TFWA WE 2018
DUTYFREEMAGAZINE.CA OCTOBER 2018 · TFWA WE · VOL 22 · NO 2
Shinsegae Duty Free changes the market p .10 DFS celebrates Auckland opening p. 22 A year to celebrate for Eraman p. 30
Letter from the Editor
Strong rebound A
sia-Pacific soared past Europe to take first place in the duty free industry in recent years, with South Korea being the most dominant player in the region. However, last year’s political turmoil between China and South Korea, which halved the number of Chinese tourists visiting the country, strongly impacted operating profits. South Korea is undoubtedly a popular destination for Chinese tourists who can contribute up to 90% of sales in the country’s downtown stores. The resolution of the crisis in late 2017 came as a welcome relief to struggling duty free operators. However, while profitability may have been down, sales have continued to rise strongly over the past two years, reaching a high of US$11.7 billion last year according to a GlobalData report. This upward trend will likely continue on an even higher trajectory in 2018. Indeed, after a brief slowdown in 2016, global duty free sales as a whole have rebounded, led by Asia. Global sales reached US$68.6 billion in 2017 and are expected to reach US$125.1 billion by 2023. Shilla Duty Free was the only Korean retailer to stay profitable in 2017, and 2018 has been a banner year for the travel retailer. Shilla’s sales increased 30% year on year in the first quarter, and in the second quarter by 53%. Operational efficiencies, lower operating costs, higher sales and a recovery in the number of Chinese travelers have all helped to create a staggering 182% increase in profits over last year. Shilla, which has won a new liquor and tobacco contract for Gimpo International Airport, is doing well in its overseas shops and is intent on further expansion. However, the retailer Shinsegae might have the most exciting news coming out of Korea. Its Gangnam branch has far exceeded expectations. The company is also beginning operations in Incheon Airport Terminal 1 after opening in Terminal 2 earlier this year. Industry experts predict that Shinsegae will take about 20% of the Korean duty-free market this year, up from 13% last year. Of course, Korea is only one of many countries in Asia, and others are becoming increasingly important to the industry. Earlier this year, TFWA noted that Asia’s international customer base is increasing beyond the global average, at 8.4% overall. Some cities, however, are far outpacing this. Kuala Lumpur and Narita are notable examples, at +14.7% and +13.6%, respectively. Singapore, Bangkok, New Delhi, Jakarta and Guangzhou all surpassed the 60 million-passenger mark, and both Shanghai and Hong Kong surpassed 70 million. This is an exciting time to be in the duty free industry in Asia, and we hope you enjoy reading about these developments and more in our TFWA World Exhibition issue of Asia Duty Free & Travel Retailing. Kindest Regards,
Hibah Noor Editor-in-Chief email@example.com
4 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
OCTOBER 2018 · TFWA WE · VOL 22 · NO 2 Asia Duty Free & Travel Retailing (ISSN 1360-9548) is published by Global Marketing Company Ltd. 26 Pearl Street, Mississauga Ontario L5M 1X2 Canada. It is distributed in the following countries, states, regions and territories on the Asian continent and in the Pacific Rim: Australia, Bangladesh, Bhutan, Brunei, Cambodia, China, Fiji, French Polynesia, Guam, Hawaii, Hong Kong, India, Indonesia, Japan, Macao, Malaysia, Maldives Islands, Myanmar, Nepal, New Caledonia, New Guinea, New Zealand, Philippines, Saipan, Samoa, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, Tonga, Vanuatu and Vietnam. The views expressed in this magazine do not necessarily reflect the views and opinions of the publisher or editor. October 2018, Vol 22, No.2. All rights reserved. Nothing may be reprinted in whole or in part without written permission from the publisher. ©2018 Asia Duty Free & Travel Retailing.
ASIA 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 firstname.lastname@example.org EDITORIAL DEPARTMENT EDITOR-IN-CHIEF Hibah Noor email@example.com ASSOCIATE EDITOR Jas Ryat firstname.lastname@example.org ADVERTISING AND MARKETING MANAGER Kevin Greene email@example.com ART DIRECTOR Jessica Hearn firstname.lastname@example.org CONTRIBUTORS Mary Jane Pittilla Rebecca Byrne Wendy Morley
CIRCULATION & SUBSCRIPTION MANAGER email@example.com
Strength. Vision. Leadership.
With a passion to succeed and belief in our strengths, we have grown to become leaders in Duty Free Operations; with Duty Free Shops, Seamen’s Clubs and Bonded Warehouses across ports in UAE. Our way of saying ‘Thank you’ to all our stakeholders is to never stop getting better.
P.O. Box 5968, Sharjah, UAE Tel: +971 6 5634033 Fax: +971 6 5634022
Email: firstname.lastname@example.org Web: www.bhatiatraders.com
What’s inside Lead Stories
10 Shinsegae Duty Free A market changer
The South Korean duty free market has long been dominated by powerhouses Lotte Duty Free and Shilla Duty Free. However, with the acquisition of the travel retail business of Paradise Hotel in South Eastern port city of Busan, Shinsegae Duty Free entered the travel retail market in 2011 and has not looked back
18 Shilla Duty Free Ahead of the curve
In spite of the difficulties faced by South Korean duty free operators over the past year, The Shilla Duty Free has managed to increase its sales year on year
26 Delhi Duty Free Services A cut above
As India’s progressive economy continues to grow, Delhi Duty Free Services is ensuring it is established as one of the world’s prominent travel retail shopping destination
A Year to Celebrate As Malaysia Airport celebrates its 25 year anniversary, Asia Duty Free Magazine talks to Zulhikam Ahmad, General Manager, Malaysia Airports (Niaga) Sd. Bhd about his achievements as the head of duty free retailer, Eraman
34 Lotte Duty Free
Leading Korean travel retailer, Lotte Duty Free is extending its international business with its first step into the Oceania region
DFS celebrates Auckland opening 22 Dior Backstage steps out at KLIA 40 High time for Frederique Constant 42
Hershey’s sweet experience JTI discusses WHO Protocol
Lead Stories 38 Melbourne Airport
A successful transformation With a record breaking 36.7 million people visiting Melbourne Airport in the full year 17/18, Asia Duty Free Magazine asks Andrew Gardiner, Chief of Retail, what the impact of the new look Terminal 2 has been over the past year
An impulse for innovation Moroccanoil is marking 10 years as the leader in oil-infused beauty with innovative launches across multiple product categories
Shiseido reigns in digital era Beauty brand Shiseido puts a digital spin on customer experiences and engagement to ensure they stay connected at all travel touchpoints
62 Anthon Berg
Anthon Berg calls on whisky aficionados Anthon Berg has taken note of Scotch whisky’s appeal and incorporated the spirit into several distinctive confectionery product launches
66 William Grant
Revitalizing the family jewels
Grant’s ushers in an exciting new era with its renamed Triple Wood signature blend, a global brand refresh and upgrades exclusively for travel retail
70 Marie Brizard
Riding the cocktail wave Liqueur brand Marie Brizard sees big opportunities for growth in Asia as it taps into the cocktail trend and tackles changing consumer tastes
72 Royal Dragon Vodka Luck of the Dragon
Royal Dragon Vodka is giving buyers the royal treatment at this year’s TFWA World Exhibition
Features Diesel does Ha(u)te Couture Diverse Flavours’ Japanese sake Editor’s picks
74 J. Cortes 52 54 56
Liquor news Kremlin speaks for itself La Martiniquaise focuses on TR
58 68 73
J. Cortes launches NUB In 2016 Belgian cigar specialist J. Cortes acquired artisanal Oliva Cigars, a company renowned for its handmade cigars
Keep the beat running through your blonde. Let the bounce of your brunette live on and on. Hang onto the soul of your strawberry blonde. Introducing color care by Moroccanoil
After 10 washes, the Moroccanoil Color Complete Collection is scientifically proven to extend color life and vibrancy by 100%.* Discover the full regimen at Moroccanoil.com
*Based on clinical test conducted on human hair against a control group after 5 washes, versus 10 with the Moroccanoil Color Complete regimen.
ONE BR AND: A WORLD OF OIL-INFUSED BE AUT Y
Shinsegae Duty Free
With the opening of the Gangnam Store and operation expansion of Incheon Airport Store, Shinsegae is targeting a massive sales figure of US$2.6 billion
by REBECCA BYRNE
The South Korean duty free market has long been dominated by powerhouses Lotte Duty Free and Shilla Duty Free. However, with the acquisition of the travel retail business of Paradise Hotel in South Eastern port city of Busan, Shinsegae Duty Free entered the travel retail market in 2011 and has not looked back
Son Yungsik, CEO of Shinsegae Duty Free
hen Shinsegae Duty Free acquired Paradise Duty Free, it was a medium sized store with sales of around KRW144.3 billion (US$127 million). This immediately gave the company a three percent toehold into the duty free market. Six years later, Shinsegae posted sales of KRW1.8 trillion
10 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
(US$1.5 billion) and had an increased markets share of 13%. Looking forward, with the opening of Shinsegae Duty Free Gangnam Store and its operation expansion in Incheon Airport store, the company is targeting a massive sales figure of KRW3 trillion (US$2.6 billion). Its rapid growth has catapulted the company into being the third largest duty free operator in the country, but this may change this year with analysts predicting that Shinsegae market share of South Korean duty free will increase to more that 20% taking the company one step closer to being the market leader. Confidence in the company is abundant. Most recently Shinsegae headed off strong competition from Shilla Duty Free to win the latest concessions at Incheon International Airport. Securing the perfumes and cosmetics concessions as well as the luxury boutique slot, recently
vacated by Lotte Duty Free, has been instrumental in increasing its sales target. The two duty free zones at the airport have posted more than KRW900 billion (US$797 million) in combined annual sales in the past. This win was quickly followed by the opening of Shinsegae’s second duty free outlet in Seoul. Located in Central City, Gangnam, the five storey outlet hosts some 350 brands and seeks to attract tourists interested in Korean cosmetics and fashion with 36% of the 13,750 square meter space allocated to Korean brands. However, the store also houses famous international brands such as Gucci, Chloe, Marc Jacobs and Kenzo. It is the first duty-free store in the world to offer the exclusive brand, Manolo Blahnik and the first duty-free store in Korea to have Italian women’s shoes brand Sergio Rossi. Shinsegae’s aim is to generate KRW180 billion (US$159 million) in sales from the new store by the end of this year, and KRW500 billion (US$442 million) from July this year to July 2019. Shinsegae is also seeing a strong performance at its first Seoul duty-free outlet in the heart of the tourist district Myeongdong which it opened in 2016. Located on the eighth to 12th floors of the Shinsegae
DRINK RESPONSIBLY www.disaronno.com #disaronnowearstrussardi
Shinsegae Duty Free
Department Store, the duty-free store houses about 600 brands including luxury brands like Gucci, Saint Laurent and Bottega Veneta. The company has said that these stores will be the ‘starting point for redrawing the landscape of the duty-free sector, and it will become a global tourism hub that draws attention from around the world’. It believes that its rapid growth is due to its effort to be ‘different’ from other duty free shops. Describing its approach, Son Yung-sik, CEO of Shinsegae Duty Free said “Shinsegae Duty Free moves towards becoming a destination with pleasurable shopping experience and memories rather than just a tax-free shop.” From the beginning, Shinsegae Duty Free has worked on creating a unique store layout to become a landmark in Seoul rather than just a shopping space. For example, on the 10th floor of the Myeong-dong store, a huge two-storey tall, 7.5-meter-wide and 4.5-meter-high swing ride takes center stage next to many cosmetics brand shops. Created by Carsten Höller, a Belgian artist, the ‘Mirror Carousel’ is surrounded by 360-degree LED video arts and colorful lights. This feature is not just grabbing attention, there is a financial cost involved as it takes up about 320 square meters of floor space, which could have been dedicated to duty free stores. However, Shinsegae decided to forgo the extra revenue to differentiate itself from other duty free stores. And
At Studio S in Shinsegae Duty Free’s Gangnam store, social media influencers can use microphones and lights for live broadcasting and filming
12 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
On the 10th floor of the Myeong-dong store, a gigantic two-storey tall ‘Mirror Carousel’ takes center stage next to many cosmetics brand shops
it has reaped results. The carousel was featured on popular Korean drama ‘The Legend of the Blue Sea’ starring famous Korean actress ‘Ji-hyun, Jeon’ in 2016. After the broadcasting, travelers rushed into the store to take a picture with the carousel. They posted pictures of the carousel on social media, raising brand awareness and making the store a “mustvisit place in Korea”. When entering the Gangnam store, 3D media facade on 7m ceilings greets customers. 3D media facade displays
welcome messages in various languages as well as 3D images of stunning travel spots of Korea. Inside the store, there is a space called Studio S where social media influencers can use microphones and lights for live broadcasting and filming. On the store’s launch day, Chinese online stars, often referred to as Wang Hongs, crowded the complex. Photos and commentary were uploaded to social media again attracting more customers. Son Yung-sik commented: “Shinsegae Duty Free Gangnam store will be the starting
Shinsegae Duty Free
point of changing duty free industry as well as global tourism destination.” With regard to e-commerce, Shinsegae is using a variety of platforms to attract and motivate its customers. According to a Son Yungsik: “Customers in 20s to 40s frequently travel and are used to online mobile shopping thus an online duty free shop has a huge potential for future growth.” Using various events and products that are not available offline, Shinsegae attracts customers to its online duty free shop. To further attract the mobile generation, it is communicating using various mobile platforms such as WeChat and C-Trip. The company also introduced a ‘Myungdong Store 2nd Anniversary celebration music video’ in which over 100 Chinese customers participated in collaboration with Chinese streaming platform. Looking to the future, Shinsegae will work to incorporate the new stores at Gangnam and Incheon Airport into its rapidly growing portfolio. And the company will continue to target future opportunities within South Korea, such as Gimpo Airport, to increase its portfolio of stores and consolidate its market position.
The five storey Duty Free Gangnam Store hosts some 350 brands
The Duty Free Gangnam Store and seeks to attract tourists interested in Korean cosmetics
TFWA CANNES 2018 YELLOW VILLAGE E26
30TH SEPT / 05TH OCT
14 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
GELS REDISCOVERED VISIBLE FEELS INVISIBLE New VisionAiry Gel Lipstick 28 bold, weightless, long-lasting shades
Beauty reimagined. Beauty made with soul.
The Shilla Duty Free
Ahead of the curve In spite of the difficulties faced by South Korean duty free operators over the past year, The Shilla Duty Free has managed to increase its sales year on year by REBECCA BYRNE The Shilla Duty Free was the only operator to maintain a profitable business throughout 2017
was a dramatic and interesting year for As happened at Jeju Airport, Shilla beat off strong competition South Korean duty free operators when from Lotte Group to win the Gimpo contract, after the two were political issues outside of the retailers’ chosen as the final candidates by the KAC. The concession covers control severely impacted travel retail sales. Throughout this 733.4 square meters and analysts predict it will generate up to turmoil, The Shilla Duty Free was the only operator to maintain a KRW60 billion (US$53 million) annually. profitable business throughout the year. Commenting on this win a spokesman said: “We believe our The upward trajectory has continued in 2018. During the first company’s successful operations at Asian major hub airports quarter in 2018, Shilla’s sales increased 30% year on year and were highly appreciated. At Incheon, Changi and Singapore, The in the second quarter by 53%. A spokesman puts this down to Shilla Duty Free is operating airport duty free concessions simulbetter operational efficiencies. Higher sales and lower operating taneously and successfully. In addition, The Shilla Duty Free has costs led to a staggering 182% rise in operating profit in the first never returned duty free licence before a concession period ends. quarter of 2018 when compared with 2017. This was also aided This proven track history as a successful and responsible operaby the recovery in the number of Chinese travelers. While the tor must have added extra credibility on The Shilla Duty Free’s market has not yet reached the level of previous years, the overall proposal.” picture is looking better. The majority of Shilla’s duty free sales comes from perfumes Sales from Shilla’s downtown operations account for approxiand cosmetics with beauty products contributing over half of the mately 58% of sales, with the airports contributing the remaining revenue. The online portion of beauty purchases is even higher 42% in the second quarter of 2018. Both channels have witnessed than offline. The online business has been going since 2000 and stronger performances compared to last year. The airport busigrowing ever since, garnering double digit growth over the last ness has benefited from new channels such as Jeju International three years. It is anticipated that this will continue, especially Airport, which had its grand opening in June, and T2 at Incheon Airport. Jeju which is the first Korean airport to apply rental fees based on the operator’s annual sales, awarded the tender to Shilla for five years. At Incheon Airport’s T2, Shilla has operated six perfumes and cosmetics stores across 2,105 square meters of retail space since the beginning of the year. It offers around 110 perfumes and cosmetics brands. Sales in 2018 also benefited from the uplift in passengers due to the Olympic games. Most recently Shilla was awarded the five year liquor and tobacco contract for Gimpo International Airport. This latest bid came after Korean Airports Corp’s (KAC) contract with local mid-sized retailer, City Plus was cancelled Overseas businesses in countries such as Singapore in April 2018 due to its overdue rental payment. contribute around 20% to annual revenue
18 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
The Shilla Duty Free
online shopping service to travelers from around the world.” Marketing campaigns are targeted and localized. These include seasonal campaigns providing regular discounts for overseas customers. The company partners with brands to offer exclusive events and pop ups to attract travelers. For example, in October Shilla celebrated its four year anniversary of operations at Changi Airport where it presented its new brand ambassadors, Koreanpop sensation Highlight. The boy group delighted fans with a special performance and meet and greet opportunities. Shilla’s overseas stores are doing well contributing around 20% to overall sales. The company opened its first overseas duty-free shop at Singapore’s Changi Airport in 2013. In December last The new Hong Kong International Airport business, with its six Beauty &You stores, year, the company added its fifth overseas outlet at is already exceeding expectatons Hong Kong International Airport (HKIA), becoming the first to manage duty-free stores in the three as Chinese travelers, who make up more than half of all online largest airports in Asia, Korea’s Incheon, Singapore and Hong sales, are increasingly purchasing online. Shilla offers both a Kong. The addition of the HKIA business, with its six Beauty mobile and web application. It works with partners such as &You stores, is already exceeding expectations. It is expected WeChat and Alipay to guarantee instant purchases and arrange overseas revenue will improve once the Hong Kong Airport collection at the airport. This enables travelers to start duty business is fully operational. Shilla also has outlets at airports free shopping prior to arriving in South Korea. A spokesman in Macao, Phuket and Tokyo. The Japanese store in particular is commented that there is great opportunity for expansion on the witnessing impressive sales in tax free zones. Once more beauty online channel for both Shilla and for brands. Niche brands are is the best selling category. trialed online before being placed instore. Overseas expansion continues to be front and center for Recently Shilla launched an English language version of its Shilla, both in Asia and outside of Asia. “Positive sales figures online store in addition to the default Korean language offering, from our duty-free shops abroad are based on our years of expeChinese and Japanese. The company believes this will help to rience and expertise in operations. We will continue to expand capture shoppers from East Asia destinations such as Vietnam, our business portfolio by opening in other cities,” said a spokeswhere English is widely used. However, it also sits with the comperson. However, the company will only invest in regions where pany’s international strategy with a spokesman adding that it is it believes that it can achieve sales. Furthermore, as perfumes and a great opportunity to increase the customer base globally: “We cosmetics are Shilla’s specialty, this is the prime category for new look forward to presenting the Shilla Duty Free’s cutting edge overseas business. The majority of The Shilla Duty Free’s sales comes from perfumes and cosmetics with beauty products contributing over half of revenue
20 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
DFS FASHIONS a grand opening in Auckland
A crowd of more than 500 customers and guests arrive at T Galleria by DFS, Auckland, for the official opening party
DFS Group celebrated the renovation of its T Galleria retail emporium in Auckland with hundreds of well-dressed guests during New Zealand Fashion Week
D Pictured from left: Prashant Mahboobani, General Manager, T Galleria Auckland, DFS Group; Jay Frame, Vice President, Head of Communications, DFS Group; and Robert Calzadilla, DFS Group Region President Asia South
22 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
FS Group, the world’s leading luxury travel retailer, has officially opened its newly renovated T Galleria by DFS, Auckland in the heart of Auckland’s Central Business District. A grand opening celebration was attended by more than 500 customers and guests, including New Zealand Fashion Week attendees and representatives from the world of luxury retail. Coinciding with New Zealand Fashion Week, the grand opening included an exciting in-store fashion show with a curated presentation by nine New Zealand-based fashion designers, displaying their fashion-forward ready-to-wear collections. In his work, Benjamin Alexander brings a touch of glamour with his sequin-encrusted suits and intricate beaded evening dresses.
T Galleria by T Galleria by DFS, Auckland’s staircase gets a makeover by Otis Frizzell
Designers pose with DFS Group’s Robert Calzadilla, Jay Frame and Prashant Mahboobani
Harman Grubisa avoids trends and produces everything ethically in New Zealand. Best friends Jessica Grubisa and Madeline Harman create art pieces that will enjoy long lifespans in women’s wardrobes. Turet Knuefermann effortlessly matches exuberance with tradition to empower women and celebrate their feminine beauty. Maaike’s collections are designed to be the perfect mix of flowing silks as well as cotton knits with a more bold and graphic edge that cater for every age group. Salasai is renowned for its bold prints, soft tailoring and languid aesthetic. Dark and unassuming, each season is crafted to be innovative yet timeless. Stolen Girlfriends Club seeks to entertain and empower a youthful, rebellious spirit and a healthy sense of humor. Founded in 2005 by three friends, Dan Gosling, Marc Moore and Luke Harwood, the garments are laced with confidence and courage, with an underlying feeling of rock’n’roll swagger. Wynn Hamlyn combines classical tailoring with an expressive technical approach led by genuine youthful joy in materiality. Zambesi epitomizes individual spirit, redefining conversation with an ironic practicality, and items are proudly made in New Zealand. Kathryn Wilson is New Zealand’s most successful footwear designer, celebrated for her innovative design and exceptionally high-quality styles.
24 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Popular DJ Jaimie Webster Haines entertains the crowd at the opening party
Stylish guests Karol Hadlow and Laura Hadlow
DFS’s First Class Beauty Lip Bar pop-up adorns the Auckland store
Surprising and delighting traveling customers
Givenchy offered engraving services to customers during the opening event
The event also included a spectacular art installation by local graffiti artist Otis Frizzell on the store’s eye-catching historical staircase, a whisky and cocktail tasting and a live performance from a popular DJ. “Our newly renovated T Galleria by DFS, Auckland is truly exceptional, and the opening event was a great opportunity to celebrate the store as well as the amazing design talent in New Zealand,” said Robert Calzadilla, DFS Group Region President Asia South. “We love to find new ways to surprise and delight our traveling customers, and with four levels of amazing products at T Galleria by DFS, Auckland, there is something for everyone to discover.” Featuring more than 200 of the world’s most desirable brands, the store is a one-stop retail paradise housed within an iconic heritage building. Products include selections from the best international brands as well as the finest New Zealand-made products, spanning DFS’ five pillars of luxury: Fashion and Accessories, Beauty and Fragrances, Watches and Jewelry, Wines and Spirits and Food and Gifts, with 33 brands available exclusively at T Galleria by DFS, Auckland.
Cederberg, Kleinood, 88 Vineyards, Deetlefs, Avondale, Groot Constantia, Napier, Mt Vernon, Ernie Els, Delaire Graff
Premium South African wines and Japanese Sake Taste and discover award-winning wines from South Africa and famous sake from Japan. To schedule a meeting, contact Anthony Budd at Diverse Flavours: +27 71 255 7344, email@example.com
Stand L34, Red Village TFWA World Exhibition & Conference, Cannes 30 Sep – 5 Oct 2018 diverseflavours.com www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
Delhi Duty Free Services
A cut above Over the past year DDFS has registered double digit growth in sales
As India’s progressive economy continues to grow, Delhi Duty Free Services is ensuring it is established as one of the world’s prominent travel retail shopping destination by REBECCA BYRNE
ue to the rapid privatization of airports in India, investment is flowing in for key anchor travel retail stores. Delhi Duty Free Services (DDFS) believes that many leading city retailer brands will start investing in airport retail as is already the case in exiting metro airports. According to Abhijit Das, Head of Marketing, DDFS, airports are key to success of travel retail: “If we compare at the years before DDFS entered Delhi Airport to now, this success of the travel retail shows the airport’s vision to be the best and pursue the best. Going forward, airports will continue to identify the most suitable global retailers to deliver a world class travel retail environment at airports.”
26 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
He goes on to discuss the impact of the India economy on travel retail. “The sheer size of the rapidly expanding middle class practically guarantees success for India’s travel consumer story for many years.” Bigger than the entire US population, India’s middle-class today numbers around 350 million people. Furthermore, middle class shoppers with high disposable income are increasingly becoming planned shoppers. They are well researched, they will look for best value, strong brands, and a premium range. Das adds: “Liquor is key category, increasingly young Indians are moving towards single malts and premium white spirits. Similarly, our cosmetics category is witnessing high growth as more women are
now traveling abroad for both work and pleasure. Deluxe Scotch remains the biggest category and contributes significantly to growth of liquor business.” In 2010 DDFS was awarded the concession to manage and operate the Duty Free Shops at Terminal 3, Indira Gandhi International Airport in Delhi. DDFS is the single largest duty free retailer in India operating out of T3 with over 1000 brands and 43,000 products. Arrivals is 65% of business, dominated by 70% Indian travelers. Departure accounts for 35% business dominated by 65% foreign nationals. In terms of space allocation, departures have 63% space. The company has a deep understanding of customer needs and behaviour Since the profile of passengers has changed over time, new brands have emerged needing space. All this has led to an complete overhaul of the DDFS stores. With shops spread over 50,000 square feet in arrivals and departures, the refurbishment has been done with detailed research to achieve best results. DDFS took a phased approach to the changes, starting in October 2017 with arrivals, which are now fully operational. Departure shops will open in two stages, November 2018 and February 2019. The investment is significant as there are completely new shops inspired to be the best in region. Finishing the refurbishments while continually adapting to the fast changing customer preferences will be a challenge over the next six months. Das adds: “Our new shops will have many new brands
Nadiya in Travel Retail
Available at the following Duty Free Shops: Dubai, Abu Dhabi, Riyadh, Jeddah, Madinah, Istanbul, Bahrain, Muscat, Cochin /NadiyaDatesArabia
Delhi Duty Free Services
and concepts especially in Perfumes & Cosmetics and we have high expectations for double digit growth whilst we progress through the development and then onwards through 2018 and beyond.” Within the product mix, top sellers are MAC cosmetics and malts at arrivals, while confectionery is leading the overall growth. Perfumes & Cosmetics is the fastest growing category and rapidly gaining market share. Over the past year DDFS has registered double digit growth in sales. This is despite a tough travel retail trading environment, which has been stagnant across the world with most travel retailers eyeing Chinese, Indians and Asians to drive
growth. Das comments: “DDFS was able to build on gradual growth during early part of the 2017 to double digit growth in last few months with sales hitting record high almost every month on previous full year”. He adds that DDFS has achieved highest ever growth and sales in all key categories, especially in liquor where the company has achieved new high of selling more bottles of JW Black in a single month than any other competitor. DDFS was also able to address low penetration levels with innovative promotions on key categories and major brands. Key to its success has been DDFS strategy to ensure its duty free offering is better than other duty free shops in the
Since 2017, DDFS has implemented a complete overhaul of all its stores
28 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
region. While price is dominant factor, so is newness and innovation, range depth and staff knowledge. DDFS also remains ahead of the curve when accommodating consumer demands. It was the first retailer to migrate to INR pricing and billing. This involved significant restructuring of business processes; software and finance reporting, but was successfully done in a few days. Benefits to customers are transparency, simplicity and like other countries, they can pay in home currency and save on exchange rates conversion. DDFS also invests resources in training, having opened its own academy in 2017. This first of its kind specialized academic program is designed to educate, train and develop entry and mid-level sales associates in retail management. The first batch of entrants has graduated and the second batch has started the course. DDFS faces a number of external challenges. These include: regional pricing among competitors; rapid passenger increases; impact of digitalization on airport shopping; dwell time; and overall adoption of “meaningful” new technology impacting customer engagement. Furthermore DDFS faces competition from almost all retailers nationally and internationally with operators in Middle east, South East Asia and a few European airports increasing their retail foot print due to the opening of new terminals or having additional shops in terminal. The fact that DDFS has achieved phenomenal growth without an increase in retail area demonstrates the success of its strategy.
advertisement removed for legal reasons
Zulhikam Ahmad, General Manager of Malaysia Airports (Niaga) Sdn. Bhd.
A year to celebrate As Malaysia Airports celebrates its 25 years anniversary, Asia Duty Free Magazine talks to Zulhikam Ahmad, General Manager of Malaysia Airports (Niaga) Sdn Bhd about his achievements as the head of duty free retailer, Eraman by REBECCA BYRNE
What has been the biggest challenge for you since taking on the job? My biggest professional challenge was making the leap from the local convenience store and retail chain industry to General Manager of Malaysiaâ&#x20AC;&#x2122;s largest travel retail operator in the duty free industry. Building new business networks, collaborating with people from this industry, as well as engaging them for mutual benefits to spur business growth was indeed a challenge. Gaining the trust and support from stakeholders in the industry such as the airports and brand principals was hard back then when I just joined Eraman in 2015. However, that was a challenge I was prepared to face and overcome despite all odds. What has been your greatest success? To see Eraman back in a healthy position from the crunch period in 2014 and 2015 due to the twin airline tragedies which seriously impacted passenger traffic through Malaysiaâ&#x20AC;&#x2122;s main airport, KLIA in particular. The business slowly picked up in 2016 and 2017 was a year of achievement where Eraman saw a huge and strong growth in terms of sales and profitability. With the growth in passenger movements for all Malaysian international
30 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
New Perfumes & Cosmetics brands that have joined Eraman at Kota Kinabalu International Airport
airports and the persistent demand for duty free merchandise rising particularly in KLIA, klia2 and Kota Kinabalu, Eraman recorded its highest ever revenue and contributed a healthy growth in sales and profitability. What changes have you seen since becoming GM? A closer collaboration and partnership between the retail operator, landlord and brand principals. A true tripartite collaboration has contributed to better sales for Eraman and enhanced the commer-
cial landscape for Malaysia Airports and Eraman as a whole. This continued effort will be an initiative that we will strive to deliver in order to create better offerings and choices especially for the travelers passing through our stores in all international airports in Malaysia. What are your plans for the year ahead? Currently, Eraman is focused on both consolidation and expansion. We are rolling out a refurbishment program for most of our outlets in all international
Contact your Hershey business partner today.
airports in Malaysia. These outlets, which comprise of all our product categories from core products and lifestyle to F&B, will undergo a facelift both externally and internally in line with our objective to generate even greater customer awareness and spend both at our retail shops and F&B outlets. In Q3 2018, Eraman introduced four monogram concept boutiques for renowned brands M.A.C, La Mer, Tom Ford and Jo Malone at Kota Kinabalu International Airport. This achievement is another milestone for Eraman, as it is our first boutique concept outside of KLIA. In mid-September 2018, Eraman Duty Free Emporium, which is located at Contact Pier KLIA has undergone renovation works. Renowned brands such as Gucci, M.A.C and Jo Malone will be welcomed by our customers who are looking for more international brands and luxury products. We are continuing our brand refresh with a co-ordinated approach. From the first quarter 2019 onwards, the website, uniforms and all through the stores will be refreshed in phases. What were the highlights of 2017 and 2018? 2017 was a year of strong growth for Eraman due to increased passenger movements at all Malaysian international airports. This led to increased duty free sales particularly at KLIA, klia2 and Kota Kinabalu. The category sales growth for 2017 was strong, led by Perfumes & Cosmetics and Chocolates which constituted 15% and 12% respectively of the total Eraman sales. While favorable passenger movements is
an instrumental part of this growth, we also formed strong marketing partnerships and collaboration with major financial players. Furthermore we implemented joint campaigns and promotions with brand principals alongside umbrella campaigns and contests. Last year we launched the Eraman Shopping Extravaganza “Buy & Win” Contest for its second consecutive year. This contest, held in three phases, ended in May 2018. It was instrumental in reinforcing Eraman’s brand value and attracted customer participation with its attractive prizes worth more than RM1 million throughout its duration. The first two phases of the contest that ran during 2017 saw more than 300,000 entries with majority of participants from Malaysia, China, and India. This demographic is consistent with the nationalities that spend the highest at our stores. To cater for the increasing Chinese visitors to the country, Eraman partnered with Alipay, the world’s largest online and mobile payment platform as well as Union Pay International, the fast growing global payment network. Both strategic partnerships saw attractive offerings in-stores for customers whilst giving the convenience in payments and enhanced customer experience. Eraman also fostered strong relationships with its brand partners especially the leading beauty houses. In October 2017, the company worked with Dior to introduce an innovative Perfumes & Cosmetics boutique at Contact Pier, KLIA. Other brands such as Gucci, M.A.C, Tom Ford, Jo Malone and LA MER will be opened in Q3 2018. In the F&B category, we won several awards including the Kulinary Top 25
Dining Choice Award 2017 for Bibik Heritage and Food Garden. The brands involved were Mamak Kandar Rice, Pantai Timur, Nyonya Taste and Selera Nusantara. Eraman also received the ‘Best Supporting Partner’ award during the 2017 Concessionaires Conference. In August 2017, we expanded our F&B franchise business under Gloria Jeans Coffees brand with the introduction of a kiosk at the Arrival and Departure Halls in KLIA. What new marketing initiatives are you doing to celebrate the anniversary? To enhance value as part of our customers’ shopping experience and in conjunction with the Eraman 25th Anniversary, we have embarked on a strategic marketing campaign called Eraman Shopping Extravaganza #25AmazingYears. This four month campaign from July until October 2018 offer prizes totalling more than RM1.2 million. With a minimum spend of RM350 at any Eraman participating outlet, customers can win not one but two luxury cars and many lucrative prizes. Among others, Eraman will be giving away international holiday packages for two to Scotland, Austria, and Switzerland, gift vouchers, designer handbags and jewelry as well as points for Petron Miles Card. In addition to this marketing campaign, Eraman continues to collaborate with leading international and local banks, reaching out to their premium card regional database with a preferential incentive to generate greater sales revenue. The privileges apply to merchandise such as fragrances, cosmetics, chocolates, liquor, fashion apparels and accessories, and will soon cover selected F&B as well.
The 2018 ERAMAN Shopping Extravaganza #25AmazingYears Contest kicked off with a bang at KLIA
32 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
live your passion
Lotte Duty Free
Leading Korean travel retailer, Lotte Duty Free is extending its international business with its first step into the Oceania region by REBECCA BYRNE
During the first half of 2018, Lotte’s overseas sales grew by 60% year on year
n August 2018, Lotte Duty Free (Lotte) signed a contract to acquire JR Duty Free’s business in Australia and New Zealand. With this first move into the region, Lotte will take over five stores in Australia, Brisbane Airport, downtown Melbourne, Darwin Airport and Canberra Airport and Wellington Airport in New Zealand. The size of the Australian duty-free market was estimated to be around KRW1.4 trillion (US$1.2 billion) in 2017. Importantly the number of outbound travelers is increasing by more than 10% per year and the region is popular with Chinese travelers, with numbers growing at 20% per annum. Global duty-free companies such as Dufry, DFS and Lagardère have entered into the business in major airports and cities in Australia. As the second largest duty free operator in the world, Lotte Duty Free, sees opportunities in the region and aims to be the largest duty-free operator in Oceania by 2023. Lotte Duty Free Shop CEO Jang Sun-wook, who attended the signing ceremony of the contract, said: “The signing of the acquisition agreement is a stepping stone for Lotte Duty Free to move to new markets after the Asian region. The company will continue to seek overseas expansion in order to achieve the title of world’s best travel retailer.” During the first half of 2018, Lotte’s overseas sales grew by 60% year on year. The company is currently operating seven overseas locations: Ginza downtown and Kansai airports in the Japan: Guam airport in the US; Jakarta in Indonesia; Bangkok city in Thailand; Da Nang Airport in Vietnam and most recently in Nha Trang Cam Ranh Airport in Vietnam. This second airport duty free store in Vietnam opened in July 2018. The com34 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
pany secured exclusive rights to run the 1,680 square meter store until 2028. Nha Trang has recently become the largest tourist destination in central Vietnam, attracting some 1.2 million travelers in 2017. The store offers cosmetics, perfume, watches, fashion items, liquor and cigarettes, and aims to serve the rising numbers of Chinese and Russian tourists who favor Korean cosmetic brands such as Sulwhasoo. The business will be run by a local joint venture in which Lotte has a 60% holding. The company expects to achieve around KRW700 billion (US$600 million) in sales over the 10 years of operation. Lotte was the first Korean operator to establish a duty free outlet in Vietnam when it opened at Da Nang International Airport, also through a joint venture with a local partner. Commenting at the time Jang said: “Lotte Duty Free will thrive in the Vietnamese market on the back of a combination of differentiated services and Hallyu star marketing.” The company aims to open additional outlets in Vietnam’s major cities such as Hanoi and Ho Chi Minh over the next three years. Prior to its well documented partial withdrawal at T1 Incheon Airport in July, Lotte felt it was necessary to reconnect with its customers. To do so it implemented a major marketing campaign strategy to promote its brand playing on the word ‘Yum’. The Korean symbol for this word, 냠, draws on the acronym for Lotte Duty Free (LDF). The company believes it is a word that is easily memorized by customers both at home and overseas, and can be spread rapidly through viral marketing. The campaign began with a ‘Yum Super Junior’ video released onto its social media network. A further six videos featuring big name artists including BTS and TWICE were released onto
World Tower: Following its withdrawal from Incheon Airport, Lotte is looking to differentiate its downtown stores
Lotte has two duty free joint ventures in Vietnam
Lotte Duty Free Shop CEO Jang Sun-wook
online platforms such as YouTube. The company even prepared a video related to its withdrawal from Incheon Airport, “Yum Lee Jong Suk” which starts with the provocative phrase “Where do you buy cosmetics now that Incheon International Airport store no longer has cosmetics?” With an eye on the global market, the videos were also distributed in Chinese, Japanese and English. Already this campaign is bearing fruit in particular on the online platform, which is showing double digit revenue growth when compared with last year. Jang comments: “In the current fast-changing duty free market environment, it is important for companies to reach out to customers first. Lotte Duty Free is not only getting closer to customers through its new symbol ‘Yum’, but is leading the trend.” As well as promoting its brand through Yum, Lotte is also looking to increase sales through ‘VIP marketing’ partnerships with brands. An example of this took place in August, when the company joined forces with L’Oreal for three day campaign. This large scale event was hosted by CEO Jang, at Lotte’s Star Lounge, the largest VIP lounge in Korea. The Star Lounge is Korea’s largest VIP lounge, which opened at Lotte’s Myeong-dong main store in April following an investment of about 10 billion won and this was the first time it had hosted such a prestigious event. It was completely refurbished for the campaign concept and attended by over 3,000 customers. Two thirds of the customers at the event were from overseas, countries such as China and Japan. Following its withdrawal from Incheon Airport, Lotte is looking to differentiate its downtown stores. It aims to host a variety of events to supplement the aftermath of the withdrawal from
The new ‘Yum’ marketing campaign features big name artists
Incheon International Airport cosmetics and fragrance stores with further differentiated markets downtown. This includes: the chance to win a Tesla Model S75D for customers who spend more than $1 in Lotte stores in Korea; an online avatar decoration event with a draw to provide customers with the package of products used to decorate the avator; and launch the mobile magazine ‘냠’ for customers and give a picnic box to downtown shoppers who subscribe to the magazine. Lotte continues to be represented at Incheon Airport in T2 after securing the major liquor, tobacco and packaged foods concession. The company features 130 liquor, tobacco and food brands over 1,408.26 square meters. The flagship store comprises six brands presented in boutique style including Johnnie Walker and Korean tobacco house KT&G’s Lil. The store boasts a wide selection of cigarettes from around the world including Korean and foreign cigarettes, cigars, electronic cigarettes. Electronic cigarettes have helped diversify the product mix and the category is showing the greatest growth rate. The performance of the store overall is steadily improving. www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
A successful transformation With a record breaking 36.7 million people visiting Melbourne Airport in the full year 17/18, Asia Duty Free Magazine asks Andrew Gardiner, Chief of Retail, what the impact of the new look Terminal 2 has been over the past year by REBECCA BYRNE
ver three years ago planning began to transform what was a downmarket and nondescript terminal, according to Gardiner. T2 at that time comprised a few souvenir stores, two restaurants and customer seating. Research highlighted the need for a greater diversity of concepts and a demand for luxury brands with strong demand for high end shopping coming from Asian visitors, in particular the Chinese who account for around 11% of all airport spending. There was no extra space, instead the existing footprint was reconfigured to accommodate luxury brands and increase Dufry, the incumbent travel retailer’s area by an extra third. In total over A$66 million (US$46 million) was invested. A new luxury area was created comprising a 40 meter walkway with dramatic 4.5 meter high shop fronts. Twelve luxury brands entered the airport including Tiffany, Burberry, Ferragamo, Bally, Boss, Armani and Max Mara. The piece de resistance if the design has to be the impressive gold ‘vaulted ceiling’. This seven meter tall stand out feature forms a striking centrepiece and echoes Melbourne’s famous laneways and Federation Square. Gardiner reports that all luxury
36 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
stores are doing well with sales tracking ahead of plan in most cases. Rolex, Burberry and Furla are proving extremely popular with travelers. With the new total of 2,743 square meters of space, Dufry rebranded to “Melbourne Duty Free by Dufry”. This New Generation Store was designed to create a fully immersive shopping experience utilising the latest technology to target customers. Screen content adapts hourly to match changing passenger profiles and different products are showcased according to the customer profile. Gardiner comments: “This magnificently refurbished store, only the second of its kind anywhere in the world, is a great example of how our retail partners are buying into that vision in a meaningful way that will enhance the experience of every traveler through our international terminal.” He stresses the importance of relationships with partners saying: We have a great relationship with our retailers, and we are realistic as pertains financial returns. We work
Andrew Gardiner, Chief of Retail, Melbourne Airport
BIN 311 t u m b a ru m b a c h a r d o n n ay
TASTEF UL LY E LE G A N T AND RE FRE S H I N G LY CRI S P
closely with them to endeavour to achieve a Win-Win-Win outcome for landlord, tenant and customer. The next chapter in the life of the Airport will focus on transforming the retail offering of T2 and T3 landside. The airport is in the process of issuing an RFP for 16 landside tenancies with the objective of a full revamp to its landside retail offer. Gardiner concludes: “Unlike domestic retail, we are very fortunate at airports in Australia to be experiencing phenomenal customer growth and on the back of that, wonderful growth in retail sales, and our forecasts are for continued growth out of China and India. Our conundrum is the old, right product at the right place at the right time sold by the right people.”
38 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Twelve luxury brands entered the airport when T2 was transformed
T R AV A EL L ER E XCLUSI V E
THE GLENDRONACH FORGUE.
WHERE HIGHLAND SPIRIT MEETS SPANISH SHERRY OAK. Deep in the Highland hills, hidden in the fertile Valley of Forgue, The GlenDronach Distillery has been quietly mastering the art of sherry cask maturation since 1826. The GlenDronach Forgue Aged 10 Years is a perfect marriage of Scottish spirit and Spanish oak, matured in Pedro Ximénez and Oloroso sherry casks to create a richly sherried single Highland malt with a long, lingering ﬁnish. THE GLENDRONACH. SHERRY CASK CONNOISSEURS SINCE 1826.
Savour with time, drink responsibly.
The Glendronach is a registered trademark. ©2018 BenRiach. All rights reserved. Scotch Whisky, 43% Alc By Vol. Imported to U.S by Brown Forman, Louisville, KY
Malaysia Airports and Colours & Fragrances
Dior Backstage steps out at KLIA Products on display at the Dior Backstage pop-up store in KLIA’s International Departures area
At KLIA’s Dior Backstage pop-up (pictured second right to fifth right): Hani Ezra Hussin (Malaysia Airports General Manager Commercial Business), Gregoire Walter (Dior Parfums SEA Area Manager Travel Retail), Nazli Aziz (Malaysia Airports Senior General Manager Commercial Services) and Olivier Dubos (Dior Parfums Senior Vice President Travel Retail World Wide)
Parfums Christian Dior teamed up with Malaysia Airports and Colours & Fragrances to offer a grand premiere entirely devoted to Dior Makeup at Kuala Lumpur International Airport
arfums Christian Dior, Malaysia Airports and Colours & Fragrances (C&F) joined forces last summer to offer a unique travelers’ experience by setting up the first ever Dior Backstage pop-up in a southeast Asian airport, at Kuala Lumpur International Airport (KLIA). The Dior Backstage pop-up was an all-new concept offering memorable experiences for all travelers passing through KLIA. Designed to offer the excellence and savoir-faire of Dior, the Dior Backstage studio was a grand premiere entirely devoted to Dior Makeup. The pop-up featured a luxurious and graphic décor of black lacquer, which aimed to clearly and stylishly define the Dior universe. Designed by Peter Philips, Creative and Image Director for Dior Makeup, Dior Backstage is the first makeup line inspired by the backstage catwalk world, for every woman who wants a professional result. This professional performance makeup line, that has wowed makeup artists from New York to Seoul, could be purchased at the pop-up store, located at KLIA’s International Departures area.
Likely boost for overall retail revenue
Speaking at the opening event on August 15, Malaysia Airports Senior General Manager for Commercial Services, Nazli Aziz, said: “We are excited that KLIA is the first airport in southeast Asia to open its doors to the Dior Backstage pop-up. It is very much in line 40 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
with our mission of enhancing the total airport experience by continuously introducing unique products and services for travelers.” Nazli added that the ongoing introduction of prestigious and international brands at KLIA was likely to boost overall retail revenue per passenger. The Commercial Services division had constantly enhanced the commercial value and airport retail experience by adopting industry best practices. This had entailed exploring creative measures to increase commercial revenue and the average spend per passenger in an evolving retail environment. “I’m pleased to note that overall sales per passenger at KLIA recorded double-digit growth of 13% in 2017,” he said. “Furthermore, in the first half of this year, sales of products under the perfumes and cosmetics category grew by 45% compared against sales recorded in the corresponding period in 2017. In that respect, Malaysia Airports is committed to our retail partners and we will continue to deliver exciting commercial value propositions to further entice passenger spending.” Parfums Christian Dior Area Manager for Southeast Asia, Gregoire Walter, said the official launch of the first Dior Backstage pop-up at KLIA marked a significant milestone for Dior Travel Retail. “KLIA, being a preferred travel and transit hub in the world, makes it the ideal place to have this beautiful Dior Backstage pop-up to offer a world-class experience with tailor-made services in this
region,” said Walter. “This project would not have been possible without the active collaboration and trust-based relationship of each party.” Walter said the special relationship, made of mutual understanding of each other’s needs and constraints, was a great and ideal way to create a win-win business. “I strongly believe that this tripartite spirit can bring happiness and an unforgettable experience to passengers,” he added. Colours & Fragrances Assistant General Manager Amy Chew said the company was committed to constantly looking out for brands that offer unique retail experiences for travelers. “C&F is proud to be working closely with Malaysia Airports and Christian Dior Parfums to present a multi-sensory, immersive and personalized experience for our global shoppers with the excitement surrounding the launch of the Dior Backstage pop-up,” she said. At the launch event, Dior makeup artists were on hand to dispense expert tips and lessons on achieving catwalk eyes, couture lips, spotlight glow, runway complexion, Parisian brows and the Dior now look. A Dior color stylist and a team of beauty consultants visited the pop-up store daily to deliver makeup services and provide expert advice to customers. Additionally, customers received special treats from Dior with their purchases, in line with the spirit of generosity and gifting of the house.
Please visit us at our booth in Bay Village 11B at TFWA WE&C!
Candy Tin new collectable item in the iconic Goldbear shape
Frederique Constant continues to offer Swiss luxury watches for aficionados who appreciate affordable luxury
High time for Frederique Constant Frederique Constant introduces six new models to its iconic Ladies Automatic Collection, completely redesigned with a new case shape and fresh colorways
by JAS RYAT
wiss watch brand Frederique Constant has paired with Global Charity Ambassador Gwyneth Paltrow in an advertising campaign to highlight the new additions to the classic and feminine Ladies Automatic Collection. The collection will include six newly designed models. The feminine models are distinguished by their subtle lines, refined decorations and colorful tones. The brand’s signature Heart Beat opening at 12 o’clock stands on the decorated sunray dials. The four new colored Heart Beat dials are further enhanced by applied diamonds and Roman numeral indexes.
Combining tradition and modernity, the new Ladies Automatic models enhance women’s natural beauty
42 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
This emblematic Heart Beat aperture has proven to be a success for Frederique Constant over the years, as it represents an interpretation of time. The embellished opening, protected by a convex sapphire crystal, houses the beating automatic movement. “The demand for ladies’ watches has increased, and this collection is the embodiment of a refreshing design at an affordable price. This collection will enable us to target more efficiently this specific segment. In addition, the support of our Charity Ambassador will extend our international exposure in terms of brand awareness,“ explains Marin Grandjean, Worldwide Travel Retail Director, Frederique Constant. The six new watches come either with polished stainless steel or rose gold plated 36mm diameter cases with an open case-back. Two models are powered by the FC-303 automatic movement displaying the hours, minutes and date at 3 o’clock. Four models are powered by the FC-310 automatic movement
displaying the Heart Beat aperture at 12 o’clock, the hours and minutes. Both calibers are Swiss made with 26 jewels, beating at 28,000 alt per hour, offer a 38-hour power reserve, and a water resistance of 50 meters. Modern and stylish, the alligator straps matching the dial colors are available in shiny grey, light blue, navy and burgundy. Each Ladies Automatic watch sold will contribute a US$50 donation to DonorsChoose.org, Gwyneth Paltrow’s charity of choice. This partnership enables DonorsChoose.org to support education and sports for underprivileged children. “Frederique Constant offers Swiss luxury watches for aficionados who enjoy a classic design at an affordable price,” says Grandjean. “Following the success of our travel retail exclusive models, we are implementing a pilot project with one of our oldest duty free partners, with whom we have designed a unique collection that will only be available in their stores as of September.” Elaborating on the company’s travel retail objectives, he reveals: “We would like to present the new Frederique Constant Collection and further develop the brand’s presence in the secondary airport perimeter, where we see an opportunity to increase our brand visibility. In addition, as our highest sell-out performance growth is recorded with the cruise line business, we aim to extend our collaboration with some major players of this industry, where the end consumer is in an optimal environment to select and purchase luxury goods, in our opinion.”
DISTILLED IN SCOTLAND BOTTLED IN DENMARK
YOU CAN NEVER BE TOO GENEROUS
The Hershey Company
A sweet experience T
he Hershey Company is on a mission to give customers a total shopping experience beyond just new items in-store. The US confectionery specialist will be showcasing new innovations in combination with in-store experiences and merchandising platforms at an expanded booth this year at the TFWA World Exhibition. On the heels of a good year, the company continues to implement programs and target particular markets in a focused approach that will follow through into 2019. Speaking with Americas Duty Free, Steve Bentz, General Manager, World Travel Retail, The Hershey Company, notes the great success the firm as seen this year through the Traveler Collection platform. “Last year in 2017 we launched
The Hershey Company explains how experiential activities are working in unison to support its confectionery product innovations by JAS RYAT
three items in this format, and all three items are doing well in the market, gaining space and sales. This year we added a fourth variety with Hershey’s Nuggets, and this new selection continues to build on the growth established by the original three varieties,” he says. All four items are a unique combination of Kisses, Reese’s, Hershey Miniatures and Nuggets that cover multiple shopping occasions, including gifting, sharing and self-consumption. “I believe in the future we will continue to look to expand the Traveler Collection platform based on the success of the initial launches,” he says.
Teaming up with innovative partners
Following through with the enhanced experience mantra, the “world’s first flotilla buggy” concept launched at Kuala Lumpur International Airport – the direct result of a The Hershey Company strong partnership in place with plans to combine CSS (Chocolate Sales & Service) in-store experiences with merchandise to optimize and Malaysia Airports, the on airport traffic airport operator. The Hersheybranded flotilla buggy is mobile, allowing the unit to follow the traffic in the airport, setting up in key locations as travelers arrive or depart at KLIA. Although it’s still too early to determine the success of this concept, the company continues to team up with innovative partners such as CSS and Malaysia Airports to create experiential
44 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
platforms that engage travelers as they continue their journey. Hershey acknowledges the importance of working with operator partners to give customers the best shopping experience as well as leverage industry insights to best understand the market and the factors that may impact who is traveling through and why. “From our research we know that the global confectionery shopper is predominantly female, traveling for business, and is shopping on their inbound journey. Our insights also tell us the global confectionery shopper spends on average of US$34 on confectionery during their trip with an average spend of about US$19 per item (source: CIR Global Study 2016),” explains Bentz. Most recently, the brand supported a successful pop-up at New York JFK Terminal 4 with its retail partner DFS. “Hershey Travel Retail is part of The Hershey Experience within our company and with that association in place, we have opened the door to a wide variety of item innovation and experiential activations that we hope to bring to the channel over time,” shares Bentz. The T4 space featured Hershey’s confectionery innovations, non-confectionery, Hershey-branded, licensed goods and a few experiential, personalization activations that were very well received. Bentz concludes: “Based on that success, we look to continue down that path in the channel over the next few years, looking to innovate with retailers in a variety of ways.”
Don’t worry if you get lost in this city. Just go with the flow!
Chris Lee 李至正, Actor
一 起 旅 行
LET’S SHOP DUTY FREE ANGKOR . AUCKLAND . BALI . CAIRNS . GUAM . HAWAII . HONG KONG MACAU . OKINAWA . SAIPAN . SINGAPORE . SYDNEY . VENICE
Japan Tobacco International
JTI takes solid stance on WHO Protocol by HIBAH NOOR
Japan Tobacco International puts forward its view of the World Health Organization’s FCTC Protocol to Eliminate the Illicit Trade in Tobacco Products, which has now been ratified
46 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
nsurprisingly, duty free tobacco products supplier Japan Tobacco International (JTI) has firm views on the World Health Organization’s FCTC Protocol to Eliminate the Illicit Trade in Tobacco Products (the Protocol), which will now come into force September 2018 as the requirement for 40 ratifying countries has been met. As a result, the first meeting of the Parties to the Protocol (MOP1) will take place this October in Geneva.
At this meeting, the Parties will discuss the next steps in implementing the measures set out in the Protocol. The duty free industry and tobacco companies broadly support the Protocol’s objective of eliminating illicit trade and believing that the Protocol has the potential to provide a global response to a global problem. However, the Protocol also mandates for research to be carried out within five years into “the extent to which” duty free contributes to illicit trade in tobacco
products. According to a press statement issued by the Duty Free World Council (DFWC) on July 11, 2018, the World Health Organization’s starting assumption therefore is that duty free is a source of illicit trade. The DFWC has been leading a global campaign together with the other regional associations to communicate to governments of parties to the Protocol that the industry vigorously rejects any claims that duty free tobacco sales contribute to illicit trade. Frank O’Connell, President of the Duty Free World Council, stated in the press release: “We refute completely any allegations that the duty free industry is complicit in illicit trade. There is no justification in penalizing legitimate law abiding retailers, brands, airports and the maritime trade under the pretext of illicit trade.” He added that the duty free industry also maintains that any research should not take place until all the measures of the Protocol have been put in place, that all signatory countries are aligned on the methodology of the study and that it must be carried out in a fair and objective manner with full industry and anti-illicit trade expert participation. “Duty free tobacco sales are frequently confused with other trade channels. Duty free is not ‘duty not paid’ sales, ‘cross-border trade’ or ‘free zone’ sales. Duty free is a highly regulated retail environment that takes place at airports, ports, inflight and onboard ferries and at land border shops, overseen by national customs authorities,” he said. O’Connell’s words in this press statement are echoed by JTI’s Worldwide Duty Free Corporate Affairs and Communications Director Gemma Bateson, who spoke to Asia, Americas, & Gulf-Africa Duty Free & Travel Retailing Magazine before the Protocol was ratified by the 40 states. “As a member of almost every duty free industry association, we actively advise our partners on the potential negative impact article 13 of the World Health Organization’s FCTC Protocol could have, not only on tobacco but also on the wider duty free industry.” Asked about what action JTI is taking to help raise awareness of article 13 of the Protocol when it may propose misguided and disproportionate measures to limit
legal duty free tobacco sales to international travelers, Bateson continued: “The duty free channel is secure, highly controlled and transparent, so of course we will defend our business against any threat that seeks to ban or unnecessarily restrict duty free sales of tobacco. JTI supports the Protocol; however, it should not be seen as the ultimate and only solution to fight against illegal trade; it cannot solve the huge impact of this criminal activity on its own. “The duty free channel should not be confused with other channels. Duty free is not ‘cross border trade’, it is not ‘non duty paid’, and it is not ‘free zone sales’. The duty free industry and legitimate manufacturers can help to identify nonlegitimate illicit white product circulating with ‘For Duty Free Sales Only’ markings – which cause reputational damage to the legal duty free channel and manufacturers. Banning duty free sales will not resolve the complex issue of illegal tobacco produced by organized criminal gangs and would not prevent them from using misleading markings on their products.” In addition, Bateson believes that the study requested in article 13 should not take place ahead of the implementation of other measures within the Protocol, particularly on ‘track & trace’ – to do so would be premature, as it would not allow adequate time for these measures to take effect.
“Most importantly, the research should be based on evidence, transparent, inclusive of law enforcement and duty free industry expertise, unbiased and global. Properly completing such a study will be complex (in order to be truly ‘evidence based’) and costly. Therefore, it is essential that it is conducted once, and only following the implementation of other aspects of the Protocol – not prematurely conducted in the absence of critical, relevant evidence,” she said. Bateson is clear about JTI’s continued position on this issue: “We will relentlessly continue investing in the fight against all forms of illegal trade, to protect our products and our brands. We also call upon all those working in the duty free industry – all channels, all brands, and all retailers – to raise their voices in order to safeguard the duty free channel. Duty free revenues are a key source of income to airports, ferries and airlines, notably. Any unnecessary attack on this legitimate channel will impact all that operate within it.” Bateson noted that the duty free supply chain is heavily controlled by Customs from the moment product leaves a manufacturer’s facility to the time it is bought and consumed. “Both tobacco manufacturers and duty free retailers have rigorous security controls and supply chain procedures in place to ensure that legitimate products are not diverted from the legal supply chain,” she concluded. Gemma Bateson, Corporate Affairs and Communications Director World Wide Duty Free, JTI
www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
An impulse for innovation
Moroccanoil is marking 10 years as the leader in oil-infused beauty with innovative launches across multiple product categories by JAS RYAT
oroccanoil, the leading oilinfused beauty company, celebrates its 10th anniversary with the introduction of the Moroccanoil Color Complete Collection. The latest innovations and technology for color-treated hair will be unveiled at the 2018 TFWA World Exhibition in Cannes this October. Asia Duty Free & Travel Retailing Magazine spoke to JuE Wong, Moroccanoil Global CEO, earlier this year when she alluded to an expansion of the Moroccanoil Beauty Division. Wong explained: “We are a consumer-centric organization in that we are very clear that the masters at Moroccanoil are the people who support us, from trade to consumers. However, there is so much more we can bring to the hair care category, and we are going to bring forth the best technology and innovation as we continue to upgrade our existing line.” Wong recognizes the power of the brand’s oil-infused products in the duty free arena, and is strengthening this presence while expanding the portfolio. The head-to-toe beauty brand has evolved to bring consumers a new category offering, the Moroccanoil Color Complete Collection. This new collection offers a revolutionary 360-degree approach to color care that addresses all sources of color degradation to keep the life in haircolor. All five products feature ArganID™ technology, which uses the power of ionic attraction to infuse argan oil into the cor48 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Lifestyle beauty brand Moroccanoil introduces the new Moroccanoil Color Complete Collection
tex, while simultaneously helping to repair and seal the hair. The collection works as a regimen, beginning at the salon with the ChromaTech Service. The regimen continues at home with a simple routine to maintain, sustain and protect color.
Strong travel retail results
“The expansion of Moroccanoil is supported by continued consumer and industry excitement and demand for the brand,” said John Gates, Moroccanoil Vice President of Retail and Travel Retail Sales. “Moroccanoil is more than a leader in oilinfused beauty; we are a lifestyle beauty brand that offers consumers multiple categories including hair care, body care and sun care.” Through 2016 and 2017, Moroccanoil saw strong travel retail results in territories launched with Gebr. Heinemann, Duty Free Americas and Dufry Europe. The brand continues to open in new locations throughout the Americas with Dufry and DFASS, and is further expanding to Asia including Korea, Singapore and Japan. To meet global consumer demand for the hero product, Moroccanoil Treatment—currently available through inflight listings—Moroccanoil is exploring partnerships to make the product available onboard in first class and business class amenity kit programs with key AsiaPacific carriers. Moroccanoil is also available in Argentina, at Ministro Pistarini (Ezeiza) International Airport in Buenos Aires and
Aeroparque Jorge Newbery. In Uruguay, the brand has a presence at Carrasco/ General Cesáreo L. Berisso International and Capitán de Corbeta Carlos A. Curbelo International airports, and has launched in Brazil at Rio de Janeiro– Antonio Carlos Jobim (Galeão) International Airport in Rio de Janeiro and São Paulo/Guarulhos–Governador André Franco Montoro International Airport in São Paulo.
A decade and beyond
In 2018, the team at Moroccanoil will continue to work closely with existing partners on aligned strategies to further strengthen overall sales volume, enhance brand awareness and open new points of sale/distribution to further engage the travel retail customer. The 10-year anniversary celebrations include the introduction of innovative technologies supported by clinical claims with the new Color Complete Collection, refinement of product assortments, branded installations and premium airport fixtures. The company intends to finish the year strongly, with an emphasis on the Asia-Pacific and Latin America markets. Gates concluded: “The iconic Moroccanoil brand is a true story of success that wouldn’t be possible without an impulse for innovation and a dedication to high-performance oil-infused beauty products.”
reigns in digital era
NARS digital Lip Wall is part of the 360-degree approach to increase footfall into duty free stores
lobal cosmetics brand SHISEIDO has embraced an omnichannel approach when enhancing consumer engagement to drive sales. Multiple digital touchpoints allow Shiseido Travel Retail (STR) to stay connected with the consumer at every opportunity. Strong relationships with retailers and airports play an important role in leveraging loyalty programs and digital platforms and offer exclusive sampling opportunities as well as click-and-collect services. This 360-degree approach uses online experiences to drive footfall to the duty free stores by using animations that are not only designed to be visually stunning, but also encourage interaction through games, photo booths and sampling. The future is here. A recent example was the NARS Lip Gallery animation at King Power’s downtown Rangnam complex in Bangkok and the SHISEIDO Ultimune 2.0 launch in Singapore Changi Airport. With animations incorporating digital aspects, subsequent sharing on social media platforms generates positive word-of-mouth and awareness.
SHISEIDO engages with travelers through different channels of interaction to stay better connected at all touch points
Digital a top priority
Beauty brand SHISEIDO puts a digital spin on customer experiences and engagement to ensure they stay connected at all travel touchpoints by JAS RYAT
50 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Shiseido Travel Retail continues to be a key player on the digital stage of global travel retail. As consumers grow increasingly more comfortable and dependent on technology, big brands are naturally adapting to this digital approach. With digital a top priority, the Shiseido Group recently developed the Digital Centre of Excellence in New York to boost and enrich the digital capabilities of the entire organization. “Part of this project is to have a global database where we share data within the group to further inform our marketing campaigns and activations. Within Shiseido Travel Retail, we have a dedicated digital strategy team already making significant progress by partnering with key stakeholders in the industry. This connection allows the digital teams to share knowledge, experience and ideas to bring forth digital disruptions that could be another step
The NARS Lip Gallery showcased at King Power’s downtown Rangnam complex in Bangkok was a successful example of how to connect using a digital approach
forward for the industry,” says Shi Ling Tan, Digital Manager Global at STR. STR also recognizes that this data will help it meet the needs of consumers with greater accuracy. Globally, with brands, retailers and airports engaged in data collection, there is an opportunity for consumer behavioral data to be shared, helping all teams to work towards the common goal of providing relevant and exciting experiences at the right moments to the consumer.
Targeting Chinese millennials
STR has been focusing on Chinese millennials for its digital experience, as they are a key consumer group who are confident spenders, looking for high quality and luxury products. This group also seeks personalized experiences, both online and offline, which was one of the driving forces behind the NARS Lip Gallery activation and the SHISEIDO #StrongSouls campaign. “These engagement strategies have seen us collaborate with key opinion leaders (KOLs), share news across popular Chinese platforms, offer redemption coupons to drive footfall in-store, utilize some of China’s fastest-growing social travel platforms such as Mafengwo, and spread the message via social media platforms like WeChat and Weibo,” says Tan. Today’s consumers are increasingly digital-savvy, and with travel becoming more affordable, the number of millennial travelers is steadily growing. STR recently introduced an O2O (online to offline) strategy based on the Chinese millennial traveler. The NARS Lip Gallery, which was stationed in King Power’s downtown Rangnam complex in Bangkok, was hugely successful, the company reports. As the first brand animation in the new atrium space to focus solely on make-up, and with Thailand being such a popular destination for Chinese travelers, it was a natural step to launch the prestigious brand in this environment. For this launch, the O2O strategy was built around the Chinese millennial traveler, incorporating advanced digital and
physical touchpoints at every aspect of their journey. Prior to the trip, consumers were exposed to targeted online and social media advertising that directed them to the NARS ‘Lips to Style’ Virtual Lip Trial app. The app was also available on-site at the Rangnam animation, where a Digital Lip Wall – with motion-sensing floating lips – encouraged consumer interaction. At the animation, shoppers could also discover NARS Lip Icons at the ‘Lips to Style’ Lip Bar and capture their lip makeover looks at the photo booth. After visiting the animation, they could share their experiences via social media, which formed a key element of the animation. These O2O interactions created a “virtuous circle” that enhanced the consumer experience at Rangnam and amplified the buzz in China to drive awareness and demand. The NARS Virtual Lip Trial app uses augmented reality (AR) to encourage users to virtually try a range of lip products, recommended shades and various finishes. It also has a gamification function that allows users to play a game called Catch your Pout, designed to convert players into shoppers. They are also able to take a selfie highlighting their selected lip shade, which can be shared on social media platforms such as Weibo, WeChat, QQ, and Facebook.
Exciting and memorable content
STR’s focus continues to be on the development and activation of O2O campaigns. After the success of the NARS Lip Gallery and, more recently, the SHISEIDO Red Vibe Street outpost, there is a continued opportunity to engage travelers during all stages of their journey, increase in-store footfall and drive awareness. Future plans include activation of the SHISEIDO Red Vibe Street outpost in other parts of the world. The outpost has already appeared in Singapore, Hong Kong, Taiwan and Japan, with more locations, such as the Netherlands, Germany and Norway, to follow. Tan is optimistic: “As we look longer term, digital and O2O campaigns will be interwoven into almost all activations that we roll out, so you can expect to see lots of engaging, exciting and memorable content from Shiseido.” www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
Nikki Minaj brings her star power to the new Diesel Ha(u)te Couture campaign
COUTURE Diesel’s new Ha(u)te Couture campaign features stars that utilize social media to help create an edgy fashion statement
Diesel arrives in Cannes with a new collection that speaks for itself
talian fashion brand Diesel will once again be present at TFWA World Exhibition to share how the brands focus on travel retail is constantly growing and evolving. This year Diesel presents its newest brand message to discuss its collection: Ha(u)te Couture. Ha(u)te Couture is an intentionally provocative and ironic communications strategy meant to disempower online haters. The hate, then, ends up empowering the wearer. With Ha(u)te Couture, Diesel once again taps into current social issues in a very personal way, starting with intentional self-scrutinizing. The brand has enlisted stars like Nicki Minaj, Gucci Mane, Bella Thorne, Miles Heizer, Tommy Dorfman, Bria Vinaite, Barbie Ferreira, Yovana Ventura, Jonathan Bellini and Yoo Ah-In to create a video. These stars picked a word or phrase that they found in their comment feeds, and those comments have been turned into edgy fashion statements on t-shirts and more; in the end, the more hate you wear the less you care. 52 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Diesel plans to take over the city Cannes during TFWA World Exhibition. The brand will promote with more than 133 billboards and city-lights. It will also partner with THE SCENE, the official TFWA nightlife club, where visitors will have the chance to experience Ha(u)te Couture thanks to branded bartender and staff uniforms, along with a photo booth activation that will be open throughout the night. Diesel’s Fall/Winter 2018 Main collection will be the label’s main focus at the show as it embodies the brands continuing efforts to reconstruct its image. The inspiration is drawn from a melting pot of elements: sport, denim, colors, graphics, checks and treatments. With the city of London acting as a primary reference point, clashing influences are borrowed from school uniforms to gothic and post-punk elements. Oversized and bigger silhouettes portray an empowering aesthetic, while iconic archive items are mixed with historic and pop cultural elements. Although this eclectic mix is different, it manages to mix seamlessly into the collection, naturally increasing appeal.
Diesel goes back to its denim roots as a quest for authenticity for focus in this collection. Pure and vintage denim feature a unique mix of ripped and repaired treatments, classic constructions, evolutions in volumes and proportions, and different washes and materials to meet a variety of personalities and body shapes. Comfort is also essential with Diesel’s signature denim fabric called “JoggJeans.” As soft and comfortable as a pair of sweatpants, product made with this material carves out a unique position in the marketplace. Accessories follow suit as hiking inspiration recurs both in female and male footwear. The sneakers’ offer is wide covering several styles from the best-selling SKB and Clever, developed with new materials to more fashionable alternatives as Millenium or La Rua enriching the offer. Bag designs include shoppers and backpacks as they are the key shapes for this season using denim, canvas and faux fur on patent leather for a more premium rang, aligning well with the footwear collection. Diesel has experienced success as the brand considers the idea of people on the move, and its offer aims to give a 360-degree experience during every journey. This ongoing growth is showcased by recent and futures openings, including at the following airports: Moscow-Vuknovo, Malta, and Shanghai Hongqiao, and a number of cruise ships. Diesel continues to fuel an on-going stride to extend its distribution at international airports worldwide.
BEACHWEAR MADE IN THE UK
C ome v is it us in t he Me d ite r r ane an Vi l l age - St and - P 1 9
Miyamizu No Hana is created with 100% Yamadanishiki Rice from Hyogo and gives a mellow and semi –dry with a crisp aftertaste. A well structured Sake with sophisticated savory
champions Japanese sake Japanese sake is being propelled to the forefront of global travel retail thanks to ambitious distributor Diverse Flavours by JAS RYAT
iverse Flavours, the independently owned distributor of fine wine and spirits, is paving the way for a pioneering liquor category in global travel retail – Japanese sake. The company will highlight Japan’s famous rice wine at the TFWA World Exhibition in Cannes, including new products from Sakuramasamune, one of Japan’s oldest sake makers from Hyogo prefecture, and a completely new range from Kinshi Masamune from Kyoto. Anthony Budd, Managing Director of Diverse Flavours, is on a mission to establish Japanese sake in travel retail with the same passion he employed to bring South African wine to the forefront of the channel. “We have been introducing sake for two years now, and the initial uptake was slow. We listed about five products in DFS in Hong Kong until the recent concessionaire change-over, and during this time DFS ran some very successful Japan festivals,” says Budd. He adds that there has been a “dramatic” rise in interest from all the large operators in Korea, Singapore, Hong Kong, China, Malaysia, and Middle East, and among airlines. This rise of interest coincides with an influx of travelers that are looking to purchase products based on the story or heritage behind them. Sakuramasamune
54 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Handmade Daiginjo is brewed with a special variety of rice called Yamadanishiki. This well balanced sake offers aromas of apple and melon, and smooth texture with a crisp after taste
is an old, historical sake brewery dating back to the 1600s. It is from one of the most important and famous sakeproducing areas in Hyogo prefecture and uses the purest spring water, highest quality rice, and ancient yeast strains. It is highly regarded in Japan for its quality and historical past, so it has high potential in travel retail, believes Budd. Diverse Flavours will also introduce Kinshi Masamune from Kyoto this year.
Interest in Japanese culture and experiences
The rise in tourism in Japan has also helped generate interest in Japanese sake with travelers. The Japanese government is actively encouraging tourists to visit Japan, explains Budd. “I think global travelers are falling in love with Japan – its culture, its people, its landscapes and geography, its food, and its wide array of spirits, wines, sake, and liqueurs. Approximately 28 million tourists have visited Japan this year and a target of 40 million by 2025 is giving all things Japanese a huge boost. Budd feels the interest in the culture and experiences will cultivate the desire to purchase sake in duty free shops. Nationalities keen on purchasing sake include South East Asians, Chinese, Koreans, Europeans and
Americans, and there’s strong interest from a younger audience. Budd feels the challenges center on supply logistics and lead times, and education or knowledge, as sake can be a bit complicated. Sake may be intimidating for new consumers as there are different qualities or grades of sake, various styles (whether it’s drunk hot or cold), and packaging written only in Japanese. Although the main focus for Budd at the moment is Asia and the Middle East, there is a growing interest from many European operators. TFWA World Exhibition will give Diverse Flavours the ideal platform to discuss the opportunities sake presents in travel retail. Budd expects to generate some interesting conversations with buyers on how Diverse Flavours can bring the Japanese experience into their duty free shops. “These days we want experiences – visiting Japan is an experience, and eating and drinking sake in Japan is the ultimate experience. Job done,” enthuses Budd. To taste and experience the Sakuramasamune and Kinshimasamune Sake, and the Diverse Flavours portoflio of South African wines visit Stand L34, Red Village and/or contact Anthony Budd at firstname.lastname@example.org or Telephone +27 71 255 7344
E VO LU T I O N S3 ®
The travel pillow that stops your head from falling forward and side-to-side.
COMPLETE HEAD AND NECK SUPPORT. COMFORT GUARANTEED.
New products for travelers take top flight in travel retail 5
1. Kavalan Original Single Malt Whisky: Kavalan distillery in Taiwan has introduced its first travel retail exclusive malt expression, Kavalan Original, aimed at showcasing the skills of its award-winning master blender to a wider audience
4. Rumtastic Rum Box: This exclusive collection of 20 rum miniatures carefully curated from around the world features a different selection each year in two variants, one with 20 rums and a 10-pack variant, which is aimed at airlines and cruise ships
2. Matcha&Chai Blend: The East India Company celebrates a modern blend of two tea traditions with the exclusive launch of its Matcha&Chai Blend. The fusion of these two distinctive and exotic teas creates a wellbeing blend that will uplift you
5. Braun MultiGroomingKit: Braun’s compact MultiGroomingKit for men has nine different uses combined in a single product. The Gillette Fusion blade delivers a clean and precise shave, while various attachments groom the entire body from head to toe
3. Penfolds Lot 518. A Spirited Wine with Baijiu: Treasury Wine Estates presents an experimental hybrid of its spirits and wine expertise. This complex, full-bodied wine has floral and fruity notes of baijiu and the bold, signature style of its fortified Shiraz
6. LINDT MAXI PLAISIR 150G: The new Lindt chocolate tablet is made of a minimum 32% whole aromatically roasted hazelnuts in dark chocolate in a convenient 150g tablet format. For maximum pleasure on-the-go
56 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
8 10 7
7. Scandal By Night: Jean Paul Gaultier expands the Scandal fragrance line with Scandal By Night, a new gourmand chypre scent. The bottle mirrors that of the original Scandal but features a deeper pink color which descends into purple
10. Osprey Daylite Plus backpack: This versatile backpack is equipped with a ventilated Spacermesh back panel, a removable abdominal strap and an interior compartment, which allows for perfect organizing. It also includes hydration packs
8. Frederique Constant Ladies Automatic Collection: The Swiss watchmaker partners with Global Charity Ambassador Gwyneth Paltrow to bring travelers six new models, distinguished by their subtle lines, refined decorations and colorful tones
11. T&C Truffles Gift Box: Food Accademia introduces a new series of exclusive gift boxes, bringing together smaller sizes of different food items. This includes the T&C Truffles Gift Box, containing five sauces perfect to accompany appetizers
9. Butlers Chocolate Collection: This assortment of luxury chocolates comes in elegant ivory gift boxes finished with a stylish sleeve. The selection inside centers on popular Asian flavors, including Green Tea, Spiced Chai and Mango & Lemongrass
12. Swiss Army Steel: This new Victorinox signature scent for men is an aquatic, deep fresh fragrance, featuring a vegetal bouquet of viola leaves mixed with a masculine lavender note. The square-shaped flacon is crowned with a grey cap www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
A tour of rums around the world Wild Tiger Rum has brought its “Think outside the bottle” philosophy to TFWA World Exhibition in Cannes this year. The company is unveiling the Rumtastic Rum Box, an experience dubbed “Around the world in 20 Rums”. This exclusive collection of 20 miniatures features carefully curated rums from around the world. Featuring rums of every style and variant’s with strong provenance, the Rumtastic Rum Box is one’s passport to travel the world of rum in a fun, engaging and experiential manner, which has already received significant pre-orders from travel retail operators. Gautom Menon, Founder and Brand Owner of Wild Tiger Rum, says: “We are optimistic about the opportunities in the tax free industry, which we believe will see the next new wave of Asian consumers and millennials embracing unique and standout rums as their drink of choice.” The Rum Box will feature a different and distinctive selection each year in two variants, one with 20 rums and a 10-pack variant, which is aimed more at inflight listings and cruise ships, where space is limited. Wild Tiger is also working on limited-edition versions of the Rumtastic Rum Box to celebrate participating nations of the 2020 Olympics in Tokyo, Japan, and for Chinese Year of the Tiger in 2022.
Wild Tiger aims to introduce products through innovation, a compelling back story and a strong point of differentiation, to add value to travelers and increase sales opportunities for operators.
The Rum Box is a unique collection of various rums from around the globe. Available in a 20-pack and a smaller 10-pack variant to accommodate for limited inflight space
Whitley Neill Flavoured Gins showcase expanded Halewood portfolio at TFWA World Exhibition Halewood Wines & Spirits set to showcase new Whitley Neill Aloe & Cucumber Gin and Whitley Neill Parma Violet Gin in travel-exclusive one litre bottles onboard Clara One in the Harbour Village at TFWA World Exhibition. Current Whitley Neill offerings include the original bestselling Whitley Neill Handcrafted Dry Gin and its full-strength flavored gin variants, including Rhubarb & Ginger, Blood Orange, Raspberry, Quince and Lemongrass & Ginger. Halewood will also be promoting Whitley Neill Rye Vodka, Blood Orange Vodka and Rhubarb Vodka as well as a selection of the company’s other premium spirits, including Marylebone Gin, City of London Distillery Gins and Dead Man’s Fingers small batch spiced rum. The latter is an inspired blend of Caribbean rums resulting in a smooth taste, with notes of saffron cake, sweet sherry, caramel, vanilla and cinnamon, nutmeg and orange. Simon Roffe, Managing Director Global Travel Retail, Halewood shares, “Our debut at TFWA World Exhibition last year lit the fuse under Whitley Neill gins and the brand has really
taken off in travel retail. Already the number one premium gin in the UK off-trade, Whitley Neill original and its flavored variants have achieved major advances in travel retail this year, securing listings in airports, airlines and ferries in Europe, Asia and North America.” He further enlightened, “We staged special promotions this summer at London City and London Luton with LSTR UK and we will be mounting a brand experience with Heinemann at Copenhagen airport. In Asia our agent MG Cellars and DFS will stage a Whitley Neill bar at Singapore Changi where we expect Lemongrass & Ginger to inspire shoppers. Among our recent airline listings are the Whitley Neill Original 5cl on Ryanair with Heinemann and Whitley Neill Blood Orange Gin on Thomas Cook UK and British Airways.” “The next challenge is to set up distribution globally with the major international retailers. We are very optimistic that the forthcoming show will prove, once again, a launch pad for our gins, vodkas, whiskey and rums in this channel,” concluded Roffe.
A growing breed. Whitley Neill Flavoured Gins adds Aloe & Cucumber Gin and Whitley Neill Parma Violet Gin to existing Halewood portfolio
58 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Ladoga Group showcases world’s most expensive vodka Ladoga Group, famous for its Imperial Gold vodka created in unique and presents a very special opportunity for the global 1721 to impress Peter the Great, will showcase for the first time travel retail market,” explained Ruslan Grigoryev, Export Direcits entire portfolio of prestigious spirits at TFWA World Exhibition tor for The Ladoga Group. “There is no other vodka like it and and Conference 2018, in Blue Village, stand H3. its majestic presence on-shelf creates interest and talkability The portfolio includes Imperial Collection Faberge vodka, amongst consumers in-store.” one of the most expensive in the world, thanks to its superHaving experienced year on year growth and currently the refined distillation process, highest quality ingredients and best-selling vodka in Russian airports duty free, Ladoga is lookunique Fabergé-egg style container. ing to replicate the success of its Imperial Collection range in Water from Ladoga Lake, the largest freshwater lake in the global duty free arena. Europe and the biggest source of the purest drinking water is “There is a huge appetite for premium and super premium used to create the vodka alongside the best quality wheat and vodka within the global travel retail market and we are looking rye from central and southern Russia. After distillation, the vodka to capitalise on this trend with our unique portfolio of products goes through 12 filtration processes, similar to those used in and recipes developed almost 300 years ago,” said Grigoryev. the best Cognac houses in France. Visitors will see all eight of the exquisitely designed Fabergé-egg style presentation cases. These are made of metal alloy enrobed in enamel of different colours and decorated with 24 carat gold gilding and coloured crystals. Each case contains a 75cl decanter of Imperial Collection vodka coupled with four glasses all made of Venetian glass. “Every element of our Imperial Collection Fabergé range is totally Ladoga Group’s Imperial Collection Faberge vodka boasts a super-refined distillation process
Torres Brandy to reveal two new travel retail exclusives at Cannes show Torres Brandy is preparing to introduce two new travel retail exclusives at the TFWA World Exhibition in Cannes. Torres 15 Barcelona Skyline Edition is described as a tribute to the exciting city of Barcelona, a top destination for many tourists, which is located near the Torres distillery. Both the case and the label on the bottle display in gold the city’s skyline, featuring five buildings: the Sagrada Família, Santa Maria del Mar, Casa Batlló, the Columbus monument and the Arc de Triomf. When four cases are joined together, the complete skyline of Barcelona is seen. The same skyline is depicted on the label. This year, Torres 15 was awarded a gold medal at both the World Spirits Awards and the San Francisco World Spirits Competition. This brandy is available in a one-liter format. The second travel-exclusive product is Torres 10 Double Barrel Traveler Edition. This special-edition, best-selling Spanish brandy is double-aged in American oak casks, which enhances the aroma complexity with a wide range of notes such as tobacco and vanilla. The Traveler Edition is inspired by Juan Torres, the second generation and first member of the family to distil.
Torres 15 Barcelona Skyline Edition brandy is a tribute to the exciting city of Barcelona, a top destination for many tourists
He started to produce mature brandies aged in oak in 1928, while building up the overseas market and strengthening sales in Spain. As a result, he received several prizes at the Barcelona International Exposition of 1929. This brandy edition is available in one-liter bottles.
www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
Wild Tiger is India and Asia's ﬁrst Premium Rum from Kerala state in Southern India by Wild Tiger Beverages. Wild Tiger was launched in 2016 and is currently available in 6 con�nents spanning over 25 countries including Czech Republic, Canada, UK, Cyprus, Chile to name a few. The brand is also listed with 10 of the Top 20 Operators in Travel Retail.
SPECIAL RESERVE RUM
Wild Tiger Special Reserve Rum is India's ﬁrst Premium Dark Rum given it's exo�c blend of Molasses and Cane juice dis�llates. The Taste has received accolades from Rum aﬁcionados around the world and has also won a few leading Interna�onal Taste and Design awards. It is predominantly a column dis�lled Molasses rum which is aged in Oakwood Casks and harmoniously blended with pure cane juice rum. It is delectable as a sipping Rum and also has great versa�lity as a mixer in cocktails. TASTE PROFILE: Intensely aroma�c with hints of vanilla, toasted wood and caramel on the nose. It is creamy and smooth on the palate with prominent undertones of molasses, candied orange peel, almond and slight oak notes. It is medium-bodied with a complexity of ﬂavours and a lingering a�ertaste.
TASTE PROFILE: Honey Gold coloured with Pronounced notes of zesty tangerine and Cardamom ﬂavors come through like petrichor and fresh cut grass. Fresh Black Pepper, Nutmeg, Ginger & Cinnamon hit your tongue. It has a warming mouth feel with a complexity of aromas and ﬂavors that are beau�fully textured. Every Sip is intense, profoundly deligh�ul, more spicy than sweet and it transports your senses to Indian Paradise.
Raise a Toast to Asia’s only Spiced Rum, a journey into uncharted territory with rich ﬂavors of the Malabar coast - the ancient hub of spice trade. Exo�c spices are steam dis�lled and fused in Molasses dis�llates from Indian Sugar Cane resul�ng in an excep�onal Honey Gold colour Spiced Rum that is naturally ﬂavoured, intensely aroma�c and truly Rumtas�c! Wild Tiger India Spiced Rum includes exo�c Indian ﬂavors of Cardamom, Nutmeg, Cinnamon, Licorice, Black Pepper, Ginger, Cassia Bark, Orange Peel, Forest Honey and a secret Tea extract!
Avant-garde Packaging Every bo le is hand wrapped in velvet fabric by local Village women. And every bo le has its own dis�nc�ve stripe pa ern like every Tiger, this makes every bo le of Wild Tiger a unique collec�ble, a great gi�ing op�on and a souvenir. The imita�on claw adds edge to the overall packaging and doubles up as a worthy Gi� with Purchase.
Giving Back! The brand donates 10% of proﬁts towards Tiger Conserva�on in South India via Wild Tiger Founda�on and also strives to create equal opportuni�es and foster women's empowerment in the state of Kerala.
DUTY FREE & TRAVEL RETAIL
NEW VENUE HYATT REGENCY ORLANDO
SUMMIT OF THE
AMERICAS A PLACE TO DO BUSINESS WITHOUT ALL THE USUAL DISRUPTION A TIME TO DIALOGUE DIRECTLY WITH EACH OTHER A WAY TO LEARN ABOUT SHARED PROBLEMS & SUCCESSES ASUTIL & IAADFS A gathering of people who care deeply about Duty Free & Travel Retail
www.2019summitoftheamericas.org March 24â&#x20AC;&#x201C;27, 2019 Hyatt Regency Orlando Orlando, Florida, USA
calls on whisky aficionados Anthon Berg has taken note of Scotch whisky’s appeal and incorporated the spirit into several distinctive confectionery product launches by JAS RYAT
he popularity of single malt Scotch whisky, combined with Anthon Berg’s high quality chocolates, is taking the liqueur-filled chocolate category to a whole new level. Danish chocolatier Anthon Berg will present this new style of liqueur-filled chocolates, the Single Malt Scotch Collection, at the TFWA World Exhibition in Cannes. In this collection, Anthon Berg has teamed up with five renowned single malt Scotch whisky brands and created a unique tasting experience. The Single Malt Scotch Collection is targeted at the general connoisseur and the whisky aficionado alike. The brand plans to take consumers on a food-pairing journey by combining 50% premium dark chocolate with five diverse whiskies, ranging from the smooth and naturally rich and pleasurably warming, through the massively peat-smoky and dry. The five selected whiskies are spread out widely on the flavor map, but are all distilled, matured and bottled in Scotland. “By launching the Single Malt Scotch Collection, we are speaking directly to the consumer who wants not only a highquality product, but is seeking to engage in a unique product experience. By adding a high-profile branded whisky concept to the international scene, our product range is even more in line with the market trends, which drive sales,” explains André Haunsø Kampmann, Senior Brand Manager, Anthon Berg International. New Marzipan Bar - Single Malt Whisky is a combination of a traditional favorite combined with a unique twist
62 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
People drive organic growth - discuss. EARLY BIRD RATE
10 % DISCOUNT
CONFERENCE & AWARDS 6/7th December 2018 Radisson Blu Edwardian Hotel London Heathrow ‘Our People Matter’ conference will challenge, highlight and discuss how we can empower our industry’s front & back of house heroes to be the people we need them to be.
TS TICKE E L ON SA NOW
OFFICIAL MEDIA PARTNERS
For a full list of awards, award entries details, programme and sponsorship opportunities, please visit our website www.ispyacademy.com or contact Christine Martin: Email email@example.com Tel +44 7811372891
Diving into the whisky trend
Whisky, a spirit with the biggest sales by value globally, is currently experiencing a global upsurge in popularity. Anthon Berg has chosen only single malts, appealing to aficionados even more by presenting only Scotch brands in the box. The masculine, smoky-grey box, combined with the hot foil gold writing and décor, accentuate the product and draw attention to the window at the front of the box, revealing the five different gold foilwrapped chocolate bottles with miniature original whisky brand labels on the front. A subtle map of Scotland is shown on the inside of the box lid to unveil the concept of the tasting tour to the consumer. The product is relevant for gifting, sharing and self-consumption. Says Peter Dige, Travel Retail Director: “Our liqueur-filled chocolate bottles are driving sales better than ever in travel retail, and the forecasts show no sign of that curve breaking. With every line extension and new product within the category, sales have settled on top of
existing sales. Also, with this new launch, we expect to see a rising sales curve, as travel retail figures on single malt whisky speak for themselves when it comes to the demand for these particular products.” The tasting tour takes consumers on a journey through Scotland, presenting all the flavors the country has to offer: Singleton – Single Malt Scotch Whisky Dufftown 12yo (40%abv); Dalwhinnie Highland Single Malt Scotch Whisky 15yo (43%abv); Oban Little Bay of Caves 14yo (43%abv); Talisker 10yo (45.8%abv); and Lagavulin Islay Single Malt Scotch Whisky 16yo (43%abv).
Aside from the liqueur-filled chocolate bottles, the Marzipan Bar is one of the most successful offerings from Anthon Berg and leads in the confectionery category in the Nordic region. Consisting of premium marzipan coated in thick, smooth dark chocolate, three versions are currently available in travel retail: Original, Nougat and Cognac. Now, Anthon
Anthon Berg’s new Single Malt Collection comes in a smoky-grey box that emphasizes the luxurious liqueur-filled chocolate inside
64 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Berg is introducing the Marzipan Bar Single Malt Whisky. “With the Marzipan Bar Single Malt Whisky we combine two favorites from the far North – the Nordic marzipan and the Scottish icon single malt whisky. This delight fits right into the existing line of Marzipan Bars and stands out with clear communication in Highland tartan foil,” says Haunsø Kampmann. The Marzipan Bars are individually wrapped in colorful metallic foils and packaged in premium and slender standup sleeves, each containing seven bars. The brightly colored bands on the sleeves display the product with food appeal. They were developed to stand out on-shelf and communicate the contents clearly. Again, the product is ideal for gifting, sharing and/or self-indulgence. “Our Marzipan Bar product line is a bestseller in our Nordic home region, and as the Nordic food trend has spread to a worldwide phenomenon, we see the popularity of our marzipan products growing outside the Nordic markets. We expect the Marzipan Bar – Single Malt Whisky to do the job and knock on the doors of other regions, where the product is not yet listed,” enthuses Dige. The new product portfolio will be exhibited at Cannes and has an official launch date of March 2019.
DISCOUNTED STAND PACKAGES FOR NEW EXHIBITORS
Exhibit at the leading global event for travel catering, onboard retail and passenger comfort Donâ&#x20AC;&#x2122;t miss the opportunity to showcase your products to over 800 airline & rail operator buyers, generate sales leads, increase brand awareness and network with 4,000 onboard professionals.
Book your stand today Call Amy Francis +44 (0)20 8910 7805 worldtravelcateringexpo.com/contact-us Co-Located with:
Revitalizing the family jewels Grant’s new line-up includes two Triple Wood blended Scotch whiskies and three Cask Edition expressions
Grant’s ushers in an exciting new era with its renamed Triple Wood signature blend, a global brand refresh and upgrades exclusively for travel retail by MARY JANE PITTILLA
rant’s, the world’s number three Scotch whisky, has announced a global brand refresh that includes striking new packaging with a renaming of its signature blend to Triple Wood and a refined Cask Edition range. The relaunch also includes upgraded packaging for the Distillery Edition, its global travel retail exclusive, which will be presented – together with the complete Grant’s family – at the TFWA World Exhibition this October (Golden Village GO2). Philip Gladman, Grant’s Chief Marketing Officer, spells out the brand’s goals: “While other blended whiskies are declining, Grant’s continues to go from strength to strength, leapfrogging others to become the world’s number three Scotch whisky. As the whisky that holds the family name, we have big ambitions to be the most distinctive player in Scotch whisky and are proud to celebrate our Triple Wood maturation, the key to our exceptional taste, with a new global brand refresh.” In travel retail, the Grant’s brand carries an important role, as William Grant
66 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
& Sons Managing Director Ed Cottrell explains: “Since blended Scotch whisky represents 58% of total global travel retail whisky value sales, Grant’s has always been a crucial brand within the William Grant & Sons portfolio, selling well in Europe, the Middle East and India in particular,” he says. “According to IWSR, in 2017 the global travel retail blended Scotch market grew by 2.3% in value, while the Grant’s brand grew 5.8%, and we are expecting to further accelerate that growth this year and next.”
Exciting program of activations
The use of wood plays an important role in the creation of Grant’s. The Triple Wood liquid is rested in three types of cask: virgin oak, which provides spicy robustness; American oak, lending subtle vanilla smoothness; and refill bourbon, bringing brown sugar sweetness. Also using the Triple Wood process, Grant’s Triple Wood Smoky is matured in three types of casks, with the addition of peated whiskies in the blend, resulting in a smooth, smoky taste.
Meanwhile, Grant’s Distillery Edition is a global travel retail exclusive blended whisky honoring those that have worked at the Grant’s Girvan distillery in Scotland. The packaging for this 46.3%abv non-chill filtered expression has been upgraded with a more premium gift carton that mentions the travel-exclusive nature of this product. Additionally, the company has simplified its Cask Edition range. For these products, Grant’s Master Blender Brian Kinsman pairs Grant’s traditional whisky blends with unusual flavor profiles. The three blended Scotch whiskies are finished in a carefully selected final cask for greater depth of flavor. Grant’s Ale Cask is described as the first blended Scotch to be finished in barrels that have previously held ale; Grant’s Rum Cask Edition is aged in rum barrels; and Grant’s 8 Year Old Sherry Cask Finish matures in Spanish oloroso sherry casks. Adds Ed Cottrell: “All of us in the William Grant & Sons global travel retail team are really excited about the new-look Grant’s family and, in particular, the upgraded Distillery Edition, which looks fabulous. In global travel retail it’s about more than the product, of course, and we’ve got a great visibility and tasting program in place to support the new look – 2019 is going to be a big year for Grant’s.”
SUBSCRIBE TO ASIA DUTY FREE MAGAZINE
ONE YEAR – 4 ISSUE AND 12 ENEWSLETTERS
Subscribe to Asia Duty Free & Travel Retailing Magazine and its monthly eNewsletter to keep you informed of the latest news. Simply fill out and return this subscription card to the following address, or fax with your credit card details to +1 905-821-2777
TWO YEARS – 8 ISSUES AND 24 ENEWSLETTERS
Please fill out this form and fax to 1-905-821-2777 or email to firstname.lastname@example.org
Asia Duty Free & Travel Retailing magazine 26 Pearl Street, Mississauga, ON Canada L5M 1X2 Tel: 1-905-821-3344 Fax: 1-905-821-2777 email: email@example.com
) area code
) area code
SIGN ME UP! I would like to receive a subscription to magazine ❑ One Year US$200.00 ❑ Two Year US$400.00
Enclosed is a cheque or money order made payable to Global Marketing Company Ltd.
credit card number
date Payment in U.S. funds must accompany this s ubscription card.
Kremlin Award Vodka
Kremlin Award’s quality speaks for itself Kremlin Award vodka returns to the TFWA World Exhibition to further its growth in travel retail by JAS RYAT
riven by strong domestic success, Kremlin Award vodka is beginning to grasp the reins in global travel retail. The Russian brand recently expanded into the US, Turkmenistan, Australia and India, and will soon be available in Latin American countries such as Honduras, Ecuador and Paraguay. This global awareness has led to slow but stable growth in the channel. Of the four vodkas available in travel retail – Kremlin Award Premium, Classic, Vintage and Organic – Kremlin Award Premium leads sales. It also happens to be the oldest and most established vodka in the portfolio. However, Artur Ghazaryan, General Director at Kremlin Award Vodka, says the company has high hopes for Kremlin Award Organic. “In the future we have good expectations from Kremlin Award Organic, since this category is becoming trendier now.” Kremlin Award Organic vodka is made from ecologically pure products: natural drinking water and alcohol produced from organically grown wheat grain from an ecologically clean area of Russia.
Ecologically pure grain
Meanwhile, Kremlin Award Vintage vodka is crafted from ecologically pure grain products of the same year’s harvest. The alcohol is made from a valuable variety of wheat of the highest quality in the selected year. In order to obtain a highquality alcohol, the wheat grains of the given year’s harvest are stored in the grain silo for a year until maturity is achieved. The alcohol made of these wheat grains is mixed with natural drinking water and passes through a multi-stage cleaning process via ecologically pure birch charcoal with a following mandatory rest and extraction. Ghazaryan notes that the brand is facing some challenges like the amount of liters travelers can bring into their different countries. Also, due to the high margins at certain airports, travel retail prices are not always reflective of the lower prices offered in the local market. At this time, travel retail represents 24% of Kremlin Award Vodka’s overseas sales. Russia continues to be its strongest market, or “mother market”, as Ghazaryan puts it. This is followed by the US, Kazakhstan, Armenia, and Azerbaijan. *Kremlin Award Vodka will be exhibiting at the 2018 TFWA World Exhibition in October (Stand number: Green Village H58).
68 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
Kremlin Award Organic vodka is being highlighted as it is made from pure products that are produced with organic ingredients in an ecologically clear are of Russia
Speciality vodka, Kremlin Award Vintage, is crafted using high quality ingredients to give a high quality spirit
Riding the cocktail wave Liqueur brand Marie Brizard sees big opportunities for growth in Asia as it taps into the cocktail trend and tackles changing consumer tastes by MARY JANE PITTILLA
Yuzu, bergamot, and cumbava are new flavors launched recently for consumers, who are looking for originality
China, Japan, Taiwan and Australia are major markets for Marie Brizard’s premium liqueur range
iqueur recipes have come back to the forefront thanks to the cocktail explosion. That’s the view of Stanislas de Parcevaux, Group Chief Marketing and Digital Officer, Marie Brizard Wine & Spirits. Today, he says, bartenders are interested in ancestral recipes made with plants, spices, roots, or seeds. Marie Brizard’s liqueurs fit the bill, as the recipes have been unchanged for more than 260 years. In order to respond to the high standard bartenders demand, the liqueur industry has become more premium. Marie Brizard liqueurs are made from more than 400 ingredients that are carefully selected for their unusual and aromatic qualities: citrus peels from Mediterranean basin, coffee from Columbia, coriander from Morocco, etc. Innovation is important to the liqueurs category, according to de Parcevaux. “If the liqueurs category wants to stay in tune with consumers’ expectations, the category has to reinvent itself and regularly propose new concepts, as other more expanded categories have done before – flavored vodkas, spiced Caribbean rum, for example.” Consumers are seeking originality, he continues. “At Marie Brizard, we spend a lot of time and energy looking for new flavors around the world; to always surprise our customers and consumers. Yuzu, bergamot, and cumbava are new flavors launched recently that are suited to 70 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
bartenders’ needs as well as the consumers, who are looking for originality and quality.” De Parcevaux adds that consumers are always looking for new sensations, in terms of taste, textures, and rare fruits. He believes the association of unpredictable/unusual elements could be the next important trend, citing spice and coffee; herbs and citrus; and fruits and coffee. But he says it is mandatory for every future development to be as natural as possible with a low ABV level. For historic reasons, Marie Brizard liqueurs are very strong in France and Spain: 70% of its business comes from these two markets. De Parcevaux says the company has big growth opportunities, especially in the US, the largest cocktail market. Business there has been steadily growing for two years. Asia is key in the future development of the brand, he continues. China, Japan, Taiwan and Australia are major markets for Marie Brizard. “Making bartenders aware of our comprehensive flavor gallery, adapted to their needs, is certainly the most important challenge,” he acknowledges. The consumer trend for healthy food and drink is having an impact on the liqueur category, reveals de Parcevaux. “There’s a switch in consumption as there’s an increasing demand for low-sugar and natural ingredients. This concerns the
entire food & beverage industry, but it has recently caught up with spirits and, more particularly, liqueurs. This is challenging for liqueurs because of their usually high sugar content. But it is nothing new to Marie Brizard; the brand’s founder was creating her eponymous liqueurs as long ago as 1755, in an age where artificial flavors had not been invented.” To address this issue, Marie Brizard continually reviews and refines its recipes, ensuring the highest quality ingredients are sourced and the best quality liqueurs are produced. This also forms part of the company’s product innovation program, in which the R&D team creates new flavors. Summing up, de Parcevaux is clear about what must be the center of the industry’s future development: attention to ingredient origins, qualitative distillation, low ABV products, and reduction of sugar.
advertisement removed for legal reasons
Royal Dragon Vodka
Dragon Luck of the
by JAS RYAT
Royal Dragon Vodka is giving buyers the royal treatment at this year’s TFWA World Exhibition
oyal Dragon Vodka is making its regal return for the third consecutive year to the TFWA World Exhibition with a new, sophisticated booth design (Stand number: Red Village M35). The luxury vodka brand will showcase its award-winning range in four collections with two price points in the premium and ultra-premium categories. The brand continues to stand out from other vodkas as a true ultra-premium brand, according to Royal Dragon Founder and President Michel Morren. “We can confidently say there is no other product that compares to us in the white spirits category,” he says. “We wow our consumers with luxury packaging and a high quality product while still at an accessible price point for the ultrapremium category. The demand for our products has shown consumers today are after a unique drinking experience — they are looking for authenticity while wanting to drink better.” Singapore-based Yam Seng Pte Ltd, a company owned by the Tuli family, Royal Dragon Vodka displays its luxuriously intricate bottle
72 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
The luxury brand
has established is the appointed agent for the a presence in vodka brand in selected key over 30 countries, continuing to evoke duty-free markets. “We quickly international appeal recognized Sunil Tuli’s extensive experience, knowledge and connections in the duty free industry after appointing his company Yam Seng Pte Ltd as our agent for duty free and thus appointed him to the Board of Directors of Dragon Spirits Limited, the owners of Royal Dragon Vodka, on January 1st 2018,” shares Morren. Royal treatment Offering products both in the premium Gaining momentum and ultra-premium category expands Royal Dragon Vodka has continued Royal Dragon Vodka’s consumer reach its progressive success in global travel and allows the brand to target a larger retail this year. The vodka picked up audience compared to traditional vodka two Frontier Awards at the TFWA brands. “We appeal to international World Exhibition in Cannes last year travelers looking to celebrate in style. We for Star Product Under US$100 and Best appeal to Asians as gold and the dragon Global Travel Retail Packaging of the symbolizes power and strength in many Year. Says Morren: “We tapped on that cultures. Millennials purchase our bottles momentum and gained many listings in as they tend to be discerning in their buya short span of time. Due to this expoing habits and are willing to spend money nential growth, we had some difficulties on better quality alcoholic drinks,” reveals keeping up with production and, as a Morren. result, experienced delays. We have since During July alone, Royal Dragon solved these issues and are ready for the Vodka was listed in Sri Lanka, Cambodia next phase of growth.” and most recently in Dubai. Still considered a young brand in travel The brand continues to grow despite retail, Royal Dragon Vodka has developed the highly competitive nature of the a presence in nearly 30 countries in the vodka category, reinforcing that today’s past four years. It is showing a strong buyers are looking for quality over quanperformance across the regions with tity. particular success in Hong Kong. The The Good Luck edition was released brand attributes the success at Hong Kong last year as travel retail exclusive from the International Airport to a diverse passenImperial collection and while the brand ger profile that includes a high percentage is aware it needs to innovate, it also has of luxury shoppers. a strong desire to stay true to the brand The next focus will be to expand and heritage and only do so when the time elevate brand awareness in the US, China, is right. In the meantime, Royal Dragon Russia and Indian markets, while staying Vodka’s customized collection allows for focused on increasing penetration and small release of limited-edition bottles to visibility in existing markets. offer newness in the vodka category.
La Martiniquaise to focus on travel retail
La Martiniquaise manufactures Porto Cruz, the world’s number one port, which can be found in Air France duty free
Brands listed in European travel retail include St James rum
Independent French spirits group, La Martiniquaise plans to introduce travel retail exclusives over the next year
by REBECCA BYRNE
ne of the top ten spirits companies globally, the La Martiniquaise Group has had great success in the domestic market. On the travel retail side, it has a strong presence in travel retail in Europe through Aelia Duty Free. In Asia, it is available in airports and border shops in Malaysia where its renowned Label 5 whisky brand is a best seller in Kuala Lumpur airport, supported by tastings, activities and displays. This brand is also popular in the Middle East where it is listed in some airports. Nadège Perrot, International Senior Brand Manager La Martiniquaise, comments that the marketing strategy for Label 5 has changed to focus more on a younger target, with an audience predominately 25 to 35 year olds. “We now promote the power of 5,” she says. “We want to celebrate group power and diversity by focusing on the core value of the brand which is group power and conviviality.”
LABEL 5 is launching a bold new activation this summer, bringing together five leading street artists from key cities around the globe, to create a series of unique urban graffiti themed around the number 5. The 2018 ‘Power of 5’ street art world tour brings to life the LABEL 5 key values of openness, energy and diversity, and will be unveiled internationally across the brand’s digital platforms and during several local events and urban workshops. Other brands listed in European travel retail include Poliakov vodka and St James rum. Perrot points out that unlike 95% of rums, which are made from molasses, Saint Agricole LabelJames 5 whisky brand is aRum best is made from sellersugar in Kuala Lumpur airport fresh can juice, giving it an aromatic quality. Label 5 and Porto Cruz, the world’s number one port, are also found in Air France duty free. Perrot admits that travel retail is still a small part of La Martiniquaise’s overall business, but it is looking to build on this presence by launching travel retail exclusives over the next year. This will start in
Europe where it has regional subsidiaries but then extend to the Middle East and Asia. Perrot is convinced that the brands have potential. Exclusives will focus on brands such as Label 5 and Porto Cruz. The challenge for La Martiniquaise according to Perrot is to boost notoriety of the group’s brands in the travel retail channel. “In France our brands are very famous, our Poliakov vodka is the leading brand in the country with more than 35% market share. However, internationally we need to work on our promotional activity to demonstrate our credibility.” The strength of the group is that it controls everything from production to the bottling of most of its brands. In 2017 the turnover reached one billion Euros for the first time and the company is getting more internationally each year with a third of its business outside of France. Furthermore its range of spirit categories is impressive making it a one stop shop. Perrot believes there are many opportunities for La Martiniquaise brands in travel retail. With the company’s dominant brands, experience and distribution networks, she believes it is able to provide high quality yet accessible products targeted at the ever increasing number of middle class travellers.
www.dutyfreemagazine.ca ASIA DUTY FREE & TRAVEL RETAILING
launches NUB J. Cortes is introducing a special edition of its premium handmade NUB range directly for travel retailers
In 2016 Belgian cigar specialist J. Cortes acquired artisanal Oliva Cigars, a company renowned for its handmade cigars
his acquisition has opened up a realm of possibilities in the travel retail market and following on from success in the domestic market, J. Cortes is introducing a special edition of its premium handmade NUB range directly for travel retailers. The exclusive box comes with four wrappers of short cigars, Maduro, Connecticut, Cameroon
J Cortes has been a family run company for over 90 years
74 ASIA DUTY FREE & TRAVEL RETAILING OCTOBER 2018
by REBECCA BYRNE
and Sun Grown. Hand rolled in its Nicaragua factory, the cigars are made from extremely dense tobacco and take up to an hour to smoke. Thomas Gryson, Travel Retail Co-Coordinator, J. Cortes & Oliva Cigars comments: “We are very proud to have Oliva and Nub in our portfolio and we believe that these premium handmade cigars are the future for tobacco in travel retail. Travelers are looking for real luxury products and limited editions.” With this innovative product, J. Cortes is looking to broaden the appeal of cigars in the duty free market. “We are targeting a younger audience in the age range of 25-35 and over looking for a premium cigar,” says Gryson. Due to restrictions on promotional activity, Gryson says it is vital to have a strong brand, a good price and attractive packaging. The price of the NUB box is around 45-50 euros and will be sold worldwide. Gryson adds that the Oliva products are extremely popular in the USA where the Nub brand is sold in boxes of 12. It has been a social media success after consumers have posted photos of a fully smoked NUB cigar standing on its end, possible due to the denseness of the tobacco. “NUB, with its appealing and prestigious vibe, will reinvent the market,” says Gryson. As cigar sales are affected by the strict regulations for cigarettes and tobacco
the challenge is to find different channels to promote products. Digital and social media play a big part in the cigar travel retail market today, but communication or advertising with digital and social media is also restricted, similar to the traditional channels. Gryson adds: “Going viral with brands has to come from the consumer itself and is very difficult to influence, as sponsored posts are not legal.” To encourage consumer participation, J. Cortes introduced a virtual reality experience following acquisition of Olivia Cigars. This proved extremely popular and the company is in talks with retailers to look at further opportunities to provide this unique VR-experience at airports. J. Cortes has been a family run company for over 90 years. In 2017, it had a 100 million (US$116 million) turnover and produced 500 million cigars. With the addition of Oliva, by the end of this year the company will be producing an extra 20 million handmade cigars. Gryson concludes: “We have invested after the acquisition. A new state-of-the-art box factory, new rolling tables and chairs, better accommodation for the tobacco in fermentation, extra investment in tobacco. On top of that, we use now our international network to let Oliva/Nub grow much faster internationally. We can truly call ourselves a global cigar player.”
advertisement removed for legal reasons