The Latin America Report News and views on the airport, airline and travel retail sectors in the region www.thelatinamericareport.com
March 2017
ASUTIL announces buyers, speakers for upcoming conference in Rio de Janeiro Also in this issue: • Argentina plans airport makeovers • Furla wave rolls to South America • Heineken to focus on border stores • More Brazilian airports could privatize
Airports/Airlines
Argentina plans airport makeovers Argentina has announced plans which they hope will double the amount of tourists coming to the country. President Mauricio Macri recently announced a new commercial plan that gives more options for flying. The government will improve the infrastructure of the sector with the modernization of 19 airports over the next few years at a cost of approximately US $1.5 billion. As well, approval has been granted to budget carrier FlyBondi to commence operation. Macri said the commercial plan will be a great driver of tourism and create 25,000 jobs throughout the country. The plan calls for the opening of 135 routes, including 58 international and 77 domestic. The government will also reinstitute the ability for foreigners to claim VAT at the airports. This year national carrier Aerolíneas Argentinas plans to purchase eight new aircraft, expand routes to Chile, Brazil and Uruguay and increase flights to Europe by 20 percent with new routes to Barcelona and Rome.
Chinchero airport construction begins Construction on the new Cusco-based Chinchero Airport in Peru has commenced. The new international airport will replace the Andean region’s Velasco Astetewhich currently serves 2.5 million passengers each year. The new airport will have the capacity to serve 7.5 million passengers every year. The 40-year concession was awarded to the Kuntur Wasi consortium (Corporación América S.A. and Andino Investment Holding S.A.)
- Page 2 -
s tion a l u rat g n co r u O
al es
u N
es tra sF eli cita cio nes
i rc e m co s xito e e ad a As n e l l util po s r una jornada de 20 aĂąo
ney Ûlled with commerc -year jour ial suc 0 2 a cess or f l i t su A to
- Page 3 -
Airport/Airlines
Bogota airport expands Expansion at Bogota’s El Dorado international airport is underway. Among the plans is an expansion of the terminal, which will allow for 40 million passengers a year by 2021. Last year the airport handled 31 million passengers. DFASS and Dufry won a joint-venture 10-year contract at the airport recently to operate more than 2,000 square metres of retail space.
More Brazilian airports could privatize Brazil is considering launching tenders for the operation of three more airports, according to local Brazilian media. Last week, the government auctioned the operation of four airports in the country. It’s now being reported, studies are underway to also privatize the operation of airports in Goiânia, Recife, and Vitória. Recently Moody’s Investors Service changed the outlook on Brazil’s financial rating to stable from negative, based on signs the country’s economy is showing signs of recovery, inflation is falling and the fiscal outlook is clearer.
Routes event comes to Quito Quito has been chosen to host Routes Americas 2018. The event is expected to attract approximately 800 representatives from 80 airlines, 300 airports and 50 tourism boards for pre-established meetings. The recent Routes Americas 2017 in Las Vegas, Nevada, saw a spike in attendance of more than 800 attendees, an 80% increase since 2015. Quito’s main objective is to continue expanding the city’s connectivity through meetings with airlines as they seek to open new routes to the Ecuadorian capital as well as expand existing routes. In 2013, the city opened a new state-of-the-art international airport, which has experienced an increase in passengers every year. The airport currently serves 14 airlines and has almost 136 daily domestic and international flights to 27 different destinations. - Page 4 -
- Page 5 -
News
Buyers, speakers confirmed for ASUTIL conference The 21st ASUTIL conference in Rio de Janeiro is gearing up its speaker line up. The conference, June 6-9, offers a combination of both speaker presentations and networking time between buyers and suppliers. As of the end of March, ASUTIL Secretary General José Luis Donagaray says registration is up 10% over the same time last year. Dufry has confirmed more than 15 buyers will attend the conference. As well buyers from Bright Star, London Supply, Neutral, LX Group, Provimex, Siñeriz and Zeinal Hnos will be present. ASUTIL has also confirmed the following speakers.
Paco Heredia
Francisco “Paco” Heredia, Manager of New Projects Development at London Supply and twice president of ASUTIL, will speak at the conference. Heredia’s presentation, “21 years of DeLorean” will draw a parallel between the film Back to the Future and the growth of the duty free industry. Heredia is known for his passionate and entertaining presentations.
Peter Mohn Peter Mohn, CEO of M1nd-set research, has presented his findings on studies commissioned by ASUTIL over the past four years. This year he will discuss a study on “Price Perception in the Travel Retail Channel versus the Domestic Market - a reality check”. The survey was conducted in five different countries. The two-month study will provide insight on this issue in the six Duty Free main categories: Beauty, Alcohol, Confectionery, Tobacco, Fashion & Accessories, Electronics.
Continued on Page 8 - Page 6 -
- Page 7 -
News
Gustavo Fagundes Gustavo Fagundes, COO of Dufry Brazil, the biggest operation of the group in America will present a business review of the current situation after the FIFA World Cup and the Olympic Games. New stores, new privatized airports and economic policy changes will surely show a new reality of customers and product mix in the stores.
Martín Eurnekian Recently, ACI LAC, the organization that represents more than 260 airports in the continent, appointed Martín Eurnekian as President for a two-year period. He is very well known in the Duty Free industry for his work as CEO in Interbaires, Argentina, and in Duty Free Uruguay. Eurnekian will share with Asutil participants valuable data and his vision of the future evolution of the airport business, including passengers and airlines. His presentation will focus on the most valued commercial revenues, such as duty free and the new reality of the average ticket. Brazil, based on a new middle class, has lead tourism in the region. Additionally, it has been the center of the growth of operations in the region. The conference will take place at the Hilton Barra Rio de Janeiro Hotel. Early bird deadline for registration is Thursday, April 6. Further information is available at http://conferencia2017.asutil.org/
- Page 8 -
- Page 9 -
News
Furla wave set to roll into South America By Wendy Gallagher Furla is opening stores in airports around the world faster than you can say handbag, And in the targets of their next surge of openings is South America, according to Global Travel Retail Director Gerry Munday. Announcing at the Cannes show last October that the accessories company had seen a sales growth of 38% year to date, Munday went on to discuss plans or 2017. “We have work to do in North and South America. We need to be stronger. This is my focus.” Munday added, “ASUTIL is a most important,” event for Furla to attend in 2017. Since joining Furla in 2011, Munday and her team have gone from 112 doors in travel retail, to 269 at the end of 2016. Last year, 22 new salespeople were added to her TR team. Overall, sales for Furla Group leaped 24.5% in 2016 with an expected turnover of €422. The Italian leather goods company celebrates its 90th year in business in 2017.
‘ASUTIL is a most important event for us’ --Gerry Munday, Furla
Furla celebrates its 90th year in business. - Page 10 -
- Page 11 -
News
Bombata brightens Brazil By Wendy Gallagher Italian bag maker Bombata is making inroads in the southern cone. Bombata representative Phil Peterson says the “fun and exciting” bags will soon be displayed in six Dufry Brasil locations at both Guarulhos and Galeão international airports. And while Peterson says there is growing interest for the bags in the region, getting a smaller-known brand onto duty free shelves remains a battle. Peterson says at some point the industry needs more shepherds who are willing to take a chance on new or lesser-known brands. “Retailers can’t just keep selling the same stuff, the same brands,” he says. “You can only keep the same brands on the shelves for so long.” He recalls joining Tumi in 1988, when it was a relatively unknown brand. “People thought I was nuts to join a company that was so new.
“How does a brand become a brand?” he asks rhetorically. “It’s a vicious cycle. I’m hoping Bombata can be a beacon for other less known brands.” He says the bright, colourful and functional laptop bags, which Dufry ordered, will be “very appealing to millennials. They like new brands.” And for Brazilians, it’s all about colour, he says. “Yellow and green will sell well...of course they are national flag colours.” Peterson says as he travelled through South America, “Everywhere I went people were asking me where I got the bag, so I took that as a good sign. He adds, the bags can be as much as an impulse buy as a Phil Peterson fun thing to have. Peterson says he is seeing improvement in retailers’ optimism, particularly as the Brazilian Real has started to climb. “Things are becoming stabilized. People are catching their breath,” he says. Peterson will be at the IAADFS show in Orlando. He can be reached at 1- 32-236-1001.
- Page 12 -
BREWLOCK™, a revolutionary new draught technology developed by HEINEKEN to bring draught beer at brewery quality to consumers at significantly reduced logistical and handling complexity.
REAKTHROUGH 100% disposable one way keg
ASE Weighs 25% less than steel kegs and has an Easyfit coupler which means any trained staff member can quickly change a keg
AVINGS No cost of returns, no cost of CO2 and no deposit on kegs resulting in cost savings
ASTE No CO2 or mixed gas added during pouring means a perfectly carbonated beer every time. BrewLock™ perfectly preserves the beer’s taste and aromas, providing an outstanding taste FOR MORE INFORMATION CONTACT: Cruises: Koos Vrijlandt koos.vrijlandt@heineken.com Ferries: Onno Huyghe onno.huyghe@heineken.com
Available for:
- Page 13 -
News
New Heineken manager to focus on border stores Heineken has appointed a new account manager for the region, with the aim of strengthening the brand in border stores. Enrique Santomé is the new Account Manager Duty Free Americas within Global Duty Free. Based in Monterrey, Mexico he will be commercially responsible for border retail channel in the Americas Region. Santomé comes from Grupo Bimbo SA where he held several international sales, trade-marketing and marketing positions. The focus for Heineken will be on border stores in South America and on the US/Canada borders. A strong growth year in 2016, Heineken attributes its success to
increased distribution of its BrewLock system and accompanying wider range including Heineken, Heineken Light, Newcastle Brown Ale and Strongbow Apple Ciders. “Inevitably there were challenges in some markets due to political and economic influences but we have a positive outlook for 2017, driven by the growth of International Premium Segment,” says the company. This year, Heineken will commence its new global sponsorship of F1 car racing, with dedicated packaging and/or consumer promotions in travel retail in our channels in the regions where F1 is major sport, such as Central America.
Travel Blue turns 30 Travel accessories brand Travel Blue is celebrating 30 years in business. The company will be at the IAADFS show in Orlando showcasing numerous products and their space-saving units. Avi Levin Managing Director of Travel Blue says: ’’30 years of hard work, drive and commitment from the Travel Blue team has been the main source of our success. We recognize and look after our customers and consumers, offering them solutions to all of their travel accessory product needs.’’ Travel Blue will be sharing the story of their 30-year history at the Orlando show. On hand will be Director of Travel of Retail,
Jonathan Smith and Andrea Rivas, Sales Manager for the Americas. Smith and Rivas will showcase neck pillows, worldwide travel adaptors, security and luggage accessories and a variety of travel bags and pouches. “Innovation is at the heart of the business and we continue to update our product range year on year,” says Smith. “It will be good to be back in Orlando. Over the years through the IAADFS show, we have established strong and successful business relationships in the Americas. This year celebrating our 30th year, we are looking forward to showcasing our new product range, creating new opportunities and meeting new retailers.’’ - Page 14 -
Andrea Rivas Sales Manager Americas
- Page 15 -
News
From left: Mariano Taratuty, Victor Hugo Bonnet and Teddy Taratuty.
New record for funds raised at London Supply golf tournament The London Supply Group raised more than US $809,000 during its annual charity golf tournament. The annual event was held at Club del Lago Golf in Punta del Este, Uruguay earlier this year. For 13 years, the Foundation has been organizing this event and all raised funds go to several charitable causes. This year, the money raised will be used to continue with the works already begun by the Foundation at the Elderly House San Ramon, in Puerto Iguazu, in order to improve its infrastructure and technology equipment, as well as to build a Rehab Center at Marta Schwartz Hospital, in Puerto Iguazu, where treatment, rehab, housing, and emotional support will be given to children and adolescents with different conditions, together with their families. The decision to build this First Comprehensive Rehab Center in this region comes from within the
spirit of the Foundation which is to contribute to the full exercise of disabled people’s rights, which were consecrated by the International Convention on Disabled People’s Rights and which have been recently introduced to the Argentine National Magna Charta.
Annual event supports education, assistance for less fortunate in Puerto Iguazu Says London Supply President Teddy Taratuty, “Thanks to the sports spirit and solidarity shown by all players, as well as the support by the sponsors who support the Foundation year after year, the London - Page 16-
Supply Group Foundation was able to collect the epic record amount of US $809,276, which no doubt was above all expectations. This new donation will allow us to continue providing equal opportunities, which is the main goal of the Foundation, and keep on going one step further with solidarity endeavors.” Over the years, the golf tournament has raised funds to help residents in the city of Puerto Iguazu, where London Supply operates one of its stores. Funded projects include construction of Madre Teresa de Calcuta Nursery and Kindergarten in the Neighborhood 1º de Mayo, one of the poorest complexes in the city of Puerto Iguazu, Misiones. This institution provides education for more than 1,200 children. The London Supply Group Foundation was created in 2008 and serves under the motto: “Give More where there is Less”
BUILD AND STRENGTHEN YOUR BUSINESS CONNECTIONS AND DISCOVER
THE BEST OF THE AMERICAS!
OF THE
SHOW
AMERICAS
March 26–29, 2017 | Orlando World Center Marriott | Orlando, Florida, USA
Learn more and register at www.iaadfs.org/DutyFreeShow - Page 17 -
News
Ride a bike, slice a cucumber William Grant and Sons interactive booth at Orlando show
William Grant & Sons never fails at coming up with an interactive booth while at the Duty Free Show of the Americas. This year it will present its portfolio within a booth designed to give existing and potential buyers the same engaging experience as it does travelling consumers. In celebration of the upcoming World Cucumber Day on June 14, William Grant will be bringing back the quirky ‘Master Serve ‘O’ Matic’ bicycle, which delivers the perfect slice of cucumber to accompany a ‘Hendrick’s & Tonic.’ The bicycle unit, along with floor and wall graphics, is designed to bring the Hendrick’s brand to life in a fun and innovative way. The main highlight will be the newly refreshed packaging for the Glenfiddich Cask Collection, which remains exclusive to global travel retail. “We were very encouraged by the response in Cannes and are confident of a similar response from the Americas, where Glenfiddich is a core
brand for us both North and South,” says Ed Cottrell, Managing Director GTR. For the Select and Reserve Cask, shades of blue were chosen to reflect a step up between the two and encourages consumers to trade up, repeated on the labels and foil caps, while the Vintage Cask features copper colouring. The Glenfiddich Cask Collection will have a separate dedicated feature area on the William Grant booth, where visitors to the show can engage directly with the range, sampling each of the expressions and learn more about the brand concept. The main booth sees a focus on Drambuie, Hendrick’s and Monkey Shoulder. Drambuie Scotch Liqueur was given a makeover at the end of 2016 with new packaging inspired by the brand’s 270 year history. With its own feature wall at the Duty Free Show of the Americas, Drambuie is seen as a hidden gem in the WGS portfolio, with tremendous potential given the current classic cocktail resurgence. The back wall of the stand is devoted to Monkey Shoulder, which continues to perform extremely well in the Americas. Its positioning of “100% Made for Mixing” supports its versatility as a premium Blended Malt whisky that can be enjoyed on its own or in cocktails. Visitors can enjoy some of the classic Monkey Shoulder cocktails from the bar area, along with other drinks from the wide portfolio. Says Richard Bush, Regional Marketing Manager: “2016 was a challenging year in the Americas due to a number of factors, including the strong US dollar and devalued local currencies, the severe economic downturn in South America and the ongoing political crisis in Brazil. In spite of these obstacles, we were able to hit and even exceed our sales targets and ended up well ahead of 2015. While we are still facing a lot of the same headwinds and it’s sure to be another challenging year, we remain optimistic and motivated at the start of 2017.”
Although WGS describes 2016 as “challenging” the company says it is optimistic about 2017.
- Page 18 -
Products Go Travel Go Travel introduces a new compact Digital Luggage Scale at the Orlando show. The scale can measure up to 88 lbs. and features a high-precision sensor and a large and bright, backlit display. When travelling between different countries, the scale can toggle between gram, ounce, kilogram and pound measurements. Go Travel has also added cabin approved Squeeze It Trio bottles into its range of travel toiletry solutions. Designed to meet all airport liquid regulations, the pack features three easy-fill silicone bottles.
Cabeau Cabeau’s latest innovations in its extended product line are inspired by customers who have shared what they like, what works and what would further enhance their travels. Cabeau introduces a range of new Luggage Straps, Luggage Tags and Luggage Locks at the upcoming IAADFS show in Orlando. “It’s always exciting to unveil our latest innovations to retailers and media at such a prominent trade show,” said David Sternlight, Founder and CEO of Cabeau. “The latest additions to our collection support our dedication to providing premium travel products and accessories that are innovative and high-quality.”
Scorpio Scorpio has partnered with Just Cavalli. The fashion brand is dedicated to a new generation of free spirits, with the youth aimed line combining flamboyance and glamour. Stuart McGuire, Chairman, Scorpio Worldwide, comments, “Working with any new brand is an exciting time for the Scorpio team, but being able to partner with a fashion brand such as ‘Just Cavalli’ is testament to the hard work and experience we bring as an inflight specialist. This new collection is ideal for those who love fashionable, statement watches at competitive price points.” - Page 19 -
Products Fraternity Spirits With the demand for premium and ultra-premium products on the rise, Fraternity Spirits will exhibit at the Orlando show a portfolio of products to suit even those with the highest of tastes. Focusing on its renowned Tequila Corralejo and El Ron Prohibido lines, Fraternity is aiming to expand its distribution in the Americas region with new additions to each portfolio. Those include Corralejo Extra Añejo 1821 and Ron Prohibido 12 and 15 (Gran Reserva).
Stoli Group Stoli Group returns to the Duty Free Show of the Americas with an expanded portfolio. Bayou Rum, which has carved its niche in the cruise channel and will be launching in airports very soon, is a handcrafted, pot distilled American rum produced from fresh Louisiana sugarcane for an award-winning flavour. Also new is KAH tequila, which was designed to pay reverence and honour to Mexico and its people. Its bottle and spirit are reflective of the Day of the Dead. KAH, which translates to “life” in the ancient Mayan language, is produced by Fabrica de Tequilas Finos in Tequila, Jalisco, Mexico. Stoli Group says it’s cautiously optimistic that certain regions within Latin America will recover from challenges caused by currency fluctuations and the current geo-political environment.
Marie Brizard Marie Brizard returns to Orlando for this year’s Duty Free Show of the Americas with refreshed packaging and award-winning products. The new revived look for the Marie Brizard liqueurs range will be on display. Marie Brizard liqueurs are riding high on the wave of the cocktail trend and the MBWS team is looking forward to sharing their Travel Retail activation plans with customers. Multiple award-winning Gautier range, which was recently recognised as the best cognac in the world for the second year in a row will be displayed. Another medal winner, Sobieski, 100% pure rye Polish vodka will be on display at the show.
- Page 20 -
Products Tito’s Following the success of Tito’s Handmade Vodka in U.S. duty free shops, Tito’s International is taking steps to expand its footprint in the Americas. The company will focus on South America, particularly Chile and Argentina to grow the craft spirits category and cater to consumers who are looking for quality brands with authenticity. During the Orlando show, Tito’s International will share its American Dream story with customers encouraging them to recognize the buying power of millennials and the importance of craft spirits, particularly vodka, which is the second-largest spirits category in the duty free channel. Managing director of Tito’s International, John McDonnell says: “With the rise of craft and the increasing appetite of millennials for products with a great back-story, operators should capitalize further on the category. Craft spirits are one the biggest purchasing blocks in the world right now and as a pioneer of the movement, we recognize the strength of this trend and believe that if operators display craft products together, they will attract more shoppers in store and increase sales across the board.”
Revlon Revlon and Elizabeth Arden will be celebrating being One in Beauty during the Duty Free Show of the Americas. Revlon will unveil a revamped line up of their best-selling Revlon Super Lustrous Lipstick travel exclusive sets.
Elizabeth Arden Elizabeth Arden will introduce a new wave of Travel Retail exclusives at the Orlando show. The company embarked on the repositioning of its Travel Retail Collection in 2016 with the launch of a whole new look for the collection of sets. The introduction of a recognizable travel retail exclusive insignia and the new consistent packaging design is aimed to help grow Elizabeth Arden’s brand awareness and affinity amongst global shoppers, says the company. Elizabeth Arden upgraded their iconic Ceramide Youth Restoring Face Serum for the first time in decades. The set will comprise of the same top-selling 3 x 30 capsule design but will be enhanced with the new and improved formula and updated packaging. - Page 21 -
Products TRS TRS has been appointed to represent new brands in Travel Retail. Two new cosmetic brands, The Konjac Sponge Company and Dr. PAWPAW have been added to the line up. The Konjac Sponge Company offers facial and body sponges. Two Travel Retail Exclusive Duo Packs plus a Mini Facial Sponge are available. Dr. PAWPAW’s Multipurpose Soothing Balm provides relief for dry irritated skin, moisturises lips, nails and cuticles, and dry cracked skin on hands, heels and elbows. Co-Founder Johnny Paterson comments, “Whilst Dr. PAWPAW is only three years old, we have been delighted with the reception the brand has received and the love people already have for our hero balms. We have been inundated with requests and a real demand for more and more products, which has been incredible. Now we are sold in 14 countries and are very excited about our international expansion over the next few years.”
Paul & Shark Paul & Shark combines craftsmanship with high tech performance for its adventurous new Autumn Winter 2017-18 menswear collection, which rediscovers the iconic symbol of the brand – the shark. The heart of the collection is inspired by Alex Bellini’s adventure at -40 degrees on an Iceland glacier and consists of four state-of-the-art jackets. Varying from merino wools treated so that they have breathable, waterproof and heatregulating properties, to double-face down jackets made with a multi-directional stretch fabric (a lightweight material that is incredibly warm), as well as the new range of trousers that incorporate the same research, processes and experimentations as the jackets. Says Paul & Shark’s Global Travel Retail Director, Catherine Bonelli: “We are focusing on fewer SKUs for global travel retail, using analysis of passenger buying patterns and preferences to create a much tighter offer highlighting styles and sizes that we know work in this channel.”
Coach Coach, Inc., announced its partnership with actress and singer Selena Gomez. The collaboration with Coach will be wide ranging and commence with her appearing in Coach’s fall 2017 fashion campaign. Wrapping up its 75th Anniversary year, Coach has a long tradition of innovation in handcrafted women’s and men’s accessories. Most recently, Coach has been undergoing a transformation returning to its heritage in leather - Page 22 -