arrosa noted at the time that an increasing number of passengers are now transiting through Carrasco.

“While transiting passengers normally purchase less in terms of volume, they’re still a very important demographic for us,” said Arrosa. Always ready to seize an opportunity, there’s no doubt that this demographic will be on Dufry’s radar in the future.

Duty Free Uruguay has implemented a number of innovative initiatives over the last two years, including loyalty programs and a pre-order website

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

“The key for us now is to focus on areas other than the capture rate by continuing to make goals that are ambitious but at the same time attainable.”

Diego Arrosa, General Manager, Duty Free Uruguay

Top Story: Dufry

A unique mix

C

ertainly a consideration for Dufry in Ecuador is the fact that recent changes to governmental regulations now make it possible for duty free arrivals stores to be opened. The country was previously one of the few locations in South America where laws prohibited selling duty free in arrivals. In fact, just before news of the purchase was released, Duty Free Ecuador announced that it would be opening its first arrivals store. The location will measure 400-square-meters and be operational sometime in the fourth quarter of this year.

Manager of Duty Free Ecuador Sergio Rinaldo explained the changing regulations in Ecuador to Americas Duty Free during this year’s ASUTIL conference: “The new regulations are predominantly aimed at attracting foreign investment and facilitating exportation. As a result of these regulations there have been changes in the way duty free stores function. Ecuador was previously one of the few countries in Latin America that didn’t allow stores in arrivals, but all that has changed now and we’re very excited.

“The arrivals store will allow us to implement those techniques that we know are working now in a setting that is more conducive to liquor sales,” Rinaldo said. Dufry has not yet commented on plans for the arrivals

store, but the Group certainly has a wealth of experience in targeting the product mix in each of its stores to specific passenger profiles.

Another consideration is the fact that Duty Free Ecuador’s passenger profile is about as specific as it can be. Rinaldo told us that between 60 and 70% of travelers moving through the airport are Ecuadorians. While some obviously live there, many call other countries such as Spain, the US or Italy home.

Regardless of whether these arriving passengers are visiting family members or returning home after a journey, there are some obvious opportunities for increased sales.

All three of the South American operators have proven themselves to be extremely capable in their own right over the years, and although details about the futures of the respective operations haven’t yet been released, it’s safe to say that most in the industry are expecting even bigger successes in the future.

Indeed, Dufry’s belief in the strength of South America and its resultant purchase of three of the region’s shining stars in duty free are indications that the boom may continue in South America for some time into the future despite the economic woes that have once

again crept up in the US and Europe.

“Ecuador was previously one of the few countries in Latin America that didn’t allow stores in arrivals, but all that has changed now and we’re very excited.”

Sergio Rinaldo, Manager, Duty Free Ecuador

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Operator News: Bright Star

Bright Star is known for its excellent selection of P&C products; the company has recently listed a number of new offerings for purchase in store and on TAM Mercosur flights

Always something new Americas Duty Free recently spoke with Bright Star about the importance of keeping its product mix fresh for travelers both in the air and on the ground BY RYAN WHITE

T

his past summer saw the launch of Bright Star’s autumn/winter TAM Mercosur in-flight catalogue.

Antonella Nuovo, Trade Manager at Bright Star, told Americas Duty Free that 20,000 copies were printed for use onboard TAM flights to destinations such as Cochabamba, Santa Cruz, Rio de Janeiro, Sao Paulo, Buenos Aires and Santiago de Chile.

“We included a nice mix of new products and bestsellers, all arranged conveniently according to categories such as fragrances, cosmetics, accessories, chocolates, spirits and tobacco,” explains Nuovo. “The reaction over the last couple of months to the new in-flight catalogue has been fantastic.”

New in cosmetics, travelers will find Christian Dior’s Capture Totale One Essential antiaging serum and Lip Maximizer, Lancome’s Rénergie Lift Volumetry, Celuli Laser products from Biotherm and offerings from Estée Lauder and L’Oreal. Another new cosmetic product that Bright Star will be selling in the in-flight magazine is L’Occitaine’s Provencal Pleasures travel kit. It contains Verbena Gel Douche (75mL), Amande Milk Concentrate (50mL), Extra Gentle Karite Shea Butter (50g) and Lavender Hand Gel (30ml).

Other brands in this season’s in-flight catalogue include Troika, Victorinox, B+D and Nici in accessories; Lindt, Ferrero and Nestlé in chocolates; and Johnnie Walker, Baileys and

“Whether on the ground or in the air, our prime objective is to keep the offering fresh for our clients.”

Antonella Nuovo, Trade Manager, Bright Star

Recent in-flight offerings in Bright Star’s perfume category include Dior and Bvlgari Miniatures, Boss Orange Man, Yves St. Laurent’s Belle D’Opium, Cacharel’s Amor Amor Absolu, CK Beauty and Lacoste’s Joy of Pink.

Furthermore, Bright Star is now offering Versace for the first time in the form of the latest launch, Vanitas.

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wines from Familia Zuccardi in spirits. “We’ve really worked hard to make sure that our latest in-flight catalogue exceeds the expectations of TAM Mercosur passengers,” says Nuovo.

As if the above weren’t enough of a selection, Bright Star is currently in the final stages of talks with The Body Shop, Salvatore Ferragamo and Narciso Rodriguez. Nuovo says

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

that products from the companies should be available very soon, both at the stores in Silvio Pettirossi International Airport and onboard TAM flights. The company is currently hard at work preparing the next issue of the in-flight catalogue, which will be released in November. Nuovo confirmed that the cover will feature Dolce & Gabbana’s Light Blue.

In addition to the new in-flight offerings, Bright Star recently launched Boss Orange Man in store and continues with a regular calendar of events that recently included Easter and Mother’s Day promotions, as well as tastings of Pisco Capel and wines from Bodega Zuccardi.

“Whether on the ground or in the air, our prime objective is to keep the offering fresh for our clients,” explains Nuovo. “Given the high number of frequent business travelers in the region, we get a lot of repeat customers. For this reason, it’s very important that we give them something new to discover

every time they enter our store.”

The cover of Bright Star’s autumn/winter in-flight catalogue; the company is currently working on its next catalogue, which will be released in November

Operator News: Monalisa

“A little help from my friends”

BY

RYAN WHITE

About to celebrate its 40th anniversary in Ciudad del Este´s burgeoning travel retail sector, Monalisa says it owes its success to the friendships it has fostered over the last four decades

I

t’s good to have friends. Just ask Monalisa. After forty years in business, the company’s store on the border with Brazil and Argentina is still located on the same corner where it was first established in 1972. Vice President of Monalisa Charif Hammoud told Americas Duty Free in a recent interview that the company’s success has a lot to do with the relationships it has built over the years, both with its many suppliers and varied clientele.

“We’re very proud because many of our customers have been visiting our store since it first opened,” says Hammoud. “Likewise, forty years has also given us time to develop great relationships with some of the world’s most sought after brands.”

While fostering strong relationships can certainly result in increased profit, in Monalisa’s case the valued feedback from repeat shoppers has informed everything from the products sold to the actual layout of the store. Case in point: Monalisa is considered by many French wine connoisseurs as the last bastion for highend, Old World wines in South America.

While many retailers have jumped on the New World bandwagon, over a period of years Monalisa identified a need among its clientele for French wines that are extremely difficult to find anywhere else in South America.

What started out as a commitment to satisfying the needs of a few customers has now gained Monalisa no small measure of fame in the region. In fact, the company has built a vast wine cellar, considered by many to be one of the best in South America in terms of both volume and quality of offerings, to cater to customers who travel from far and wide to buy high-end brands such as Petrus, Cheval Blanc, Margoux, Lafite, Latour and Romanée Conti to name but a handful.

“As with everything we do, our clients ask for it and we deliver,” says Hammoud. “This philosophy has never steered us wrong.”

The company’s practice of giving customers what they want extends across categories. In watches, for example, Monalisa has noticed a demand for higher-end brands.

Richard Mille watches, which start retailing around US$60,000, were launched at the store in June of this year.

“We want shoppers to know that they can find the best of everything at Monalisa,” Hammoud explains. “However, equally impor-

32

tant is making sure that our offerings in each category run the gamut in terms of prices. In watches, for example, you’ll also find Cartier, Bvlgari, Tag Heuer, Montblanc and Swatch timepieces among others. This is where our relationships with suppliers come into play.

Regardless of whether an item costs US$50,000 or US$200, they know that we’re interested in offering quality products above all else.”

Continued growth Largely as a result of its proactive attitude toward customer service, Monalisa has seen some impressive growth in recent years.

Despite the fact that 2010 was a banner year, the company saw sales in the first half of this year trump 2010 numbers by 25%.

“The economy in general in the region is very healthy,” explains Hammoud. “Of course, everyone has heard about the strength of Brazil, and added to this you have the Government of Paraguay investing a lot in tourism in the area. Fortunately for us tourists to Ciudad del Este, especially Brazilians, have been very kind and often make their purchases with Monalisa.”

It’s no exaggeration to say that Monalisa’s main store has become somewhat of an attraction in its own right. A good example of the store’s drawing power took place on September 7, 2010, Brazil’s Independence Day. Monalisa had 11,103 people in the store on that day alone, which stood as a record until 14,258 visitors entered the store in a single day in April of this year. Impressively, on the same day Monalisa was only about 1,700 people away from beating out Iguazu Falls for the most visitors.

“This is a record that we’re very proud of,” says Hammoud. “It’s made all the more impressive when you consider that we are only open from 8:30 am to 4:30 pm. But I have to admit,” Hammoud says with a grin, “that we stayed open until 6 pm that day to take advantage of the influx of customers. We didn’t want to close!

“Although coming in first place above a nat-

ural wonder like Iguazu Falls is a lofty goal, we’ll keep trying,” he adds.

Hammoud tells us that apart from watches, fashion is another category that has contributed significantly to Monalisa’s increased sales. He credits the growth largely to the introduction of such big-name brands as Ralph Lauren’s Polo, Tommy Hilfiger, Lacoste, Diesel, Kipling and Oakley to name but a few.

“The response to these brands has been outstanding,” he notes. “The evolution of the fashion category is really more specifically the story of the increasing popularity of these particular brands within our store. Another category that has benefitted from the inclusion of the best brands in the world is perfumes and cosmetics. Travelers visiting our store can find products from such esteemed names as Parbel, LVMH, Estée Lauder, Coty, BPI, P&G and more.”

Looking ahead On an average day, Monalisa welcomes between 2,000 and 2,500 shoppers. While this is a far cry from its record-breaker back in April, it’s still certainly an honest day’s work. The company is looking toward high season, which takes place from November to January, and expects to welcome approximately 4,000 shoppers a day during the period. Also likely to help business is the fact that the government is currently building a second bridge across the Paraguay River, thereby increasing access to Ciudad del Este.

“In addition to high season, the fact that we cater to Brazilians, Paraguayans, Europeans and Argentineans means that there’s any number of holidays every month where we see spikes in both sales and the number of people in the store,” Hammoud says. “Our goals for the foreseeable future are simple: To continue offering our clientele something truly unique in travel retail and grow with Ciudad del Este as more and more people discover the benefits of visiting Paraguay.”

“As with everything we do, our clients ask for it and we deliver. This philosophy has never steered us wrong.”

Charif Hammoud, Vice President, Monalisa

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

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Operator News: Monalisa

Now and then

Of course, the main store looks very different now than it did forty years ago. Monalisa’s flagship location—the company also has 5 Aphrodite-branded perfume stores in the local market and a distribution arm—now boasts 8 floors that include virtually every traditional travel retail category along with some pleasant surprises that are difficult (or nigh-on impossible) to find in other locations in South America.

Level 6: Sports Equipment

Level 5: Sportswear and Houseware

Level 4: Fashion

Level 3: Restaurants, Food and Confectionery

Level 2: Electronics

Level 1: Watches, Jewelry, Sunglasses & Accessories

Keeping it chic

Monalisa can be defined as travel retail (catering to 80% Brazilians, with the other 20% made up of Argentineans, people from other parts of South America and even some Europeans) as opposed to duty free because the products it sells are not tax-free. Despite this distinction, Hammoud notes that suppliers often competitively set their prices.

Furthermore, Monalisa has found a number of ways to continue enticing travelers to visit, the most notable of which is carving a niche as a retailer of ultra high-end merchandise. Throughout its 8,000-square-meters of selling space, Monalisa’s flagship store offers luxury brands such as Steinway & Sons, Christofle, Baccarat, Lalique,

Parmigiani Fleurier and Callaway to name a few.

Main Level: Perfumes and Cosmetics

Cellar: Wines and Spirits

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

From its humble beginnings in 1972 Monalisa has grown to be a destination unto itself in Asuncion, Paraguay

Operator News: DFASS

Continued improvement

CEO of DFASS Bernard Klepach tells Americas Duty Free that the first half of the year was fruitful for DFASS, both in terms of sales and partnerships BY RYAN WHITE

W

hile recent economic turmoil in the US and Europe has left open the question of how well the duty free and travel industries will fare over the rest of the year, DFASS has come off a first half that CEO Bernard Klepach

calls “more robust” than the previous year. In addition to regularly updated onboard product offerings, DFASS is this month partnering with Diageo, another powerhouse in the travel retail industry, to bring Asian travelers a promotion related to the liquor supplier’s well publicized

Americas Duty Free: Can you tell me a bit about DFASS’s performance over the first half of 2011?

Bernard Klepach, CEO, DFASS: The market for in-flight duty free has become more robust over the first half of 2011. We are experiencing double-digit growth. The market is continuing to improve from a sales per passenger perspective and DFASS has also grown in terms of market share.

ADF: What are your top three selling categories in duty free?

BK: Cigarettes, liquor and perfumes & cosmetics are our bestsellers.

ADF: Within those categories, what are your top four sellers?

BK: There’s no hierarchy as all four are top sellers, but Phillip Morris products, Diageo spirits and The L’oreal Group and Estee Lauder’s perfumes & cosmetics are performing the best.

ADF: Are there any emerging categories or brands that are gaining more of a following lately?

BK: The gift and accessories business is continuing to grow. Watches have become a key product category that continues to expand with breath of range and price point.

ADF: With regard to the passengers you serve, what nationalities are at the top in terms of purchases?

BK: Asians, Americans and Europeans purchase the most. As such, we try to carry a diverse range across categories that appeals to all nationalities.

ADF: Did purchasing habits on flights in the Americas change in the first half? Many operators are telling me that consumers are more willing to trade back up this year after a rough couple of years. What is DFASS’s perspective on this?

BK: Above all, passengers are still looking for value for money and savings over domestic retail prices.

ADF: How often does DFASS revamp its onboard offering?

BK: Most of our client programs are refreshed every 6 months from a ranging and catalogue perspective. Approximately 15-20% of the product range is changed each time. Our pre-order programs via the internet allow product to be added without the time constraints of catalogue printing. The majority of our catalogues within the US are available in an electronic format.

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

support of F1 racing. Regardless of factors beyond the company’s control, Klepach makes it clear that strong partnerships, great products and a clear vision—perhaps the most important ingredients for any company’s success— are three things that DFASS isn’t lacking.

ADF: In terms of onboard pouring, what are some popular brands that travelers are drinking?

BK: Johnnie Walker and the brands from Diageo continue to be market leaders from a pouring perspective. We are also seeing great demand for the brands from Bacardi and Pernod Ricard. Additionally, wine is continuing to grow in popularity.

ADF: How is DFASS’s partnership with Diageo coming along?

BK: We have a great partnership with Diageo, with new promotions and initiatives on a monthly basis. The next major one will be our links with them for Formula 1 in Asia, which will take place in September.

“The market is continuing to improve from a sales per passenger perspective and DFASS has also grown in terms of market share.”

Bernard Klepach, CEO, DFASS

ADF: Over the last couple of months, has DFASS partnered with any new airlines throughout the world?

BK: The newest partnership is with Fly Guam, which went live in June of this year.

ADF: Training staff to sell onboard is obviously very important. Can you explain DFASS’s training process for our readers? What works best for DFASS in terms of motivating staff to sell?

BK: DFASS employs specialized crew trainers with in-flight experience. They participate in crew training and road shows throughout the world. This team also implements incentive programs for

flight attendants and consumers on an ongoing basis.

Operator News: Baja Duty Free

The newly revamped tobacco section at Baja Duty Free’s Gateway store in San Ysidro

The newly revamped tobacco section at Baja Duty Free’s Gateway store in San Ysidro

Changing it up

A good year With sales up in key categories and recent renovations bringing stores in line with an overall branding vision, Baja Duty Free expects continued success in the second half of 2011 BY RYAN WHITE

W

hen asked how business has been of late, Elisa Castro, Vice President of Retail at Fairn & Swansonowned Baja Duty Free, says simply that the company is “having a good year.” This may be an understatement, for not only has the operator benefitted from an uplift in spirits and beer sales across its eight stores along the US-Mexico border, recent FDA regulations restricting the display of tobacco products haven’t hurt business either.

In fact, at a time when many operators are struggling to break even with tobacco sales, the category is up at Baja Duty Free’s stores.

As reported in Americas Duty Free’s ASUTIL issue, the first quarter was successful for Baja Duty Free, and Castro told us that sales continued to be solid during the second quarter. “Although we saw sales of beer slide a bit during the economic crisis, it’s always been a strong category for us,” she says. “This year we’ve seen it pick back up again, along with sales of spirits in general.”

Bestsellers across Baja Duty Free’s stores include ABInBev brands and Cuauhémoc Moctezuma brands, especially Tecate Light.

38

The company has also seen success with a regular calendar of summer promotions that offer shoppers suggestions for mixing cocktails with their favorite spirits. Castro notes that Buchanan’s and Johnnie Walker Scotch are always big sellers along the border.

Staying ahead of the game The FDA’s latest restrictions essentially put new limitations on the display of tobacco products in duty free stores along the border. Cigarettes and other tobacco products must now be stored behind the counter—no longer are shoppers allowed to touch tobacco products on display.

“Of course, we’ve complied with the new FDA regulations,” says Castro, “and depending on the location and what we feel works best have either put the products behind the counter or used glass casings. This said, I can tell you that the new rules haven’t really impacted our sales at all, which is encouraging.”

Marlboro continues to be a bestseller for Baja Duty Free. However, Castro notes that the USA Gold brand, originally introduced during the recession due to its lower price point, has proven to be a standout as well.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

While the new FDA regulations necessitated small changes to all eight of Baja Duty Free’s stores, larger-scale renovations have been taking place across locations for some time now. The company started renovating selected shops in 2009 and recently completed a remodeling of its Calexico store. Both aesthetics and layout were elements that Castro and company took into consideration in the latest round of work.

“Keeping our branding consistent across all of our locations was a prime objective,” Castro says. “It’s important to us that our customers know that they’re in a Baja Duty Free store the moment they walk in.”

The signature signage, colors and wooden accents synonymous with the Baja Duty Free brand were updated for consistency in the Calexico store. Furthermore, the layout was changed slightly so that visitors would pass by other categories before reaching the popular beer section. Finally, a general facelift was given to both the exterior and interior to keep it looking modern.

Given Castro’s mention of the 2009 downturn, we asked her about whether Baja Duty Free is bracing for a double dip recession.

While she is cautious, the knowledge that the company has come out of recent hardships stronger than ever has obviously provided some measure of perspective on the US’s economic woes.

“You hear on the news that the economy is in bad shape, but the other side of the coin is that retail is up,” she says. “Of course, there may be a lag and we could feel the effects of the current situation months down the road, but for the moment we’ll continue focusing on maintaining the increases that we’ve seen over the first six months of the year while looking forward to the busy holiday season.”

The greats of Torres. A gift of time.

Airport News: Chicago O’Hare

Slings and arrows Chicago O’Hare’s redevelopment plans for Terminal 5 draw fire from Chicago Aviation Partners, pointing to a possibly lengthy delay in the planned renovations BY RYAN WHITE

A

s first reported by Chicago Business, the proposed redevelopment plan for Chicago O’Hare’s Terminal 5 has hit a considerable snag after Chicago Aviation Partners (CAP), a joint venture that involves Duty Free Americas, filed a lawsuit, calling the selection process “a sham.” Chicago City Council originally approved an ordinance that allowed the City to enter into a Concession Redevelopment and Management Lease Agreement with Westfield Concessions Management, LLC. The agreement provided for a complete redevelopment of the concessions program in International Terminal 5 at O'Hare International Airport to add new food and beverage, news and gifts, specialty retail and duty free locations.

The agreement provided for Westfield to redevelop and manage concessions in International Terminal 5. As opposed to privatizing the terminal itself, the deal specified that the City would retain ownership of the asset with the opportunity, at the 10-year anniversary of the agreement, to terminate the 20-year agreement without cause. It was noted that Westfield and its operators would invest approximately US$26 million to redevelop the terminal's concession program.

The contract also provided for the relocation of the security checkpoints to open up prime concession space and the build out of 40

several new concession spaces within the airside location (post security) of the terminal.

In total over 25 concession spaces were planned.

Westfield agreed to pay the City annual rent commensurate with revenue generated at Terminal 5 each year. The annual rent to be paid by Westfield was set at either US$3.00 per actual international enplanement from Terminal 5 in the prior calendar year or a percentage rent of 16% of gross sales, whichever is greater. It was specified that the US$3.00 per enplanement would be tied to the Consumer Price Index to account for inflation.

The argument The lawsuit, filed a press time, claims that the City will earn US$120 million less in revenue with Westfield over the 20-year period of the lease. Requesting a preliminary injunction, CAP has noted that the contract must be awarded to the highest bidder.

The lawsuit stated, in part, that after “considerable effort to block aldermen’s access to details of the competing bids, the City awarded the contract to Westfield—whose non-responsive, contingent-riddled deal resulted in US$120 million less revenue to the City than CAP's guaranteed minimum payments, and incredibly required the City to guarantee an undisclosed return on investment to Westfield or face reimbursement of all of Westfield's investment in the project."

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

The City responded, saying in a statement: “The City Council rejected CAP’s bid resoundingly, with close to a unanimous vote for Westfield’s proposal. Westfield has a proven track record of delivering on their promises, unlike CAP. Our process was fair and open to all bidders, and there was unprecedented transparency regarding all aspects of the proposals prior to the City Council's vote on this matter.

"This is simply an attempt by a disgruntled bidder to stop the award of a contract to another party. The plaintiff has made these allegations over and over again, and they have been soundly rejected.”

Despite the City’s rebuttal, the Chicago Tribune published a report suggesting that aldermen weren’t given enough time to properly review all aspects of the contract. Ald. Scott Waguespack was quoted as saying that “the contract bidding process fails the most basic business standards. Using Westfield's own projections, we have found that the other bidders would generate 20 to 50% more revenue.”

While there was no news at press time as to whether or not the preliminary injunction would be granted as per CAP’s request, it’s clear that the issue will take longer to resolve than either the City of Chicago or Westfield would like. Americas Duty Free will continue to keep readers abreast of the situation through both

online and print communications.

Operator News: DFA

DFA’s new 117-square-meter Thomas Pink boutique in Concourse D of Miami International Airport

Bringing luxury to Miami

DFA opens four luxury boutiques at MIA, effectively cementing its place as the largest duty free retailer in North America BY RYAN WHITE

O

n Monday, August 15, officials from the Miami-Dade Aviation Department (MDAD) and Duty Free Americas (DFA) celebrated the grand opening of duty free boutique locations for luxury brands Coach, Emporio Armani, Montblanc and Thomas Pink at Miami International Airport (MIA).

The new locations, which began with the public opening of Coach in February and continued with Montblanc in April, Emporio Armani in May and Thomas Pink on August 10, are all located near gates D-9 and D-10 in Concourse D. DFA celebrated the new stores with a grand opening ceremony that included guided tours by brand representatives and ribbon cuttings for each store, a red carpet fashion show with professional models by Emporio Armani, entertainment by a classical pianist and grand opening remarks by DFA President Jerome Falic and Miguel Southwell, MDAD Deputy Director of Business Retention and Development.

Two mock guards dressed in the traditional British “Coldstream Guards” uniform flanked the entrance of the 117-square-meter Thomas Pink store, the brand’s first US airport location. Established in London, Thomas Pink is part of the Louis Vuitton Moet Hennessey group and a leading international retailer of luxury shirts and fine clothing 42

with flagship stores in London, New York, Paris and more than 80 boutiques and concessions worldwide. The store at MIA offers an array of men’s and women’s apparel and a wide range of accessories.

“DFA’s new boutiques take the luxury brand offerings at MIA to another level with duty free products not yet available in other airports,” said Adrian Songer, MDAD Concession Business Development Chief. “We are extremely honored that DFA chose MIA as their first US airport for these prestigious, high-end brands.”

“Since most airports only have one duty free concessionaire, the boutiques give the consumer a more personal shopping experience,” Jerome Falic told Americas Duty Free.

He went on to note that the passenger profile in Terminal D of MIA is made up mostly of Latin Americans such as Brazilians, Venezuelans, Columbians and Mexicans, as well as Europeans.

“These brands are very well known around the world and all of the passengers we cater to are familiar with them,” he explained.

DFA’s Emporio Armani store—the brand’s first airport location in North America—is a 95-square-meter boutique that offers the brand’s complete lifestyle collection for men and women, including formal wear and casual wear, sportswear, leather accessories, watches, eyewear and jewelry.

The 64-square-meter Montblanc location

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

is the brand’s first-ever travel retail boutique and features its renowned high-quality writing instruments as well as its expanded product range that now includes writing accessories, leather goods, male and female jewelry, eyewear and watches.

The 100-square-meter Coach boutique is one of only two airport locations for the brand in the US and offers leather goods and men’s and women’s accessories.

Strong sales These latest openings mark what has been an impressive first half of 2011 for DFA. Falic notes that sales in the first six months were up across the board: “This year we have enjoyed a very big increase in sales over last year,” he says. “Airport traffic is up and consumers are looking for the latest product offerings, which we are able to offer.”

In addition to DFA’s booming business, Falic says that UETA is doing very well in South America. He cites Macau as another standout, explaining that sales have more than doubled in both regions over last year.

“I really cannot point to one particular region as we have had tremendous growth throughout all of the regions both at airports and borders,” Falic told us.

Despite the US being unable to shake its much publicized economic troubles, DFA has found itself in a very enviable position

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Operator News: DFA

The ribbon cutting at the new Emporio Armani boutique

Miami-Dade Aviation Director José Abreu (center) joins Duty Free Americas officials to celebrate the opening of the Coach boutique at MIA

So far, so good

The new Montblanc boutique will measure 64-square-meters

Just as important as the fact that the passengers in Terminal D will recognize these iconic brands is that MIA has posted solid passengers numbers in the first half of 2011. Total volume was up 6.8% through June, according to statistics from the Miami-Dade Aviation Department. MIA saw 18.8 million travelers in the first six months of the year, representing 1.2 million passengers more than the airport served through the same period last year.

International passengers jumped 8.4% to 8.8 million travelers and domestic travelers grew 5.4% to 10 million. In the month of June alone, total passengers increased 7.6% to 3.2 million passengers. International traffic grew 8.6% to more than 1.5 million passengers and domestic travel rose 6.8% to nearly 1.7 million passengers.

Passenger numbers were boosted by new and expanded routes. In March, KLM began new service from Amsterdam with four weekly flights, and Iberia began new service from Barcelona with three weekly flights. Also in March, Delta began providing daily service from London Heathrow. American Airlines launched new daily service to Casa De Campo, Dominican Republic in May and began increasing service to seven other destinations as well. In June, Dutch airline ArkeFly also began twice-weekly service from Amsterdam and TAP Portugal began service from Lisbon five times per week. June also saw the beginning of Airbus A380 service by Lufthansa for its daily service from Frankfurt, which increases capacity on that route by nearly 200 seats per day.

Despite a downturn in air cargo movement worldwide that resulted in a decrease of 1.8% in MIA’s total cargo volume, freight shipments between Asia and MIA jumped 9.2% to 43,623 tons through June. After growing from nine weekly flights in 2009 to 19 weekly flights in 2010, Asian cargo service at MIA expanded further with the addition of three weekly freighter flights from Seoul's Incheon Airport by Asiana Airlines on September 1. MIA's four Asian cargo carriers combined now provide direct freighter service to cargo hubs in Taipei, Seoul and Hong Kong, as well as connecting flights to 21 other destinations in mainland China, MIA's leading Asian trade partner in both volume and value of goods.

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

given its vast experience in selling to passengers from other regions of the world. The currencies of other countries have strengthened versus the US Dollar, says Falic, and this has resulted in increased sales, cementing DFA’s place as the largest duty free retailer in North America with 115 duty free and news and gift stores in US airports and along the US borders with Canada and Mexico.

Falic concluded our conversation by noting that he’s happy with what DFA has achieved to date. He says, however, that there is always more to accomplish. “As good as business is, we are continuously looking for new opportunities to expand either in airports in the US or wherever we feel there are other opportunities. Over the last couple of years, we’ve opened very large department stores in Uruguay on the border of Brazil and we are building three more over the next year. We also opened several airports in Central and South America and are looking to expand there as well,” he says.

Indeed, the Falic brothers’ collective drive to continue raising the bar is no doubt the biggest factor in DFA’s success. The other side of the proverbial coin, of course, is the fact that it is this very same drive that won’t let them rest after having achieved more than

most ever dare to dream.

Industry News: IAADFS

More questions than answers Michael Payne, Executive Director of IAADFS, discusses the region’s positive performance during the first half and contemplates what lies ahead for the rest of the year BY RYAN WHITE

The Americas: “Sales are up” Americas Duty Free: In terms of duty free sales in the Americas for the first half, do you feel the region is on the right track? With the recent economic news are you bracing for a double dip in the second half? If so, will travel be affected in much the same way as it was the first time?

Michael Payne, Executive Director, IAADFS: We don’t collect figures for the industry but you see numbers that indicate sales were up across the region through the first two quarters. Travel is up and more often than not we track that trend. It also appears that spend per passenger is increasing. Particularly now, global conditions obviously warrant caution, but we were on a good trend line for the first two quarters. The only thing I know for sure is that it is going to be volatile. I can state the obvious: If travel remains strong we should be fine. If corporations start to again reduce their travel and leisure travel drops, we won’t be.

locations that come to mind, but there are too many to mention them all. I think this issue is being addressed but the competition for infrastructure dollars will only increase.

ADF: Can you comment on other issues such as the one bag policy, threats from the WHO, etc.? Are there any new developments we should know about?

MP: They are both areas of concern and IAADFS remains active, particularly with regard to WHO issues. Alcohol and tobacco will be a focus in the overall WHO non-communicable disease initiatives and will need to be monitored from a duty free perspective. The one bag policy, if implemented in a draconian manner, is certainly not good for duty free so we are obviously watching that closely whenever it crops up and taking appropriate action.

ADF: You expressed concern at last year’s ASUTIL conference that the industry isn’t doing enough to define itself, noting that

“Particularly now, global conditions obviously warrant caution, but we were on a good trend line for first two quarters.”

46

IAADFS 2012: Sticking to a successful format ADF: The 2011 Opening Cocktail was open to everyone. Will you be keeping this format in 2012?

MP: Yes, we plan to follow the same format but hope to improve on the overall event even more though we felt it was very successful and well received ADF: Are there any changes planned in terms of show times, event days, etc.?

MP: We’ll stick to essentially the same schedule although we may switch out some of the activities on Sunday, perhaps adding some new sports day events and possibly adding an educational session on Sunday afternoon.

We are looking at ways to enhance the pricing package to make it easier for people to attend all social functions. The one event ticket price offering seems to be too high for many attendees and people seem to like the idea of being able to purchase everything at one price. More to come on that.

ADF: What is your forecast in terms of attendees?

MP: I really don’t know at this stage. However, as long as we control/limit access to the show to those engaged in the duty free channel our universe will be 2,500 to 3,000 or so participants.

Michael Payne, Executive Director, IAADFS

ADF: During last year’s ASUTIL conference, you pointed out inadequate airport infrastructure as a major obstacle to growth.

Have you seen any improvement in this regard?

MP: I still think finding public or private dollars for infrastructure investment at airports will be difficult. Having said that you certainly see progress at a number of locations in terms of expansion and upgrades to facilities—Miami, New York, Cancun, Atlanta, Buenos Aires, Panama and Brazil are some

itations, allowances and so forth, which can be confusing for infrequent travelers particularly. There simply isn’t one set of rules globally that governs all of this in a uniform manner and we need to work at ensuring travelers know what they are permitted to do or not do. It’s a complicated issue.

many travelers are still confused about exactly what duty free is. In the year or so since the 2010 ASUTIL conference, do you feel any progress has been made?

MP: I believe operators and suppliers work hard to define for their customers the value of duty free and present an overall compelling image and concept designed to attract customers. My comment was more in the context of the variances that exist globally surrounding value, currency issues, security bags, confiscation of products, quantity lim-

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

ADF: Will there be any changes made to the gala dinner?

MP: At the Board’s direction, we definitely have a goal to enhance the Gala. Attendance has been dropping and we need to get it back to the type of evening that people want to attend and can feel good about entertaining customers. There will be a lot more information coming out on this but people should plan now to attend the Tuesday night Gala. It will be up scaled and easier for people to participate. It is going to be a great evening.

Conference Review: ASUTIL

An eye

toward the future

The strength of the Latin American economy results in a 2011 ASUTIL conference that was a lot closer to heaven than hell BY

RYAN WHITE

T

he 2011 ASUTIL conference, themed “Ni Infierno, Ni Paraiso,” concluded on Saturday, June 25 with a visit to Tulum and Xel-Há. The restful social activity was well earned, as delegates spent Wednesday to Friday listening to and engaging with an all-star lineup of speakers, getting down to business during three days of networking sessions and continuing discussions in a more relaxed manner during the many social events.

José Luis Donagaray, Secretary-General of ASUTIL, told Americas Duty Free that 310 delegates attended this year, representing a record for the South American duty free conference. He said that social activities were well attended and expressed his thanks to all attendees.

“At last year’s ASUTIL conference we welcomed 270 guests to Puerto Rico,” he explained. “We’ve consecutively broke attendance records for the last three years. Needless to say we’re very pleased. I think the conference presentations provided attendees

48

The conference portion of this year’s ASUTIL event was well attended on both days, largely due to the quality of speakers present from a wide range of disciplines

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

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Conference Review: ASUTIL with very useful information that applies directly to their businesses.

“It was very interesting to see the wonderful work that ASUR has done in Terminal 3 of Cancun Airport during the Opening Cocktail,” he continued. “Furthermore, the Aldeasa-sponsored Gala Dinner was very enjoyable.

“Finally, the social activity on Saturday was a big one!” he said. “We left the hotel to go to Tulum and Xel-Há at 8:00 am and returned at 4:00 pm, offering participants yet another opportunity to connect on a different level in a very relaxed setting. We’re very content with every aspect of the conference and would like to thank all the sponsors and delegates.”

The numbers behind the conference In the Welcome and Official Opening, President of ASUTIL Francisco “Paco” Heredia provided delegates with some statistics related to Latin America’s impressive performance over the last year, noting that across 12 countries and 15 duty free operators, sales increased an average of 39.2% in Q1 2011 over the same period last year. Heredia gave more good news, noting that the increase in sales is well above average passenger increases during the same timeframe (+19.4%). In terms of sales increases per category, fragrances led the way over the same period (+41.2%), followed by spirits (+34.1%), tobacco (+26%), confectionery (+49.1%), electronics (+52.2%) and fashion, sports, gifts and other (+32.8%).

The conference

As always, lunches were included in the registration fee, with Wednesday’s midday meal being a picnic by the beach

Following Heredia’s welcome, Anne Kavanagh took the stage for a discussion themed “Travel Retail: We need to tlk.” After a coffee break sponsored by Americas Duty Free and Godiva, Enrique Urioste, CEO of Neutral Duty Free, and Patrick M. Collins, Senior Partner at JH Partners, gave a presentation entitled “Why Latin America? Why duty free border shops?”

“Brazil: The country of the present” was the theme of Ivan Correa’s discussion. In it, he talked about the evolution of Brazilians’ spending abroad since the year 2000, indicating a clear increase over the last decade and, perhaps more importantly, a forecasted increase in travel by Brazilians abroad over the decade to come.

On Friday morning after a coffee break sponsored by Americas Duty Free and Godiva, Carlos Melconian, Director of M&S Consultores, gave a presentation entitled “Abundance: Permanent or Temporary?” He noted that Latin American economies now face the challenge of “managing the bonanza” and the resulting inflationary pressures and currency appreciation.

50

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

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Conference Review: ASUTIL Melconian was followed by Lewis Allen, Director of Environments for Portland Design, who discussed “How the travel retail environment needs to respond to the passenger.” He used Changi, Schiphol and Orlando Airports, among many others, as examples of the “fantastic things that airports can do to go one step beyond… and change your mood.”

After another coffee break, Disney Institute’s Business Program Facilitator Jack Santiago gave a talk entitled “Disney’s approach to people management.” He discussed how to create a corporate culture and the importance of inspiring and creating an emotional connection with clients.

The conference closed with the presentation of the lifetime achievement award to Martin Moodie, Founder and Chairman of The Moodie Report.

Networking and evening activities ASUTIL’s popular networking sessions, sponsored

by Diageo and Bacardi, took place for a full nine hours on Wednesday followed by a further four and a half hours on Thursday. This year’s meet-

ings were arranged by attendees as opposed to ASUTIL organizers but still provided the suppliers the same opportunity to get face time with the numerous Latin American buyers present.

As always, lunches were included in the registration fee, with Wednesday’s midday meal being a picnic by the beach. On Thursday and Friday, delegates were invited to the Tulum Terrace to enjoy lunch.

Wednesday night’s Opening Cocktail took place at Cancun Airport’s Terminal 3, where ASUR treated guests to appetizers and cocktails against the backdrop of Aldeasa’s impressive walkthrough store. Thursday’s Gala Dinner, sponsored by Aldeasa, was held on the beach at the Presidente Intercontinental Cancun Resort. Traditional performances by Mexican dancers and mariachis followed cocktails and a delicious dinner.

Just as last year, coffee breaks for the 2011 ASUTIL conference were sponsored

by Americas Duty Free and Godiva

A triumphant return to South America At the Closing Ceremony, it was announced that next year’s ASUTIL conference will remain in its new timeslot in June. Furthermore, it has already been confirmed that the 2012 conference will take place in Iguazú, Argentina.

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Conference Review: ASUTIL

Con la mirada al futuro La fuerza de los resultados de la

economía latinoamericana en la Conferencia ASUTIL 2011 estuvo mucho más cerca del Paraíso que del Infierno

L

a Conferencia ASUTIL 2011, titulada “Ni Infierno, Ni Paraíso”, concluyó el sábado 25 de junio con una visita a Tulum y Xel-Há. La agradable actividad social fue muy merecida, pues los delegados estuvieron de miércoles a viernes escuchando y participando con un grupo estelar de ponentes, haciendo negocios durante tres días de sesiones de contacto y prosiguiendo los análisis de una forma más relajada durante los múltiples eventos sociales.

José Luis Donagaray, Secretario General of ASUTIL, le comunicó a Americas Duty Free que este año el evento contó con la asistencia de 310 delegados, lo cual representa un récord para la conferencia duty free suramericana. El alto ejecutivo afirmó además que las actividades sociales fueron muy concurridas, y les expresó su agradecimiento a todos los asistentes.

“En la Conferencia ASUTIL del año pasado les dimos la bienvenida a Puerto Rico a 270 invitados”, explicó Donagaray.

“Hemos roto los records de asistencia consecutivamente en los últimos tres años. No es necesario decir que estamos muy complacidos. Creo que las presentaciones de la conferencia les proporcionaron a los asistentes información muy útil que se aplica directamente a sus negocios”.

“Resultó de gran interés ver durante el Coctel de Bienvenida, el maravilloso trabajo que ha llevado a cabo ASUR en la Terminal 3 del Aeropuerto de Cancún. Además, la Cena de Gala patrocinada por Aldeasa fue muy agradable”, añadió el alto funcionario de ASUTIL. “Finalmente, la actividad social del sábado ¡fue magnífica!”, agregó Donagaray. “Salimos del hotel en camino a Tulum y Xel-Há a las 8:00 am y regresamos a las 4:00 pm, y los participantes tuvieron otra oportunidad más de conectarse a un nivel diferente, en un ambiente muy relajado. Estamos muy satisfechos con todos los aspectos de la conferencia, y queremos agradecerles a todos los patrocinadores y delegados”.

Thursday’s Gala Dinner, sponsored by Aldeasa, was held on the beach at the Presidente Intercontinental Cancun Resort

Cifras divulgadas en la Conferencia En la Bienvenida e Inauguración Oficial, Francisco “Paco” Heredia, Presidente de ASUTIL les ofreció a los delegados algunas estadísticas relacionadas con el impresionante rendimiento de Latinoamérica en el último año, destacando que en 12 países y 15 operadores duty free, las ventas se incrementaron en un promedio de 39.2% durante el primer trimestre del 2011, en comparación con el mismo período del año pasado. Heredia dio otras buenas noticias, enfatizando en que el incremento de las ventas está muy por encima de los aumentos promedio de pasajeros en ese mismo período (+19.4%). En términos de incrementos de ventas por categoría, los perfumes estuvieron a la vanguardia en el mismo período (+41.2%), seguidos por los espirituosos (+34.1%), tabaco (+26%), confitería (+49.1%), artículos electrónicos (+52.2%) y artículos de moda, deportivos, de regalos y otros (+32.8%).

La Conferencia A la bienvenida por parte de Heredia le siguió la ponencia de Anne

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

On Thursday and Friday, delegates were invited to the Tulum Terrace to enjoy lunch

Conference Review: ASUTIL Kavanagh titulada “Travel Retail: We need to talk”. Luego de una pausa para café patrocinada por Americas Duty Free y Godiva, Enrique Urioste, Director Ejecutivo de Neutral Duty Free y Patrick M. Collins, Socio Principal de JH Partners, ofrecieron la presentación “Why Latin America? Why duty free border shops?”.

“Brazil: The country of the present” fue el tema de la ponencia de Iván Correa, quien habló acerca de la evolución de los gastos de los brasileños en el extranjero desde el año 2000, indicando un claro incremento en la última década, y, tal vez lo más importante, un incremento pronosticado en los viajes de brasileños al extranjero en la próxima década.

El viernes en la mañana, luego de una pausa para café patrocinada por Americas Duty Free y Godiva, Carlos Melconian, Director de M&S Consultores, ofreció la presentación titulada “Abundance: Permanent or Temporary?”, destacando que las economías latinoamericanas enfrentan el reto de “administrar la bonanza” y las presiones inflacionarias y el aumento del valor de la moneda resultantes.

A Melconian le siguió Lewis Allen, Director de Ambientes de Portland Design, con su ponencia “How the travel retail environment needs to respond to the passenger”. Lewis recurrió a los aeropuertos de Changi, Schiphol y Orlando, entre otros, como ejemplos de “las cosas fantásticas que pueden hacer los aeropuertos para ir más allá de lo convencional… y cambiar su estado de ánimo”.

Después de otra pausa para café, Jack Santiago, Presentador del Programa de Negocios del Disney Institute ofreció la ponencia titulada “Disney’s approach to people management”, en la que analizó cómo crear una cultura empresarial, y la importancia de inspirar y crear una conexión emocional con los clientes.

La Conferencia fue clausurada con la entrega del premio a la trayectoria destacada a Martin Moodie, Fundador y Presidente de la Junta Directiva de The Moodie Report.

Contactos profesionales y actividades nocturnas Las populares sesiones de contacto profesional de ASUTIL, patrocinadas por Diageo y Bacardi, se llevaron a cabo durante nueve horas completas el miércoles, seguidas por otras cuatro horas y media el jueves. Aunque las reuniones de este año fueron coordinadas por los asistentes y no por los organizadores ASUTIL, les proporcionaron a los proveedores las mismas oportunidades de tener tiempo de contacto con numerosos compradores latinoamericanos presentes.

Como siempre, los almuerzos estuvieron incluidos en la cuota de inscripción, y el del miércoles fue un picnic en la playa. El jueves y el viernes se invitó a los delegados a disfrutar del almuerzo en Tulum Terrace.

El Coctel Inaugural del miércoles en la noche se realizó en la Terminal 3 del Aeropuerto de Cancún, donde ASUR les ofreció a los invitados aperitivos y cocteles con la impresionante tienda de Aldeasa como fondo. La Cena de Gala del jueves, patrocinada por Aldeasa, se llevó a cabo en la playa en el Presidente Intercontinental Cancún Resort. A la presentación de bailes mexicanos tradicionales le siguieron cocteles y una deliciosa cena.

Un regreso triunfante a Suramérica En la Ceremonia de Clausura, se anunció que la conferencia de ASUTIL del año próximo se mantendrá en su nuevo período programado del mes de junio. Además, se confirmó que la Con ferencia 2012 será en Iguazú, Argentina.

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Wednesday night’s Opening Cocktail took place at Cancun Airport’s Terminal 3, where ASUR treated guests to appetizers and cocktails against the backdrop of Aldeasa’s impressive walkthrough store

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Beauty Beat: Fragrances

The

Reb’l Fleur by Rihanna Company: Parlux Fragrances Description: Rihanna’s first fragrance is as much in tune with the Barbados-born singer’s roots as it is with the glamour of her present life in New York City. Created by internationally renowned perfumers, Caroline Sabas and Marypierre Julien, this fruity chypre is joyous yet intense, sophisticated yet surprising Booth: Green Village M64

sweet smell of success This year’s fantastic new fragrance launches are sure to please even the most reluctant of consumers

Travalo Excel

Flight by Michael Jordan Company: Five Star Fragrance Description: Jordan’s newest fragrance is the next generation of inspiration that lets your dreams and aspirations take flight. The olfactory notes start with top notes of fresh bergamot and orange flower. Middle notes present aromatic lavender, emerald sage and geranium.

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Company: Aydya Limited Description: This new refillable perfume spray carries up to 30% more fragrance than the Travalo Classic, so you can travel for longer before refilling.

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Beyoncé Pulse I Fancy You by Jessica Simpson Company: Parlux Fragrances Description: I Fancy You is the fourth addition to the Fancy fragrance series and is a collaboration between Jessica Simpson and renowned perfumer Cécile Hua of Mane. A soft, velvety floral musk, I Fancy You is a fragrance that naturally expresses the charming ‘Girl Next Door’ side of Simpson Booth: Green Village M64

Madison by Brooks Brothers Company: InterParfums Inc., Essence Corp.

Description: A new fragrance that speaks to younger trendy women. It is named after the renowned Madison Avenue in New York City, one of the most fashionable and sophisticated shopping avenues in the world. The fragrance unfolds with classic feminine notes of night blooming jasmine, surprisingly twisted with spicy accents of pink pepper and the subtle fruitiness of plum blossom Booth: Ambassador Village V9

Company: Coty Beauty Price: Edp100ml: US$50; Edp 50ml: US$42 Description: Reflective of Beyoncé’s incredible energy and powerful femininity, the fresh notes in Beyoncé Pulse intermingle with unique citrus, floral gourmand and Beyoncé’s favorite flower, the orchid Booth: Marine Village Foyer 3 S3

Attimo L’Eau Florale Company: Ferragamo Parfums Description: Fashion designer Salvatore Ferragamo presents its newest creation; Attimo L’Eau Florale, a celebration of femininity with a chic personal touch by the designer.

With its soft color palette, the outer packaging expresses the femininity and romance of the fragrance Booth: Riviera Village RC13

Attimo pour Homme Company: Ferragamo Parfums Description: Salvatore Ferragamo unveils its new masculine fragrance, a fresh and woody oriental fragrance that embodies the masculine facets of Salvatore Ferragamo’s distinctive elegance. The classy masculine flacon was created by renowned designer Sylvie de France Booth: Riviera Village RC13

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Guess Seductive I’m Yours Company: Coty Beauty Price: Edt 75ml: US$53; Edt 50ml: US$44 Description: Guess Seductive I’m Yours is a lush, sexy oriental scent, tantalizing with its delicious contrast of delicate florals and luxurious musks and wood Booth: Marine Village Foyer 3 S3

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Wanted by Jesse

by Jesse McCartney Company: First American Brands Description: As the fragrance unfolds, it presents a bouquet of sweet jasmine and rose blossoms in the heart, adding harmony and depth.

Background notes of cedarwood and amber unite with sensual musk nuances, embracing the scent and adding an alluring ambiance Booth: Green Village J57

* That kind of attention to detail deetail is why the key travel retail stores and over oveer 165 airlines have listed Travalo in the last 12 2 months.

YELLO YELLOW OW VILLAG GE VILLAGE

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Beauty Beat: Fragrances

Viva Rock by John Richmond

REFILLABLE P PERFUME ERFUME TRAVEL SPRAY SP PRAY

Company: Euroitalia, Essence Corp.

Description: This juice opens on the sparkling and energizing blend of star fruit and Sicilian mandarin with an unexpected touch of cactus flower. The heart reveals floral notes of damascena rose, watery jasmine and delicate cherry blossom. The dry down seals a sophisticated rock’n’roll femininity enveloped by delicate musks, sensual ambergris and elegant orris Booth: Riviera Village RE2

Cannes annes and Come to TFWA Ca ourself, pick a colour for yyourself, compliments. with our complime ents.

Kaloo Fluffy Dragée gift box Company: The Millennium Essence Company Description: This gift box contains a soft toy twice the size of a regular Kaloo plush toy along with clinically tested, 100ml alcohol-free scented water, featuring subtle notes of almond and vanilla. The box is beautifully decorated with a satin ribbon Booth: Ambassadeurs Village U5, U7, U11

Sensuous Nude Company: Estée Lauder Description: Characterized as a woody musk fragrance, Sensuous Nude’s powerful yet direct and minimal construction is sensual to the core, just like today’s woman, says the company Booth: Riviera Village RE18

Betty Boop Party Company: First American Brands Description: Betty Boop Party’s top notes consist of bergamot, grapefruit and mandarin orange, with star jasmine and orchid as heart notes. Magnolia, sheer woods and sparkling musk finish this fun fragrance Booth: Green Village J57

xcel will be The New Travalo EExcel C showcased at TFWA Cannes, in 10 vibrant, lustrous colours.

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Beauty Beat: Skincare & Cosmetics

Looking your best

High Shimmer Lip Gloss

Skincare and makeup suppliers continue to up the ante with a host of new products that promise to bring beauty to all traveling shoppers

Everlasting Compact Foundation SPF 15 Company: Clarins Description: A breakthrough high-tech compact foundation. The texture combines the lasting hold of its Everlasting liquid version with the softness of a powder plus Clarins skincare expertise

Photographer: Guido Mocafico/Clarins

The Concentrate Company: La Mer, Estée Lauder Description: Now available in a new size of 30ml. The Concentrate enables the skin to repair and restore its appearance. It soothes irritation and redness caused by cosmetic procedures. It moisturizes skin, helping alleviate the feelings of tight or taut skin often associated with scars and improves the appearance of scars and stretch marks Booth: Rivera Village RE18

Instant Definition Mascara Company: Clarins Description: The double brush was inspired by the way classic mascara is applied.

The brush lengthens and separates every lash, including short ones, for spectacular ‘wide angle’ results. A new generation formula offers intense color and takes care of lashes

Nordic Wind Nail Polish Company: Micys Company, Pupa Milano Description: The technologically advanced nail polish uses resins for long lasting brightness, a “jellified system” for easy application and intense color and nitrocellulose to help it dry fast. Available in a mini 5ml format; the special applicator has rounded bristles, perfectly curved to pick up and release the right amount of color

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Company: Bobbi Brown, Estée Lauder Description: This new formula features a special mix of pearls in a clear base for the ultimate in shimmer, shine and color. It is also good for lips thanks to moisturizing emollients and vitamins C and E that condition and offer antioxidant protection Booth: Riviera Village RE18

Prep + Prime Future Lash Serum Company: MAC, Estée Lauder Description: This new patented formula promotes natural lash growth for longer, thicker, stronger-looking lashes, with dramatic results visible in eight weeks when used twice daily Booth: Riviera Village RE18

Repairwear Laser Focus All-Smooth Makeup SPF 15 Company: Clinique, Estée Lauder Description: This new foundation incorporates Clinique’s advanced patented technology from the power-house de-ageing serum, Repairwear Laser Focus Wrinkle & UV Damage Corrector, creating the ultimate de-ageing foundation. This liquid makeup instantly softens lines and covers imperfections, creating beautifully flawless skin and giving an airbrushed appearance Booth: Riviera Village RE18

Smokey Eye collection Company: Two Faced Cosmetics Description: A collection of nine, complimentary shades are the perfect palette of wearable, smokey eye options for day to night, and every memorable moment in between. The collection also includes how-to cards that offer step by step application instructions for creating smokey eyes in minutes

Fragrance News

Coty hosts beauty advisor worldwide trainings

Fragrance giant Coty Prestige recently organized two beauty consultant conferences for its European team in Marbella, Spain.

The event focused on the upcoming fall launches and gave a sneak preview for spring, creating a lot of excitement. The teams are made up of a mix of 23 different nationalities, which gave the event an amazing cultural dimension.

Bernd Beetz, CEO of Coty Prestige, surprised the beauty advisers with his presence. He gave an inspirational speech and thanked all of them for their very hard work and daily dedication to the brands Coty represents. He also pointed out that travel retail is not only the showcase to the world for Coty Prestige but that it has been growing at twice the rate of the market.

The 220 attendees participating in the event returned home

after three days, fueled with extended knowledge about the upcoming launches. They were in very high spirits - the event was a success from all angles, both professional and interpersonal.

Some participants commented: “Fresh and ready to get back into action and provide even better customer service on behalf of Coty Prestige.” Another said: “Thank you, thank you for the most wonderful time. It will stay in my heart forever.”

A similar conference also took place in Phuket, Thailand where beauty consultants from North, South Asia and Asia Pacific were trained. Coty also received great feedback during this event.

The next conference will be held in Cancun, Mexico for North American and Latin American beauty advisors. At the conclusion of this conference, Coty Prestige will have trained and entertained over 400 beauty advisors worldwide.

Coty Prestige held a beauty advisor training in Marbella, Spain.

Tairo International continues to build blockbusters

Mexican retailer French Parfums displays Tairo International’s fragrances

Tairo International continues to build blockbusters Tairo International once again filled the Caribbean and Mexican market with innovative launches this year. Lacoste’s newest launch Joy of Pink was promoted with remarkable photo booths at retailers such as French Parfums in Mexico and Maggy’s in Aruba. The launch of Joy of Pink continues to be a hit and has established the Lacoste Pink pillar as a powerhouse within the P&G portfolio.

Additionally, in the month of April, Tairo suc-

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cessfully launched Marc Jacob’s Daisy Eau so Fresh from Coty Prestige. The animations were youthfully spirited, positively fresh and charming. Stores and windows were dressed in Daisy Eau so Fresh elements as the whimsical and sparkling fragrance took over the Caribbean.

Tairo also held beauty events and makeovers for Yves Saint Laurent’s (YSL) dynamic new lipstick Rouge Pur Couture. Selected women at the events, held in St. Martin, Nassau and

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Kirk Freeport in Grand Cayman, were treated to fabulous makeovers, courtesy of the exceptional YSL make-up artists.

With many blockbuster launches yet to come, Tairo International will be holding a beauty advisor seminar on September 30 through October 3 in Miami, Florida. The seminar will introduce the newest initiatives to the beauty advisors and buyers from the region while providing some fantastic learning experiences.

After the success of the Perfume Lounge Parbel unveils the Skincare Lounge

Company News: Parbel

Parbel hits the high notes Success in the Americas takes careful orchestration

T

here is a host of brands in the L’Oréal stable, but when it comes to travel retail the company is focused on a very specific range. The undoubted market leader for Parbel (L’Oréal Travel Retail Americas) is Lancôme, where a constant cycle of new releases and promotions keep the name fresh and the customers interested.

“The most important brand for L’Oréal Luxe is Lancôme,” says Javier Labarta, CEO of Parbel.

“Lancôme is the leader, and we want to keep the brand modern and up to date.”

The core of the Lancôme brand is skincare, and at the moment the most important

“When women start using prevention creams, they may not be consciously aware of what they’re using.

When they delve deeper into the knowledge of cosmetics they want a reliable product.”

Javier Labarta, CEO of Parbel

*Photo courtesy of Zoltan Prepszent

BY

HIBAH NOOR

Visionnaire [LR 4212 4%] Corrector Serum

news in that line is the release of Visionnaire [LR 4212 4%] Corrector Serum. Based on molecular research that has uncovered what L’Oréal calls “a miraculous new molecule” – the LR 4212 of the product’s name – Visionnaire promises to rejuvenate the skin, imparting finer texture, erasing wrinkles, reducing pigmentary and vascular irregularities and tightening pores.

LR 4212 is the result of ten years of research and some 17 patents that are in place to guard the secrets behind its operation. The parallels with the strongly science-based Génifique skincare line, released at the end of 2009, are strong.

The Visionnaire LR4212 press release notes that the product is patterned after the natural healing and regeneration processes found in the plant world – in particular the release of the jasmonic acid “signal molecule” that triggers natural repair and defense mechanisms. It was research into how to mimic this response process that led Lancôme researchers to the discovery of LR4212, which “self-propels” through the layers of the epidermis, where it initiates a series of micro-transformations in the tissue.

Science also played a significant role in another major release – the announcement of Lancôme Teint Miracle foundation makeup. Teint Miracle is based on

Lancôme’s Teint Miracle foundation makeup

Trésor Midnight Rose

a decade of research into how to alter and enhance the way light is reflected by the skin.

Lancôme researchers say that they have discovered that light is reflected by the skin through seven different pathways, some of which involve layers deeper than the surface.

The research included the input of a panel of experts, and a study of 770 women between 15 and 74 years of age, both of which contributed to the discovery of the big role that the emission of light in the pink and blue ranges of the spectrum plays in endowing skin with the appearance of ‘inner luminosity.’

The research led to the development of “Aura-Inside,” a proprietary Lancôme technology that the company refers to as “a natural light creator combining a new generation of pigments inspired by optical research applied to biology, with a unique liquid light essence.” The technology “works on each component of natural light, both re-emitted and reflected, when traditional foundations only play on surface radiance.” The pink and blue bioptic Visionnaire pigments are the key to how the foundation works.

The third of the three core releases is Trésor Midnight Rose, a new variation in the Trésor fragrance line. A fruity floral centered on the keywords “spontaneity, freshness and mischievous femininity,” Trésor Midnight Rose was created by perfumer Anne Flipo. The fragrance reveals an intense, honeyed heart in which rose, which is the olfactory signature of the Trésor fragrance, is presented with added sweetness.

Keynotes of deep, intense rose absolute and bold raspberry are complemented by the combination of jasmine and peony with fresh blackcurrant bud absolute and intense pink pepper. As the final touch, the drydown of Virginia cedar essence, vanilla and musk serves to warm up the floral notes.

“Trésor Midnight Rose is a colorful, upbeat and joyful fragrance,” Flipo says. “It embodies mischievous femininity: rose becomes playful, driven by deliciously tangy raspberry tones, wooden shimmers and voluptuous vanilla notes. This spontaneous, irresistible rose charms everything in its path. It’s a real signature.”

Labarta adds that another recent launch – Rénergie Eye Multiple Lift, released earlier this year – is also serving above and beyond the call, with sales now more than three times what was expected.

In particular, Labarta says that middle-aged female customers who seek protection and correction stages of skincare have different concerns and approaches, both segments are driving growth for Lancôme. “When women start using prevention creams, they may not be consciously aware of what they’re using,” Labarta says. “When they delve deeper into the knowledge of cosmetics they want a reliable product.”

Staying in front In fragrances, the PCI division is doing very well in the Americas, as well as globally, Labarta says. Right now they’re focusing on two big products: Acqua di Gioia and Armani Code Sport – the latter first launched into European travel retail in June, followed by a rolling launch through Asia and the US. Code Sport features Megan Fox, new to Armani.

The Ralph Lauren Big Pony collection, launched last year, is still going strong, and Labarta believes the momentum will be strengthened with the launch of a body spray, as well as through a continued emphasis on big-scale POS activities. “For this brand we want to attract new and young consumers, bringing fun to the airports for them,” he says. “We want to catch all those passengers and transform them into consumers.”

A new Big Pony Music Edition, which comes in a limited edition in each of the four juices, is packed with a colored set of noisesuppression earphones with volume control and microphone. An accompanying GWP treats customers to a set of quality portable speakers.

The music promotion is titled Music 4 All and runs globally starting August. In US airports the promotion features a 10-20-

square-meter space where customers can listen to music including “Secrets,” the OneRepublic hit that also serves as the theme for the Big Pony commercial.

A new 20-squaremeter skincare lounge was implemented in Santiago de Chile in May and extended to Argentina’s Ezeiza airport in June. The lounge is staffed by Beauty Advisors who take customers through skincare products by Lancôme, Biotherm and Biotherm for Men, offering diagnosis and remediation plans, facilitated by “the skin advisor” on an interactive tablet platform. “What we discovered with this type of animation is that consumers want more information and service, which our teams are willing to provide for them,” Labarta says.

Going forward, Parbel’s strategy is threefold, Labarta says. First, “sell out” – focus on providing the best customer service. Second, focus on developing the presence in airports.

“Airports are becoming places where people spend a large amount of time,” Labarta says.

“Each year we receive new travelers and we want to show them the personality of our brands and the innovations that our brands have created. We are convinced that shopping in airports will become more frequent in the coming years.”

The third element is control over distribution – being selective when choosing where to place the brand. “Our consumers expect a high level of service and a comfortable environment, and those two elements will define which stores can or cannot be present with our brands,” Labarta says.

Parbel’s travel retail business in the Americas has grown by over 30% this year. As reported in the TFWA 2010 edition of Americas Duty Free, Labarta and his colleagues were then finding encouragement in the rebound of air traffic and of the economy generally. That trend has continued through 2011. “Lancôme is performing well in the Americas up to now,” he says. “We’re gaining market share. In some strategic airports our performance is four

points above the market.”

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Company News: La Prairie ADVERTORIAL

La Prairie’s newly opened flagship store in Waikiki, Hawaii

La Prairie enters Hawaiian travel retail with a bang With a stunning flagship store at DFS Galleria Waikiki the company extends its personalized service BY HIBAH NOOR

T

ravelers to Hawaii who strive to experience luxury beauty shopping will now have a perfect environment in which to do so with the opening of the exclusive La Prairie travel retail flagship store at DFS Galleria Waikiki.

The elegant store features white marble, brushed aluminum and gleaming glass, decorated in La Prairie’s signature white and

silver color scheme. It will welcome travelers with its full range of skincare as well as fragrance and foundation. Travelers will also be provided with the extraordinary service associated with La Prairie.

Operated by DFS, the elegant flagship store goes beyond offering a full range of La Prairie’s luxurious anti-aging beauty products; it also features tailor-made consultation and personalized service.

La Prairie unveils Cellular Power Infusion

La Prairie’s newly released Cellular Power Infusion utilizes a three-dimensional agedefiance system to restore skin to a more youthful state at any stage of the aging process. The company says that the product employs a threefold action to secure cellular energy supply and protect skin from the effects of external stresses, backing up the skin’s own natural renewal processes.

Cellular Power Infusion operates on the three dimensions that are responsible for the aging process: the energy units within each skin cell, the skin cell itself and the structural makeup of the skin. It reverses energy loss within cells by activating cellular power stations and securing a continuous flow of energy Cellular Power to the cells. It also stimulates epidermal stem cells, allowing new Infusion cells to rise to the surface, triggers natural renewal of skin cells and protects against environmental stress. It supports the rebuilding of the skin’s structure and the renewal of skin tissue, and also helps to reintegrate cells in aging skin to restore firmness and elasticity and reduce the appearance of lines and wrinkles.

Swiss Snow Algae provides a shield against environmental stress and energy loss, protecting the vulnerable biocode of the cellular power plants, improving the longevity of skin cells and supporting their renewal. A Skin Renewal Peptide helps activate cellular power stations, support the skin’s own system for natural biocode renewal and restore mitochondrial DNA. It also helps stimulate the formation and renewal of key components of the extracellular matrix, improving the skin’s structural balance, firmness and elasticity. And Phyto Stem Cell Extract, containing stem cell components from Swiss red grapes, helps delay the aging of epidermal stem cells.

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“La Prairie is delighted to have found another great opportunity to work with our global partner DFS, following successful openings in Hong Kong and Macau,” says Lola Perez, General Manager, Travel Retail Americas.

DFS Galleria is the ultimate luxury shopping destination, bringing together world-class brands and unparalleled client services. The mall presents the perfect match for the new La Prairie counter, which offers the high level of service that La Prairie customers expect.

From the face to the neck Expanding its focus beyond the face, La Prairie introduces Anti-Aging Neck Cream, a cellular firming complex. This luxurious cream effectively helps to recondition and recontour skin that becomes dehydrated and slackens with age. The result is tighter, smoother, firmer skin with a noticeable lessening of age-related symptoms: crepey texture, age spots and the appearance of a double chin.

The formula incorporates a new emulsifier combination, derived from olive oil, which creates an oilin-water emulsion with a liquid crystalline structure similar to that in the skin itself. The bio-mimetic liquid crystals generated by the emulsifier form a protective shield on the skin’s surface, which maintains the natural skin barrier while enhancing the penetration of the active ingredients.

The action of Anti-Aging Neck cream a cellular firming complex is threefold: the first refirms slack skin and restores elasticity; the second reshapes and reduces volume in the chin zone and lastly renews

hydration and targets age spots.

Anti-Aging Neck Cream

Company News: L’Oréal Consumer Products Division

L’Oréal Consumer

The giant body butter display has received great feedback from travelers

harnesses growth in the Americas

With multiple listings under its belt, L’Oréal zeros in on its strategies at point of sale BY HIBAH NOOR

M

iami-based L’Oréal Consumer Products Division has maintained a strong foothold within the Americas travel retail market, resulting in tremendous growth across its four brands: L’Oréal Paris, The Body Shop, Roger Gallet and Maybelline.

“2011, and what’s coming in 2012, are really the application of our strategy. L’Oréal Paris remains our bread and butter. We’re doing some great launches and animations

what the brand is about.”

A major launch for the brand is Volume Millions Lashes, a mascara that amplifies volume for a more intense effect. To accompany the product, L’Oréal came up with strong animations for airports in Montevideo, Bogota and Buenos Aires. In each animation, the sales of the product, already among the brand’s bestsellers, experienced a big surge, with increases of 100-200%. After experiencing exceptional success with this product, the company added Million Lashes Carbon Black, with a richer black

“Retailers can see that the [Body Shop] brand is performing well and they want a piece of that and they’re asking us for advice...”

Sebastien Levi, Division Manager, L’Oréal Consumer Products Division

with the brand. One of the challenges and strategies we have right now is for the new brands – The Body Shop on one hand and Roger Gallet on the other,” explains Sebastien Levi, Division Manager, L’Oréal Travel Retail Americas – Consumer Products Division.

L’Oréal Paris L’Oréal Paris is more than ever a brand that is here to “blow the markets,” according to Levi.

“We’re generating additional sales and this is 70

pigment to intensify the look, and Million Lashes Waterproof in May 2011.

On the makeup side, the lipstick Le Rouge Infallible was the other major launch for L’Oréal Paris, with animations planned in the second semester. This lipstick provides color and comfort for 10 hours.

Finally, Infallible eyeshadow, in a new light and smooth texture, is also a major launch of the brand in 2011, having hit the shelves since July.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

One of L’Oréal Paris’ new launches: Lipstick Le Rouge Infallible

In skincare the major launch is the serum Youth Code, an extension of the best-seller Youth Code range launched in 2010. This product is exhibited in a novel new display. “We’re creating an amazing merchandising tool, which is a giant product.

The giant product displays can hold 60 pieces per display,” says Levi.

Other new launches under the L’Oréal Paris umbrella include a product inside the brand’s number one skincare range Revitalift, which is being revamped. The new Revitalift 10 fights 10 signs of aging, with a SPF 20 index, is currently being rolled out.

The Body Shop In terms of growing a brand, The Body Shop knows the drill, with numerous listings in travel retail, including not only Montevideo, Sao Paolo and Rio, but also Bogota and Panama among others in Latin America. The brand’s overall success in Latin America is leading to new openings in Buenos Aires, Argentina with Ezeiza and Aeroparque airports.

In North America, openings include Houston and Miami International Airport and JFK’s T3 and T7, operated by DFA – and before the end of the year the airports of Detroit and Washington Dulles will follow.

F O R I N F O R M AT I O N , P L E A S E C O N TAC T : T R A V E L . R E TA I L @ TO M M Y. C O M

Company News: L’Oréal Consumer Products Division

L' Oréal Paris giant Volume Million Lashes mascara POS display in Santiago Airport, Chile

“Thanks to great results with DFA, we’re going to open in Punta Cana, Dominican Republic,” says Levi. The Caribbean is also on Levi’s list as the company will start business in the region’s airports for the very first time.

Another first will be listings in Canadian duty free with Aldeasa in Vancouver airport. “Retailers can see that the brand is performing well and they want a piece of that, and they’re asking us for advice. Most locations have gondolas measuring 150cm (59 in.) or 200cm (79 in.). For smaller shops, we also have a tower that perfectly complements the gondola. We also do backwalls when it’s necessary,” says Levi.

In terms of best sellers, Levi explains that there’s definitely a taste for the body moisturizers called body butters. “Our number one SKU is a set with four different body butters at 50ml (1.7 oz) each, inside.”

Levi says that this format has been phenomenal, first in Europe but then in the US at Miami International Airport.

The brand is well suited Roger Gallet’s Fleur d’Osmanthus

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The Body Shop’s “Create your Own” concept allows consumers to customize their set according to their liking

for gifting. The “Create your Own” concept, introduced last October, allows the consumer to create their own set or a gift by picking two Body Shop products and receiving the third one free. The complimentary item can be a mini shower gel or mini body butter.

“This is a powerful tool; it created a lot of animation around the point of sale. You get to create your own harmony and that’s what the brand is about. This is something we learned from local markets. Of course we don’t have the same freedom as the domestic market but we try to recreate the atmosphere that has made The Body Shop so successful in the past 35 years,” says Levi. This promotion is available in Panama, Mexico, Uruguay and Columbia.

The Body Shop brand originated in London, England, where the franchise is extremely protective of the brand image. The Body Shop has always been recognized for its strong values, with a strong commitment to community trade and animal rights.

“While executing new business it’s very important to respect the identity of the brand,” says Levi. “The retailer understands the strength of the brand and concept; it’s one of the brands of the future. The world is more and more aware of its duties to the environment, and a consumer is first and foremost a citizen of the world. The Body Shop offers great products, but it does a bit more than that...”

Roger Gallet The Roger Gallet brand is on the rise after rapidly picking up momentum. Levi describes it as extremely powerful, in demand and very popular in Latin America. He says that this brand is more popular in the southern hemisphere than in the north.

Much attention has been given to the brand’s presentation at the point of sale, by providing soap racks, blotters, tester bar and shelves. The brand can also be presented in a tower, already present in airports in Montreal, Caracas and Bogota. This semester, in a special promotion, the company is offering one mini 30ml (1 oz) edt with the purchase of two Roger

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Gallet products.

Roger Gallet will be celebrating its 150th birthday next year. For many years, this brand was renowned for its Eau de Cologne, under the name “Jean-Marie Farina,” still a bestseller today, and its unique expertise in soaps, but it has also been able to innovate with new products and new scents.

Roger Gallet’s newest launch is called Fleur d’Osmanthus, which is offered as a fragrance, soap, body lotion, soap sets and shower gels.

In short, it covers a full range of scented bodycare products.

The Osmanthus Blossom is from China.

It’s a rare and precious shrub that grows near vast plateaus covered with terraced fields.

The plant’s seeds take two years to sprout. And there is an explosion of scents when the clusters of delicate apricot-tinted white flowers appear. This tiny heart releases a swirl of smooth and colorful floral notes. Somewhere between juicy apricot flesh and silky peach skin, Osmanthus has a fragrant, stress-reducing and uplifting aroma.

“We’re truly excited about the brand and we’re ready to move ahead. The brand is [currently] available in 90% of airports in Latin America duty free. To celebrate the 150th birthday of the brand, Roger Gallet will offer limited editions next year, that will focus on the brand’s history and strength, but in a modern and fashionable way. The operators and consumers will love these limited editions; they will bring a lot excitement at

the point of sale,” says Levi.

Company News: Bijoux Terner Bijoux Terner brings their new concept called AdiXion to life in Miami International Airport

Luring customers into AdiXion Bijoux Terner finds a perfect solution for housing its myriad brands under one roof

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iami-based gift supplier Bijoux Terner has swiftly and successfully penetrated the travel retail market, bringing luxury onto store shelves at a US$10 price point. Earlier this year Americas Duty Free reported that the company had also become a portfolio brand by diversifying its products and price points to fit a different structure, with brands such as Voux (US$20), Déjà Voux (US$20) and X’est Jolie (US$30).

Bijoux Terner continues to take things to the next level by unveiling three new additional brands: Trésor du Temp at US$20, Madeira at US$40 and Eleganzza at US$50.

“Bijoux Terner continues to be the core of our business and we continue to be behind it. In addition we are working on several things to fully develop our branding strategy and our different price points,” says Gabriel Bottazzi, CEO & President, Bijoux Terner.

The new brands, Trésor du Temp, Madeira and Eleganzza, are made up of several fashionable collections focusing mostly on beautifully embellished ladies belts, bags and jewelry. “We will continue designing more collections to enhance the value of accessories through key elements such as “The Xochi Collection” with a combination of sterling silver 925 and Czech faceted crystals and natural stones for Eleganzza,” explains Lina Henao, Chief Creative Officer & VP, Bijoux Terner.

The perfect solution to housing these brands under one roof is the concept of AdiXion.

Debuting at the Miami International Airport (located in the hallway between Terminals J and H) in July, AdiXion offers all the brands mentioned above in a 47-square-meter store.

Great focus has been placed on the presentation of the brands and the overall look of the fashion forward boutique. The interior of AdiXion is apple green which is the key color accentuated by black and brushed aluminum.

“Sparkling black and silver floors enhance

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BY

HIBAH NOOR

our amazing décor as well as our fixtures, kiosks were opened at San Juan Internaand a lighting system makes product display tional Airport in Puerto Rico and one more stand out in a boutique feel environment,” store was opened in Atlanta Airport T3(74explains Henao. square-meters). It also Price points are comopened up a new full store municated by signage in Atlantic City. spread across the store Bijoux Terner also has using hangtags in different plans to open new stores colors drivers to identify in Mexico, Panama, each brand. The products Aruba, St. Maarten and are showcased by collecthe Dominican Republic. tions with short stories Zoning in on best sellthat explain the key attribers, Arygros mentions that utes of each. the mix of the best-selling “The exclusivity of our products is always the same brands with designs espeno matter where you are. cially made for us by the “Best performing product most skilled artists and categories are bags, factories adds superior watches, jewelry, showing value to the products sold a pretty even split.” at the store and open up Several different price points and brands Argyros explains that the door to a new busi- will all be housed in the AdiXion boutique Latin America and the ness opportunity,” says Henao. “The store Caribbean are regions experiencing huge opened to the public in July, and we are growth, particularly in the last two years, extremely glad with the results we are seeing doubling business. Business on the border of as of now. It is proving to be a winner as Brazil has been a huge contributor. people like the merchandise and enjoy shopWhat’s the key to the company’s success? ping in it. It is creating a lot of buzz at the air- “We are keeping the same mentality that has port as we are seeing great excitement around made Bijoux Terner successful in the past. The the concept.” consumer would like to see a fashion forward value product at an affordable price. After conducting several surveys, the understandNew openings Panos Argyros Vice President & General Man- ing that we have is that Bijoux Terner’s US$10 ager, Travel Retail Worldwide, Bijoux Terner, items are perceived at a value of US$25 to $26. fills in Americas Duty Free on other new No one in the market has our offering in terms of variety, product offering, value, profdevelopments within the company.

Bijoux Terner has been opening up branded itability, ease of mind execution and follow stores and kiosks in new areas. The company up,” says Argyros. “We are looking to increase recently opened multiple outlets in Mexico, our offering from Bijoux Terner to our new including Grand Plaza (102-square-meters), brands and our new multi brand boutique a store in Forum (60-square-meters) and in concept, AdiXion”.

For any inquiries on the AdiXion bouCozumel (79-square-meters). Bijoux Terner also opened in Panama with three kiosks in tique, contact Panos Argyros at +305 500

Tocumen International Airport, while four 7523 or pargyros@bijouxterner.com.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Fashion Report

Fashion forward

Pal Zileri keeps it simple, elegant and chic

S

Buckles, bows and belts: travel retail and its passion for fashion hould you want a designer bargain, there are really only three places available: the outlet malls where you’re going to buy last season’s stock that no one wanted to buy from the brands’ stores the first time round, the internet where you can’t see what you are buying and you can’t really be sure how genuine it is; or at a travel retail location where designer brands are clamouring for the own-brand boutique or shop in shop space.

In the price-off between high street stores and their duty free counterparts cosmetics are, dare I say it, in many cases cheaper to buy on the consumer market than they are anywhere else. But with fashion you know you are getting a deal. I’ve been known to buy a Mulberry bag or two while passing through the airport. At around 20% off the new season’s collection, the fashion maths adds up.

Take newcomer to travel retail, Tommy Hilfiger. This stalwart of all things Americana has flown into the travel retail arena and embraced the category with aplomb. The brand is already, according to Briac Pinault, Vice President Global Duty Free & Travel Retail “the leading ready to wear brand in South and Central America’s airports, duty free and duty paid, landside and airside.” Considering Tommy Hilfiger has only been represented in the industry for the last few months, it is already going great guns.

But according to Pinault, this is because the products are easy pickups (something that suits the typical impulse purchase at airports) with logos, in a world where logos still sell product. Simple sizing also plays a part.

Recognizable fashion that sells well for the brand in duty free includes polos, sweaters, button-down shirts, chinos, caps, small leathergoods, belts and underwear.

The Lacoste flagship store in Paris will be the basis from which all its other stores are centred

BY

LORNA STRICKLAND-COOK

This isn’t a rocket science collection of goods. It’s a selection that sells well for a lot of brands. Classic fashion house Pal Zileri also sees the benefit in offering such a selection including: knitwear, shirts, polo shirts, sportswear, leather goods, ties and accessories, Travel Retail Area Manager, Chiara Corò reveals that the best selling items are shirts, polo shirts and ties.

Simplicity rules The simplest array is often the best, as Pal Zileri knows to its benefit. It’s Lab collection for spring summer 2012 features the cool of black and the nautical chic of blue and white.

By focusing on two key trends that see no sign of dying off any time soon, Pal Zileri isn’t going to confuse the customer with overwhelming choice in the all important and fast paced travel retail checkout.

Its new collection to be launched at Cannes

Vilebrequin’s Bengal Tiger (below) and French Marigold swim trucks (right)

Ready to wear ticks all the boxes, according to Tommy Hilfiger

is inspired by the sixties movie Purple Noon, starring Alain Delon and Marie Laforet. The mood of the collection reveals the casual elegance of a young couple, who are sailing toward Ischia in the height of summer.

The vintage look gives vitality to artfully lightened colors, washed fabrics and garments, treated leathers and sportswear items in combinations of linen and suede. The search for that sixties feel is communicated all by the fabrics, which are natural and prestigious, but treated to give the appearance of garments that are ageing gracefully.

The formal feel of the collection proposes fresh combinations: medium grey with touches of fuchsia; light grey interwoven with

lavender; blues range from navy and sky blue - with hints of "sunflower" yellow - to denim blue mixed with off white. Colors give a sense of sharpness, embellished by the patterns of pinstripes and checks.

Getting a market and making it yours, especially in travel retail is rare. Vilebrequin is doing for swim shorts what Frey Wille has done for enamel. This tres chic French label oozes laid back, elegant beach side glamour and has found its place in the industry. After all, what other dedicated swimwear label is making as much headway in the channel?

Vilebrequin is looked after in travel retail

by LATR, represented alongside Parker pens and Guess Jewellery. Area Manager Tiffany

Lacoste accosts travel retail

A new dawn is rising for fashion brand Lacoste, famous for its iconic crocodile symbol and polo shirts. Since the arrival at Devanlay, Lacoste’s fashion and accessories partner, of new CEO José Luis Duran, formerly with Carrefour, combined with the talent of incoming designer Felipe Oliveira Baptista, Lacoste is bringing to the market new initiatives, new lines and new concept stores creating a new life force for the brand.

With experience of brands such as Max Mara, Cerruti and Nike, Baptista promises a new era for Lacoste women. And expansion is definitely on the cards for Lacoste. For the next year, Lacoste is looking to expand its business globally. All regions have growth objectives within an aggressive development plan. Before Duran’s arrival, China was opening 40 point of sale locations per year; since 2009 it has been opening 75 per year. The brand hopes to have more than 400 locations at the end of 2011.

That expansion plan is reflected in travel retail where, says International Travel Retail Director Catherine Bonelli: “We aim to increase our travel retail points of sale to approaching 300 by 2014 (around 200 as of today). With our new designer and greater commitment to women’s wear and children’s, we are looking forward to a really dynamic 2012 with many new growth prospects in the pipeline. With the aim of travel retail development, Lacoste is now keen to build its inflight distribution and, to this end, in the process of developing a new collection for inflight worldwide which will be presented at TFWA World Exhibition.”

Baudin tells Americas Duty Free that “the LATR goal is becoming incontrovertible in luxury accessories distribution through travel retail.”

Still more popular in Europe than in other territories, Vilebrequin has chosen its time wisely. As Baudin says: “each year, we note fashion is increasingly present in airports in all categories as ready to wear or accessories. It becomes a life style and fashion is (now even) at the cutting edge of technology. Contributing to this life style diffusion is our objective and success.”

Childrenswear: The holy grail of fashion retailing?

Is there room to bring more to the market?

Tommy Hilfiger’s Pinault believes that there is certainly room for invaders on the pitch: small invaders that is.

Pinault believes that childrenswear is a virtually untapped market in travel retail.

“It’s an important category,” he says. “It appeals to business travelers buying a gift for their kids on impulse.

“Competition in the childrenswear segment is currently limited in airports, as most of the brands license this range. It has a great untapped potential in travel retail.” It has quickly become one of the best selling subcategories for Tommy Hilfiger.

The supplier will be showcasing looks from its Spring Summer 2012 womenswear, menswear and childrenswear collections. “As a true lifestyle brand, Tommy Hilfiger occupies a unique space in the travel retail market. We’re offering classic American sportswear with a preppy twist. Tommy Hilfiger reinterprets classic pieces and injects color and humour into every design,” he says. “We don’t take ourselves too seriously.”

It is this attitude that steers only the brave but with a world of opportunity out there in travel retail, the fashion arena has room for the great, the quirky, the formal, the preppy.

www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

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Natural gemstones

Pearl News

Honora’s black and white necklace from its Bohemian collection

Americas Duty Free speaks to three pearl experts to find out how these lustrous gems have the consumers spending BY HIBAH NOOR

J

ust like other gemstones, pearls carry a meaning. Historically, the glowing orbs have been associated with wisdom and held a great appeal to women worldwide. With the quality and lustre of pearls, no wonder they’ve been at the forefront of the jewelry category.

Honora Americas Duty Free: How long have your pearls been available in the Americas duty free market?

Bettina Rubinton, Director, Duty Free Sales, Honora: Honora Cultured Pearls have been available in the Americas duty free market since 2009. Our range of jewelry and pearls have been launched worldwide through our cruise ship and airline partners.

One of Majorica’s star creations from its Fall/Winter 2011 range is the Capricho collection

ADF: Do you have any new developments to share?

Honora: We continue to focus on bringing our retailers and customers an internationally recognized brand which offers a great product at an incredible price. We are receptive to the current worldwide economic environment, thus focusing on value driven boxed sets.

ADF: What’s your best-seller in Americas duty free?

Honora: Our best sellers are earring boxed sets. We offer an incredible product, in a great gift box at an incredible value (US$50).

This earring box set qualifies as one of Honora’s best-sellers in the Americas duty free market

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ADF: Will you be launching any new collections during the TFWA show?

Honora: In June we launched our Fall 2011 collections at the JCK Show in Las Vegas.

Our new collections focus on fashion using color pearls as well as precious and semiprecious materials and stones.

The two best-received collections are Rock Star and Bohemian. Rock Star consists of natural agate pearls dangling from a 48-inch rosary linked strand of our freshwater pearls. It is available in white, black, rose and navy. The Bohemian collection mixes white and black pearls with black onyx and other semiprecious stones.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBEROCTOBER 2011

ADF: What’s unique about pearls?

How are yours unique in comparison to your competitors?

Honora: Honora jewelry is designed and manufactured using genuine cultured pearls.

We only use the top 3% of the pearl harvest. Our competition in duty free use mostly “man-made organic pearls” which are not real or cultured.

These revolutionary cultured pearls are over 90% pearl nacre and offer the widest array of pearl shapes as well as pearl colors. Honora is the largest importer of Freshwater Pearls in the United States and focuses on the top 3 to 5% of the pearl harvest.

Majorica Americas Duty Free: How long have your products been available in the Americas duty free market?

Marc-Antoine Breuil, Managing Director, Majorica: We have been present in the Americas duty free market for over 30 years however it is only recently that we decided to bring more focus and resource to this high potential market.

In North America, we are available in JFK, New York, Montreal, Vancouver airports as well as in US-Canada border stores.

We have also a large presence on cruise ships in the Caribbean with all the major companies. In Central and South America, we have been traditionally present in airports and free shops although we were missing some key markets in Central (Panama, Mexico) and South (Brazil, Argentina) America on which we are working, with good results so far.

ADF: Do you have any developments to share?

Majorica: We concluded a partnership with Motta in Central America in 2009, which has given some very positive results in Panama, Colombia and Venezuela. In the Caribbean, we are now distributed by Philippe Gerard Enterprise to develop in this market

where we have strong presence onboard the cruise ships but not enough in the island ports.

ADF: What’s your best-seller in Americas duty free?

Majorica: One of our best-selling pieces is our multi-colored baroque necklace. It sells very well due to the unique color combination and size of the baroque pearls, which are a Majorica specialty. It is an updated classic that can be worn everyday and is a great accessory for the traveling woman.

ADF: Will you be launching any new collections during the TFWA show?

Majorica: We will present our new Fall and Winter collection at the Cannes show made of about 70 items. We are very excited about this collection, which we offered in preview at the Baselworld show of last March.

One of our star creations is Capricho, a delicate combination of white and champagne color pearl set on a yellow gold chain, which has proven very successful in Basel.

ADF: What’s unique about pearls? How are yours unique in comparison to your competitors?

Majorica: The perfection and beauty of pearls have magnified women’s femininity since time immemorial. Majorica, established in 1890 on the Spanish island of Mallorca, invented the complex creation process behind our world’s only handcrafted organic pearls. The Majorica pearls have the natural color, iridescence and luster of the finest South Sea pearls, although at a much more affordable price, which makes our creations very adequate to the travel retail environment. All our pearls also come with a 10-year warranty, which is a key element in reassuring the transient consumers of the duty free stores.

Misaki Americas Duty Free: How long have your products been available in the Americas duty free market?

Philipp Wille, President, Misaki: We have been present on the Latin/South American market for more than five years now and will soon start in North America. For the moment, we are available in the main duty free point of sales in the Latin/South American market as well as in Canada.

ADF: Do you have any new developments to share?

Misaki: Concerning the duty free channel, Misaki’s new target is to develop the cruise

line industry thanks to the excellent introduction we just had this year with the MSC cruises in Europe.

Concerning now the domestic market, and after the openings in China, Bulgaria and Israel, we are planning to open two franchise stores in Miami by the end of the year.

Beyond a better brand awareness, these stores or shop- in-shops clearly allow us to present a trendy and modern atmosphere, to make sure to we are always in line with the brand’s image and to create proximity with the customers.

ADF: What’s your best-seller in Americas duty free?

Misaki: The most popular pieces are still those which enhance the natural beauty of the pearls, that is to say long sautoirs or pearl necklaces such as the “Babydoll,” the “Colette” or the “Samantha” one which play with original hues and crystals.

In addition, I would say that the “Nude” set is also above the average, highlighting a minimalist style, featuring a unique and delicate cultured pearl linked with a gleaming silver chain.

ADF: Will you be launching any new collections during the TFWA show?

Misaki: The new Collection 2012 will pay tribute to Monte Carlo and revive royalty. From gleaming creations paved with crystals to noble signs turned into a glam chic and resolutely modern rock inspiration, each creation is devoted to this smart and lavish backdrop which is Monte-Carlo.

ADF: What is unique about pearls?

How are yours unique in comparison to your competitors?

Misaki: They have definitely a universal and timeless appeal because every woman can relate to pearls and adopt this gem to her own style. As a flattering natural jewel, it’s a kind of “must-have.”

In terms of product, the key factor in this competitive sector is to have creative and innovative products to retain consumers’ interest. Indeed, throughout the years, Misaki’s approach has been to be the “fashion statement” of pearl and to come with a differentiated and totally new offer, which is not really expected from a pearl brand.

Constantly searching for perfection, it combines the beauty and the tradition of Japanese pearls with European and

very contemporary designs.

Regarding the duty free market in a global view, we can notice that it has clearly diversified its offer these last few years and we are pleased to see that jewelry and fashion have gained more and more space. The market has definitely changed, pushed by the economic configuration of the travel sector but above all by consumers’ expectations to treat themselves and to find exclusive products also in this market. As it is for the beauty sector, travel retail clearly is gradually becoming a strategic market for jewelry, and especially for Misaki, which for many years now has been among the top jewelry

brands in this travel retail sector.

The Colette necklace is a best-seller from Misaki’s Tropical Temptation collection

Sunglass Report

Guardrails model from Maui Jim's memory metal collection Maui Flex

Shine on As more retailers tap into the potential of sunglasses, the sector’s already radiant glow is spreading

S Gucci's special edition 1921 sunglasses, part of an exclusive collection from Safilo celebrating the brand's 90th anniversary

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BY

JAMES ROSS/HIBAH NOOR

unglasses was the best performing product sector in travel retail in 2010 according to Sweden-based travel retail research analyst Generation, and, in the Americas, where Latin markets have been bouncing back strongly after the global downturn, the category has continued to show strength into 2011.

From a global perspective – including domestic markets – big players such as Luxottica and Safilo have reported good results in 2011, with markets in the Americas showing big gains.

Safilo’s global sales in the six months to the end of June 2011 were up by +7.8% (at constant currency) to €603.3 million (US$863.5 million) with the travel retail business showing among the most dynamic performances. The Americas outperformed this at +8.9%, bettered only by Asia Pacific at a rapid +14.6%. The company pointed to a good underlying performance “fuelled by the accelerated growth of Latin American markets (and) momentum in the US market remaining strong”.

By comparison, Luxottica produced first half sales of €3,190 million (US$4,567 million), up +9.3% (at constant currency) with North America gaining +15% in terms of wholesale turnover and only emerging markets growing faster at +21%. The company claims to be the number one sunglasses retailer in Mexico with 76 stores and is building its optical presence in Latin America where it has completed the acquisition of Multiopticas.

In travel retail the picture is equally bright. Luxottica, which leads the market by a long way, says it has been seeing a double-digit impact from striking new in-store environments it has put in place across the globe, including the Americas. These rely heavily on the principles of category management that the brand heavily espouses.

Group Travel Retail Director Francis Gros says: “Luxottica Travel Retail is determined to rise to the challenge of being category leader. We launched our category management activity two years ago in Cannes and merchandising and in-store environment are important building blocks.”

The company – whose owned and licensed brands include Ray-Ban (the leader in travel retail), Oakley, Vogue, Burberry, Chanel, Dolce & Gabbana, Donna Karan, Polo Ralph Lauren, Prada, Tiffany and Versace – has some good examples of how such environments are helping the sunglasses sector flourish in travel retail. For example, in the arrivals stores at Brazil’s São PaoloGuarulhos Airport a new sunglasses merchandising Tom Ford unit has been developed and is doing well implemented with Dufry. for Marcolin

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Appealing to both male and female customers, the unit maximizes the number of facings on each side, but also features promotional spaces at either end. These end pieces can be changed throughout the day to allow Dufry to tailor the merchandising of different brands or ranges depending on flights and passenger profiles.

Since the implementation of these fixtures, sales have grown by +80%. Vivianne Nunes, Regional Procurement Director, Dufry do Brazil comments: “Sunglasses is a major growth category for Dufry and Luxottica’s new fixtures have been incredibly successful. They are elegant, enticing and really help our customers through the decision-making process.”

Other locations have seen even better results. At Buenos Aires Ezeiza Airport in Argentina, an increase in the number of facings of just 10% achieved sales growth of +90% in volume and +96% in value while a Ray-Ban wall at Punta del Este Airport in Uruguay has produced sales growth of +94% by volume and +107% by value. The higher value sales, versus volume sales, show that RayBan has been able to shift more high-end models as a result of the new merchandising.

Gros adds: “We are working with some of

Read on

The red dot of eyewear specialist Buch + Deichmann is appearing at more travel retail locations as demand for off-the-shelf socalled ‘readers’ increases. Pre-graduated reading glasses, required by people suffering from presbyopia – or the diminishing power to focus on subjects close to the eye – are a growing area for B+D in travel retail and the company has a range of Readers and Smart Readers that are modern and trendy, designed to shake off the ‘middle-aged’ image that reading glasses often conjure up.

The company’s latest ranges – Kent and Fly – have been well received. A spokesperson for the company says: “We are having great results with these recent launches which come in six colors and a range of strengths. They have already become favorites with travelers visiting duty-free stores throughout the world.”

For travel retailers, readers and also sun readers are ideal because passengers simply pick the magnification (from +1 to +3.5) that suits them, a sale that is often incremental to a sunglasses purchase or other store buys. B+D, based in Buenos Aires, also sells its readers in packs of three in case a pair is lost, which often happens on holiday or when traveling.

Commenting on the sunglasses market in travel retail overall, the spokesperson says: “The duty free market has shown a sustained and solid performance. We have seen positive figures in our main markets in Asia, Europe and specially South America (and) we feel that the category can still grow further.”

Marchon reaps the rewards of its focus on quality and value Founded in 1983, Marchon Eyewear is a large manufacturer and distributor of eyewear and sunwear with an accent on high-end products, technical depth and upmarket design. Its designer portfolio boasts some of the best known names in the field, including Salvatore Ferragamo, Valentino, Calvin Klein, Karl Lagerfeld and others.

Mark Ginsberg, Marchon’s Senior Vice President Global Marketing, says that recent growth in the sunglasses market has been very good, hitting double digits in some cases. Marchon’s designer and “accessible” designer brands are standouts, Ginsberg says, with brands including Michael Kors, Fendi and Nike doing especially well across all markets and price points.

While he’s aware of market volatility globally, Ginsberg believes many market constants still remain. “Great product with strong price/value benefit will always perform. In tough times, this helps separate the ‘wheat from the chaff.’ Our continued investments into design, product development and technology help keep our collections relevant and among those preferred by an ever savvy consumer base.”

And there’s always opportunity to grow. As far as travel retail is concerned, as Marchon expands its ‘custom fit’ style/SKU budgets and hones its response to market trends and preferences, Ginsberg says the company will reach more buyers and increase sales incrementally. “We’re extremely confident that our plans in place will result in greater sales and penetration into this exciting distribution model.”

B+D Readers RL - Pack X3

the most progressive retail partners for this category. These projects demonstrate the impact and success that can be achieved when we have the right merchandising environments. They combine creativity, the latest materials and the fundamentals of sunglasses category management.”

At Marcolin, which makes eyewear for a wide range of designer fashion and luxury goods houses, the category has come into its own in recent months. Marcolin USA Travel Retail/Duty Free Sales Manager Marco Lares says: “We are very pleased with the results from our sales in travel retail so far, as the sunglasses category is taking centre stage in the market. The challenge from this point forward is to continue offering strong recognized collections in the channel such as Tom Ford and Roberto Cavalli, which are fast growing due to their worldwide brand name recognition, and also add new offerings such as Swarovski, Diesel, DSquared2, John Galliano, Timberland, Kenneth Cole NY and Reaction plus Kenneth Cole Reaction Readers.”

Polarized specialist Maui Jim Sunglasses is also upbeat. Director Global Travel Retail Giles Marks adds: “Given the very uncertain economic global climate, we continue to have substantial double-digit growth this year.

There are no specific product segments ‘outshining’ other styles – a tribute to the strength of the overall brand.”

www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

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Sunglass Report Category management and new facings are paying off for Luxottica in airports like Sao Paolo

US-based Marchon, which has Calvin Klein, Lacoste, Michael Kors, Nike, Nautica, and Sean Jean among others in its stable, has recently picked up the Valentino licence after Safilo lost it, and also Salvatore Ferragamo, moves that indicate it may be looking to become more European centric. In terms of travel retail the company declined to comment on the channel but has stated a strategic aim of “matching our diverse brand portfolio with the most appropriate travel retailers”.

While the Americas overall is proving fruitful for travel retail, there continues to be a north-south divide as economic growth progresses at very different rates and this will affect strategies in the channel. For now conditions have not changed enough to warrant big changes. Maui Jim’s Marks says: “Both North and South American markets bring different challenges. Regional variations are a given, and as a global organisation, Maui Jim reacts accordingly to ensure the brand is ultimately successful.”

Lares at Marcolin was also unfazed by the current economic conditions. “Coming from ASUTIL in Cancún in June, we believe that even with the regional political issues, the growth in sales to the travel retail segment continues at a very steady pace. There is a tremendous ‘push’ in sales attributed to Brazilian travelers, plus an increase in travel throughout the region in general which has helped us. Also, most stores at the main airports in the Americas are dedicating more space to displaying fashiontrendy sunglasses.”

It appears that there will be no let up in the development of the sunglasses market in the Americas for the rest of the year. With Luxottica driving better category management at the region’s airports, and retailers looking to sunglasses as an exciting ‘hand-on’ sector for passengers to try and buy, suppliers’ expec tations remain high.

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Polaroid celebrates 75th anniversary

To commemorate 75 years of innovation and iconic sunglass design, Polaroid has created a 75th Anniversary Sunglass Collection inspired by designs from the 1940s to the 1980s.

Each model comes in two colorways and is made from TR90 high tensile nylon giving exceptional durability and crystal-clear clarity to the frames.

To support the 75th Anniversary Collection, Polaroid has created a special “anniversary tag” in black and gold.

Understated, nostalgic 1940s styling is reflected in the simple demi or black frame designs of Buddy, contrasting nicely with the 1950s California sunshine frames of Bel Air for him and Jive frames for her. For would-be road rebels, there are curved Rider frames from the 1960s or the big framed Twist in a striking plum or brown colorway.

For the 1970s, there are generous disco-diva Sophia frames with open temple arms or cat-suited Elvis-era Las Vegas frames in silver or gold. The collection completes on a high note with two tear-drop Aviators: Vice in gold or gun metal or the eye-catching look-at-me frame, Wave in black or brown.The highlight is an original new aviator design called Seventyfive, drawing on Polaroid frame designs from the 1970s. Made from Monel nickel alloy and corrosion proof sprung stainless steel, these frames have maximum flexibility for all-day wearer comfort and bear some beautifully discreet Polaroid branding on the temple arms. They are fitted with Polaroid’s polarized UltraSight lenses treated with an anti-reflective coating on the back and stylish flash mirroring on the front for perfect glare-free vision and a great look.

The Anniversary Collection runs alongside the Best under the Sun Launch Collection which features ten frames drawn from original Polaroid designs dating from the 1930s to the 1980s.

First shown at the TFWA Asia Pacific show earlier this year with great success and now available globally, the Launch range includes a 1930s style, Swing, with a rounded, softcoloured frame reminiscent of the glamour fashions of the day. 1940s frames show the first radical development of the classic Polaroid tear drop lens shapes in Victory, while for the 1950s, showbiz style returns with Marilyn and Broadway – two cat eye frames with gorgeous detailing. 1967’s Summer of Love is recreated with the generous frames and graduated lenses of Memphis while it’s all change to vivid styling for the 1970s collection of three designs, Donna, Flower and Rebel. The Launch Collection is completed with two 1980s look-at-me big frames –Image and Glam- with graduated lenses.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Polaroid sunglasses from the 75th Anniversary Collection

Jewelry News

Contemporary cufflinks Two leading accessory brands deliver this elegant and much admired piece of men’s jewelry to the duty free market

Equss: Reaching out

A

ustralian jewelry brand Equss, a fashion and accessory company, recently added another category to its trendy portfolio. Just over a year ago the company started offering cufflinks to its consumers.

“The reason why I started doing cufflinks was because I was on a business trip and landed in an airport and realized I didn’t bring any cufflinks with me. I tried to find one pair of cufflinks and I could only find one brand Equss’ Equss’best-seller best-sellerfrom from the theEgo EgoCollection Collection

and the design wasn’t great and the price was really high. I was forced to buy whatever was available,” explains Alex Chaves, Managing Director, Equss.

The driver of demand was the Middle East, where this accessory is imperative in completing an elegant look. “When we started with the cufflink selection, we tried to feed it into the Middle Eastern market, which is our strongest market. We tried to have a glitzy look of crystals and that seemed to be working very well. But we also have a demand of cufflinks in other markets that are more conservative and not as flashy as … the Middle East,” says Chaves.

Equss designed more classic, conservative and elegant cufflinks for areas such as Asia.

The cufflinks are for both for men and women. “We try to keep things generic, not only gender wise but also

T

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is a focus on leather and beaded bracelet sets: the St. Tropez collection, available in four colors, represents a perfect holiday gift purchase.

What sets apart Tateossian’s cufflinks is the movement, innovation, quality and signature. Every piece is highlighted with an element of surprise, making for an interesting and unique product.

“Male accessorizing is much more on trend.

Men are dressing up and being creative, for example wearing a suit with no tie to appear casual and comfy whilst still wearing cufflinks to complete the look. If men do wear a tie, they wear cufflinks too and then accessorize with a very short and narrow tie clip,” explains Robert Tateossian, CEO, Tateossian Ltd. Tateossian says that cufflinks are a perfect gift item. They relate to a holiday purchase, are small to carry for the

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

HIBAH NOOR

age groups,” says Chaves.

The best seller for the brand is the Ego Cufflink collection, which features the Equss logo touched with sparkling crystals edges.

“Ego cufflink is one of our signature products that represents Equss’ attitude toward luxury and extraordinary life. We have it in gold and silver plated,” explains Chaves.

Equss also recently launched Zarge cufflinks made of stainless steel in a striped pattern. The design is modern and smart. It is available in two colors. Also by Equss, the Quadrat cufflink is created from stainless steel squareshaped cufflinks making a classic statement.

This year, the brand has ventured into the Americas market by joining forces with Horizon International Duty Free, which will distribute their products in the Americas.

Cufflinks from the Quadrat Collection

Tateossian: Quality first ateossian has built an enviable reputation as one of the world's leading jewelry and accessories brands.

This year brings many new developments for Tateossian. Due to popular demand, the company is currently developing a new and extensive line of its signature Italian leather bracelets for both men and ladies. Tateossian has also announced new products on British Airways, Saudi, Malaysian and Singapore Airlines. The company is delighted to announce a collaboration with the Valiram Group, which will start with placements onboard their Asian leg cruise lines starting in August 2011.

At this year’s TFWA WE show, Tateossian will be showcasing bracelets for men along with a focus on cufflinks and jewelry with movement. The Tateossian Propeller Cufflink is key this season with a moving gold propeller, perfect for an inflight travel gift. For ladies, there

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passenger and, for retailers, they take up a small amount of space for stock.

Tateossian is very strong in the domestic US market and is available in stores such as Neiman Marcus, Saks, Fred Leighton and a host of other known independent retailers. Tateossian will be looking to expand into the Americas duty free market this coming year. Currently, the brand is available all over Europe,

Middle East and Asia.

Tateossian’s Propeller Cufflink is key this season

Writing Instrument Report

The writing head is at the heart of the “Parker 5th Technology” system

BY

ANDREW BROOKS

The writing experience provides an intimate connection with customers

“2

010 was a terrific year for travel retail with a strong double-digit growth figure versus 2009,” says Urs Messerli, International Duty Free Manager/Export Manager Americas for Caran d'Ache. “We experienced double-digit growth during the first trimester of 2011 versus the same period last year.” Messerli notes that the growth rate slowed somewhat in the second trimester thanks to currency percentage issues related to the strength of the Swiss Franc.

In terms of category management, Caran d'Ache focuses on three different gift offerings for the traveling consumer: children's gifts (guilt purchase, birthday, seasonal, etc.), premium gifts (birthday, friendship/love and business giving) and informal giving (return to work, thank you, homecoming, etc.). Caran d'Ache's strongest market is Europe, followed

by Asia, Americas and the Mideast/Africa.

For premium pens, the target buyer is male, from 30 to 50 years of age. For the informal segment embraces the entire public, while Caran d'Ache's color-intensive lines are aimed at adults buying for children.

Messerli says that Caran d'Ache's proactive promotion schedule tends to emphasize

GWPs, coupled with staff sales incentives.

When Messerli spoke with Americas Duty Free, Caran d'Ache had just launched a new promotion at the Geneva Airport in conjunction with the airport authority (AIG).

Lasting one month and ending in late August, the promotion occupied a special promotional area of 12-square-meters in front of the Cartier and Hermès stores, and was geared to selling fine arts/color products and Swiss souvenir pens including duty free exclusives.

An artist was on hand to demonstrate the use of top-of-the-line products. At the same time, a GWP offered a children's drawing set with a specified purchase amount. The promo was timed for the run-up to back-to-school, which occurs in August in Switzerland.

As always, TFWA WE in Cannes will be Caran d'Ache's chosen platform for new launches this year. Messerli declined to provide details, but he promised our readers that stand RB9 in the Riviera Village this year would be the venue for some noteworthy new announcements.

For Cross, travel retail sales in the Americas represent about 3% of total Cross sales, says National Accounts and Travel Retail Manager David Ferreira. However, this figure is growing as travel retail sales outpace over-

all growth, and also thanks to the expansion of distribution into new markets and channels such as duty paid.

“2010 sales were very good versus 2009, as many retailers resumed ordering, thus carrying more inventory and product selection to the end consumer,” Ferreira says. 2010 was also notable as the year that Cross launched its self-serve concept in the Americas, with particularly good success in Canadian and US airports where customers are comfortable with the notion of buying a pen, journal or reader from US$20 to US$50 without assistance. As for 2011, “it's looking great,” says Ferreira. “Travel retail sales are up 13% in June year-to-date.”

In Americas travel retail, South America – airlines included – has continued to be the fastest growing market. “In these countries, our premium aspheric reading glasses are usually our number one category, often outselling our pens,” Ferreira says. The company doesn't have products exclusive to travel retail, but some lines tend to be sold mainly in that channel thanks to the application of specialized packaging and merchandising concepts – notably self-serve.

“The share of readers and journals – that come with a free Cross pen – is very high in travel retail,” Ferreira says. “In some markets Cross journals

The Cross display, showing pens and journals

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

DUTY & TAX FREE DISTRIBUTOR WHOLESALER R E TA I L E R

CORPORATE OFFICE OAKLAND 400 Lancaster St. Oakland, CA 94601 (510) 533-8260

SEATTLE 9875 40th Avenue South Seattle, WA 98118 (206) 760-0350

www.fairn.com

BRANCHES LOS ANGELES 329 N. Figueroa St. Wilmington, CA 90744 (310) 518-6001

FLORIDA 701 NW 33rd St., Bldg.300 Pompano Beach, FL 33064 (954) 545-4151

www.bajadutyfree.com

Writing Instrument Report

that represents 90% of the sales.” Cross has maintained heavy investment in journals, where sales growth has been strong in the last couple of years. Fourteen additional models were launched in March.

While Ferreira says the travel retail market for writing products hasn't benefited from third-party statistical research, he says the company has received retailer feedback, along with the sales numbers, which place Cross second behind Montblanc in the US$20 and up writing products category. “What's important to note is that the writing instrument market in travel retail being a small category, most of the operators only carry Cross and a luxury brand like Montblanc – sometimes Cartier,” Ferreira says. “Cross is a more affordable luxury/premium brand instead of purely luxury.”

For Jean-Charles Hita, President of fine writing leader Parker, last year’s decision to return in a big way to the travel retail market has already been amply justified. The decision was Parker’s announced at Cannes Ingenuity Pearl Lacquer last year, and the comPGT PVD pany will return this year bearing plenty of evidence that the decision was the correct one.

“After Cannes last year, we started to implement our shop-in-shop experience around the world,” Hita says. “Our target for 2011 was to open 100-120 venues, and halfway through the year we’re already at 80.”

The plan calls for this pace to be maintained over three years.

So far Parker’s travel retail footprint is strongest in Asia (Southeast Asia in particular), which is always the best place to start, but Hita adds that he’s been very positively surprised by feedback from the Americas: based on stock reorders it’s actually the top performing market for Parker. The Middle East is also clicking, with strong results from Dubai Duty Free.

Overall, Parker is experiencing high doubledigit growth in travel retail, Hita says, supported by higher-than-expected price points.

Pricing is key. Hita believes that an emphasis on posting consistent pricing globally has helped Parker win customers, many of whom are regular globetrotters and will pick up on discrepancies. This consistency reinforces the solidity of the brand, Hita says, helping to cement its reputation as the leader in the fine writing category at price points from €40 to €100 (US$57-$142).

New fixtures for Parker are the Sonnet Feminine Collection and the Parker Premier Monochrome Edition. Sonnet Collection, 88

inspired by the Pink Gold trend, displays a range of accessories in exclusively feminine and modern finishes, created for women around the world. The line is available in Pink Gold PVD, Pearl Lacquer, and Metal and Pearl Lacquer accents.

The Parker Premier Monochrome Edition Collection, part of the higher end of Parkers’ fine writing domain, presents a distinctive full-block color design, from the pen’s body through to its tip, with an ontrend “texture clash.” The collection is available in Pink Gold PVD, Titanium PVD and Ceramic Black designs.

Hita and his team are looking forward to Cannes this year because it will provide the venue for the launch of a completely new technology the company believes will revitalize the entire fine writing segment. Called “Parker 5th Technology,” the new system lies at the heart of the new “Parker Ingenuity” line of pens,

which will come to market in “Classic” and “Daring” configurations.

“There hasn’t been anything new in fine writing now for two or three decades,” Hita says. “Ingenuity will be very strong for people who do a lot of writing but also for gifting. The fine writing category is seen as a bit old-fashioned, and we think we can attract new customers who are younger by offering them a writing experience they won’t get anywhere else.”

The key to the new system consists in a cutting-edge refill tip and an engraved metallic hood that together constitutes the “Parker 5th Technology.” The flexible interaction allows for easy usage and refill, eliminates ink overflow, and enables the pen to adjust to the user’s individual writing style to create a more pleasurable writing experience. Available in bold large and elegant slim models, the pens take design cues from the luxury watch and

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Caran d’Ache promotional corner – Geneva Airport, 2011

The Prismalo pencil set, from the children’s gift category

jewelry markets, with a mix of metal and texturized, soft-touch rubber effect, sandblasted metallic Pink Gold PVD, iridescent Pearl Lacquer, Chrome PVD, and Black Lacquer.

“With the pioneering ‘Parker 5th Technology’ and modern, elegant Parker Ingenuity Collection, the world of fine pens is about to change forever,” the company says. “The new generation won’t have to choose between ease and design – now they can have both.”

Company News: Nestlé International Travel Retail

Demonstration layout illustrating NITR’s “Perfect Store” concept in action

The perfect score

The growth strategy for Nestlé International Travel Retail has all the bases covered ANDREW BROOKS

A

sweet tooth is born, not made. But success in catering to that sweet tooth is definitely something you earn with hard work and good judgment. A solid growth market doesn’t hurt either, as Alan Brennan, Customer Marketing Manager for Nestlé International Travel Retail (NITR) will tell you.

“NITR has exclusive distribution in the Americas for its portfolio of brands, and in general consumption of confectionery in the region continues to grow,” Brennan recently told Americas Duty Free. The rate of growth varies by country, and Argentina and Brazil are the two key markets, Brennan says.

In 2010 NITR posted strong double-digit year-over-year growth, with KitKat, Nestle Swiss and After Eight the main drivers. The surge has continued into 2011, boosted by a strong Brazilian economy, which is associated with an increase in passenger traffic in the Americas.

The nationality group represented in the Americas is strongly drawn to confectionery’s traditional appeal for gifting and snacking, Brennan says. South American customers also seem to have a strong preference for confectionery manufactured in Europe. “Brand availability and exclusivity play a pivotal role in their decision-making process when it comes to confectionery,” Brennan says.

Brennan adds that a key trend in the market is to trade up when gifting, especially within the informal and premium categories, as customers become more aspirational in their brand selection. They increasingly seek out international brands for gifting, as well as for sharing and self-treat snacking.

“The various KitKat gift packs, sharing pouch, Nestle Swiss 400g bars and the After Eight 400g gift pack have all proven to be very 90

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successful in meeting a strong shopper need to gift and share within the Americas market,” Brennan says.

The “Perfect Store” strategy, a sophisticated matrix of interlocking customer drivers matched against NITR deliverables and initiatives, remains a huge focus for the company. In addition to its undoubted effectiveness in expanding NITR’s success, Perfect Store has garnered attention across the industry, and Brennan shared with Americas Duty Free some of the promotional ideas that underpin the broad strategy.

“Aligned with its Perfect Store initiative, Nestlé’s promotional strategy is centered on its building blocks to increase sales by providing mechanics that individually can be targeted to increase penetration, conversion and basket size,” Brennan says. “In the joint planning stage of the promotion, clear objective setting is important to ensure an optimum return of investment for both the retailer and supplier.

This should include identifying the target shopper nationality, with a clear understanding of their shopping mission, and needs to ensure the mechanic is relevant and engaging to increase conversion, SPH and ATV.” NITR has worked with retailers on a number of initiatives to target different shopper nationalities, shopping missions and associated needs. The Quality Street limited edition Ramadan tin is one example of the results generated by this approach, with its focus on Muslim customers during Islam’s holy month.

Brennan also notes that the use of information technology has become a cornerstone of marketing plans. A number of major international retailers now use LCD touch screens to interact with customers and engage their interest while they’re in-store. Brennan

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

The Quality Street limited edition Ramadan tin

says that Nestlé has developed an interactive Smarties game to engage families at the front of the store – or even just outside – and draw them in, improving penetration.

The main focus for 2011 continues to be the Perfect Store initiative. “The issues of low passenger penetration and shopper conversion remain key challenges for all industry stakeholders,” Brennan says. “Aligned with addressing these issues, Nestlé’s focus is the development of credible solutions for retailers centered on three core competency areas – boosting penetration, the Perfect Gift Offer and cash till point optimization.” Increasing penetration is self-explanatory: the Perfect Gift Offer aims to convert more browsers to buyers, while cash till point optimization will boost the size of the existing basket.

While he declined to reveal specific plans for TFWA WE in Cannes, Brennan assured Americas Duty Free that “we can promise an exciting new range developed with the specific needs of the traveling shopper in mind.”

Confectionery Report

Guylian airport display

State of the sweet

G

uylian comes to TFWA WE 2011 in Cannes with a strong lineup of new items, says Steven Candries, Guylian Export & Travel Retail Director. There are also some adjustments and upgrades being made to the presentation of some of the company’s classics: this year the iconic Seahorse Chocolate line will be reinforced with a dark chocolate addition to the familiar marbled chocolates. They will appear in a new gift box, which Candries believes will help to reinforce Guylian’s leadership in the seashells segment.

“The seahorse is by far the most loved shape in our seashell collection, so with this line extension we really respond to a consumer desire,” Candries says. The new box (16 pieces – 185g) features a hardboard lid and is aimed at the upscale gifting segment.

Guylian is also presenting a new truffle variation to fit alongside its premium flaked La Trufflina truffles and the recently launched La Perlina pralines: a traditional Belgian truffle with a smooth milk truffle filling and a dusting of fine cocoa powder. The new confection is available in a 23-piece ballotin.

“We’re really going back to our roots,” Candries says. “Guylian’s company founders Guy and Liliane started the Belgian family business in the sixties with premium handmade truffles, packed in ochre-yellow-gold square boxes. We’re now using the same colors for this new ballotin, expressing our Belgian heritage and expertise. As we’re really differentiating our brand in this chocolates segment, we’re convinced that consumers will be attracted by both the story and product, bringing a valuable sales growth for our trade partners.”

Guylian is also broadening its presence

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in the assortment segment with the addition of the Luxury Belgian Collection. This assortment combines some Guylian favorites: Guylian seahorse chocolates Original Praline, Opus Belgian Pralines and the new La Perlina Milk Truffles.

“We will be showcasing all travel retail brands in Cannes,” says Lara Candido, International Marketing for Storck Travel Retail Ltd. Werther’s is heavily represented of course, and this year the lineup includes the new Werther’s Original Chocolate Specialties & Caramelts (305g).

Along with merci Finest Selection and Toffifee, Werther’s Original are the travel retail heroes for Storck, Candido says. The favorite and most successful promotions Storck uses tend to be a series of price-off and multibuy promotions, always tailored to local requirements, conditions and preferences.

The health-conscious trend does have an impact on Storck. While the demand for sugar-free confectionery is concentrated mostly on the domestic side, Candido believes there is ample opportunity to replicate the success of Werther’s Original Sugar Free in travel retail. According to Generation Research, Storck’s travel retail strength is concentrated in the informal gifting segment, where 40% of its sales come from.

On the business side, Storck Travel Retail recently relocated from The Cotswolds in Southwest England to join its sister company Storck UK Ltd. in Winchester, Hampshire in Southern England. At the same time, the travel retail team is losing Managing Director

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Paul Ridgway, who more than anyone else is responsible for the success of Storck Travel Retail. Ridgway is retiring after 17 years as a ‘Storckie.’ Key Account Manager Karyna Rooke left the team in May of this year, and in September she will be followed by Lara Candido herself. Both are departing for new

opportunities elsewhere.

Toffifee 400g

The merci Finest Selection 250g travel retail assortment

Confectionery News Toblerone is one of Kraft’s travel retail frontrunners

Kraft covers all key segments

For Cannes this year, Kraft Foods World Travel Retail (KFWTR) is launching a mix of new offers from recognized travel retail brands like Toblerone, Cadbury and Milka, as well as launching the Oreo biscuit brand into the travel retail channel. “The TFWA World Exhibition has always been the ideal launch platform for our new concepts, and following our integration with Cadbury, this year we come to Cannes with a stronger-than-ever portfolio in all the key confectionery segments – chocolate, gum and candy,” says KFWTR Managing Director Andreas Fehr.

Fehr and his team will unveil the Toblerone

Variety Gift Box with four flavors, including milk, white, dark and the ‘Snowtop’ milk-white combination, available in travel retail for the first time. And the Toblerone White Minis Pouch brings one of the most popular Toblerone flavors to the market in a snack size format.

New from Cadbury are two new offers in the gifting sector. The Cadbury Chunk Box offers 26 individually wrapped pieces of Cadbury Dairy Milk chocolate in a gift box modelled on a chunk of Cadbury Milk Chocolate. And the new Cadbury Travel Mix contains Dairy Milk, Caramel, Twirl, Fudge, Eclairs and Twist. The Milka brand will be augmented with two new

offerings – Milka Popcorn and the Milka Crispello Pouch. Popcorn combines Alpine milk chocolate with slightly salted popcorn, while the Crispello Pouch offers individually wrapped pieces of chocolate-covered wafer filled with a smooth milk chocolate cream.

“KFWTR is very present in Asia,” says Fehr.

“With the number one position in the confectionery category according to Generation, our brands are well represented in Asia and enjoying strong brand awareness. With Cadbury as part of our portfolio, our position is further strengthened given the strength of the Cadbury brand within Asia.”

Duc d’O: new and improved Gijsbrecht Ostyn, Brand Manager for Belgium-based Duc d’O Chocolaterie, has revealed that the Swiss chocolate maker will reveal two new additions as well as some major improvements to existing products. A major innovation in the truffle segment will be clearly distinguished from the company’s existing offerings by being introduced as a new line – the “Intense Collection.” This collection now appears alongside Duc d’O’s well known Original Collection.

Defined as a sub-brand, the Intense Collection will contain all the exclusive truffle varieties that are marked by unique flavors and features. At the same time, Duc d’O will launch two new truffle variants: a milk chocolate truffle with a crunchy biscuit filling and a white truffle with strawberry mousse. The first features one of France’s most renowned biscuits – the crèpe dentelle or feuilletine. The second contains small strawberry pieces in the strawberry mousse.

Duc d’O says that consumer research has shown that strawberry is one of the most popular chocolate flavors.

Both will be launched in a 100g box, with visuals provided by well known food photographer Stephane Verheye. The box will be a first for Duc d’O in stating that all truffles are 100% natural.

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Duc d’O has also launched five limited edition truffle, praline and mini praline package designs called “Winter Tales” for the 2011 holiday season. The designs are by leading international design firm Brandimage. New products will be launched in the La Boule sharing range, marked by new packaging with a window, adjusted weight, new foils and value pricing. The 5.5g mini pralines, first launched in 2001, will get a new look that brings them into line with the rest of the range, and Pâtes de Fruits will receive new packaging, with the original ballotin replaced by a modern bottom-lid box with a brighter design.

The Duc d’O Intense Collection

Company News: Portland Design

Some of the world’s most revered and iconic luxury names, such as Johnnie Walker Blue Label, are an integral part of the Emporium experience

Different by design Portland Design transforms the retail experience by showing airport authorities, operators and suppliers how to think outside the box to generate revenues

A

BY

RYAN WHITE

mericas Duty Free recently had the pleasure of sitting down with Lewis Allen, Director of Environments at Portland Design, to discuss the company’s philosophy when it comes to creating unique environments in travel retail. Set up in 1987, Portland operates as a creative collective of individuals strong on research and insights, brand communications, retail masterplanning, public realm design, signage and wayfinding, and retail and F&B design.

Always a rousing speaker at industry events, Allen’s talks generally center on what airports and retailers are doing right—or wrong—in terms of engaging customers during their journey. For Portland, the jumping off point of any project is discovering what makes a particular client unique.

“When trying to figure out how to make any category more engaging, the bigger issue of the overall customer experience always comes into play,” Allen says. “When we make our presentations to suppliers and operators, we always discuss this very important topic. It’s about offering more engagement and allowing airport operators to create stronger brands armed with the knowledge of what makes their airport different and what their customer will enjoy.”

Of course, Allen admits that the commercial side of any endeavor is important. For Portland, designing a retail space is really about the challenge of ensuring a seamless interplay between commercial considerations and the passenger experience, and there is perhaps no better example of this than Diageo’s groundbreaking Emporium initiative in Dubai International Airport.

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Emporium hosts a combined presentation from the Diageo Reserve portfolio of brands and the Möet-Hennessy portfolio

A new way to shop Located in a 150-square-meter standalone retail and bar space, Emporium hosts a combined presentation from the Diageo Reserve portfolio of brands and the Möet-Hennessy portfolio—including some of the world’s most revered and iconic luxury names, such as Johnnie Walker Blue Label, Zacapa, Tanqueray No 10, Ketel One, Don Julio, Hennessy, Dom Pérignon, Veuve Clicquot and Möet & Chandon.

The objective of the project was to create a retail space that would encourage and allow customers to fully engage with the brands in a more meaningful way. Typically around 80% of all airport passengers do not make purchases when they travel, so both Diageo and Portland saw an opportunity to reach out and attract this group of travelers.

“You have to be able to look at each site with the realization that everywhere is unique,” Allen says. “A template approach isn’t the way to go. There are parts that you can use, but most of the design needs to be customized to the specific location. This doesn’t just have to do with where in the world you are, but also where in the airport you are and what the other offers are in the airport.”

It can be said that a staple of Diageo’s marketing strategy is communicating the history of much loved brands such as Johnnie Walker or Don Julio. However, the point of difference in Emporium is how and in what environment these stories are shared with the customer. Place

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

plays a very important role at Emporium, with the Bedouin culture referenced throughout the space. Pleated fabric wall panels overlap to form display apertures for product display, with a dark brown palette creating a warm neutral backdrop for the bar, display tables and product to stand out from. Atmospheric lighting creates focused illumination onto the products while at the same time generating a calm and intimate ambience.

Whether or not travelers catch the references to nomadic culture isn’t the point, says Allen. Rather, the goal is finding a way to snap passengers out of traditional ways of thinking about shopping for spirits in duty free. “The category could be considered a bit tired and in decline,” he says. “Emporium is a different way of shopping for that category and a different type of engagement with the product through presenting the stories behind each brand and having different kinds of conversations with travelers.”

How it’s done “All of our work is based around customer research in terms of what people are saying in the channel,” Allen explains. “We then look at the gaps between what customers are saying and what they’re getting. Customers aren’t necessarily going to be able to articulate everything that they want, but if you look at research you can read a lot into it to the point that you can help the client create a set of parameters around what they want to achieve.”

CON NNECT. COMMUNICAATE. CONQUER. FOR A FUTTURE FRREE OF BREAST CAANCER

BCAC BC A AM AC AMPA PAAIG IG N.C N.C CO OM

Company News: Portland Design The local produce section (food and nonfood) at Larnaca Duty Free in Cyprus

The baseline for Portland is that each project needs to offer a unique experience for travelers. “Wallbays, gondolas and lightboxes work in some places but they aren’t necessarily what need to be everywhere,” Allen says. Particularly with regard to premium products, there is an opportunity to go beyond the norm and create something truly different.

tunity for revenue is there if you get it right,” Allen says. “As trends keep changing, we continue to work on it.”

What’s trending The catch-all in duty free these days seems to be technology. Interestingly, although Portland is on the cutting edge in its field, imple-

“Wallbays, gondolas and lightboxes work in some places but they aren’t necessarily what need to be everywhere. There are always opportunities to make something better.”

Lewis Allen, Director of Environments, Portland Design

In addition to the initial research that goes into creating a space like Emporium, Portland continues to monitor each of its completed projects to keep abreast of changing trends and continue adding to its knowledge base. “There are always opportunities to make something better,” says Allen.

In the case of Emporium, for example, while women aren’t the core target demographic, Portland is trying to determine how the concept appeals to this important group of consumers. Allen notes that liquor isn’t generally a category that engages women effectively, but learnings from Emporium may help to improve future projects. “The oppor98

menting new technologies in the spaces it designs is something the company is cautious about. “Technology is interesting because there’s a debate about how much should show up in a retail store,” says Allen. “For us, it’s about being cautious, because there’s nothing worse than seeing technology in a store when it’s out of date or broken down and doesn’t work.

“For me, there has to be a really good reason to use it and we’re not convinced at the moment that there are enough good reasons to use it in the store. At the end of the day people’s smartphones are going to be more useful for them in the stores than any piece of technology an operator can install.”

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Allen also makes reference to what he calls “the world of walls.” He notes that people’s lives are becoming less and less compartmentalized and some operators are starting to take this into account in their store designs with cafés, restaurants and retail sharing the same environment with fewer walls separating them. “I think people are much more into the playfulness of mixing things up a bit,” he says.

As a result of the above, food is also playing a bigger role in airport experiences through creating an air of sociability. “Why separate retail and F&B if there’s a great energy and excitement to a space when the two are combined?” Allen asks.

Things to come Portland is currently working with Diageo on several more retail transformation projects around the world, although specifics couldn’t be released at press time. Allen did note, however, that in true Portland style the next Emporium-type project that the company works on “won’t look anything like Emporium” and will be location-driven in its design.

Allen and company are also currently working in Las Vegas and Los Angeles on various new airport projects while continuing to support existing partners in evolving their retail concepts to suit changing trends. Allen says Portland is working as a consultant with Köln-Bonn Airport to help identify branding opportunities and make sure the customer experience is delivered across all touchpoints.

“What we’re really advocating is that airports and retailers alike take ownership of the entire experience,” Allen concludes. “When this is done right, amazing things can happen.”

Going to the next level...

A new name with a very familiar face Go Travel is a name you can expect to see in duty free locations all across the globe. Design Go, the global leader in travel accessories has rebranded to Go Travel.

Designed to spark effortless recall for the consumer, this new evolution of the ‘Go’ mark is striking in its simplicity. Instantly readable and recognisable, the new Go Travel branding will help to build consumer brand loyalty as we take this next stage on our journey.

Rest assured, nothing has changed except for the name.

Go Travel delivers the same winning retail concept in-store that is based on an extensive collection of high quality, innovative travel accessories. It’s why we have been at the forefront of the travel accessory market for more than 30 years...

Liquor Report: Holiday Cocktails

The Bombay Sapphire Collins experience The Bombay Sapphire Collins experience

“T

Masters of the mix

Leaders in cocktail culture share their views on the market BY

ANDREW BROOKS

2011 Bacardi Cruise Competition winner “O Bloody Hell”

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Bacardi’s permanent promotion

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

he World's Best Tasting Cocktail’ promotion has been incredibly successful in driving the white spirits category in travel retail,” says Vinay Golikeri, Marketing Director for the Bacardi Global Travel Retail Division. The promotion pushes three of the company's key brands: Bacardi Superior in the Bacardi Mojito cocktail, Grey Goose vodka in the Grey Goose Cosmopolitan and Bombay Sapphire in the Bombay Sapphire Collins. Travelers in Asia have responded very strongly—over 80% of those who took part said they enjoyed the experience, with fully 60% saying they would be likely to order one of the cocktails or make it at home. The promo has had a definite positive impact in conversion to sales, including a high impulse purchase rate.

The Bombay Sapphire Collins program is now in its fourth year, and still going strong. Running throughout the Americas this year and in 2012, the experience is being enhanced with a free iPhone app offer. Of course the Bombay Sapphire Collins is featured prominently on the app, but the software goes a step beyond with an extensive range of other cocktail recipes that highlight the versatility of the Bombay Sapphire brand.

This fall will see the launch of the seventh annual Bacardi Cruise Competition, which recognizes the outstanding talents of onboard bartenders and chefs. Last year's event attracted a record 1,600 entries from professionals working on cruise and ferry lines around the world, Golikeri says. The Bacardi Ready-to-Serve (RTS) range, offering ready-made cocktails based on Bacardi Superior Rum, has effectively established a new category in travel retail, according to Golikeri. It has also provided Bacardi Global Travel Retail with a new, convenience-based consumer access.

“The Bacardi Mojito RTS has achieved exponential growth in airports, cruise and ferries in the Americas,” notes Golikeri. This success led naturally to its launch in the Asia-Pacific market, along with two additions to the range: the Bacardi Piña Colada RTS and the Bacardi Strawberry Daiquiri RTS. Both were launched into travel retail in May.

Pernod Ricard’s cocktail culture

“P

ernod Ricard has a clear strategy to continue promoting the cocktail culture thanks to our ample portfolio, which fulfills the different cocktail trends in the domestic markets,” says Enrique Girones, Marketing Vice President, Pernod Ricard Americas Travel Retail (PRATR). “The cocktail concept appeals to everyone—the complexity and quality of the ingredients are the key demographic difference.”

In the Americas, cocktails have been a big part of the drinking culture for a long time, with consumers becoming increasingly sophisticated and knowledgeable. The result is that premium international brands such as ABSOLUT, Malibu, Chivas Regal and others are in high demand. PRATR doesn't really focus on the cocktail culture through duty free, Girones says, choosing to focus on the quality, history and brand equity of the brand. That said, ABSOLUT, Malibu and Kahlua are fixtures in the cocktail scene, and popular cocktails such as the Mojito and others are a factor in what Girones calls the

“perimeter” of PRATR's business.

“The strength and quality of the brands are the key motivators to be added to the best cocktails in our domestic markets, which benefits sales and the perception of our customers,” Girones says.

The company works very closely with the bartender and mixology expert communities to find new ways to enhance the cocktail experience in conjunction with new product launches.

New editions such as ABSOLUT Orient Apple and ABSOLUT ELYX are notable cocktail presences, Girones says. The ABSOLUT brand has a full schedule of promo-

Pernod Ricard’s highly successful ABSOLUT Orient Apple

tional events and new releases—in May, Pernod Ricard launched ABSOLUT SF, the latest in a line of limitededition, city-inspired flavors. SF features a blend of grape, dragon fruit and papaya that adds a bold edge when mixing cocktails. SF was launched with the creative support of notable San Franciscans, including painters, musicians, apparel designers and technology-forward entrepreneurs.

In April, Pernod Ricard's status as a leader in cocktails was confirmed when eight of its brands carried off ten best-inclass “Chairman's Trophy” honors at the 2011 Ultimate Cocktail Challenge competition in New York—the most of any company in the competition.

The triumph followed strong results, including four top honors, at the second annual Ultimate Spirits Challenge.

Giant strides for Diageo

F

or Diageo, the primary action these days has to be with the iconic Johnnie Walker Black Label blended Scotch whisky which, together with Baileys, is the company's leading brand in travel retail. In July Diageo launched a new limited edition packaging design by leading graphic artist Jasper Goodall. Goodall has undertaken a reinter-

Diageo Reserve World Class Bartender of the Year 2011 Manabu Ohtake mixes a cocktail

pretation of the famous Johnnie Walker “Striding Man” figure, following in the footsteps of other major illustrators who have done the same over a century, going back to Tom Browne's first rendition in 1908.

The limited edition comes in a 75cl bottle gift pack based on black tones contrasting with the trademark orange-gold of the figure.

“When I was approached to reinterpret the Johnnie Walker Striding Man logo I knew almost straight away what I wanted to do,” Goodall says. “I recalled, during a visit to a whisky distillery years ago, the guide telling me how, slowly, over time, a small amount of whisky evaporates and escapes the barrel, and this is known as the 'angels' share.'

“I thought it would be great to visualize this; spirits slowly rising up to the angels.

The limited edition is a big part of Diageo GTME's attack on the gifting category in travel retail, which is a segment where Diageo GTME believes there is potential for significant new growth. In particular, says Sarah Springer, Innovation Director for Diageo GTME, Diageo is determined to address the relative underperformance of gifting in the liquor category, which is at only 40%, well below the 56% in confectionery, for example.

In addition, the scale of the opportunity is underlined by the fact that shoppers spend 34%

more when buying a gift in travel retail.

In August, Diageo appointed the agency VCCP to look after the advertising for its range of ready-mixed cocktails, such as Smirnoff Mojito, Smirnoff Cosmopolitan and J&B Manhattan, in Europe. The 700ml cocktails were rolled out in 2009 to enhance the accessibility of Diageo’s brands. The announcement followed closely on the appointment of Dare to promote Diageo's range of premixed 250ml cans, which includes Pimm's & Lemonade, Captain Morgan's Spiced & Cola and Gordon's Gin & Schweppes Tonic.

In July, Diageo GTME made some major adjustments to its team following an operational review earlier in the year. Steve White was named GTME Marketing Director and will oversee customer marketing and brand development while pushing the company's core gifting and innovation work. At the same time, Sales and Operations Director Olaf Grewe wound up his work on the European market and left Diageo, while Corporate Relations Director Tim Rycroft also departed after four years.

Soon afterwards, GTME hired Saatchi & Saatchi to run retail branding campaigns, initially with a focus on advertising, as well as in-store promotions and sampling for

Smirnoff vodka.

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TFWA WE liquor preview

Best and brightest

Americas Duty Free presents a guide to some of the many must-see wine and spirits exhibitors at this year’s TFWA WE BY RYAN WHITE

T

FWA WE has long been known as the world’s premier duty free event, and one look at this year’s exhibitor list makes it clear that the 2011 exhibition won’t disappoint. From new companies and products to returning suppliers showcasing old favorites, it’s sometimes hard for attendees to know where to begin. Below Americas Duty Free presents a guide to what’s new in the world of wine and spirits at Cannes this year.

Bardinet Contact: Estelle Sauvage, Export Brands Manager Stand: Yellow Village, H53 Products featured: Sir Edward's Scotch Whisky; Glen Moray Speyside Single Malt Scotch Whisky; Bardinet French Brandy; Old Nick Caribbean Rum; Negrita Rum; and Beehive Brandy Recent awards or accolades: A silver medal best in class award for Bardinet French Brandy XO, a silver medal for Sir Edward’s and a bronze medal for Glen Moray Classic (among other accolades), all at the 2011 International Wine and Spirits Competition; New developments: Launch of Bardinet French Brandy XO and Old Nick Caribbean white and gold rums in January 2011; Upcoming launch of Sir Edward’s 12 YO and Glen Moray 10 YO matured in Chardonnay casks; new packaging for the Alvinde range of Chilean wines; and Sour Maracuja, a new SKU in the Bardinet portfolio

Cooley Distillery Contact: Stephen Teeling, Global Travel Retail Manager Stand: Mediterranean Village, N17 Products featured: Kilbeggan 18 Year Old Irish Whiskey; Greenore 18 Year Old Single Grain Irish Whiskey; Connemara Peated Single Malt; Connemara Peated Single Malt; and The Tyrconnell Single Malt New developments: Increased distribution in travel retail; new Greenore listings with World Duty Free and Dubai Duty Free; a full rollout of portfolio with Brittany Ferries; and two new branded areas in Belfast and Dulbin Airport’s T2 with Aelia

SPI Group Contact: Marco Ferrari, Chief Marketing Officer Stand: Green Village, J67 Products featured: Stoli Chocolat Razberi; elit by Stolichnaya Pristine Water limited edition; Stolichnaya Gold; the Premyr Mixology Collection; Achaval-Ferrer wines New developments: The launch of Stoli Chocolat Razberi; introduction of a new global marketing campaign for elit entitled “You Know Better”; elit by Stolichnaya Pristine Water limited edition launched in Cannes, with only 300 numbered bottles available

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A. de Fussigny Cognac Contact: Jean-Dominique Andreu, President Stand: Red Village, K21 Products featured: A. de Fussigny Sélection; Supérieur Fine Champagne; XO Fine Champagne; XO in Cigar Tubes (5cl); XO 24 Carats Grande Champagne; and Vintages (1969, 1970, 1975 and 1988) Recent awards or accolades: A double gold medal for A. de Fussigny XO at the 2011 San Francisco World Spirits Competition; a gold medal and "Exceptional" score of 95 points for A. de Fussigny XO by the 2011 Beverage Testing Institute; and a gold medal for A. de Fussigny XO at the 2011 Concours Mondial de Bruxelles New developments: XO 24 Carats Grande Champagne; Vintage Collection (1969, 1970, 1975, 1988); and XO Fine Champagne in Cigar Tubes (5cl)

Gruppo Campari Contact: Matthijs Kramer, Global Travel Retail Manager Stand: Bay Village 25 Products featured: Campari; Aperol; Wild Turkey; Skyy Vodka; Glen Grant; Frangelico; and Cinzano

Belvédère Duty Free

Peller Estates Contact: Louise Wilson, International Sales Manager Stand: Blue Village, G19 Products featured: Peller Estates Vidal Icewine; Peller Estates Cabernet Franc Icewine; Peller Estates Oak Aged Icewine; Peller Estates Riesling Icewine; Peller Estates Ice Cuvee; and new Peller Estates Ice Cuvee Rose Recent awards or accolades: A double gold at the 2011 All Canadian Wine Championship; a gold at the 2010 Paris Vinalies Internationals; and a gold at the 2010 London International Wine and Spirits Competition, all for Peller Estates Vidal Icewine New developments: Peller Estates Vidal Icewine is now part of British Airways’ in-flight duty free selection and also offered onboard Celebrity Cruise Lines; Peller Estates Ice Cuvee is now offered on P&O Cruises and in the Gold Lounge at Kuala Lumpur Airport

Innovative Liquors Contact: Shachar Gat, Vice President of Operations & Logistics Stand: Red Village, K25 Products featured: Bear Hug Infusions range of naturally flavored spirits New developments: Bear Hug Infusions Tequila Papaya

Distilleria Bottega Contact: Sandro Bottega, President Stand: Yellow Village, A16 Products featured: Amarone Bottega, Il vino Prêt-á-porter, with white leather case embellished with debossed black lettering designed by Denise Focil

Contact: Josette Morieux and Torben Vedel Andersen Stand: Green Village, H52 Products featured: Sobieski Vodka; DANZKA Vodka; the Marie Brizard range, including Chocolat Royal & Grand Orange; Gautier Cognacs, including Eden, VSOP, XO & Sève

by Gautier Recent awards or accolades: A silver medal in packaging and design for DANZKA Vodka at the 2011 San Francisco World Spirits Competition; “Impact Hot Brand” awards three years running (2008-2010) for Sobieski from M. Shanken Communications; a silver medal for Marie Brizard Grand Orange at the 2010 San Francisco World Spirits Competition; and a bronze medal for Marie Brizard Chocolat Royal at the 2010 San Francisco World Spirit Competition New developments: New packaging for Gautier Cognacs and the introduction of the Marie Brizzard Essence range

Constellation Brands Canada Contact: Amanda Dolotowicz, Business Development Manager Stand: Yellow Village, D26 Products featured: Inniskillin Icewine Riesling/Cabernet Franc duo pack (2 x 200ml) Recent awards or accolades: Two silver medals for 2007 Inniskillin Vidal Icewine from the International Wine and Spirits Competition and Decanter magazine New developments: Launch of new vintage 2007 Inniskillin Gold Icewine

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Liquor News Russian Standard launches IMPERIA Swarovski limited edition Russian Standard Vodka, the top premium vodka in Russia, has launched its luxury brand IMPERIA in a limited Swarovski Crystal Crown Edition. This exclusive limited edition celebrates the splendor of Imperial Russia and features a bottle that is adorned with twenty-four clear Swarovski crystal beads. Quartz, also known as "rock crystal," is mined from natural sources in the Ural Mountains of Russia, a vast mountain range extending from north to south in western Russia and one of the richest sources of mineral

wealth on earth. For many centuries the Ural Mountains were Russia’s imperial treasure-trove, abundant in precious stones and natural resources.

The limited edition of 20,000 bottles were available worldwide starting in August in selected high-end hotels, restaurants and clubs as well as in premium stores, specialized spirits boutiques and international airports.

“We are proud to present the IMPERIA Crystal Crown Edition, a 21st century revisit of the time-honored tradi-

Tequila Esperanto proves popular with major travel retailers Americas Duty Free recently spoke with Roberto Pastrana, Director of Tequila Esperanto, about the company’s latest successes in duty free. The high-end brand is already listed with Dufry, Grupo Wisa and Aldeasa in Mexico, and is now setting its sights on increasing its presence in travel retail.

Tequila Esperanto is produced in the highlands of Jalisco and made from 100% agave. Although the company’s offices are in Mexico City, the brand is already getting attention around the world for the unique mix of tradition and modernity that it employs. Tequila lovers can choose from Blanco, Reposado, Añejo and Extra Añejo varieties, all produced traditionally to exacting standards. In addition, Tequila Esperanto’s bottles are hand-blown and each boasts a handmade glass agave plant. Every bottle is unique, making the brand perfect for aficionados looking for a high-quality tequila that can also be proudly displayed.

“Our Extra Añejo expression comes in a display box with two premium shot glasses,” says Pastrana. “Furthermore, every expression is sold in a bespoke box, making it perfect as gift. We’ve received awards from around the world for both packaging and fantastic liquid within, and so far the reaction in duty free has been amazing.”

With all three operators, Tequila Esperanto is in the top five in terms of sales. Pastrana notes that Brazilian and Colombian travelers are particularly fond of the brand, and for this reason both countries are prime objectives as the company makes plans for expansion into new markets.

“Obviously Brazil is a very important market these days, and from research we know that we’re already popular with Brazilian travelers in Mexico,” he says. “We feel there are also opportunities in Colombia, so we’re currently exploring our options and hoping that our success with major travel retailers to date will help us get a foot in the door.”

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tion of vodka heritage and the Imperial luxury which drives us to ultimate perfection,” says Walter Kooijman, Commercial Director Global DF & APAC, Russian Standard Vodka International.

“The elegant IMPERIA crown cap references the special place that hats and headwear have held in Russian society for centuries, as the height of one’s headpiece traditionally indicated one’s social status. Our customers, who demand only the best, will surely enjoy this last word in luxury.”

Mount Gay honors sailing legacy with launch of nautical limited edition Mount Gay Rum has been associated with the sailing community for over three centuries. This year, to honor the brand’s commitment to the world of sailing and the rich history from which it stems, Mount Gay has created the “Nautical Limited Edition,” representing the beginning of a nautical series featuring maritime signal flags.

This collectable bottle of Mount Gay Eclipse Rum features the nautical flag design of the letter “M” and is designed to be enjoyed on board or wherever rum lovers celebrate the sailing legacy of the brand.

The Mount Gay Rum Eclipse Nautical Limited Edition “M” design was released in August in various global travel retail locations such as in Australia, New Zealand, Spain, France, Germany and the UK, and also on board Brittany Ferries and P&O, priced at parity with the standard Mount Gay Eclipse Rum. This limited edition will also be exhibited at TFWA WE in Cannes.

Mount Gay has created the “Nautical Limited Edition,” designed to be enjoyed wherever rum lovers celebrate the sailing legacy of the brand.

The IMPERIA Crystal Crown Edition features a bottle that is adorned with twenty-four clear Swarovski crystal beads

The Famous Grouse launches celebration blend

The Famous Grouse is celebrating 30 years as Scotland’s favorite whisky and to celebrate this impressive milestone Master Blender Gordon Motion has created his very own celebration blend presented in a limited edition Wade decanter. The Famous Grouse Celebration Blend Decanter will be exhibited at TFWA WE in Cannes on the Maxxium stand at M53 in Green Village.

Containing whisky from the year in which The Famous Grouse became Scotland’s number one selling whisky and carefully selected whisky from subsequent years, it is the first special blend created by Gordon Motion since he assumed the role of Master Blender in 2009. With only 10,000 bottles available worldwide, a proportion of which will be available in global travel retail, this celebratory decanter is set to become a much cherished collector’s item for whisky enthusiasts and fans of The Famous Grouse.

The decanter features three unique illustrations of the iconic grouse taking flight, painted by the famous British wildlife artist Rodger McPhail. McPhail has a long association with the brand, having drawn the much loved red grouse that adorns every label of The Famous Grouse whisky.

Glen Williams, Managing Director Maxxium Travel Retail, says:"Maxxium Travel Retail is delighted to be the first to introduce The Famous Grouse Celebration Decanter to market. We see an increasing demand for higher style blends and limited editions with the travelers in Europe and we are confident that this new product perfectly matches the interest of these consumers."

Only 10,000 bottles of The Famous Grouse Celebration Blend Decanter will be available worldwide, with a proportion of the total available in duty free

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Liquor News

Savary introduces new wines to portfolio, redoubles Americas focus Savary Argentina recently rounded out its international wines portfolio with the introduction of the Rolland Collection from renowned oenologist Michel Rolland. Also new at Savary is the addition of the Hess Collection, which features wines produced in Argentina, USA, South Africa and Australia, and Francoise Lurton wines from such regions as France, Spain, Portugal and Chile.

“Selected vintages from these latest additions will be available for duty free sale with travel retailers in South America,” the

company noted. “We’ve had phenomenal support from Michel Rolland and Francois Lurton. We’re proud to say that they’ve seen the value of our enterprise and we thank them for their support.”

While already a staple in many travel retail stores throughout the Americas, Savary is currently in talks with two major retailers to extend its reach even further.

While it is too early to give details, the company’s goal is to have Americas-wide coverage by the end of this year.

Of course, 2012 is just a few months

away, and Savary will set its sights on conquering the Middle East and Asia in the new year. “Our intention is to become one of the most important wine distributors in travel retail, and we’ve made some very significant steps toward achieving this goal,” said the company. “We want to develop the wine category within duty free, incorporating promotions, special activations and staff training as a means of replicating some of the successes that other categories such as whisky, confectionery and perfumes have enjoyed in the duty free channel. Operators are seeing the value of this approach and we’re expecting to have news of further listings in the very near future.”

A spectacular view of Francoise Lurton’s vineyard; Savary has added the family’s wines to its portfolio, along with wines from the Hess Collection and Michel Rolland

Brown-Forman introduces Finlandia Platinum vodka at TFWA WE Finlandia Vodka makes its long-awaited entry into the luxury category when it introduces its new high-end vodka, Platinum, at the TFWA Conference in Cannes, France, September 22, 2011. Made with Finland’s purest glacial spring water and finest six-row barley, Platinum is handcrafted under the supervision of Finlandia Master Taster Marku Raittinen, passed over a bed of Finnish birch chips and then finished through slow arctic chilling to ensure ultimate smoothness.

Raittinen, a 17-year veteran with Finlandia, has been serving as the manager of the vodka’s Taste Training Program and a global ambassador to vodka events and tastings around the world. Over the years Raittinen has traveled to over 51 countries on behalf of Finlandia and taste trained by his estimation over 15,000 people including consumers, bartenders, trade representatives and members of the news media.

“Platinum is a terrific addition to the Finlandia portfolio and should prove to be popular in the travel retail/duty

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Made with Finland’s purest glacial spring water and finest six-row barley, Platinum is hand-crafted under the supervision of Finlandia Master Taster Marku Raittinen

free marketplace. Finlandia is already globally recognized for its quality and taste and a luxury vodka like Platinum will only enhance its reputation among connoisseurs of high quality spirits,” said Jim Perry, Brown-Forman’s Managing Director of Travel Retail.

Another of Platinum’s special attractions is the bottle itself, which was a collaboration between noted contemporary Finnish designer Harry Koskinen and Ken Hirst, an award-winning package designer. Inspired by the natural beauty of Finland, the striking Platinum bottle depicts the essence of an icy Nordic landscape. The suggested retail prices for Finlandia Platinum will vary by geographic location.

Finlandia Vodka was one of the first premium vodkas to introduce flavors from nature in 1994 with the launch of Cranberry. Since then, Finlandia has introduced several fresh tasting flavors to the portfolio, which currently includes Lime, Mango, Grapefruit, Tangerine, Raspberry and Redberry.

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Liquor News

The Bodega Weltraud at the Torres Pacs del Pinedès winery near Barcelona

Old world, new world Spanish winemaker Bodegas Torres is used to making news, whether by winning wine awards or grabbing headlines for its environmental and social commitment, or even attracting attention with the striking Waltraud Cellar designed by architect Javier Barba at its Pacs del Penedès winery in Catalonia. Recent headlines include stellar point scores from a commissioned evaluation in July by Jay Miller, who is closely associated with renowned wine critic Robert Parker. Torres’ Gran Muralles and Reserva Real received scores ranging from 93 to 96 points, a success that Torres says places it among the best rated Spanish wines. Earlier in the year, Reserva Real 2007 won a gold medal in the Challenge International du Vin 2011, while four other vintages took bronze medals.

Torres attracted attention at last year’s TFWA WE with the unveiling of the music-themed Atrium range, which includes Cabernet Sauvignon, Merlot and Chardonnay, all characterized

by what Torres describes as “an intense and sensual symphony of aromas.” Cabernet Sauvignon is intended to be paired with charcuterie, paella, as well as meat and game dishes, in addition to cheese, and offers up notes of jams, dark fruits and toasted bread.

The Atrium Merlot exudes the scent of red fruit jam with vegetable undertones of coffee and liquorices. “A silky, broad palate with sweet tannins offers fine notes of blueberry and plum and a long finish. This wine can be paired with charcuterie and all kinds of meats, as well as tomato-based sauces,” say the Torres notes on the vintage. Finally, the Chardonnay features intense aromas, “is complex, silky with elegant breadth, and its ripe peach notes combine with touches of vanilla. The wine can be served with seafood, smoked salmon, paella and turkey.”

Overall, Torres carries some 50 brands sold in 140 countries around the world. The

company’s primary presence in Spain is obvious, but recently Torres has moved to intensify its winemaking work in Chile and California, both of them prime breeding grounds for global wine success stories. The Californian footprint is still relatively small at 32 hectares (79 acres), while the Chilean holdings cover 912 ha (2,253 acres) and the Spanish home turf hosts 1,594 ha (3,938 acres).

Torres closed out 2010 with a turnover of €205 million (US$292 million), 9% better than 2009 and almost double the expected increase. Exports account for 72% of sales, and the company has been working hard to develop its presence in the BRIC countries, with China standing out as a particular success story. Torres is the first European wine company to hold direct distribution there, where in addition to its own vintages it does distribution duty for wines from France, Italy, Austria, Germany, Portugal and the US.

Brugal gains momentum in Americas with airport activations

The two-month New York activation will be mirrored elsewhere in major travel retail outlets in New York Newark, Miami, Houston, Canada and Latin America

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Smiling faces and a premium rum tasting experience await travelers passing through New York JFK Terminal 1 Departures this summer.

Brandowner the Edrington Group, their distributors Rémy Cointreau Travel Retail Americas and retailer International Shoppes have combined forces to mount high-profile Brugal activations featuring travel retail exclusive Brugal Extra Viejo Reserva and Brugal Añejo Reserva starting with New York JFK. The two-month New York activation, which follows the successful launch of Brugal Reserva in duty free in the Americas last March, will be mirrored elsewhere in major travel retail outlets across the Americas including New York Newark, Miami, Houston, Canada and Latin America duty free during August and September with others later in the year.

Commenting on the New York JFK activation, Scott Halpern, Vice President, International Shoppes said: “We are very excited to be a part

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

of the Brugal duty free launch. It is a wonderful rum and we look forward to showcasing a taste of the Brugal Reserva expressions to a global audience in New York and later Philadelphia.”

André de Almeida, Edrington Group’s Area Director - Americas Duty Free, added: "Following the positive reaction from the trade at the IAADFS show 2011 to the introduction of Brugal, we are gaining momentum behind listings and activations on the brand across the Americas duty free market.

“Consumers will be exposed to the brand across different channels in 2011 and will have the opportunity to taste a rum with a distinctive, lighter style with drier woody notes that come through whether drunk neat or mixed. Brugal is produced under a very tightly controlled distillation process to guarantee a clean spirit with low levels of congeners and all of this combines to make Brugal a unique proposition in the rum category in travel retail.”

Experience a unique variety of refined, delicate flavours

Visit us at Stand Mediterranean Village N7

Liquor News

MONARQ sets the pace The trend in duty free in the Americas has been generally positive so far this year, especially in South America, says Robert de Monchy, Managing Director & Owner of MONARQ Group. “New stores are opening in several airports and borders and the duty free market has attracted new players as well.

There is lots of movement, especially in Uruguay and Central America.” Heineken and Disaronno are doing especially well for MONARQ, as well as super premium specialty brands like La Fée absinthe and Crystal Head vodka.

“Duty free and travel retail is becoming a destination shopping area, where consumers are looking for unique experiences and propositions,” de Monchy says. “Consumers are looking for a great product at a fair price, not so much bargains.” Despite the economic downturn, de Monchy says that price isn’t the main reason people buy duty free, “apart from

the arrival stores in places like Brazil, which is quite a different concept.”

One secret of MONARQ’s success is a paced approach to expansion: the company builds the internal organization to handle new business or brands before taking them on operationally. “I’m a firm believer in investing in people, systems and the organization in general,” de Monchy says. “Without the right people, there’s no business to be done.”

For Cannes, MONARQ will be highlighting most of the spirits portfolio, including Disaronno, Tia Maria, Bols, Fernet Branca, Zubrowka bison grass vodka, Molinari sambuca, Crystal Head vodka, Pallini Limoncello, La Fée absinthe and Casa Noble superpremium tequila. New products on display will include Sol and Dos Equis, Mexican beers that are part of the Heineken Group, which Monarq represents in Latin American duty free.

World Brands focuses on the showcasing opportunities that duty free provides World Brands won’t be at Cannes this year, but already has plans in motion to prepare for the 2012 show, says Karlo Reyes, Vice President, Operations. Irrespective of attendance at trade shows, the duty free and travel retail business continues to be solid. Reyes points to figures showing that wine and spirits accounts for around 17% of the total market, partaking in a general overall market increase but not gaining share significantly.

Zubrowka bison grass vodka from Poland

For World Brands, tobacco products are a major focal point, but on the spirits front, Ruskova Vodka is a market maker. Ruskova is a quality product not priced at a premium, Reyes says.

“As far as new developments in the duty free industry, more specifically the liquor segment, this is something we can talk about all day long,” Reyes says. He singles out Pernod Ricard Travel Retail’s launch of the new ultra pre-

mium ABSOLUT ELYX in July and the partnership of Delhi Duty Free Services with Diageo to launch the World Class Bar passenger engagement program as two examples.

“The duty free segment of the business is very important,” Reyes says. “It’s a constant showcase and promotional vehicle for brands throughout the world. Even the most recognizable brands in the market still value and use the duty free segment on a constant basis.”

Mozart hits the high notes For Mozart Distillerie, the addition of Mozart Dry in 2009 rounded out the company’s well known line of premium chocolate spirits. The products, now sold in about 70 countries, were first introduced in 1981 and now comprise five varients, including Mozart Chocolate Bitters. Mozart Gold is a full-bodied cream liqueur based on milk chocolate and fresh cream in a blend with aromatic notes of vanilla and cocoa. “The raw materials for Mozart Gold are well traveled,” the company says. The cocoa used is a mixture of Forastero (West Africa) and Trinitario (Caribbean) types. In addition to the fresh cream, Mozart Gold contains conched dark chocolate from Belgium and Bourbon vanilla from Madagascar, as well as crystal sugar and pure sugar cane distillate.

Mozart White is a light chocolate cream liqueur featuring aromatic vanilla, fresh cream and high notes of white chocolate. Like Mozart Gold, Bourbon vanilla from Madagascar features prominently in the list of ingredients, but this product is notable for a low fat content. As it contains less fat than other Irish creams, 110

it has a longer shelf life—the same shelf life as Mozart Gold—always an important consideration for travel retail. Mozart Black, the dark chocolate variant, is described as smoky with tart notes of cocoa in addition to notes of dark chocolate, vanilla and caramel.

Mozart extended its presence in the mixed drinks market with the recent launch of Mozart Chocolate Bitters, a highly concentrated product, which also features the Forastero and Trinitario cocoa types. In addition to an ingredient in premium mixed drinks, the bitters is touted as a signal addition to sauces, desserts and other dishes, and Mozart has enlisted some famous culinary names to associate with the product. This parallels the CHOCtails recipes created by well known mixologists for the Mozart Dry product—names like Bastian Heuser, the renowned German bartender, and Moritz Niederstrasser of Villa Kennedy in Frankfurt.

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Mozart Black Chocolate Pure 87

Company News: Patron

The growth of green BY

ANDREW BROOKS

Sustainable business practices give Patrón another way to lead the pack

“S Patrón’s distillery in the highlands of Jalisco is a showcase for environmental practices

All of Patrón’s bottles are handmade from recycled glass

The reverse osmosis system recycles 70% of the wastewater generated during distillation

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uccess unshared is failure.” The phrase is something of a personal motto for John Paul DeJoria who, as co-founder of the upscale tequila marquee Patrón, evidently knows a thing or two about success. The ultrapremium Patrón, which was founded in 1989, today has over 1,200 employees at their distillery in Mexico and sells in over 120 countries around the world. Indeed, the company has probably done as much as any single tequila to move the category massively up-market with specialty brands, flavored drinks and Hacienda del Patrón, the distillery in the highlands of the Mexican state of Jalisco that embodies the boutique sensibility.

Lasting success like this is founded on proprietary know-how that is jealously guarded. But the publicly minded DeJoria wants to offer the world—including competitors—an intimate look at everything the company does to minimize the impact its operations have on the environment. The discussion was very much on the mind of Greg Cohen, Patrón’s International Director of Corporate Communications, when he spoke with Americas Duty Free recently.

“Our green commitment is an ongoing effort,” Cohen says. “We have a whole team that oversees nothing but our environmental program. We’re always finding new ways to improve—it’s something we’re very proud of.”

Cohen points proudly to some Patrón landmarks. The company was the first tequila maker in Mexico to install a reverse osmosis process that enables it to convert most of the otherwise unusable wastewater generated during distillation back into clean water that can be used in the cooling towers, gardens and for cleaning.

Patrón is also determined to get maximum value from used agave fibers. Cohen says that Patrón has set aside a 5-hectare site where the crushed fibers are composted. The company also welcomes waste fibers from other tequila makers in the vicinity of the Hacienda del Patrón.

Last year, Patrón treated about 5,500 tons of spent fibers from other distillers. Most of the compost created—4,300 tons—went back to local agave growers, while Patrón used the rest in its own gardens. The company also provides compost to the nearby town of Atotonilco.

The altruistic impulse runs deep at Patrón, Cohen says. “We’re very careful when it comes to certain proprietary elements of our distillation process and recipe, but we want our environmental work to be an open book. There, anyone can come in and see what we’re doing.”

Case in point: Jalisco water authority SEMADAS regularly conducts tours of Hacienda del Patrón to show representatives from other business concerns what is possible. And PROFEPA, Mexico’s national environmental protection authority, recently presented its Clean Industry Award to Patrón. The company has also attained ISO 14001 for its environmental programs.

When asked whether Patrón saves money with its earth-friendly practices, Cohen says point-blank that they cost Patrón more than they save. “We’re talking about fertilizer and water,” he says. “They aren’t expensive inputs.” And cost savings aren’t the point: environmental stewardship really is an end in itself for this company.

“The spirits industry is doing a lot environmentally,” Cohen says. “But we’re proud that in the tequila industry we’re leading a lot of these efforts.” The theme was front and center at the 2010 “Fortune Brainstorm Green,” an event hosted by Fortune magazine to showcase the thinking of leading green scholars and entrepreneurs. It’s a mark of Patrón’s own stature that its COO and Executive Vice President John McDonnell was invited to speak.

McDonnell opened the book on Patrón by highlighting for attendees everything that the company is doing. To what has already been covered here, he added the observation that all of Patrón’s hand-crafted bottles are made entirely from recycled glass. But he added a new twist by going on to note some of the environmental initiatives other spirits companies are pursuing. Indeed, to a seasoned trade show attendee, that willingness to share kudos is a remarkable demonstration of how important environmental consciousness is

in Patrón’s operations.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Company News: WEBB

WEBB is currently laying the groundwork for an upcoming duty free tasting of St. Germain elderflower liqueur

Expanding horizons WEBB banks on its success in the Caribbean to open duty free doors farther afield BY

ANDREW BROOKS

“O

ur business overall continues to do very, very well,” says Andy Consuegra, Founder and Managing Partner of marketing and distribution company World Equity Brand Builders (WEBB). “Last year we grew 69% and this year we’re well into double-digit growth.”

For WEBB, the Caribbean domestic and duty free market is the main focus, with cruise lines also important for sales both in onboard stores and via pouring. Consumers are coming back to the Caribbean, Consuegra says, with the US Virgin Islands and St.

WEBB runs tastings for many of its brands throughout the year; pictured is a recent tasting of Flor de Caña rum

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Maarten markets especially encouraging.

WEBB is also benefitting from a productive partnership with International Shoppes, running promotions and tastings in its stores at New York’s JFK Airport.

The rebound is a bit of a mixed bag. Performance for the first half of this year is outpacing the first half of 2010, but Consuegra says that while customer numbers are reviving, the average sale remains low because customer purchasing power is still weak.

A lot of WEBB’s business is in the domestic market, but when it comes to duty free, Consuegra is especially proud of the job his company has done to fine-tune its work carrying Nestlé chocolates on Starboard Cruises vessels. The stable is now up to 30 ships, working routes in Asia, Europe, South America and of course the Caribbean.

“We’ve been working on this since WEBB was founded in 2007,” Consuegra says. “We’ve worked very closely with them to ensure product gets to their ships all over the world, wherever they happen to be. The logistics are complex, but I think we’ve cracked the problem, and now we’re reaching critical mass.” Sales this year are way up over 2010, Consuegra says.

WEBB handles a diverse and interesting portfolio. In June, the company ran a tasting program for Flor de Caña rum at JFK. This will be run again in October, and WEBB is also laying the groundwork for a tasting of St. Germain liqueur, another strong brand. Overall, WEBB runs a few tastings every year.

When we spoke with Consuegra, WEBB had just launched Blanton’s Bourbon in the International Shoppes channel, and he told us a re-order had just been received, which suggests that initial sales were brisk, to say the least.

Overall Consuegra reports that the Caribbean is very strong, with especially good growth in Flor de Caña in the Cayman Islands through the Tortugas duty free chain—it’s also a solid brand in the domestic market: “We’re seeing about 40% over last year in both duty free and domestic,” he says.

The Macallan single malt scotch whisky is a strong performer in the Caribbean.

WEBB carries accounts pretty much throughout the Caribbean, although the business is mainly domestic.

A relatively new star is Blanton’s Bourbon, picked up almost

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

two years ago. “Blanton’s overall is exceeding our expectations, well into the double digits in terms of growth,” Consuegra says.

“Probably more than other brands this is being driven from the duty free side.”

The brand’s strength owes a lot to the fact that while Blanton’s Original is available and recognized in the US, Blanton’s Gold and Straight from the Barrel aren’t. So when a loyal Blanton’s drinker finds the varieties, a sale is almost assured. Just to make sure, WEBB offers a Blanton’s humidor with a two-bottle purchase.

The super-luxury champagne Armand de Brignac has also exceeded expectations. This stellar vintage is entirely hand crafted by a grand total of eight people in the Cattier winery in France, presided over by family patriarch Jean-Jacques Cattier. Rated by Fine Champagne Magazine as the best in the world, Armand de Brignac has attracted a big share of the spotlight. In a full-page article, the Wall Street Journal went so far as to christen it “the champagne of champions.”

At press time, Consuegra expected to have an announcement soon about Armand de Brignac being signed into duty free channels in North America and

Europe.

WEBB reports that Flor de Caña rum is showing good growth both in duty free and domestically

Š2011 Southern Comfort. All rights reserved. Southern Comfort is a registered trademark.

THIS IS YOUR

IT’S COMING

FALL 2011 Come and try it for yourself at the Brown-Forman stand M70(Green Village), TFWA World Exhibition in Cannes.

DRINKING RESPONSIBLY IS HOT ©2011 Southern Comfort. All rights reserved. Southern Comfort is a registered trademark.

Company News: Pernod Ricard Americas Travel Retail

Absolut-ly

fabulous

Pernod Ricard’s Enrique Girones discusses ABSOLUT ELYX, as well as a number of other brand initiatives set to make a splash in duty free during the second half BY RYAN WHITE

T

he Absolut Company calls its latest travel retail launch, ABSOLUT ELYX, an exploration of the brand’s heritage, which includes an impressive five centuries of vodkamaking tradition in the rich farmlands of Skåne in southern Sweden. Fittingly, the development of ELYX took place over a period of more than ten years, handcrafted in small volumes from the very finest, carefully selected, single-estate winter wheat and the purest spring water. For the spirit’s distillation, a rectification still from 1929 has been restored to operation in the Absolut factory in Åhus. It uses traditional copper catalyzation for unique flavor, aroma and texture qualities.

Speaking with Americas Duty Free, Marketing Vice President of Pernod Ricard Americas Travel Retail (PRATR) Enrique Girones recently went over some of the ELYX-related activations travelers can expect to see in the coming months in the Americas. In addition to outlining the promotional calendar, Girones also pointed out that the limited edition offering will be an area of focus at Pernod Ricard’s stand during this year’s TFWA WE in Cannes.

“In the month of August, Absolut ELYX will launch in the Rio de Janiero and Sao Paulo airports,” Girones explains. “The promotion will be fully executed with signage, promoters as well as tastings.”

ELYX is well-positioned to appeal to duty free travelers in Brazil, who are known for showing a keen interest in new luxury products. The Absolut Company notes that the ABSOLUT ELYX manifesto rests on four pillars that effectively communicate the uniqueness of the product: • 100% hand-selected, single-estate winter wheat: ABSOLUT ELYX is distilled exclusively from hand-selected superior quality winter wheat from the famous Råbelöf estate near the Absolut factory in Åhus.

• Pristine water filtered by nature: The ABSOLUT distillery rests on its own pristine natural underground springs, the very source of ABSOLUT Vodka. Filtered through a boulder ridge and limestone bedrock through thousands of years, this water has never been exposed to any kind of pollutants.

• Perfected through copper catalyzation: ABSOLUT ELYX is distilled in a restored vintage rectification still from 1929, with columns, pumps and hand-forged pipes all in solid copper.

• Genuine craftsmanship: ABSOLUT ELYX is hand-crafted in single batches in a process that is carefully and personally supervised by master distillers and other craftsmen at every stage. No computers are used.

ABSOLUT Orient Apple will launch in duty free in the Americas in September

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Chivas Regal’s popular The Age Matters campaign will be run in Uruguay, Argentina, Rio de Janiero and Sao Paulo this year

Girones tells us that in addition to launching in Brazil, ELYX will be released later in the year in US duty free. “Pernod Ricard Americas Travel Retail has a clear priority of enhancing our permanent presence throughout Americas Travel Retail,” he says. “We are working really closely with the key duty free operators to find winwin solutions to continue rewarding and bringing new experiences to the international consumer.”

A world of choice In addition to the launch of ELYX, ABSOLUT Orient Apple will be coming to the Americas in September. Of course, with such a diverse portfolio, Pernod Ricard isn’t stopping at the new ABSOLUT releases. Girones confirmed that The Age Matters campaign, spearheaded by the Chivas Regal brand, will be launched throughout the Americas this year.

“In our North America airports, The Age Matters campaign will run through August then again in March and April of 2012,” Girones says. “The campaign will showcase Chivas Regal, Ballantine’s and The Glenlivet.”

Americas Duty Free ended the interview by asking Girones about business in the first half of the year, and he suggested that the strength of Latin American countries has made it apparent that travelers are ready for the kinds of high-end brands that Pernod Ricard specializes in: “Business has been strong the first half of the year,” he says. “The market trend is toward premium and super premium products thanks to the strong demand from South American and Central American consumers. Our ample premium and super-premium portfolios fulfill such a

consumer demand.”

Company News: Diageo

Grand slam Johnnie Walker

Double Black promo “Experience the Flavour” promotion touches down at four Americas hubs BY

ANDREW BROOKS

A

t the end of July, Diageo Global Travel & Middle East (GTME) launched “Experience the Flavour,” a tailored Johnnie Walker Double Black promotion at four strategic airports in the Americas that gives travelers an interactive experience of the signature brand. The major internationals at Mexico City, Dallas, Las Americas in the Dominican Republic and Miami have partnered for the promotion in cooperation with major retailers and the airport authorities at each location to run the campaign promoting Johnnie Walker Double Black, the spirit that Generation Research pegs as number 8 by value in travel retail.

Diageo says Johnnie Walker Double Black “amplifies some of the trademark characteristics of Johnnie Walker Black Label, notably the smokiness, to deliver an additional intensity of flavor—a nuance for those more adventurous drinkers who are prepared to experiment with something new from their favorite brand.” It sells at a 15% price premium above Johnnie Walker Black Label.

All four launches are supported by tailored programs that maximize concourse visibility in high-traffic areas with the aim of driving conversion and accelerating brand momentum. “Building on the remarkable impact of Johnnie Walker Double Black in its first year,” the company says, “the focus is now on deepening engagement with shoppers to strengthen their understanding of the brand and the unique taste experience it provides and also drive brand loyalty.”

The promotion has been adapted to local conditions in each venue, and includes sampling and direct selling—where appropriate—as incremental sales opportunities added to the sales efforts of the main duty free stores. In addition to promotional banners and displays at key points, the promotion supports a tailored program at each location, using a range of branded supporting units deployed in-store or on the concourse. These include hosted interactive units with plasma screen displays to engage customers. The promotion also includes in-store sampling bars.

Diageo has found concourse sampling promotions to be very successful in the past, generating positive consumer response—not only in terms of buying, but also with regard to longer-term loyalty, as revealed by research questions about intentions to purchase in the future. Impressively, fully 86% of respondents indicate they are likely to make a repeat purchase.

Johnnie Walker Double Black launched in January 2010 at six locations worldwide, and JFK International in New York was the only venue in the Americas. More recent launches bring the total of Americas locations to more than 80. Double Black also won the coveted Masters Award at the 2010 World Whisky Masters Awards in the “Best Super Premium Blends” category.

Johnnie Walker Black Label is already a towering presence within GTME’s portfolio, but it’s worth noting that Double Black, in its relatively short lifetime, has

Diageo intends to capitalize on the impressive performance of Johnnie Walker Double Black with a new airport promotion that highlights the spirit’s unique taste profile

120

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

already reached about one-third the size of its storied cousin, without cannibalizing sales.

The variant also exceeded tested volume targets in six locations by a factor of seven. Diageo says that the brand’s volume estimates for the 2010-11 financial year are likely to be exceeded by more than 25%.

“Johnnie Walker Double Black has been the single most successful brand launch we have ever had in the region,” says Gregorio Gutierrez, Regional Vice President Diageo GTME, Americas. “The brand’s launch in the Americas region was phased across a series of major hub airports, including New York JFK and Los Angeles, as well as the four locations now hosting our “Experience the Flavour” activation. The brand’s launch impact from day one was truly stunning, immediately creating a powerful impression on retail partners and shoppers alike and delivering above expectations on volume targets.”

Gutierrez notes that partners including DFA, DFASS, DFS, Dufry and Global Brands are closely involved in the promotion, along

with the relevant airport authorities.

Company News: William Grant

New for 2012 will be travel retail exclusive The Balvenie Tun 1401, which includes rare and precious liquid from a number of casks married in Tun 1401 at The Balvenie distillery

BY

RYAN WHITE

William Grant & Sons continues to invest in the travel retail channel through an all-star lineup of brands and personnel

O

n track for another record year in travel retail, William Grant & Sons (WG&S) will have its biggest category-devoted team to date at TFWA World Exhibition this year (Gold Village, Stand 2), headed up by Managing Director Global Travel Retail Rita Greenwood.

The past year has seen a number of key category appointments, including Stephen Corrigan as Travel Retail Director North America; Paige Parness as Regional Marketing Manager The Americas; Alex Warren as Business Development Manager Europe; Neeraj Sharma, Business Development Manager Indian Subcontinent; and Scott Hamilton, Regional Manager Australia and South Pacific.

In terms of products, WG&S notes that one of the big success stories for 2011 has been the launch of the travel retail exclusive 19 Year Old Glenfiddich Age of Discovery. Such has been the reception that for 2012 WG&S is introducing a second version, again exclusive to the channel, as part of what will become a gifting range. Glenfiddich Age of Discovery II will also be a 19 Year Old vintage, in this case celebrating the pioneering nature of American traders who shipped their Bourbon whiskies from down the Mississippi River to New Orleans. Age of Discovery II will be available to global travel retail in the first quarter of 2012.

It has been an equally exciting year for Irish Whiskey Tullamore Dew. Currently the world’s second largest Irish Whiskey, WG&S will be unveiling a new bottle, marketing and advertising campaign at Cannes this year. Tullamore Dew is also one of the sponsors of the Blues Night on Wednesday September 21, where the spirit will be served during the evening.

“We’re really excited about the potential for

122

Tullamore Dew and have great ambitions for the brand,” says Global Marketing Manager Ian Taylor. “The new look will form the basis of our promotional activities moving forward and we can promise some extremely innovative and engaging programs.”

Outstanding growth for Hendrick’s Gin continues in travel retail thanks to a program of high profile theatrical promotions and activities that highlight the unique manufacturing process and taste of Hendrick’s.

This year has seen an increased focus on creating greater image in the Americas, in particular in New York, which has worked “exceedingly well” according to Taylor.

Following the success of the travel retail exclusive Tea Time Martini gift pack, WG&S will be launching a new “Curiositorium” gift pack for 2012 at TFWA World Exhibition.

Focus for The Balvenie Single Malt Scotch Whisky is in the handcrafted nature of its creation, using five rare crafts, which places it in a unique position within the sector. New for 2012 will be travel retail exclusive The Balvenie Tun 1401, an expression which includes rare and precious liquid from a number of casks specially selected by the industry’s longest-serving Malt Master David Stewart and married in Tun 1401 at The Balvenie distillery.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

For Grant’s Blended Scotch Whisky, now the world’s number three brand in retail value according to IWSR, the focus continues to be premiumization of the brand with the continued roll out of the global travel retail exclusive 25 Year Old, the premium 12 Year Old and various cask finishes which highlight the depth and quality of the brand.

To support the complete range of Grant’s whiskies, William Grant & Sons continues to install a new range of wall bays at key airports across the globe and create theatre in store with a series of high profile sampling activities.

WG&S also notes that Sailor Jerry and Monkey Shoulder continue to enjoy growth with distribution limited to locations where listings are supported by strong domestic on- and off-trade presence. Both are supported by impactful and entertaining promotions and sampling activity.

“Travel retail continues to be the flagship for brand building and showcasing the premium nature of the William Grant & Sons portfolio,” Greenwood says. “In line with this we continue to support the channel with significant investment in both our brands and

personnel.”

In addition to investment in its award-winning portfolio of brands, WG&S continues to expand its team of travel retail personnel

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Company News: General Cigar

Whether it’s large ring gauge cigars or smaller cigarillos, General Cigar is set to meet the varied needs of travelers in the second half with novel packaging and new product launches BY HIBAH

T NOOR

he Americas Duty Free recently had the opportunity to speak with Cameron Shaw, Director of Marketing for General Cigar International, about what attendees to this year’s TFWA WE can expect to find at the Scandinavian Tobacco Company booth in Blue Village D10. In an earlier interview, Shaw made note of two divergent trends in the cigar industry—while cigarillos have become very popular, extremely large ring gauge cigars are also in demand. With its offerings at this year’s exhibition, General Cigar has managed to please both enthusiasts who prefer a large, robust smoke and those who prefer the compactness of a cigarillo.

Celebrating two iconic brands “We will be showcasing some special packages from Macanudo and Don Tomás,” explained Shaw. “In particular, we’re celebrating the success of Macanudo 1968.”

For Macanudo 1968, General Cigar is releasing three new four-packs in the popular Robusto, Corona and Rothschild sizes.

Furthermore, in response to consumer demand, a three-pack of Macanudo Robusto cigars will be launched at Cannes. The pack will feature cigars from the Café, Maduro and 1968 collections.

In Don Tomás news, a new eight-pack that takes the form of a carrying case will be debuted at the show. The bespoke packaging contains an easy-carry handle and is highlighted with elegant gold-colored gilding.

“It’s sure to delight travelers,” says Shaw.

A big idea in a small package TFWA WE will also see the travel retail launch of Macanudo Club Minis and Club Cigarillos. “We’ll soon be launching what we call a ‘flightpack’ for these brands, which will consist of five packs of 20 cigarillos,” Shaw explains.

“The development of these packs is a direct result of the trend toward smaller cigars and we have already received strong interest from our partners in many travel retail markets.”

The packs were actually introduced domestically in Germany and proved to be bestsellers.

General Cigar expects them to be just as popular in the airport environment, where smoking time is limited and travelers often opt for smaller-sized cigars.

The second half of the equation

Another new addition at this year’s TFWA WE will be a carrying casestyle eight-pack for the Don Tomás brand

124

Of course, getting the product right is only one part of the process. Cigar lovers are generally very knowledgeable and it takes a highly trained salesperson to make the in-store experience something memorable. While General Cigar keeps a hectic training schedule, Shaw sees this as a very important element of selling the brands in duty free.

The company was recently with DFA for a training session at JFK before moving on to the operator’s Miami stores for a session involving about 120 staff members. Rather than being generic classes on the basics, General Cigar prefers giving salespeople in-depth knowledge about the specific brands that their company sells.

“We talk about everything from a cigar’s country of origin to all the ingredients used in its creation,” Shaw explains. “High-end products require knowledgeable salespeople and there are really no shortcuts in this regard.”

One of the many benefits of the merger with STG, Shaw noted, is that where training is concerned General Cigar’s reach has widened significantly. While training sessions in the world of duty free have traditionally been confined to airport stores, General Cigar is now beginning a large-scale project that will see more border stores receive specialized classes.

“It’s something that we’ve wanted to do for a long time,” he says. “The merger has made this a real possibility so we’re very excited.”

Of course, speaking of the recent merger it’s impossible not to mention what is likely the most important benefit for both parties: the strength of a combined portfolio and the means to reach more consumers. For General Cigar’s part, Shaw is pleased with the results so far this year.

“With the latest introductions of Café Crème Caramel Cream, Café Crème Espresso Rumtwist and Café Crème Vanilla Honeyswirl, we have secured additional placement for our products,” he says. “Sales are excellent, and to me this indicates that we have more winners within

our global sales portfolio.”

General Cigar will be introducing three new fourpacks for Macanudo in the popular Robusto, Corona and Rothschild sizes

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Company News: British American Tobacco

out the world, this represents a significant investment, both in people, time and money. We’ll be starting with key strategic airports in the Americas before rolling the concept out further.

BAT’s new in-store furniture incorporates storage and display space, as well as an area where hostesses can give demonstrations to travelers

Listening and responding

The importance that BAT places on operator and traveler feedback results in a number of new innovations in both products and in-store backwall and gondola furniture BY RYAN WHITE

C

arlos Felipe dos Santos Rocha, BAT’s Global Travel Retail Marketing Manager for Americas, recently sat down with Americas Duty Free to discuss new developments ahead of this year’s TFWA WE in Cannes. As per usual, the company hasn’t rested on its laurels.

Travelers can expect to see new products and innovative new backwall and gondola furniture in selected airports in the Americas.

Americas Duty Free: Can you tell us about new products that BAT will be releasing in the near future?

Carlos Felipe dos Santos Rocha: We’ve got a lot of great products in the pipeline.

After great success with the Blends platform, we are now introducing DUNHILL Switch.

Based on consumer research and established expectations, we are introducing this new offer which consists of a King Size product with natural menthol capsule inside the filter.

The consumer will have the option to “switch” and blend the DUNHILL Master smoke with a natural menthol finish when and if he pleases.

Furthermore, as DUNHILL tobacco expertise and credentials are an intrinsic part of the brand DNA we will be introducing the “blenders mark.”

This is the precise moment our blenders recommend pressing the capsule to get the most of this DUNHILL switching experience.

sumer and customer feedback, we’ve identified that the current fixtures, while good, don’t completely fulfill their needs and expectations.

Put very simply, we knew we could do better.

Given that BAT products are sold through-

ADF: Can you tell us a bit about the new backwalls and gondolas?

CFSR: It was really quite a task developing this project due to the balancing of our large consumer-centric portfolio versus the limited in store space available and the different countries and regulations.

We’ve come up with a modular system that can fit in virtually any space, from gondolas to larger displays. Any store in any location in the world can optimize its store and display furniture in accordance to its specific peculiarities and limitations.

The furniture is modern and durable, made of stainless steel. Most importantly, it was developed using traveler and operator feedback. We know it fulfills their needs and expectations, which makes us very excited

about its actual implementation.

“We’ve come up with a modular system that can fit in virtually any space, from gondolas to larger displays.”

Carlos Felipe dos Santos Rocha, Global Travel Retail Marketing Manager for Americas, BAT On the heels of a successful Americas launch of DUNHILL Blends (pictured), BAT is now releasing DUNHILL Switch

ADF: I know BAT is currently working on a global project to update its backwall and gondola furniture in travel retail. Can you tell me how work is progressing?

CFSR: The objective of the project is to gradually replace our current product furniture in selected airports. After extensive global con-

126

ADF: What airports and operators will be involved initially?

CFSR: GTR Americas will be one of the first regions to drive this innovation at retail level.

The prototypes are already with Grupo Wisa in Mexico City and Dufry in Sao Paulo. Our key account managers Marcos Novis & Hector Chavez are doing a great job in keeping all stakeholders involved. The plan is that after the test period we’ll be incorporating even more suggestions from operators and travelers before rolling the concept out fully.

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Company News: J.C. Newman The Diamond Crown Holiday Gift Set features three unreleased, super premium cigars displayed in a genuine leather barrel vaulted case

The spice of life J.C. Newman launches a variety of new products just in time for this year’s TFWA WE BY RYAN WHITE Brick House Short Torp Due to the wide-spread popularity of Brick House cigars, J.C. Newman is adding a sixth size to the Brick House line: a 5 ½” x 52 pyramid called the “Short Torp.”

Originally launched in four sizes, J.C. Newman expanded the line last year by adding Mighty Mighty, a whopping 6” x 60 that packs a mouthful of flavor. The new pyramid shape allows for a concentration of flavors in the head of the cigar, creating an exceptional and unique smoking experience.

Each cigar is handmade in Nicaragua using the finest Nicaraguan tobaccos and wrapped in a one-of-a-kind Havana Subido leaf. Brick House was recently named one of Cigar Aficionado’s top 25 cigars of 2010.

El Baton Belicoso After three successful years, J.C. Newman has announced an expansion of the El Baton line with the new Belicoso. At 5” x 56, the Belicoso offers a mouthful of flavor in a short time span.

“We researched the marketplace and it was clear El Baton lovers wanted another pyramid option,” said J.C. Newman President Eric Newman. “We worked hard to create a cigar El Baton loyalists wanted at a price point they can afford.

Keeping true to the El Baton 128

C

igar aficionados rejoice! J.C. Newman has announced the release of no fewer than five new products just in time for TFWA WE. According to the company, travelers will be able to find these cigars in select duty free locations throughout the world starting this fall. Below Americas Duty Free presents a guide to what’s new with one of the industry’s most prolific cigar companies.

mantra, these belicoso cigars will pack ‘mucho flavor for little dinero.’”

Diamond Crown Torpedo #8 The Diamond Crown Torpedo #8 joins the highly rated Diamond Crown robust series. The 5” x 58 cigar features 100% pure Dominican long filler tobaccos wrapped in a smooth Connecticut Shade leaf.

Like all Diamond Crown cigars, the Torpedo #8 is handrolled by the world famous Tabacalera A. Fuente.

The shorter size makes the Diamond Crown Torpedo #8 a perfect travel companion, easily stored in a small humidor or humibag. But don’t let the size fool you, its 58 ring gauge packs just as much flavor as one of its larger counterparts without compromising even the most sensitive of palates. Hints of chocolate and maple combine with aromas of cedar to create a cigar that is intoxicatingly smooth.

Diamond Crown MAXIMUS Double Robusto #6 Diamond Crown MAXIMUS Double Robusto #6 joins the highly rated Diamond Crown MAXIMUS series. The 5” x 56 cigar features 100% pure Dominican long filler tobaccos enveloped by a robust Sungrown Ecuadorian wrapper. Like all Diamond Crown MAXIMUS cigars, the Double Robusto #6 is hand rolled by the world famous Tabacalera A. Fuente.

The cigar’s shorter size makes it ideal for

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

the connoisseur with limited time, while a smaller than usual ring gauge allows for easy storage while concentrating the flavors into its 5” x 56 frame.

A sweet draw of molasses and coffee mixes with rich hints of oak and cedar to impact the pallet without overpowering it.

Diamond Crown Holiday Gift Set J.C. Newman has redesigned its Diamond Crown Holiday Gift Set. To be released this fall, the set features three unreleased, super premium cigars masterfully displayed in a genuine leather, barrel vaulted case lined in plush red velvet. Each controlled release gift set features one each of the following: Diamond Crown Classic Double Belicoso (6 ¾ x 54): A robust blend of 6 to 7 individual tobacco leaves wrapped in a 5-year aged, double fermented Connecticut Shade leaf.

Diamond Crown Julius Caeser Double Belicoso (6 ¾ x 54): Just off a 93 rating from Cigar Aficionado, this unreleased Julius Caeser is made using a rich Ecuador Havana seed wrapper filled with a blend of 100% Dominican tobaccos.

Diamond Crown Cameroon Select Double Belicoso (6 ¾ x 54): Available nowhere else, the Diamond Crown Cameroon Select is made using finely aged Dominican tobaccos bound in a creamy Cameroon tobacco leaf hand selected from the fertile soils

of West Africa.

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worldwide after a good meal since 1846 www.underberg.com

Made in Germany

Tobacco News Imperial Tobacco celebrates the Year of the Dragon Imperial Tobacco will be introducing two new concepts to buyers at TFWA World Exhibition this year (Gold Village 6): the Davidoff Chinese New Year 2012 special edition and the Golden Virginia Travellers Edition. In addition, Imperial Tobacco will be discussing a number of special edition and high profile promotional activities planned for 2012, based on the very latest in interactive technology. This will include the use of an augmented reality screen on the stand which enables items held in front of a camera to be modified or changed on the screen, “turning something regular into something special,” says the company.

Following the great success of the Chinese New Year sleeve introduced to celebrate the Year of the Rabbit in 2011, Imperial Tobacco has created an exclusive Davidoff travel retail presentation for the Year of the Dragon in 2012. An elegant, sophisticated dragon motif is printed both on a special 200-stick carton and the individual packs within it, available for Davidoff Classic, Lights and the Asia-specific Supremes varieties.

Available globally from mid-December until the end of the Chinese New Year celebrations, the special edition is ideal for travelers to buy as a gift or memento of this annual festivity.

In other Imperial Tobacco news, Golden Virginia is now available in a travel retail exclusive embossed tin containing 10 x 50g pouches. This special tin is designed with vintage maritime charts of the Canary Islands, inviting consumers to remember their holiday.

Available from August 2011, the tin is initially exclusively available to travelers at Canary Islands airports and selected ferries between the UK and Spain. Ideal as a destination gift, Imperial Tobacco notes that the Travellers Edition tin may be adapted for other popular destinations in the future.

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Davidoff’s new Year of the Dragon presentation will be available from mid-December for Davidoff Classic, Lights and the Asia-specific Supremes varieties

Publicly traded pioneer leads electronic cigarette industry Since 2008, electronic cigarettes have become increasingly popular as an alternative to smoking traditional tobacco cigarettes given the fact that e-cigarettes can be used virtually anywhere. At the forefront of this burgeoning movement is pioneering e-cigarette company Vapor Corp. [OTCBB: VPCO], which offers a range of e-cigarette brands—from the rechargeable Fifty-One brand to the disposable Krave brand—to satisfy the varied needs of virtually any smoker.

“Vapor Corp.’s e-cigarette brands are distinct from many other e-cigarettes available today, both in terms of the quality and the cutting-edge technology employed,” says Adam Frija, Director of Business Development at Vapor Corp. “Our electronic cigarettes do not emit any second-hand smoke. Instead, our products emit an odorless vapor. Our electronic cigarettes look like, taste like and feel like a cigarette, but they aren't cigarettes."

The filter of the Fifty-One contains flavoring, nicotine and an atomizer that essentially vaporizes the nicotine. When you inhale, a microcomputer activates the atomizer and the battery (contained in the white part of the e-cigarette). The end of the Fifty-One even glows when you puff it.

The Fifty-One starter kit will retail in duty free for about US$100, after which time consumers will only need to buy refill cartridges at a retail cost of just US$3 per cartridge. The Fifty-One’s battery can run all day on a full charge and the starter kit contains a charger that can plug into a wall socket or a USB port.

Over the last 3 years, Vapor Corp. has crossed into virtually every distribution channel available in the US, such as convenience stores, tobacco shops and supermarket chains. The company also sells direct-to-consumer on its website and has carved out a very respectable niche selling in mall kiosks throughout the US. The worldwide duty free channel is attractive to a company like Vapor Corp. for two main reasons, says Frija: “First of all, airports are very high-traffic areas for retail, which is what any company looks for. Furthermore, e-cigarettes are a perfect fit for the duty-free customer, for the busy traveler on the go. Vapor Corp. has increased its business exponentially year over year since its inception and I have no doubt that both the traveling public and the duty free industry will see immense value in our brands.”

The Fifty-One starter kit will retail in duty free for about US$100; a refill cartridge costs US$3 and each can last as long as two pack of traditional cigarettes

THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Unzip a new skin feeling that lasts, in one stroke.

New Silk épil 7 Dual Epilator •

with

Braun GmbH, Dept. IAM-DF, Frankfurter Straße 145, D-61476 Kronberg, Germany, Tel.: +49 6173 30 2221, E-mail: mellin.k@pg.com, www.braun.com/global

New & Notable

Necklace Bolero

JEWELRY

Company: Antica Murrina Veneziana Description: Antica Murrina presents the Bolero line characterized by retro elements. The collection features twisting glass rings decorated with spirals of micro aventurine. The beads are incorporated with a classic silver leaf and 24 karat gold leaf Booth: Blue Village D12

Tres Jolie Collection Company: Brosway Italia Description: The collection features different charms made of 316L stainless steel, Swarovski elements, stones, enamels and ceramic. With unique Italian styling, supported by exclusive craftsmanship, this affordable collection will entice consumers of all ages Booth: Blue Village C4

Ripples Collection (Bracelet)

CONFECTIONERY

Company: Clogau Gold Description: Stylish contemporary boldness fuses with an elegant design in the new Ripples Collection.

Inspired by the movement of a ripple of water, rose quartz circular forms are handcrafted, imitating the glistening of water Booth: Yellow Village D35

Chupa Chups Travel Tin Company: Perfetti Van Melle Global Travel Retail Description: An exclusive gift tin containing 16 lollipops. The tin is decorated with typical travel symbols such as passport stamps and signposts. This can also be customized for specific destinations Booth: Blue Village G27

Butlers Seasonal Collections Company: Butlers Chocolates Description: This year, Butlers will launch deluxe gifting packs, featuring impressive new selections of delicious alcohol free chocolate assortments, aimed at celebrating special occasions Booth: Green Village L73

Neuhaus Dessert Collection Company: Neuhaus Description: The new limited Neuhaus dessert collection will delight all travellers’ senses!

Discover a crème brûlée, sabayon, tarte tatin and moelleux au chocolat brought to you by Neuhaus.

Booth: Yellow Village AA11

LIQUOR Il de Ré Cliffside Cellar Company: Camus Wines & Spirits Description: Cliffside Cellar is drawn from eaux-de-vie, grown, distilled and aged on the Island of Ré, the most westerly part of Cognac AOC. Distinctively marine and mellow, Cliffside Cellar undergoes final maturation in a cellar deep in the Fort de la Prée Booth: Blue Village F11

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Please visit us at TFWA Cannes, Booth Ambassadors Village U5/U7/U11

Test your knowledge of the people, products and organizations in the Americas duty free industry! Good Luck!

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1. Edrington-owned premium rum 2. Location of this year's ASUTIL conference 3. Company offering luxury items at a US$10 price point 5. If you drink Mount Gay rum you may be a _____ 6. DFASS head honcho 7. Delightfully curious gin owned by William Grant & Sons 8. Operator Monalisa is about to celebrate what anniversary?

10. Chupa Chups brandowner 11. Popular General Cigar brand 14. Skyy Vodka brandowner 15. La Prairie's new Cellular _____ Infusion 18. Portland Design's latest achievement in Dubai in cooperation with Diageo 19. Chocolat Razberi vodka brand 21. New Finlandia release 22. Caribbean rum that can be found at Bardinet's stand 27. New Jessica Simpson fragrance 28. Elderflower liqueur distributed in select locations by WEBB 31. Joy of Pink, the newest launch from _____ 32. Travel retail giant that recently acquired major South American operators 33. Composer or maker of chocolate spirits?

35. Airport in Buenos Aires

Maker of fine Icewine Market-leading brand for Parbel Pearl experts Nestle's After _____ Imperial Tobacco's latest limited edition celebrates the year of the _____ Fine Cognac in recognizable orange-colored packaging The second "A" in IAADFS Airline on which Bright Star sells duty free Maker of fine writing instruments Co-founder of Patrón Tequila The "D" in B+D Leading sunglass brandowner Diageo's Johnnie Walker Jasper _____ edition New marketing director for Bacardi Global Travel Retail Latest super premium Pernod Ricard release Premier Spanish winemaker The vodka of choice for Bruce Willis New IMPERIA Crystal Crown vodka features crystals from _____ CEO of Coty Prestige

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THE AMERICAS DUTY FREE & TRAVEL RETAILING SEPTEMBER/OCTOBER 2011

Across 4. Inniskillin 9. Lancome 12. Majorica 13. Eight 16. Dragon 17. A de Fussigny 20. Airport 23. TAM 24. Cross 25. DeJoria 26. Deichmann 29. Luxottica 30. Goodall 34. Golikeri 35. Elyx 36. Torres 37. Sobieski 38. Swarovski 39. Beetz Down 1. Brugal 2. Cancun 3. Bijoux Terner 5. Sailor 6. Klepach 7. Hendrick’s 8. Forty 10. Perfetti 11. Macanudo 14. Campari 15. Power 18. Emporium 19. Stolichnaya 21. Platinum 22. Old Nick 27. I Fancy You 28. St-Germain 31. Lacoste 32. Dufry 33. Mozart 35. Ezeiza

Across

Success in ITR comes in many colours.

As one of the leading confectionery players in ITR, you’ll find Mars’ brands at almost every travel location across the world. Focusing on the key purchase motivations our stunning product portfolio, containing the nr. 1 and nr. 2 brands M&M’s and Snickers, is backed by creative merchandising driving the purchase decision.

Our combination of insight, category vision and global strength enables us to optimize the effectiveness of our unmatched portfolio of global favourites. Finally, we continue to develop exciting new concepts.

For example, we now have all Wrigley products fully integrated into our ITR program, creating even more opportunities to drive your business.