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DUTYFREEMAGAZINE.CA JUNE 2017 · ASUTIL · VOL 27 · NO 2

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Brazil sees stability p. 18 Motta on the upswing p. 30 Spotlight on Paraguay p. 32

LETTER FROM ASUTIL PRESIDENT

Welcome to ASUTIL 2017

n behalf of the Board of Directors of ASUTIL, I would like to welcome you to this very special edition of the Annual Conference, held in Rio de Janeiro, Brazil, where our first Conference took place 20 years ago. Our theme this year is “Back to the Future.” No one wants to be stuck in the past, and certainly not those in a business environment, where one must constantly stay ahead of the curve; but we can learn from the past. Under any given circumstance, which decisions could have been better? What did we do well? The answers are helpful when similar circumstances arise. Currently, the future is looking much brighter than it was one short year ago, especially in South America. We all have traveled this ocean before. We know the tides, the ebbs and flows and the tumultuous storms. Now, after a very challenging period, the industry shows a positive trend, proof that we are back on course. During this period the industry has faced other challenges: consolidations, mergers and acquisitions, and an increasingly important relationship between suppliers, landlords and retailers. A huge investment was made in several airports in Latin America, especially in Brazil, where the concessions of important

e had our first ASUTIL conference 20 years ago in the same city where we are having our final ASUTIL conference this year, in the biggest country in our region. Back when we began, numbers were small. We have grown a lot since then, and numbers are now consistently big. Through this time we’ve dealt with many problems in the economy, in global travel, in the retail environment and with government regulations, and we will continue to deal with all of these issues in coming years. The theme this year is “Back to the Future.” Basically, we are reflecting on the past, learning, looking at the good and bad, what worked well and what did not work so well. We are looking to the past to improve the future. Now our focus will be on planning the Summit of the Americas. We are having many meetings, working to define exactly what the new product will be, and looking for a new venue – 2018 is the final year it will be in Orlando.

airports moved to the private sector, enabling world-class infrastructure and further growth and development of retail. The modern customer demands more products, more value for money, and world-class customer service. To fulfill these needs the inevitable trend is to bring the “Digitalization” technology to our shops, which is one of the key drivers going forward in order to offer a more customized value proposition, including services and information, and to also give this new customer more reasons to buy in our stores. Finally, ASUTIL is aware of the worldwide trend in terms of industry consolidation and growth and is evaluating future alliances in order to further develop and strengthen partnerships to be in line with this trend. Being President of ASUTIL throughout this time, tasting the bitter and the sweet and facing changes and challenges, has been a great experience and pleasure. I’d like to thank the Board of Directors and the staff of ASUTIL for supporting our industry and me through this period. Warm regards,

Gustavo Fagundes President ASUTIL

We at ASUTIL welcome delegates to the final conference. In addition to our important networking time, we have exceptional speakers for you, including Martin Eurnekian, President of ACILAC; Olga San Jacinto, Director, GOOGLE LATIN AMERICA; Ernesto Talvi, Executive Director, CERES; Murilo Portugal Filho, Executive President, FEBRABAN; and some more familiar faces such as Peter Mohn of m1nd-set, Rafael Parodi of Siñeriz, Francisco Heredia of London Supply, Jose Antonio Gea, of Dufry, myself and of course ASUTIL’s President, Gustavo Fagundes. This year our schedule has changed somewhat, and for the first time our post-conference social event will take place on Friday. We look forward to seeing you there. Best regards,

José Luis Donagaray Secretary-General ASUTIL

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

LETTER FROM ASUTIL PRESIDENT

Welcome to ASUTIL 2017

n nombre de la Junta de Directores de ASUTIL, quiero darles la bienvenida a esta edición tan especial de la Conferencia Anual que se lleva a cabo en Rio de Janeiro, Brasil, precisamente donde se realizó nuestra primera reunión hace veinte años. Nuestro tema de este año es “De regreso al futuro”. Nadie desea estancarse en el pasado, especialmente aquellos que operan en un entorno de negocios donde hay que estar continuamente a la vanguardia. Sin embargo, todos podemos aprender de las lecciones del pasado. ¿Qué mejores decisiones podríamos haber tomado en cualquier circunstancia dada? ¿En qué tuvimos éxito? Las respuestas a estas interrogantes resultan útiles cuando surgen circunstancias similares. En la actualidad, el futuro se avizora mucho más brillante en comparación con hace solo un año, especialmente en Suramérica. Todos hemos navegado antes por este océano. Conocemos sus mareas, sus flujos y reflujos, y sus tumultuosas tormentas. Ahora, luego de un período muy difícil, la industria muestra una tendencia positiva, prueba de que vamos de nuevo por el camino correcto. Durante este período, la industria ha enfrentado otros desafíos: consolidaciones, fusiones y adquisiciones, y una relación cada vez más importante entre suministradores, dueños de propiedades y comerciantes minoristas. Se ha hecho una enorme inversión en varios aeropuertos de Latinoamérica,

ace veinte años, realizamos nuestra primera Conferencia ASUTIL en la misma ciudad donde celebraremos este año nuestra conferencia final. Hemos crecido enormemente desde entonces, y ahora las cifras son sistemáticamente sustanciales. En todo este tiempo hemos enfrentado numerosos problemas: en la economía, los viajes globales, el entorno minorista, y con las regulaciones gubernamentales, y los seguiremos confrontando en los próximos años. El tema de este año es “De regreso al futuro”. Básicamente, estamos reflexionando sobre el pasado, aprendiendo, analizando lo bueno y lo malo, lo que salió bien y lo que no funcionó tan bien. Estamos mirando al pasado para mejorar el futuro. Ahora nuestro enfoque se centrará en la planificación de la Cumbre de las Américas. Estamos sosteniendo numerosas reuniones, y trabajando para definir exactamente cuál será el nuevo producto, así como buscando un nuevo sitio de reunión. El 2018 será el último año que la realizaremos en Orlando. ASUTIL les da la bienvenida a los delegados a su conferencia

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

especialmente en Brasil, donde se privatizaron las concesiones de aeropuertos importantes, propiciando una infraestructura de clase mundial, y un mayor crecimiento y desarrollo del comercio minorista. El cliente moderno exige más productos, más valor por su inversión, y un servicio al cliente de clase mundial. Para satisfacer estas necesidades, la tendencia inevitable es incorporar a nuestras tiendas la tecnología de “Digitalización”, uno de los principales impulsores de avance para ofrecer una proposición de valor más personalizada, incluyendo servicios e información, y, además, darle a este nuevo cliente más razones para comprar en nuestros establecimientos. Finalmente, ASUTIL está consciente de la tendencia mundial en términos de consolidación y crecimiento de la industria, y está evaluando alianzas futuras para desarrollar y fortalecer aún más sus alianzas, a fin de estar a tono con esta tendencia. Ser Presidente de ASUTIL durante estos tiempos, enfrentar lo bueno y lo malo y asumir cambios y retos, ha sido una gran experiencia y placer para mí. Quiero agradecerles a la Junta de Directores y al equipo de ASUTIL por habernos apoyado a la industria y a mí en estos años. Un saludo afectuoso,

Gustavo Fagundes, Presidente ASUTIL

final. Además de nuestras importantes sesiones de contacto profesional, contamos con excepcionales conferencistas para ustedes, como Martin Eurnekian, Presidente de ACI-LAC; Olga San Jacinto, Directora de GOOGLE LATIN AMERICA; Ernesto Talvi, Director Ejecutivo de CERES; Murilo Portugal Filho, Presidente Ejecutivo de FEBRABAN; y otras caras más conocidas como Peter Mohn de m1nd-set; Rafael Parodi de Siñeriz; Francisco Heredia de London Supply; y José Antonio Gea de Dufry, además de un servidor y, por supuesto, de Gustavo Fagundes, Presidente de ASUTIL. Este año nuestra programación ha cambiado en cierta medida, y nuestro evento social posterior a la conferencia se llevará a cabo el viernes. Espero verlos a todos en Rio de Janeiro. Un saludo afectuoso,

José Luis Donagaray Secretario General ASUTIL

James Franco Introducing The new Fragrance for men

LETTER FROM THE EDITOR

Upward trend

fter a couple of years of depressing numbers in the region, this ASUTIL should have a more celebratory feel as economic reports are consistently positive. A stabilized economy means customer confidence is on the rise in Brazil, and that is good news not only for the border communities that so rely on the Brazilian customer, but also on other countries in South America, as the Brazilian traveler returns. ASUTIL Secretary General José Luis Donagaray says 2017 has kicked off with double-digit growth over the same period in 2016, and the reason is stability. With the exception of Venezuela, the rocky rollercoaster ride that much of the continent had been on has come to an end, and stability is reigning supreme. While the U.N.’s Economic Commission for Latin America and the Caribbean forecast for GDP growth in the region is modest for the coming year, consumers are traveling and spending again, and that can only be good news for travel retail. Despite the recent recession, infrastructure in the region continues to grow. Argentina in particular has announced a massive four-year infrastructure development plan that, along with new and improved highways, trains and railway lines, will see everything from improved landing facilities to complete airport rebuild in 19 of the country’s airports. This should have the double effect of providing many thousands of quality jobs, thereby stimulating the economy, along with helping to bring air travel in the country up to modern standards, thereby making travel to and within the country more attractive. The Argentine government has also expressed a mandate to improve tourism in the country. Development is always on the proverbial mind of Dufry, and now is no exception. Along with upgraded stores in Argentina’s Ezeiza and Aeroparque airports, Rene Riedi, CEO Latin America, tells us about a substantial new project in Bogota, Colombia, including a complete renovation of already existing duty free space and 880 square meters of new space. The company has also been awarded a large new duty free space in Mexico City, and a rapidly growing cruise line business operating mainly in the Caribbean. This year is ASUTIL’s final conference, as starting next year it will become part of the newly formed Summit of the Americas. Americas Duty Free would like to congratulate President Gustavo Fagundes, Secretary General José Luis Donagaray and all the individuals who have, through ASUTIL, worked tirelessly to help the duty free-travel retail industry in South America a great success, and we wish you all the best in the coming years. Please enjoy this final Americas Duty Free ASUTIL issue and the event itself in Rio de Janeiro, the very same city where the event began. Kindest Regards,

Hibah Noor Editor-in-Chief hibah@dutyfreemagazine.ca

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

JUNE 2017 · ASUTIL · VOL 27 · NO 2

The Americas Duty Free & Travel Retailing magazine (ISSN 0962-0699) is published four times a year April, June, October and November by Global Marketing Company Ltd. 26 Pearl Street, Mississauga, Ontario L5M 1X2 Canada. It is distributed throughout Central America, South America, the United States, Canada, U.S. Virgin Islands, U.S. Pacific islands, and the islands in the Caribbean. The views expressed in this magazine do not necessarily reflect the views and opinions of the publisher or the editor. June 2017, Vol 27. No. 2. Printed in Canada. All rights reserved. Nothing may be reprinted in whole or in part without written permission from the publisher. © 2017 Global Marketing Company Ltd.

THE AMERICAS DUTY FREE & TRAVEL RETAILING 26 Pearl Street Mississauga, Ontario L5M 1X2 Canada Tel: 1 905 821 3344; Fax: 1 905 821 2777 www.dutyfreemagazine.ca PUBLISHER Aijaz Khan aijaz@globalmarketingcom.ca EDITORIAL DEPARTMENT EDITOR-IN-CHIEF Hibah Noor hibah@dutyfreemagazine.ca SENIOR EDITOR Wendy Morley wendy@dutyfreemagazine.ca ASSOCIATE EDITOR Jas Ryat jas@dutyfreemagazine.ca ART DIRECTOR Jessica Hearn jessica@globalmarketingcom.ca CONTRIBUTORS Ronnie Lovler

CIRCULATION & SUBSCRIPTION MANAGER accounts@globalmarketingcom.ca

LETTER FROM THE EDITOR

Tendencia ascendente D

espués de dos años de cifras deprimentes en la región, esta conferencia de ASUTIL tendrá un tono más festivo, pues los informes económicos son sistemáticamente positivos. En Brasil, una economía estabilizada equivale al aumento de la confianza del cliente, una buena noticia no solo para las comunidades fronterizas que tanto dependen del consumidor brasileño, sino también para otros países en Suramérica, a los que regresa el viajero de Brasil. José Luis Donagaray, Secretario General de ASUTIL, afirma que el 2017 se inició con un crecimiento de dos dígitos en relación al mismo período del 2016, y la razón es la estabilidad. Con la excepción de Venezuela, los accidentados altibajos que experimentara esa parte del continente han llegado a su fin, y la estabilidad es ahora la palabra de orden. Si bien la Comisión Económica para Latinoamérica y el Caribe de las Naciones Unidas pronostica que el crecimiento del PNB será modesto en la región el próximo año, los consumidores están viajando y consumiendo nuevamente, y no puede haber una noticia mejor para el sector minorista de viajes. A pesar de la reciente recesión, la infraestructura sigue creciendo en la región. Argentina, en particular, ha anunciado un enorme plan de desarrollo de infraestructura de cuatro años que, conjuntamente con la creación de autopistas nuevas y mejoradas, de trenes y líneas de ferrocarril, se materializará en muchos aspectos, desde mejores instalaciones de aterrizaje, hasta una completa reconstrucción en 19 aeropuertos del país. Lo anterior podría ejercer el doble efecto de proporcionar miles de empleos de calidad, estimulando por tanto la economía, conjuntamente con elevar el viaje aéreo en la nación a estándares modernos, dándole así más atractivo a los desplazamientos hacia y desde el país. El gobierno argentino también ha dado la orden de mejorar el turismo en la nación.

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

El desarrollo está siempre presente en la mente proverbial de Dufry, y ahora no es excepción. Además de los establecimientos remodelados en los aeropuertos Ezeiza y Aeroparque de Argentina, René Riedi, su director ejecutivo para Latinoamérica, nos habla sobre un nuevo y sustancial proyecto en Bogotá, Colombia, que consiste en una renovación completa del espacio duty free ya existente, y 880 metros cuadrados de espacio nuevo. A la compañía también se le otorgó un enorme espacio nuevo duty free en la Ciudad de México, y está operando un negocio de cruceros en rápido crecimiento, fundamentalmente en el Caribe. Esta será la última conferencia de ASUTIL, pues a partir del próximo año formará parte de la recién creada Cumbre de las Américas. Americas Duty Free quiere felicitar a su Presidente, Gustavo Fagundes; a su Secretario General, José Luis Donagaray, y a todos los que, en ASUTIL, han trabajado incansablemente para que la industria duty free-minorista de viajes de Suramérica logre un gran éxito. A todos ellos les deseamos lo mejor en los próximos años. Disfruten este número final de Americas Duty Free ASUTIL y el evento en Rio de Janeiro, la misma ciudad donde se llevó a cabo la primera conferencia. Un cordial saludo,

Hibah Noor Editora en Jefe hibah@dutyfreemagazine.ca

Transforming Travel Retail.

Wherever you go with Dufry, you have a world of shopping in your hands. The best brands and the best prices with the largest variety. Today made up of more than 2200 shops, in 64 countries and 380 locations all around the world.

CONTENTS

What’s inside LEAD STORIES 18 Dufry Brazil THE SUN IS SHINING

After a time of freefall for the Brazilian Real and a deep recession, Brazil is seeing stability and rising consumer confidence along with it

VUELVE A BRILLAR EL SOL EN BRASIL

Después del desplome del real y de una profunda recesión, Brasil está volviendo a la estabilidad y a la recuperación de la confianza del consumidor

26 JPT JPT EXPANDS ITS OFFERINGS

JPT is giving customers a chance to buy designer watches and specialty sunglasses at its new store in Iquique, Chile

30 Motta International MOTTA INTERNATIONAL ON THE UPSWING

It’s looking to be a very good year for Motta International as the company expands its business in Trinidad & Tobago, Cuba and Colombia

34 Latam Overview LATIN AMERICA ECONOMIES IMPROVE IN 2017

2017 is full of promise for the duty free and travel retail industry in Latin America

34 FEATURES Spotlight on Paraguay

Monalisa now in Asunción

CONTENTS

61 LEAD STORIES

46 Dufry STRENGTHENING ITS FOOTHOLD In less than three years, Dufry has acquired two major duty free operators, but the travel retail superpower continues to find new places to land

FORTALECIENDO SU POSICIÓN

En menos de tres años, Dufry ha adquirido dos notables operadores duty free, pero la superpotencia minorista de viajes sigue buscando nuevas sedes para afianzarse

52 Airports: Argentina NEW INFRASTRUCTURE

The priority for Argentina’s new government has been economic stimulus. To create many thousands of jobs in addition to providing a better framework for business development, a large sum has recently been earmarked to target infrastructure across the country

56 Daniel Wellington A GREAT STYLE COMPANION

Fast-growing watch brand Daniel Wellington is aiming to appeal to the global traveler with its sleek and minimalist timepieces

52 56

58 MosquitNo TAKING A BITE OUT OF TRAVEL RETAIL

MosquitNo B.V. aims to fill a gap in the market for effective insect repellent products that are retailer and consumer friendly

62 Stoli LINE EXPANSION

After its earliest days as the global vodka and the past few years re-establishing itself in this light, Stoli is adding new brands and depth to the company’s portfolio

63 MONARQ SOUTHERN RULE

For MONARQ Group, double-digit growth is the norm, and that has continued in LATAM in recent months

FEATURES Destination chocolate PGT introduces Myme Accessories Liquor News

60 61 64

Wild Tiger Rum roars 66 Davidoff offers something new 68 Questionnaire: Dayalan Nayager, Diageo 70

BRAZIL-DUFRY

Visitors to ASUTIL are invited to visit and tour Dufry’s store in Rio de Janeiro

The sun

is shining After a time of freefall for the Brazilian Real and a deep recession, Brazil is seeing stability and rising consumer confidence along with it by

WENDY MORLEY

olatility is never a stranger to a South American economy. After an enormous and long-lasting upswing, the past few years have been a bumpy ride for Brazil, whose economic woes have affected the entire continent and certainly the duty free industry. Sales in Brazil dipped a reported 30% during the recession, and for some border community stores that number was even higher. By all accounts, the tables have finally turned. While the economy is far from where it was only three short years ago, the currency has been fairly stable during the second half of 2016 and into 2017, and consumer confidence is returning. Research from seven of the country’s most populous cities shows consumer confidence is now at its highest since January of 2015. As the currency has stabilized, the inflation rate has decreased to its lowest rate since September 2012. It’s safe to say the business community in Brazil is optimistic about the coming year, though under no illusions of a quick bounce back to former glory.

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Domestic travelers Travel retail in Brazil is more strongly affected by the consumer confidence of its own national population than elsewhere, simply because of travel habits. The vast majority of passengers traveling in Brazil’s airports are Brazilians, so appealing to foreigners does not affect the bottom line as it might elsewhere. Gustavo Fagundes, COO of Dufry Region II, Brazil and Bolivia, says: “In Brazil, particularly, our main customers are the Brazilians themselves and for this reason, generally speaking, the currency effect plays a relevant role here in terms of purchase power as it can create some level of uncertainty in terms of customer’s perception and confidence when they are planning their trip. Having said that, the recent currency stability has been contributing positively to our local operations, which since the second half 2016 have been posting a very positive performance, with double-digit growth in the first quarter of 2017. Looking

Part of Dufry’s success is its specialty offering, such as this luxury watch shop in Rio de Janeiro

ahead, we expect the exchange rate to keep stabilizing, based on future prospects for the political and economic situation in Brazil as well as no major changes in the world economic scenario.”

ate the needs in terms of retail offer in each airport to deliver the best retail format/solution, be it a Hudson shop, a specialized store or a brand boutique, for instance.”

Seizing opportunity

Bringing convenience to Brazil

While the downturn in the economy might have caused Dufry decreased sales in the short term, the company was strong enough to take advantage of some opportunities that arrived when other smaller companies were unable to weather the storm, snapping up locations that had been run by others and using its strong position as leverage to lengthen existing contracts. “Indeed we took advantage of all opportunities in the market and we were able to add more spaces in the past few years as well extend important contracts,” confirms Fagundes. “The new retail spaces were integrated as additional areas in our business plan in each specific location according to our strategy, and the retail offer in each airport. We also conducted an assessment to evalu-

Hudson Group, a New Jersey-based travel retailer acquired by Dufry in 2008, has hundreds of airport newsstands operating under the name Hudson News, mainly throughout North America. Until recently, the convenience concept was not a familiar one in Brazil. Dufry brought the Hudson News store concept to the Brazilian market in the São Paulo Guarulhos Airport, along with the other shops opened in the airport’s new Terminal 3, opened in 2014. Fagundes says: “The concept was widely well received by the Brazilian market, becoming a benchmark for Hudson operations outside US and ultimately, a consolidated important player in Brazil. We attribute this success also to the fact that the conve-

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

BRAZIL-DUFRY

nience concept didn’t exist at airports in Brazil, and Hudson met both domestic and international traveler’s demands, providing a wide selection of products they may need during their journey, from soft drinks, confectionery, travel accessories, electronics and personal care items to publications in general. Hudson can now be found in the main Brazilian airports, be it as stand alone shops or incorporated inside other Dufry shops.”

Duty paid gets supersized Another new concept Dufry introduced to the Brazilian market recently is the Dufry Shopping duty paid mega stores. These stores also opened during Brazil’s multi-city airport infrastructure rebuild in time for the FIFA World Cup of 2014 and Olympics of 2016. “We introduced the Dufry Shopping mega stores in 2014, in a pilot at Brasília Airport,” says Fagundes. “Dufry Shopping is a general travel retail shop serving domestic passengers, with a shopping environment and product offer similar to duty free shops. This is a very interesting concept and unique worldwide, with great potential, given that in Brazil, domestic passengers account for around 90% of the air passengers. We have already expanded the concept to another six airports, including Rio de Janeiro, Guarulhos, Viracopos and Curitiba.”

After Dufry Shopping’s success in Brasilia, the megastore opened in other locations such as this one in Viracopos

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Addressing customer needs Dufry’s success in the region comes from a mix of continuing with the tried and true, creating new, and addressing changes in the way customers expect to shop. “Some of our most successful duty-free and duty-paid concepts already in place in Brazil are the brand boutiques, featuring the most prestigious brands in the world; the last-minute shops to serve our customers’ needs right up to the final moments of their travel; the walkthrough concept providing a better shopping experience; the pre-order service, allowing customers to reserve and collect their product at their convenience in our shops at exclusive cashier points and finally, our loyalty program RED by Dufry, offering special discounts and benefits to our members. All of these concepts and retail formats combined put together a comprehensive portfolio allowing Dufry to create a world class shopping experience for all customers.”

The future is bright Looking ahead, Fagundes is expecting the positive trend seen over the past three quarters to continue. “We expect the exchange rate to keep stabilizing based on future prospects for the political and economic situation in Brazil, assuming no major changes in the world economic scenario. We are starting to see a recovery in the Brazilian economy, and a healthy and growing economy for sure supports and encourages people to travel, be it for business or leisure. Also, a more stable currency can encourage consumer spending.”

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BRAZIL-DUFRY

In 2014, Dufry opened the first duty paid megastore called Dufry Shopping, located in Brasilia

Vuelve a brillar

el Sol en Brasil

a volatilidad nunca ha sido ajena a la economía suramericana. Luego de un ascenso enorme y duradero, los últimos años han sido difíciles para Brasil, cuyos problemas económicos han afectado a todo el continente, y, por supuesto, a la industria duty free. Según los reportes, las ventas en Brasil disminuyeron un 30% durante esa recesión, pero la cifra fue mucho más alta en algunas tiendas comunitarias de frontera. Pero, a todas luces, la situación ha cambiado. Si bien la economía está lejos de lo que fue hace solo tres años, la moneda ha gozado de cierta estabilidad durante la segunda mitad del 2016 y en el 2017, y la confianza del consumidor está aumentando. Varios estudios realizados en siete de las ciudades más populosas del país revelan que la confianza del consumidor está en su nivel más alto desde enero del 2015. En la medida que se ha estabilizado la moneda, la tasa de inflación ha disminuido a su índice más bajo desde el 2012. Se puede decir que la comunidad de negocios en Brasil se siente optimista con respecto al año próximo, aunque sin ilusiones de una rápida recuperación a las glorias pasadas.

Viajeros nacionales La industria minorista de viajes en Brasil se ve más afectada por la confianza del consumidor de su población nacional que en otras partes, por el simple hecho de los hábitos de viaje. Como la gran mayoría de los pasajeros que viajan en los aeropuertos del Brasil son nacionales, atraer a los extranjeros no afecta tanto las ganancias como podría suceder en otros países. Gustavo Fagundes, Director de Operaciones de Dufry para la Región II, Brasil y Bolivia, afirma: “En Brasil, particularmente,

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Después del desplome del real y de una profunda recesión, Brasil está volviendo a la estabilidad y a la recuperación de la confianza del consumidor nuestros clientes principales son los propios brasileños, y por esta razón, hablando en general, el efecto de la moneda desempeña un papel relevante en términos de poder adquisitivo, pues puede crear algún nivel de incertidumbre en términos de percepción y confianza del cliente cuando va a planificar su viaje”. “Dicho esto”, prosigue, “la actual estabilidad de la moneda ha estado contribuyendo positivamente a nuestras operaciones locales. Desde la segunda mitad del 2016 se ha producido un rendimiento muy positivo, con crecimientos de dos dígitos en el primer trimestre del 2017. Mirando al futuro, esperamos que la tasa de cambio se mantenga en estabilización, en base a las perspectivas futuras de la situación política y económica de Brasil, así como en la posibilidad de que no ocurran cambios importantes en el escenario económico mundial”.

Aprovechar la oportunidad Aunque la crisis económica pudo haber provocado una disminución de ventas para Dufry a corto plazo, la compañía tuvo la suficiente solidez para aprovechar algunas oportunidades que aparecieron cuando otras compañías más pequeñas no pudieron capear el temporal, incorporando establecimientos que habían sido operados por otras empresas, y usando su firme posición como potencial para extender contratos existentes. “Aprovechamos realmente todas las oportunidades en el mercado, y pudimos incorporar más espacios en los últimos años, además de lograr extensiones en contratos importantes”, confirma Fagundes. “Los nuevos espacios minoristas fueron integrados como áreas adicionales a nuestro plan de negocios en cada lugar específico según nuestra estrategia, y la oferta minorista en cada aeropuerto. También realizamos una

Asutil 6-9 June 2017 Nogueira Networking Time Hilton Barra Hotel, Rio De Janeiro Contact us for an appointment: jonathan@z-zoom.co O: +44 (0)208 581 3611 M:+44 (0)7785 244934 www.z-zoom.co

z-zoom is part of the

Group

BRAZIL-DUFRY

evaluación de las necesidades en términos de oferta minorista en cada aeropuerto, para proporcionar el mejor formato/solución minorista, ya fuese una tienda Hudson, un establecimiento especializado o una boutique de marca, por ejemplo”.

Incorporación de tiendas de conveniencia en Brasil Hudson Group, firma minorista de viajes radicada en Nueva Jersey, adquirida por Dufry en el 2008, cuenta con cientos de estanquillos de periódicos con el nombre de Hudson News, principalmente en Norteamérica. Hasta hace poco, el concepto de tiendas de conveniencia no estaba enraizado en Brasil. Pero Dufry Dufry brought the Hudson News convenience concept to Brazil. The convenience concept was previously unknown in the country, and has llevó el concepto de tiendas Hudson News al mercado been well received in both domestic and international terminals brasileño en el Aeropuerto Guarulhos de São Paulo, conjuntamente con otros establecimientos inaugurados para la Copa Mundial FIFA 2014 y las Olimpiadas del 2016. en la nueva Terminal 3 del aeropuerto, en el 2014. “Incorporamos las mega tiendas Dufry Shopping en el 2014, “El concepto tuvo una recepción ampliamente positiva como proyecto piloto en el Aeropuerto de Brasilia”, explica en el mercado brasileño, convirtiéndose en punto de referencia Fagundes. “Dufry Shopping es una tienda minorista de viajes para las operaciones Hudson fuera de los Estados Unidos, y, general que presta servicios a pasajeros nacionales, con un entorno de compras y una oferta de productos similares a las en última instancia, en un factor importante y consolidado duty free. Es un concepto muy interesante y original en todo el en Brasil”, añade Fagundes. “También le atribuimos este éxito mundo, con gran potencial, dado que, en Brasil, los nacionales al hecho de que el concepto de tiendas de conveniencia no conforman el 90% de los pasajeros de aerolíneas. Ya hemos existía en los aeropuertos del Brasil, y Hudson fue el concepto extendido el concepto a otros seis aeropuertos, como Rio de que satisfizo las necesidades del viajero nacional y extranjero, Janeiro, Guarulhos, Viracopos y Curitiba”. proporcionando una amplia selección de productos que podrían necesitar durante el viaje, desde refrescos, confitería, Satisfacer las necesidades del cliente accesorios de viaje, electrodomésticos y artículos de uso El éxito de Dufry en la región es producto de una mezcla de personal hasta publicaciones en general. Hudson está presente continuidad con lo ya demostrado, la creación de cosas nuevas, actualmente en los principales aeropuertos del Brasil, ya sea y la realización de cambios en la manera que los clientes esperan como tiendas independientes o incorporadas dentro de otros comprar. “Algunos de nuestros conceptos más exitosos en las establecimientos Dufry”. tiendas duty-free y con pago de aranceles en Brasil son las boutiques de marca, que ofrecen las marcas más prestigiosas del Mega tiendas Dufry con pago de aranceles mundo; las tiendas de compras de último minuto para satisfacer Otro nuevo concepto introducido recientemente por Dufry las necesidades de nuestros clientes hasta los momentos finales en el mercado brasileño son las mega tiendas Dufry Shopping de su viaje; el concepto de tiendas de tráfico obligado que ofrecen con pago de aranceles. Esos establecimientos también fueron una mejor experiencia de compras; el servicio de pedidos inaugurados durante la reconstrucción de infraestructura anticipados, para que los clientes puedan reservar y recoger de aeropuertos en varias ciudades del Brasil, justo a tiempo sus productos como más les convenga en puntos exclusivos de cajeros en nuestras tiendas y, finalmente, nuestro programa de lealtad RED by Dufry, con descuentos y beneficios especiales para nuestros miembros. Todos estos conceptos y formatos minoristas combinados, conforman un portafolios integral que le permite a Dufry la creación de una experiencia de compras de clase mundial para todos los clientes”.

Un brillante futuro

The confectionery area is tempting as passengers walk through the Rio de Janeiro store

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Con respecto al futuro, Fagundes espera que continúe la tendencia positiva de los tres últimos trimestres. “Esperamos que la tasa de cambio siga estabilizándose, en base a las perspectivas futuras de la situación política y económica de Brasil, así como en la posibilidad de que no ocurran cambios importantes en el escenario económico mundial. Estamos comenzando a ver una recuperación de la economía brasileña, y, sin dudas, una economía saludable y en crecimiento respalda y estimula a la gente a viajar, ya sea por negocios o placer. Además, una moneda más estable puede estimular el gasto del consumidor”, concluye.

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JPT

JPT expands

its offerings JPT is giving customers a chance to buy designer watches and specialty sunglasses at its new store in Iquique, Chile by

RONNIE LOVLER

Tarana and Prakash Thadani, owners of JPT Duty Free at the Zofri Mall in Iquique, Chile at an event marking the launch of Ferrari, Essence Collection

A view of JPT’s Duty Free store at the Zofri Mall

JPT’s high-end sunglass section at their duty free store

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

or the husband and wife team who are the mainstay of JPT, the thrust of what they do has always been about taking calculated risks. That’s what JPT Vice President Tarana Thadani and her husband, Prakash, will be doing once again in June, when they open a store selling designer watches in the Zofri Mall in Iquique, Chile. “So far, this will be the only high-end watch boutique in Zofri,” she said. The watch brands that JPT will sell include Hublot, Omega, Panerai, IWC, Tag Heuer, Montblanc, and Tissot. However, she emphasized that this is just a beginning, and this does not stop here, as JPT’s search to add more of the world’s renowned prestigious brands is constant. “We will continue expanding, innovating and bringing in more brands,” Mrs. Thadani said during a face-to-face conversation with Americas Duty Free & Travel Retailing. “That is our idea, to bring new things in that aren’t available anywhere else in northern Chile.” It’s definitely a risk, but for the Thadanis, this is just a continuation of their long-standing practice for breaking the ice and constantly introducing and starting new trends. That’s what they did in 2000 when they opened their first small store in the Zofri Mall. “We began with a small store – no more than 20 square meters – where we began selling perfume,” she continued.

THE FIRST MALL IN RIVERA & THE LARGEST DUTY FREE IN URUGUAY

www.sineriz.com.uy Rivera - Uruguay

JPT

Some of the luxury watches available for purchase at the JPT Duty Free store

“Then we decided to take more risks and now we have ten stores with the brand JPT.” “I am a proud wife of my self-made husband who started from nothing; due to his ample experience in the perfume industry, JPT is now a successful and a highly recognized luxury brand in this city,” said Mrs. Thadani. She says JPT’s truly groundbreaking step came in 2008, when they opened Zofri Mall’s first duty free-concept store. She quotes, “That store is our pride. That was the moment we took the step to having something bigger.” “We were pioneers when it came to opening a type of business that people in Chile didn’t know,” she said. “It wasn’t common for them to see a store with such a concept of a duty free with many different branded products under one roof.” She mentioned how important it was for JPT to bring in brands that were not available in the northern region of Chile – especially in accessories such as watches, sunglasses, handbags, jewelry, and more. “We see huge potential in this region of Chile, thus we strive to bring in new brands that potential customers would travel abroad to purchase in earlier times,” continued Mrs. Thadani. “Due to the constant approach by our potential buyers in the field of sunglasses, we pursued Luxottica group for almost three years until we became official retailers for Chanel sunglasses and likewise with other brands.” Mrs. Thadani also credits JPT’s success to a new achievement that has become prominent in 2017: the establishment of a

direct link with most commercial houses. Despite being in a free zone with no value added tax (VAT) of 19%, JPT remains loyal to its customers by maintaining internationally recognized prices on all its products. As a co-captain, Mrs. Thadani is a team player. She attributes a lot of JPT’s success to the company’s staff. “I have an excellent team like no other in the free zone. We have a creative and innovative team that adds to the success,” she said. Mrs. Thadani notes that most of JPT’s customers are from the mining region of northern Chile, from areas such as Antofagasta and Calama. Additionally, for the past two years more and more Argentines have been visiting Iquique for its lovely beaches and temperate weather. She added that Iquique is more accessible

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

A view of the area where luxury, exclusive watches are on display at the JPT Duty Free store in the Zofri Mall in Iquique, Chile

now that there are direct flights from the north of Argentina. According to JPT’s luxury goods Brand Manager, Francisco Aguilar Cruz, Iquique’s visitors are people of means. “Many of the tourists who come to Iquique have money. They have summer homes in Iquique and they have purchasing power. Most importantly, they want to buy a high value product they can take back home,” he said. “Up until now, they had to travel far to purchase such products, but now when they come to Iquique, they will be able to buy these brand here,” he added. Consumers have a wide range of goods available to them for purchase. JPT’s duty free concept store offers a highly diverse product-range such as liquors, confectionaries, accessories, and clothing lines like Desigual and Paris Hilton. JPT’s bridge connecting the business to its customers is among the strongest factors in bringing and retaining visitors to its stores. JPT is involved in a highly diversified marketing scheme, making efforts to get its word out to the mass public and new tourists from neighboring countries, strengthening its brand image by using various marketing strategies from billboards and airport trollies, to events management and social media. Will they expand beyond Iquique? Maybe. “We are looking at malls. We are not closed to different markets, but we will do this step-by-step, as innovation and expansion is part of JPT’s tradition,” Mrs. Thadani said.

MOTTA INTERNATIONAL

A render of the first floor of the airside west at Piarco International Airport in Trinidad & Tobago, where Motta International is making its debut on this island nation

Motta International on the upswing It’s looking to be a very good year for Motta International as the company expands its business in Trinidad & Tobago, Cuba and Colombia by RONNIE LOVLER

otta International is on the move, expanding its presence in several airports around the region, including its debut in Trinidad & Tobago, a new store in Cali, Colombia, and expansion of its business in Cuba, among other things. Company CEO Erasmo Orillac sat down recently with Americas Duty Free & Travel Retailing to share his excitement about developments in the Caribbean. “We are in the process of finalizing the contract. As you can imagine, it’s been a long process. But we are almost finished with the contract,” Orillac said. “The store is finished. We are waiting for customs inspection and approvals. The store is ready, we just need to do the inspection and fill the stores with merchandise.” The stores at Piarco International Airport mark Motta’s first business venture on the islands. In all, Motta won a five-year contract to operate three duty free stores at the airport there. The

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

permits were awarded to Motta in late April and the company is now in the process of getting the surety bonds and shipping the initial order. The stores were expected to begin operation by mid-June. But Trinidad & Tobago is just one aspect of Motta’s regional expansion. The company is hard at work in Cuba in conjunction with Cuban authorities there as it prepares for the launch later this year of a duty free store at Jose Marti International Airport in Havana and three other smaller airports. “We are doing the blueprints with the final design for approval,” Orillac said. “But we don’t foresee any problems. We have to do the construction plans and we are working with them (Cuban officials) on design. It’s going well, slow but well,” said Orillac. Motta is working with a number of US-based companies on the project, which slows things down a bit because of the need to

This render provides an overview of the ground floor of the Attenza store at the international airport in Trinidad & Tobago

work around US trade restrictions. Orillac said, although former President Barack Obama reopened diplomatic relations with Cuba in 2015 and tourism from the United States to the island is now allowed, the trade embargo is still in place. Motta International is currently working with Cuban authorities on all the details of the concession, which Orillac considers a very positive challenge. “A lot of people will go by boat, but a lot of people will fly over. So it’s a challenge, but a good challenge to have,” he said. And Orillac is very optimistic about Cuba. “There is a lot of opportunity in the future. Cuba can no longer remain an isolated point in the Caribbean or in the Americas. President Obama made the first steps. The opening of Cuba is coming. It’s just a matter of time.”

However, in nearby Colombia, the openings are already in place. Colombia’s economy is booming and the peace agreement between the Colombian government and the Revolutionary Armed Forces of Colombia (FARC) has set the stage for even greater economic potential. In the case of Motta, its Colombia expansion is occurring at Alfonso Bonilla Aragón International Airport in Cali and El Dorado International Airport in Bogotá. The latter is ranked as one of the world’s 50 busiest airports. Motta already had a store at the Cali airport but now that the terminal itself is being remodeled, Orillac opted to remodel the store. “The space inside is close to 300 square meters. We already have the blueprints approved. We are doing all the work,” he said. In Cali, Motta was awarded a ten-year contract in the brandnew terminal. Expectations are that the new Cali store will be operational in July. Similar construction is underway at El Dorado. “We are adding to our store in the new expansion of the terminal. We won a concession for 618 square meters. And those are due to open in the second half of this year,” he said. That contract has been renewed through 2027. But Motta International is active in other countries as well, including its home country of Panama. The company is seeking new opportunities at Tocumen International Airport and is planning to participate in a duty free concession bid that will take effect June 30. The company has done business as Attenza Duty Free in Colombia, Mexico, Nicaragua, Panama, Venezuela, Ecuador and El Salvador, with Trinidad & Tobago and Cuba joining the mix in 2017. It is also using the Internet to generate more business. Through its website, www.attenza.net, passengers can pre-order merchandise on the Internet and pick it up and pay at the airport. Most of those shoppers are part of the millennial generation, under 35 years of age. In addition to his role at Motta International, Orillac is chairman of IAADFS, the International Association of Airport Duty Free Stores. In that capacity, he spoke at the recent IAADFS show in Orlando, noting the positive outlook across the board for the duty free industry for 2017. “Right now we have a stable environment. There are no major crisises in Latin America. We have a stable playing field,” he said. But just as significant for the duty free industry is the increasing accessibility of travel, he said. “Airlines are making travel accessible to a growing middle class. And when they travel, they are willing to spend.” But there are concerns. One of the big issues separating airport authorities from business operators, is dwell time, or the amount of time people have at airport before boarding a flight or making a connection. In Panama, for example, he noted the dwell time is only 56 minutes, something airport authorities brag about, but which is troublesome for store operators, because it leaves so little time for passengers to shop. And while that is a real concern, the general outlook for Motta International is definitely bright.

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

PARAGUAY OVERVIEW

Paraguay forging ahead in tourism growth Paraguay tourism numbers are up prompting more travel retailers to take a look at this landlocked South American nation by

RONNIE LOVLER

araguay is one of the fastest growing tourism destinations in the world, in terms of percentage growth according to the United Nations World Travel Organization (UNTWO), and this could mean a parallel growth for the duty free and travel retail industry. “Paraguay almost doubled its arrivals,” UNWTO said, in its most recent report, from the previous year. Although the final numbers for 2016 were not yet in, they were expected to stay on track. Paraguay’s growth reflects an overall increase in tourism to South America, which was up by 6%, but Paraguay experienced the largest relative growth, according to international travel research. Americas Duty Free & Travel Retailing look into what’s behind Paraguay’s striking growth in tourism sees three possible reasons for rising numbers - a general trend among millennial tourists to explore the unexplored, a growing international trend in cultural and environmental tourism, and for regional visitors from Argentina, Brazil and Uruguay, shopping. “Paraguay is receiving many more tourists because it is less expensive than Argentina and Brazil,” according to José Luis Donagaray, Secretary General of ASUTIL. “You have a lot of people going to buy domestic things in Asunción. Today Argentines are traveling a lot to Asunción to buy products.” Michael Payne, President and CEO of the International Association of Airport Duty Free Stores (IAADFS) notes that Para-

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Paraguay’s growth reflects an overall increase in tourism to South America

guay has done quite a bit to develop free trade and to stabilize its financial banking system. “But in terms of the tourism question, it’s likely due to the increased border traffic,” Payne said. And indeed the number of visitors coming into Paraguay from Argentina, Brazil, Uruguay and Bolivia is increasing, as is the money these visitors spend. Argentines appear to leading the travel charge. With new political and economic stability at home, Argentines are on the road. Telam, an Argentine national news agency, reported that in the first quarter of 2017, more than 280,000 Argentines traveled to Paraguay for shopping and vacationing during the southern hemisphere summer. Telam said Argentines are flocking to Paraguay because of lower prices for electronics, generally between 30 and 50% less than in Buenos Aires. “The lower taxes and the situation of the neighboring countries, favors shopping tourism,” according to Antonella Nuovo, Trade Manager for Bright Star Paraguay. “Many Brazilians, and in the last months especially Argentines have come to the capital to make purchases.” Uruguayan distributor Alejandro Sosa, President of Y. LucasCalcraft, S.A., who keeps an eye on regional trends, didn’t mince words. “Paraguay is booming…the infrastructure is booming. They just inaugurated a new shopping mall that is the prettiest one I have seen.” Paseo La Galeria in Asuncion, offering 45,000 square meters

Inside the Bright Star shop at the international airport near the capital city of Asunción

Another view of the Bright Star duty free store at Silvio Pettirossi International Airport in Paraguay

Bright Star’s store at Silvio Pettirossi Inetrnational Airport in Paraguay captures the attention of shoppers

of retail shopping, opened in May 2016. The launch of the megashopping space was considered so significant that the country’s President, Horacio Cartes, was on hand for the opening. Paraguayan travel retailer Monalisa is the first in the industry to be in La Galeria with “an improved replica of its historical flagship border store” and an exclusive space for wine and champagne at its “La Cave.” Monalisa defines its mission “as an effort to import and distribute luxury products, in order to enrich the lifestyle of our customers.” Nuovo agreed La Galeria mall “has generated a lot of interest among tourists as well as the border cities of Ciudad del Este, Pedro Juan Caballero, and Encarnación, All of this generates a great growth in the flow of visitors to the country.” Other Paraguayan travel retailers like Shopping China and Mannah may soon follow suit. Shopping China, with stores in Cuidad del Este, Salto de Guairá and Pedro Juan Caballero, is looking for a location in Asuncion, according to reports. Mannah Duty Free is at Silvio Pettirossi International Airport and border locations. Bright Star’s Nuovo says “some economists are describing Paraguay as the ‘South American Switzerland.’ It is a country rich in land, water, and electricity, with the lowest taxes in the area; in addition to the macroeconomic stability, inflation and devaluation of the currency is very contained, “ she said. “The regional conjuncture of the neighboring countries, the crises in Argentina and Brazil, have favored (Paraguay) so that real estate investors and industry (are coming),” Nuovo said.

“On the real estate side in the last year the city of Asunción has grown enormously with big buildings such as the World Trade Center and hotel chains like Dazzler, ALoft, Esplendor, and coming soon, Hilton.” she added. Improvements at Silvio Pettirossi International Airport are also helping to grow travel to the country. Bids are out for new construction and a highway project are making the country’s principle airport more appealing. “The road to the airport was quite bad. Now they are making a road from the airport to downtown that will get you there in five or ten minutes,” Uruguayan distributor Sosa said. More passengers are coming in and out of that airport, which also is good for the facility’s duty free shops. At the end of 2016, the airport reported more than one million passengers entering or leaving Paraguay, according to Paraguay’s Department of Civil Aviation Statistics. The government agency said it was the highest number of passengers recorded since the airport began operations in 1980. Also worth mentioning are the ahead-of-the curve business strategies of Amaszonas Airlines, which among other things, is focusing on the region by connecting cities in Chile, Uruguay, Argentina, and Bolivia with Paraguay. In April, the airline began offering daily flights between Asunción and Buenos Aires and points in Uruguay, and in May, took things a step further with flights to and from Salta in northern Argentina, and Iquique in northern Chile.

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

LATAM OVERVIEW

Latin America economies improve in

2017 2017 is full of promise for the duty free and travel retail industry in Latin America

o far, so good in 2017 for the travel retail and duty free industry in Latin America, with a first quarter that is seeing a higher rate of growth, overall higher earnings, and therefore high hopes for the year ahead. The first quarter of 2017 kicked off with double-digit growth in South America, according to José Luis Donagaray, Secretary-General of the South American Association of Duty Free Stores (ASUTIL). Donagaray told Americas Duty Free and Travel Retailing the numbers are pointing to a very good year, since

RONNIE LOVLER

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

“growth is over 10%. That’s double digit.” Donagaray is to release more details at the ASUTIL conference in Rio de Janeiro, Brazil in June. “Brazilians and Argentines are traveling a lot. Things are good in Uruguay, Paraguay and Peru, too,” he said. “And people are spending a lot in the duty free stores.” It’s a big turnaround from last year, when the political and economic crises in Brazil and Argentina kept people in the region’s two biggest countries at home. spending minimal tourism and travel dollars. But the just-concluded southern hemisphere summer saw hundreds of

José Luis Donagaray, Secretary-General, ASUTIL

thousands of people back at the resorts and vacation hot spots as well as the duty free and travel retail stores with plenty of cash in hand. “With the exception of Venezuela, Latin America is now stable,” Donagaray said. Last year was very tough. There was a difficult economic situation because commodities dropped down in prices. We had a lot of issues in politics, elections in Argentina and the problem with (Dilma) Rousseff in Brazil.” Rousseff was ousted as president of Brazil in August 2016 after months of scandal and financial upsets. And in Argentina, reform-minded centrist Mau-

ricio Macri was elected president in late 2015, replacing the leftist government of Cristina Fernández de Kirchner who left Argentina in economic shambles. But where economies were once rocky, Donagaray sees situations that have calmed and steadied. “The economy has stabilized. Commodities have stabilized. And with the exception of of Venezuela all the countries are stable.” Donagaray said. “We had elections in Peru, no problem. Ecuador, no problem. There is more stability.” Michael Payne, President and CEO of the International Association of Airport Duty Free Stores (IAADFS) also points to a more reliable and predictable rate of exchange as another benefit. “The currency exchange rates which sets things due to the economic challenges is certainly more stable than it was three or four years ago, and with a couple of exceptions on track to become more stable. Democratic processes are more set than they were five years ago,” he said. Enrique Urioste, CEO of Uruguay border store chain Neutral Duty Free concurs with the positive outlooks shared by Donagaray and Payne. “I definitely see things getting better. I think that we are on the upside of the roller coaster. If you look at the two pillars of the Latin America economy, Argentina and Brazil, we are starting to see the bounce back of their economies. So we are really positive about the outcome for 2017.” The facts speak for themselves. Many in the travel retail and duty free industry are expanding their operations, increasing

the number of stores in existing and new locations, and acquiring new businesses. Urioste’s Neutral Duty Free just celebrated its 30th anniversary with nine stores along the Uruguay-Brazil border and a 10th store at the international airport in Rosario, Argentina, as well a presence on the ferries that run between Argentina and Uruguay. Motta International is expanding its Caribbean reach with new stores opening or under construction in Cuba and Trinidad and Tobago. Top Brands International is now in Colombia, has an expanded presence in the Bahamas and other Caribbean locations. That kind of expansion doesn’t happen when economies go south, although the duty free and travel retail industry does seem to be ahead of the curve in Latin America. In a recent report, The U.N.’s Economic Commission for Latin America and the Caribbean — ECLAC — estimated overall regional GDP growth at a modest 1.3% this year. In 2016, the regional economy, shrunk by 1.1%, according to ECLAC. But country-specific reports show an anticipated growth of 2.4% for Argentina, although just .6% for Brazil. The highest overall growth rates are anticipated in Bolivia at 4.2%; Peru, 4.1%; and Paraguay, 3.5%. There was also a sense of optimism at the recent IAADFS conference in Orlando, where hundreds of retailers and distributors gathered. At that meeting, ASUTIL and IAADFS announced they

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

LATAM OVERVIEW

Ribbon-cutting ceremony with IAADFS board of directors earlier this year during IAADFS show

would join forces for a Summit of the Americas in Orlando in 2018. Because of contractual obligations, Canada’s Frontier Duty Free Association will not be a formal partner for that event, although the hope is that the Canadian group will join the effort in the future. Uruguayan distributor Alejandro Sosa, President of Y. Lucas-Calcraft S.A. has been keeping an eye on developments in South America’s Pacific Coast countries. “In the Pacific, in Iquique (Chile) there is a shortage of work. But at the end of the day, Chile is a stable economy so it not much of a problem.” He is also following events in Peru, especially in Tacna, near the border with Chile, where his company is eyeing possibilities for expansion. “The local distributors sell in Tacna and pay 6% duty. Duty free in Tacna operates in a different way. There are two “mercadillos” big halls with many small simple shops, no luxury ambience,” Sosa said. “Believe it or not Bolivia is doing well. Colombia is a healthy economy. So for me, the prospect in Latin America is changing for the good,” Sosa said. But there are issues that are a concern, including the uncertainties of regional and nation-to-nation relationships with the new US administration of President Donald Trump. Still ASUTIL’s Donagaray is not worried. “We’re pretty fine,” he said. I think Trump is a man from business. He

will negotiate. He comes from business, not politics, so he will negotiate,” Donagaray said. And although there may be some tensions with Mexico over immigration and the border wall issue, Uruguay’s Sosa says in South America Trump’s presidency is not causing too much anxiety. “So far, there’s been no impact. There’s a lot of talk, but there’s not much that is affected.” Yet IAADFS’s Payne did see some repercussions in terms of travel, after Trump’s bans on travel by citizens of some Muslim-majority countries and the subsequent US judicial stays on those orders. Corporate travel dropped between 12 and 14%, Payne said. “People were not sure if they should go, if they should come, or if they were going to send somebody back. There was definitely an impact but it is

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Enrique Urioste, CEO, Neutral Duty Free

too early to really know on a larger scale if this can be attributed to Trump, economic, (issues) or a security problem.” But Payne also points to more specific concerns befalling the airport duty free and retail business, in terms of Latin America, and even more globally, such as dwell time, in other words the amount of time a traveler has between flights during international travel. “You can blast through an airport and grab a bottle of water and a magazine and you get to your flight and that’s all you do, or if you have terrific duty free offerings and you have time, you (the traveler) can spend some money,” Payne said. “So that’s the issue when you hear people talk about security and infrastructure that doesn’t enable you to move through an airport quickly or the gates are so far apart, it translates into real dollars for people,” Payne said. Other issues that affect duty free and travel retail are the customs allowances set by host nations, the amount of liquor and tobacco products a consumer is permitted to buy, as well as restrictions on the number of bags passengers are permitted to take aboard a plane as hand luggage, Payne said. “Those are the challenges and I don’t know if the fact that there is an increasing number of clientele flying globally will offset those challenges,” Payne said. “There’s more lift and an evolving middle class that should produce more volume, spin for our business, so I think there are more opportunities as well,” he added. In other words, opportunity and growth seem to be dominant trends and the words that are being used to describe 2017 for Latin America’s travel retail and duty free industry.

Michael Payne, President and CEO IAADFS

A VODKA TRAVELS. THE VODKA EXPLORES.

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COPA AIRLINES

The 737 forms the backbone of the Copa Airlines fleet. This aircraft is the -800 series. The airline will be receiving its 737 MAX aircraft order in 2018

Copa MAXs

out

n January 19, officials from Copa Airlines broke ground at Tocumen International Airport on a new Center of Specialized Technical Maintenance set for completion in the second quarter of next year. By that time, the airline will be in the midst of a busy delivery schedule that will see more than 60 737 MAX aircraft set to arrive during 2018. “With these new Boeing 737 MAX aircraft, our customers will enjoy the benefits of the best technology available in the market,” said Gustavo Vargas, Communications Director at Copa Airlines. “This order represents an important step toward strengthening Copa Airlines’ leadership in the region, while allowing us to improve our world-class service and expand our network through the Hub of the Americas in Panama City.” However, the airline is currently building its fleet. At the beginning of

Panama’s flag carrier is preparing for a big year, with a major 737 delivery schedule set for 2018 by

this year Copa took delivery of a 737-800 Next Generation aircraft, while another is scheduled to arrive this spring. In addition to building its route structure, Copa is reaching out to another passenger group with a low cost carrier called Wingo, and adding a new destination in Cuba. Copa has invested US$15 million in the new maintenance center at Tocumen. It will allow the carrier to simultaneously conduct maintenance on three 737s and an Embraer 190. In addition to its major maintenance capabilities, Copa plans to use the facility for winglet installations, landing gear replacement, aircraft painting and other specialized technical work. The airline currently has a fleet of 100 aircraft of two varieties, 79 737 Next Generations and 21 Embraer 190s. The new center “brings to Panama the majority of the specialized technical maintenance that Copa today handles outside the country,” said Ahmad

The Hub of the Americas Airport in Panama City

RICK LUNDSTROM

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Zamany, Copa Airlines’ Vice President of Technical operations. A total of 38 aircraft in the airline’s fleet are in a two-class configuration and outfitted with with leather seating, according to the Copa Airlines website. The Business Class cabin offers a range of comfort items, a frequently updated wine list and a new rum is featured each month. Last summer, Copa Airlines opened up a new route to Holguin, Cuba, the country’s fourth largest city. The new destination adds to the commitment the airline has to the country. Copa first flew to Cuba with three weekly flights starting in 1995.

Copa’s LCC Copa launched Wingo, based on Bogota, Colombia in December 2016 with a fleet of four 737-700s. It currently operates flights to 16 destinations has a classic tiered fare and service structure common to low-cost carriers around the world. “With Wingo, we want to serve those who want to fly well at low prices,” said Vargas. “We want to be a low-priced good quality alternative for those who fly for the first time and for those who want to travel more but cannot afford it.” The airline’s fare structure gives passengers six options to personalize the flight experience. With extra payment they can choose from airport check-in, express lines at check-in, checked baggage. Pets, musical instruments and sports equipment are a separate charge along with food and beverage, seat assignments and the “Wingo Experto” seat, which has extra pitch. Passengers are allowed to carry on one personal item of up to six kilograms and one piece of hand luggage up to 10 kilograms without charge.

CARIBBEAN ARI

Caribbean ARI’s specialty concept store, The Caribbean Rum Collection, had another excellent year, helped by promotional support from Mount Gay

A year of pride

and industry by

JAS RYAT

Caribbean ARI’s flourishing travel retail operation in Barbados grew even stronger in 2016, thanks to the 50th anniversary of independence celebrations

2016

was a milestone anniversary for Barbados with the 50th anniversary of independence on November 30. Diaspora from around the globe flew in to participate in the celebrations – and Caribbean ARI’s airport operation shifted into top gear to reap the rewards. Caribbean ARI General Manager Toni McDonald says: “Caribbean ARI has been a key part of Barbados travel retail since 2007 and we proudly celebrated this milestone anniversary with a series of events and promotions in our three airside stores,” she says. “These included 50th Anniversary Exclusives, and limitededition products from Hennessy Cognac and Mount Gay rum drove sales in the liquor category. A special Pride & Industry gondola featured a range of premium, 100% Bajan products over the 50-day celebrations and together with our Taste of Barbados concept the category outperformed the previous year by 24%.” Caribbean ARI finished 2016 strongly with overall sales increasing by 5% compared to 2015. This was driven by double-

Whisky category expands “Our specialty concept store, The Caribbean Rum Collection, which opened in June 2015 had another excellent year,” says McDonald. “This was helped by tremendous promotional support from Mount Gay.” The whisky category also grew, strongly aided by the continued support of William Grant & Sons. New products listed this year include niche chocolatier The Green Monkey, a Barbados-made, premium gifting range of rum truffles, mendiants and confitures. The brands own boutique on the island is exclusively available at Runway Duty Free. The Green Monkey brand has outperformed the company’s expectations and is now in the top five selling brands. The operator has also secured exclusivity within the airport on St Lucy artisanal fragranced candles, another locally made premium artisan product, which has sold very well. Other than Caribbean ARI the St Lucy range is available only at Limegrove and premium Spa resorts on the island.

digit growth on liquor, tobacco, food and confectionery and fashion accessories.

New concept focusing on local foods In Q2 the operator opened its new Taste of Barbados concept focusing on local foods, which helped increase the subcategory by over 12% year-on-year. Its top three categories are perfumes and cosmetics, liquor, food and confectionery. Passenger traffic grew at 7.5% versus 2015, and even though penetration was marginally down on 2015, the company enjoyed good growth on the core liquor, tobacco and confectionery categories. Caribbean ARI has also been impacted by Brexit, which has had an impact on UK penetration rates due to the weak sterling rate versus the Barbados dollar. The UK represents 36% of the traffic and has the largest share of sales, followed by regional and US destinations. However, this has been offset somewhat by good growth in spend across the categories on all other key destinations, namely the US, Canada and regional traffic.

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

To celebrate the 50th anniversary of Barbados independence on November 30, Caribbean ARI staged a series of events and promotions, including a special Pride & Industry gondola highlighting a range of premium, 100% Bajan products

OF SWITZERLAND

SWITZERLAND

Monseñor Rodríguez, 654 - Ciudad del Este, PARAGUAY - Tel. + 595 (061) 500 645 MonalisaParaguay MonalisaParaguay SnapsMonalisa

MONALISA

Monalisa’s store in Paseo La Galeria has a definite appeal for customers looking for luxury goods and a chance to visit the company’s emblematic La Cave winery on the premises

Monalisa now in Asunción Paraguay retailer Monalisa brings its unique brand to the residents and tourists in the country’s capital city by

RONNIE LOVLER

n 1972, Monalisa opened its first retail outlet in Puerto Presidente Stroessner, actually Ciudad del Este – Paraguay, triggered by the economic boom generated from the construction of the Friendship Bridge between Paraguay and Brazil in 1965. Since inception, Monalisa was recognized as a luxury retail outlet and throughout the years it maintained its tradition, introducing all novelties in almost all categories of consumer products, including exclusive wines and champagnes in its cellar “La Cave” and grew to become a unique shopping experience distinct from its surroundings.

A view of the entrance to the Monalisa store in Paseo La Galeria. Even the entry into the store is an experience

After almost 45 years at the same location, Monalisa was encouraged by the economic boom in Paraguay and selected the flagship, newly opened, shopping center Paseo La Galería to expand its operations and solidify its presence by opening a second Monalisa in the capital Asunción (MO-2). Monalisa (MO-2) is meant to be an improved replica of the historical Monalisa flagship’s border store and it has dedicated an exclusive space for selective wine and champagne lovers at its newly inaugurated “La Cave.” Both stores are open for local residents and tourists. Nonetheless,

On display is just one of the exclusive wines available for purchase in Monalisa’s wine cellar, La Cave, in Asuncion

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Monalisa is investing highly in the local market for the sake of generating customer’s loyalty and steady growth in the local market. We take great pride with around 500 labels that we import from all over the world. The Asunción winery “La Cave” has designated spaces by label. In addition, it has a private seating for tasting. Monalisa defines its mission as an effort to “import and distribute luxury products, in order to enrich the lifestyle of our customers. We create opportunities to contribute to the growth of our country, ensuring individual and collective success.” And Monalisa is living up to its promise.

A fisheye view of the wine cellar in Monalisa’s wine cellar, La Cave, in its Asuncion store

SINERIZ

More than a

destination Siñeriz’ massive expansion in recent years is far from the end of the story as the company continues to create reasons to visit by

WENDY MORLEY

As a “destination,” Siñeriz offers a lot more than just shopping. Other amenities include restaurants, a cinema and a children’s play area, shown here

In addition to its extended fare, Siñeriz also carries more usual duty free items such as perfume and cosmetics

More than just a wine store, Siñeriz offers over 8,000 labels, with a focus on artisanal brands

With so much floor space and so many categories, Siñeriz needs plenty of checkouts, and it has them – 40, to be exact.

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

hile other Brazil border stores were having a very difficult time through 2015 and 2016, Siñeriz was busy increasing its floor space substantially. The store’s Commercial Manager Hilmi Abdullah says while it has not been easy adding space in a struggling economy, the company had planned the renovation for a long time and was well prepared. In addition, he says, the economy helped them streamline. “With the drop in sales we had more time to execute and analyze the company’s projects. We cut unnecessary expenses and focused on the most important services and opportunities at the moment, so on one hand we decreased the operational costs and on the other hand we invested in the planned expansion.”

Massive store is 100% Siñeriz Sineriz’ main store is enormous: 10,000 square meters of duty free space, featuring the main duty free categories plus plenty of other non-traditional items. “Our categories include food and beverage, electronics, perfumes/cosmetics, toys, clothes and outdoor goods,” Abdullah says. “The store does have some spaces dedicated to specific brands, decorated with branded furniture and décor, but these branded areas are not run as partnerships. We do not have any other companies working in our space,” says Abdullah. “We negotiate with brands on the space and the furniture in our branded areas.”

Surge in 2017 By all reports, Brazilian consumer confidence has begun returning, as of Q3 last year. Some companies are showing stunning improvements year on year. For Siñeriz, while 2017 has been especially good, 2016 was not so bad either. “We had a particularly nice 2016, and until this point 2017 has been awesome,” Abdullah says. “From January to April we had a fantastic period. In May things dropped a bit, which is normal after a great sales period. I think 2017 will be a very good year, with lots of opportunities.”

Something new Last year Siñeriz opened a new restaurant, and according to Abudullah the result has been spectacular. “We have always believed in quality. Our company, our projects and our thinking are always focused on this. When we opened the restaurant, we were confident that it would work well. First, because it is one of the most important restaurants in Uruguay, and second because will bring a new food experience to our region. But it worked better than we ever anticipated. Because of that, another important Uruguayan fast-food restaurant that until now has not had restaurants in the interior will open in Siñeriz Shopping before July 2017.” Since Siñeriz began its renovations, the goal has been to make the store a destination unto itself. According to Abdullah, again the reality has outperformed the goal. “In last December we opened the first integrated immigration center in Uruguay in Siñeriz Shopping. Uruguayan and

Brazilian immigration agents work there. This means, when you go from Brazil to Uruguay or from Uruguay to Brazil you must go to the Siñeriz Shopping to fulfill the formalities and legally go from one country to another. Besides of all the food and shopping experience, now you can solve the legal formalities in Siñeriz Shopping.”

Downtown location fared well While Siñeriz Shopping may have become a destination unto itself, the company also has a downtown store. While this store also grew during reconstruction, its offer is not as grand. Despite this, and despite the fact that many downtown stores really did suffer during the downturn, the Siñeriz downtown store held strong. “As with all the downtown stores at this location we felt it a little more, but its sales were not too different. This location may not have the parking, food court, cinema or any other facilities/services that Siñeriz Shopping has, but it is still the biggest downtown store and has a strong location just one block off the main city street.”

Over 8,000 labels One of the many draws at Siñeriz Shopping is the wine. “We have more than 8.000 different labels in stock,” says Abdullah. “We are not just a wine store; we are a specialized wine store. We have selections that range from inexpensive Chilean brands to the most exclusive French brands, for which we have exclusivity in Uruguay,” He says customers’ tastes are changing, and these changes mirror what the industry is seeing with beer and spirits: the move toward craft and artisanal brands. “We are seeing a change in the consumer selection,” Abdullah says. “Not specifically in the price, but in the quality. They are not just buying brands that are well known or for which they see many advertisements; they are choosing wines for the quality, principally the ones that are artisanal made.”

Coming next If anyone thinks Siñeriz Shopping’s management might rest for a little while after all the renovations and additions in recent years, they would be incorrect. The company’s most recent project is a renovation of the store’s furniture. “We started in May and will finish before August of this year. At the end we will have changed approximately 25 percent of the store’s furniture. This is a huge number considering that we have 10,000 square meters of floor space.” Without question, one of the reasons for the success of Siñeriz is its willingness to stay on top of its customers’ needs and desires. “We continue to change and update, looking to completely satisfy our consumer with new trends and brands, and keeping up to date with modern tendencies. We think it is very important that the consumer who lives far from the border and comes to visit us only once or twice a year sees things changing: new brands, new furniture, new corners.”

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RENÉ RIEDI – DUFRY

In keeping with Dufry’s mandate to offer a local feel, its Cancun store offers a truly Mexican themed Tequileria

Strengthening its foothold In less than three years, Dufry has acquired two major duty free operators, but the travel retail superpower continues to find new places to land by WENDY MORLEY

s with others doing business in South America, Rene Riedi, Division CEO Latin America for Dufry, says growth numbers are looking positive for 2017. “We started to see a change in organic growth in Q3 of 2016,” he says. “This year is showing a strong contrast to the same time last year. Peru, Chile, Mexico, the Caribbean, Ecuador and Uruguay all continue to do OK, but Brazilians are now really coming back.”

Rene Riedi, Division CEO Latin America for Dufry

While Brazil is always the biggest chapter of the South American economic story, Riedi says Argentina is also playing an important role since the new government changed the oppressive rule that tacked another 35% on for nationals using credit cards outside of the country. “Brazilians and Argentinians are both buying more,” he says.

Joint venture in Colombia Dufry has so many projects on the go around Latin America and the Caribbean that it’s a wonder Riedi even has time to discuss what’s happening. “It’s busy,” he says, “but manageable.” Much of the focus from Dufry’s Latin American office has been a new joint venture with DFASS in Colombia. In January of this year the companies were awarded a 10-year concession agreement to run the operations at El Dorado International Airport in Bogotá. Dufry has already been operating a successful joint venture with DFASS in Chicago, and DFASS was already established in Colombia.

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

This strong and positive relationship was important in Dufry’s decision to partner with the company. The joint venture, which is called Dufry-DFASS S.A.S., will operate two substantial duty free spaces in the International terminal, called Bogotá Duty Free. “We’re very busy right now; it’s a major development,” says Riedi. “Things are progressing nicely. We’ve set up a small management team and we will hire staff soon.” The El Dorado International Airport is located in Bogotá, the capital of Colombia. In 2015, the total passenger traffic was 30.2 million, making it the busiest airport in the country and third busiest in Latin America.

New and former space Because there is already a substantial duty free store, Dufry-DFASS will focus their efforts in offering a complementary assortment. “The main area consists of two stores facing each other; it’s not a true walkthrough, but the way we designed it makes it appear like a walkthrough,” says Riedi. “There will be an additional space of approximately 880 square meters in the new terminal extension. We will offer all core categories in the central island space. Across the corridor

Dufry, in partnership with DFASS, is opening two duty free spaces in Bogota’s International terminal, opening in July, and a duty paid space in the airport’s Domestic terminal, opening later in the year

we will have fashion and luxury offer with brands such as Chanel and Victoria’s Secret. In the other space in the new terminal extension we will repeat our core categories but also offer additional concepts such Timebox, a fashion watches concept; Suncatcher, a sunglasses concept; L’Atelier, an apparel concept and Tech on the Go, an electronic concept.” The Hudson News convenience concept, which Dufry brought to Brazil in 2014, has been rolling out throughout South America, and will be opening in Colombia as well. “Dufry’s plan is to continuously foster the international roll-out of the Hudson concept,” says Riedi.

Duty paid in Departures The duty free area will be open in July. A little later in the year, Dufry-DFASS will also open a duty paid store in the Domestic Departures terminal. The duty paid store, which will have a floor space of approximately 900 square meters, will be a walkthrough store offering all the traditional duty free items: liquor, P&C, watches, food/confectionary, jewelry and accessories. Also on offer will be a Hudson News store and a Tech-on-the-Go electronic store.

Anchor position in Mexico City Dufry has been awarded a concession contract to operate a duty free shop at Mexico City airport Terminal 2 with 400 square meters of duty free retail space. Mexico City airport is the busiest airport in Latin America. The airport received 41 million passengers in 2016, of which 14 million were international passengers. Dufry already operates over 20 shops at the airport, including general travel retail shops, brand boutiques, specialized shops and convenience stores. The new store, which is located centrally in the terminal, is accessed just past security. Like the Colombia duty free stores, this one is expected to open in July.

Cruising around the globe With the cruise industry growing around the globe but the majority of the business still in the Caribbean, it seems natural that Dufry’s Miami office might set its focus on the cruise industry, and indeed it has. Early this year Dufry signed an agreement with Grupo Pullmantur to operate all gift shops onboard their fleet, close to 2,000 square meters distributed across four ships, until 2022. The shops will offer

Earlier this year, Dufry Cruise Services won an agreement with Grupo Pullmantur to operate all gift shops onboard their fleet

a wide range of products from several different categories such as liquor, tobacco, perfumes, cosmetics, confectionery and watches in addition to jewelry, fashion, accessories and sunglasses, among others. One year ago Dufry Cruise Services operated on nine ships, whereas now that number is 16. While the cruise business is rapidly growing in Asia, the main hub of the cruise ship industry is still Miami, with the three main players: Carnival Corp., Royal Caribbean International and Norwegian Cruise Line cumulating nearly 75% of the market, “It makes sense for Dufry Cruise Services to be run from Miami, but it’s supported by operating units in Hong Kong, Barcelona and Miami. With this structure we can easily support the busy and fast-growing cruise market,” says Riedi.

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RENÉ RIEDI – DUFRY

The Cancun duty free store is just one of the many projects throughout LATAM and the Caribbean that Dufry has been working on lately

Fortaleciendo su posición

l igual que otros funcionarios que hacen negocios en Suramérica, René Riedi, Director Ejecutivo de la División de Dufry para Latinoamérica, afirma que las cifras de crecimiento son positivas en el 2017. “Comenzamos a ver un cambio en el crecimiento orgánico durante el tercer trimestre del 2016”, explica. “Este año está mostrando un fuerte contraste con el mismo período del año pasado. Perú. Chile, México, el Caribe, Ecuador y Uruguay siguen teniendo una buena marcha, pero los brasileños están en franca recuperación”. Si bien Brasil es siempre el capítulo principal de la historia económica suramericana, Riedi destaca que Argentina también está desempeñando un papel importante desde que el nuevo gobierno cambió la ley opresiva que gravaba otro 35% a los nacionales que

En menos de tres años, Dufry ha adquirido dos notables operadores duty free, pero la superpotencia minorista de viajes sigue buscando nuevas sedes para afianzarse

usaban tarjetas de crédito fuera del país. “Tanto los brasileños como los argentinos están comprando más”, asegura Riedi.

Empresa conjunta en Colombia Como Dufry tiene numerosos proyectos en marcha en Latinoamérica y el Caribe, es una maravilla que Riedi pueda disponer incluso de tiempo para analizar lo que está ocurriendo. “Hay mucho trabajo”, afirma, “pero es manejable”. Gran parte del enfoque de la oficina de Dufry para Latinoamérica ha estado en una nueva empresa conjunta con DFASS en Colombia. En enero pasado las compañías obtuvieron un convenio de concesión de diez años para llevar a cabo operaciones en el Aeropuerto Internacional El Dorado de Bogotá. Dufry ya ha estado operando una exitosa empresa conjunta con DFASS en Chicago, y DFASS ya se ha establecido en

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Colombia. Esta relación sólida y positiva fue importante en la decisión de Dufry de colaborar con la compañía. La empresa conjunta, que lleva el nombre de DufryDFASS S.A.S., operará dos sustanciales espacios duty free en la terminal internacional, llamados Bogotá Duty Free. “En estos momentos estamos muy ocupados. Es una tarea importante”, revela Riedi. “Todo va progresando a la perfección. Hemos creado un pequeño equipo de gerencia, y pronto contrataremos personal”. El Aeropuerto Internacional El Dorado está ubicado en Bogotá, la capital de Colombia. En el 2015, el tráfico total de pasajeros fue de 30.2 millones, para ocupar el primer lugar en actividad del país, y el tercero en Latinoamérica.

Espacios nuevos y ya existentes Como ya cuenta con una sustancial tienda

RENÉ RIEDI – DUFRY

duty free, Dufry-DFASS concentrará sus esfuerzos en ofrecer un surtido complementario. “El área principal consiste en dos tiendas una frente a otra. No es un auténtico espacio de tráfico obligado, pero la forma en que lo diseñamos es muy parecida”, explica Riedi. “Habrá un espacio adicional de 880 metros cuadrados aproximadamente en la extensión de la nueva terminal”. “Ofreceremos las categorías principales en el espacio de la isla central”, continúa Riedi. “Al otro lado del corredor tendremos una oferta de modas y lujo, con marcas como Chanel y Victoria’s Secret. En el otro espacio de la extensión en la nueva terminal repetiremos nuestras categorías fundamentales, pero también ofreceremos conceptos adicionales como Timebox, un concepto de relojes de moda; Suncatcher, un concepto de lentes de sol; L’Atelier, concepto de vestuario; y Tech on the Go, un concepto electrónico”. Por su parte, el concepto de tiendas de conveniencia Hudson News, que Dufry llevó a Brasil en el 2014, ha sido inaugurado en toda Suramérica, y también se incorporará en Colombia. “El plan de Dufry es fomentar continuamente la puesta en marcha internacional del concepto Hudson”, añade Riedi.

Dufry con pago de aranceles en sección de salidas El área duty free será inaugurada en julio. Poco después, Dufry-DFASS también pondrá en marcha una tienda con pago de aranceles en la terminal de salidas nacionales. El establecimiento, con un espacio de aproximadamente 900 metros cuadrados, será una tienda de tránsito obligado con todos los artículos duty free tradicionales: licores, perfumería y

While the duty free area in Bogotá is not actually a walkthrough, it is designed to mimic and function like a walkthrough

cosméticos, alimentos/confitería, joyas y accesorios. Además, habrá una nueva tienda Hudson News y otra de efectos electrónicos Tech-on-the-Go.

en un espacio privilegiado de la terminal, a la salida del chequeo de seguridad. Se espera que, al igual que las duty free de Colombia, sea inaugurada en julio.

Posición privilegiada en Ciudad de México

En cruceros por el mundo

Dufry recibió un contrato de concesión para operar una tienda duty free en la Terminal 2 del Aeropuerto de Ciudad de México, con 400 metros cuadrados de espacio minorista duty free. Dicho aeropuerto es el de mayor actividad en Latinoamérica, y recibió 41 millones de pasajeros en el 2016, de los cuales 14 millones fueron extranjeros. Dufry ya opera 20 tiendas en el aeropuerto, como establecimientos minoristas de viaje generales, especializadas y de artículos de primera necesidad. La nueva tienda está ubicada

Along with other traditional duty free categories, Dufry will offer fashion watches at its duty free and duty paid locations in Bogota, in addition to its cruise ship stores and other new locations

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Como la industria de cruceros está creciendo en todo el mundo, pero la mayoría de las operaciones se realizan en el Caribe, parece natural que la oficina de Dufry en Miami podría enfocarse en dicha industria, lo cual ha estado haciendo. A principios de año, Dufry suscribió un convenio con Grupo Pullmantur para operar tiendas a bordo de su flota, con unos 2,000 metros cuadrados distribuidos en cuatro barcos, hasta el 2022. Las tiendas ofrecerán una amplia gama de productos de diferentes categorías como licores, tabaco, perfumes, cosméticos, confitería y relojes, además de joyas, modas, accesorios y lentes de sol, entre otras. Hace un año, Dufry Cruise Services operaba en nueve barcos, una cifra que se ha elevado actualmente a dieciséis. Si bien la industria de cruceros está creciendo rápidamente en Asia, su principal centro sigue siendo Miami, con tres compañías principales: Carnival Corp., Royal Caribbean International y Norwegian Cruise Line que abarcan casi el 75% del mercado. Por tanto, “tiene sentido que Dufry Cruise Services opere desde Miami, pero con el apoyo de unidades de operaciones en Hong Kong, Barcelona y Miami. Con esta estructura podemos respaldar fácilmente el mercado de cruceros activo y en rápido crecimiento”, concluye Riedi.

AIRPORTS: ARGENTINA

New infrastructure The priority for Argentina’s new government has been economic stimulus. To create many thousands of jobs in addition to providing a better framework for business development, a large sum has recently been earmarked to target infrastructure across the country by

WENDY MORLEY

While most of the US$1.42 billion investment will go toward updating terminals in other cities, Ezeiza in Buenos Aires will receive some upgrades as well

PHOTO BY LUIS ARGERICH

A Argentina’s Minister of Transport Guillermo Dietrich, pictured at far right as President Macri announced infrastructure spending last year PHOTO BY CASA ROSADA ARGENTINA

Dufry has renovated a number of its stores in Argentina, including this shop in Ezeiza

rgentina’s Macri government, elected late in 2015, wasted little time making changes that affect travel retail in the region. Almost as soon as the new government took its newly dusted seats, it halted the tax that forced Argentine nationals to pay an extra 35% on credit card usage outside of the country. While that decision may have helped Argentine nationals to travel more or at the very least shop more while traveling, it didn’t help bring money to the country. But the new government has made no secret of its goal to vastly improve the economic outlook of Argentina, from attracting tourism, business and investment to providing jobs. The government’s announcement that it would be investing in infrastructure is expected to go far in all of these areas.

Cross-country air transport investment While, by all accounts, Argentina’s air transport industry has languished on the back burner for the past 15 years or more, the industry has now come forward and entered the spotlight. Minister of Transport Guillermo Dietrich announced late last year that the government will be spending approximately US$1.42 billion over four years to upgrade its air transport infrastructure, focusing on 19 of the 54 airports across the country. “The majority

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Jujuy province, which is receiving a new airport, boasts strikingly beautiful colored hills as one of its tourist attractions

administration’s agenda will open up opportunities for aviation to play a key role in the country’s development, with priorities including improved safety, quality infrastructure and reduced charges and taxation. “There is an opportunity to put Argentina on the map in regional terms and in global terms,” says Cerda in an IATA special report. “It is a great country. There are issues to resolve, but the stakeholders are having positive discussions. Aviation is finally on the agenda of the Argentine government and there is no doubt that there can be a win-win relationship between the government and the industry.”

Remote regions to benefit

PHOTO BY AUGUSTO SARITA

of airports haven’t seen work for more than 30 years,” Dietrich said. In part, these upgrades are expected to increase air carrier competition, meaning increased routes and reduced airfares. Ryanair, Wingo and Flybondi have all reportedly already expressed interest in entering the lower-cost airline market in the country, although Dietrich says there are no plans to lift regulations for foreign carriers to compete in domestic markets. Currently few of the country’s airports accept international flights. This air transport investment is part of an overall infrastructure spend that includes highways, railway lines and trains, to foster increased economic viability.

Improved traveler experience Most of the airport expenditure will go toward rebuilding, extending and modernizing terminals, thereby increasing operating capacity and improving traveler experience, in addition to improving control towers and landing operations. Newly renovated arrival and departure lounges, more check-in points and free WiFi in all terminals are some of the stated upgrades. This is in line with the government’s announcement that it would be focusing on increasing tourism to the country. Whereas other airports including Ezeiza (Ministro Pistarini International Airport) – the main international airport in Buenos Aires and one which is already

seeing terminal renovations – will see operational improvements such as new control towers, repaved runways or extended aprons, as part of the newly announced infrastructure plan the following airports will all see terminal rebuilding or renovations, which should offer opportunity for greater retail presence: • Aeroparque: Extension of the terminal • Mendoza: Extension of the terminal • Tucumán: New terminal • Comodoro Rivadavia: New terminal • Jujuy: New terminal • San Juan: New terminal • Catamarca: New terminal • Esquel: Refurbishment of the terminal • Formosa: New terminal • Posadas: Refurbishment of the terminal • Bariloche: Refurbishment of the terminal • La Rioja: Extension and readjusting of the terminal

A wise investment According to the IATA, aviation is worth $9.6 billion to Argentina’s GDP and supports 370,000 jobs. Meanwhile air traffic in the country is set to rise at 5.2% per year through 2020, although the Argentine government has stated it would like to see domestic air travel double over the next four years, helped by these new investments. Peter Cerda, IATA’s Regional Vice President for the Americas, says the new

While the four-year airport-improvement plan is mainly focused on passenger travel, the plan also seeks to boost commercial capacity at remote airports across the country to stimulate air-transported exports of local production, such as produce, and allow for greater business potential in general. The province Jujuy, in the northwest of the country, for example, will receive what amounts to a brand-new airport. Approximately US$42 million will be invested in its construction, which includes a new control tower, new parking lot, more sleeves and a new terminal. “It’s been 56 years since the airport was built,” said Dietrich, at a public announcement in the province. “After so many years we are going to build a completely new airport.” He suggested that more remote provinces such as Jujuy could develop much greater than currently is happening, in commercial business, industry and tourism, but to do so these regions require investment capital such as this.

Funding in action The Argentina Infrastructure PublicPrivate Working Group (IPPWG), established in late 2016, has made a number of suggestions to help fund the country’s complete infrastructure development plan, including airports, trains, rail systems and highways. Among other suggestions such as developing a selfsupporting agency like the Port Authority of New York and New Jersey, the IPPWG suggests attracting international investors. To that end Minister of Transport Dietrich has presented in other countries such as China.

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GUEST WRITER

A story of

success

Moroccanoil has become a true multi-category lifestyle beauty brand thanks to a new division that supports its booming travel retail business JOHN W. GATES, Vice President, Retail and Travel Retail Sales, Moroccanoil by

ast summer, Moroccanoil launched its travel retail business presence in Latin America with inflight offerings onboard Avianca and LATAM Airlines with DFASS and DFW, respectively. An article about the launch and expansion in the Asutil 2016 issue of this magazine predicted that the ongoing success of Moroccanoil in travel retail seemed assured. Since then, we have proven that prediction to have been on the mark. The Moroccanoil story is one of suc-

cess, from creating the worldwide buzz on argan oil to global expansion into the travel retail market. Our duty free growth in Latin America has been no different. In addition to renewing future inflight listings with Avianca and LATAM Airlines with the iconic Moroccanoil Treatment, The Traveler, we’ve opened new doors in premium airports through Dufry. Moroccanoil is now available in Argentina at Buenos Aires Ezeiza International and Aeroparque Jorge Newbery airports. In Uruguay, we have a presence at Carrasco International and Capitán de Corbeta Carlos A. Curbelo International airports. We most recently launched in Brazil at Galeão International Airport in Rio de Janeiro and Guarulhos International Airport in São Paulo.

An impulse for innovation

An example of Moroccanoil’s expansion into Latin America. This new installation is in Montevideo, Uruguay

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Following our impulse for innovation has yielded some truly marvelous results. Since 2014, when we started aggressively pursuing travel retail, we have secured partnerships with Duty Free Americas, DFS, Dufry, Gebr Heinemann, Kappe and Nuance, as well

as established an inflight presence onboard British Airways, KLM, Lufthansa and Swiss. The Latin American market is top of mind in our travel retail expansion strategy. Demand for Moroccanoil is particularly enthusiastic in Latin America, which has always been one of our leading markets in both brand awareness and sales volume. We’re exploring possible expansion of our inflight product offering to further service our Latin American consumer, but for the moment we’re staying focused on spreading The Traveler far and wide.

A relentless pursuit of simple, high-performing products At the core of Moroccanoil products has always been ease of use, which lends itself naturally to travel retail. Jetsetting consumers picking up hair and body care products at the airport will find the Moroccanoil travel offering to be perfect to throw in a carry-on for nourished skin and hair, anywhere. Travel-sized Moroccanoil products can be used quickly and easily by those on the go. Travel retail is supported by our newest division, the Moroccanoil Beauty Division, which encompasses hair care, Moroccanoil Body™ and Moroccanoil Sun™. This division perfectly complements our Professional Division, which is long-beloved in the salon and spa community. This consumer touchpoint is perfect for our easy-to-use travel offering, and solidifies the Moroccanoil Beauty Division as a true multi-category lifestyle beauty brand.

32nd Annual 32e Congrès Convention annuelle Canada’s Exclusive Duty Free Convention

Congrès exclusive de l’association hors taxes du Canada

DANIEL WELLINGTON

A great style

companion Fast-growing watch brand Daniel Wellington is aiming to appeal to the global traveler with its sleek and minimalist timepieces by

JAS RYAT

Daniel Wellington has recently partnered with supermodel Kendall Jenner to introduce Classic Petite timepiece

ook on the wrist of any millennial traveler and there’s a good chance their watch comes from Daniel Wellington, thanks to its sleek design and a new partnership with a supermodel. The travel retail channel is a key focus for the brand, as Brianna Amoroso, Key Account Manager, Travel Retail, explains. “Our goal is to develop a strong cruise presence throughout the Americas, especially in the Caribbean and US, as well as a strong focus on expanding our border shop business in Latin America, Canada and the US military. We are also further developing our traditional airport retail with key partners,” she says. In Europe, Daniel Wellington is developing its strong presence with existing key partners and focusing on enhancing

each POS. The company continues to invest in its team and has hired a new merchandiser who focuses on travel retail in Europe. Further, it is opening up more pop-up stores at airports. An upcoming market is the UK together with World Duty Free Group, with which it is present at all the main airports in the region. For Asia Pacific, Daniel Wellington has established a strong duty free network across key markets, particularly in Korea, Hong Kong and Southeast Asia. The brand is present with its partners in duty free downtown gallerias, airport stores and inflight with key operators. In 2017, the company will focus on expanding its presence in newer markets such as Australia, the Middle East and Latin America.

Partnership with Kendall Jenner Daniel Wellington is a Swedish brand founded in 2011. Known for its sleek and minimalist design, it offers timeless accessories, worn on all occasions by men and women all over the world. Since the inception, Daniel Wellington has sold over 6 million watches, and established itself as one of the fastest-growing brands in the watch industry, says Ola Melin, Daniel Wellington’s Public Relations Manager.

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

“We have recently partnered with Kendall Jenner to introduce Classic Petite. Classic Petite is a statement timepiece that truly reflects the design approach of Daniel Wellington. As the latest addition to the Classic collection, the new 32mm watch offers a minimalist and contemporary look, imbued with attitude,” he says. Made from stainless steel, Classic Petite is available in rose gold and silver and with a black or white dial. Asked about why the brand has been successful, Melin says: “Daniel Wellington offers sophisticated and classic designs – at an attractive price point. We are excited to see that people of all walks of life are wearing their very own Daniel Wellingtons. As a great style companion, our products accompany the student, the professional, the athlete, the artist, the traveler, as they tell their stories from all over the world.” A cornerstone of the Daniel Wellington brand is its community’s enthusiasm, dedication and creativeness, he adds. “The massive engagement and participation from people all over the world is inspiring and humbling, and something we are incredibly proud of. What innocently started out as a way to show the world our watches, has in five years evolved into an ever growing and incredibly powerful global movement that continuously pushes the boundaries for what a community can achieve together,” concludes Melin.

MOSQUITNO

Taking a bite out of travel retail MosquitNo B.V. aims to fill a gap in the market for effective insect repellent products that are retailer and consumer friendly by

JAS RYAT

osquitNo is entering the travel retail channel with a serious but at the same time light-hearted message to travellers and families. Every year, approximately 800,000 people worldwide die from a mosquito bite. MosquitNo’s products protect against these mosquitoborne diseases. “We see a great opportunity in protecting not only the casual traveler, but also the permanent resident and the complete family in high-risk areas,” says Gabriel Czemerys, who is responsible for MosquitNo sales for the Americas. “This means there is a huge opportunity for us in both airport arrival and departure shops as well as in the domestic market, such as pharmacies, beauty stores, convenience stores, the high-end department stores, specialty and sportive stores, e-commerce or web sales and for shop-in shops concepts. “These huge opportunities are exactly the reason we exhibited at the TFWA Asia Pacific this year,” he adds. The Dutch company believes that by making the solutions to common travel problems fun, it enables consumers to explore adventurous destinations worldwide. “We make the reality of warding off numerous, tiny and dangerous critters – such as mosquitos – fun and light-hearted with our ‘don’t bite me please’ slogan.” The company’s products were developed to complement every style and preference, from towelettes to 2in1 sprays and creams, to stickers and bracelets. All products are 100% DEET-free and non-toxic. “Our all-natural ingredients,

creative designs and high-end packaging distinguishes us from any competitors that might attempt to match our unique style and product effectiveness,” explains Czemerys.

New effectiveness tool for consumers This year, MosquitNo’s main focus is to introduce its innovative Insect Repellent Factor (IRF) tool. Just like the SPF factor for sun creams shows how protective the sun cream is to the sun, the company has developed a tool that shows how effective the insect repellent is against mosquitoes. IRF includes four factors: 1 to 4. The higher the factor, the more powerful the protection against insects like mosquitoes and ticks. The IRF is also designed to help retailers create displays and planograms based on the product effectiveness. Using the new travel retail campaign ‘Bite Prevention For Travelers and Families ’, MosquitNo seeks to remind travelers of the importance of a good insect repellent. Through an exclusive joint development, MosquitNo has created a groundbreaking 2in1 skincare series protecting

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

against both the sun and mosquitoes. The firm has also developed new standalone displays to support its campaign, which can be seen at airports in Europe and Asia. “We know that mosquito products are among the most commonly forgotten items when packing. To remind the savvy traveler, we grab them with our signature white and lime green packaging and displays like the new standalone display. Then we amuse and entertain them with our edgy and catchy logo ‘MosquitNo’ and ‘don’t bite me please’ slogan.” Because of the publicity surrounding the Zika virus, MosquitNo has seen a huge sales uptick, and the average spending in this category is significantly growing, notes Czemerys. MosquitNo’s business priority is to develop the market in Central, South America, and the Caribbean where the Zika virus is spreading. Additionally, the firm wants to place more displays at fixed locations at airports and duty free shops. “We are also focusing on the developments in travel retail e-commerce. Together we can protect the citizens of the world against mosquitoes,” he concludes.

MosquitNo sees huge opportunities for its innovative insect repellent products in travel retail and has launched a campaign taglined ‘Bite Prevention For Travelers and Families’

DRINK RESPONSIBLY

REPUBLICA DEL CACAO

Destination

chocolate

This focus on experience has led Republica del Cacao to concentrate on the travel retail channel

Republica del Cacao creates fine, single origin chocolates from Latin America’s most famous tourist hotspots and is proud of its sustainability program for local farmers

cuador-based chocolate specialist Republica del Cacao is on a mission to excite travelers with its Latin American “cacao destination” concept that offers a single origin product of the highest quality and – most importantly of all – provides a memorable travel experience. This focus on experience has led the company to concentrate on the travel retail channel, as Daniela Ribadeneira, Key Account Manager, explains. “Our strategic placement along the traveler’s route and our ‘cacao destination’ concept, together with our brand image and our premium quality products, have led travelers to choose our products as the premier souvenir when departing home. This has turned airport sales through duty free and duty paid channels into Republica del Cacao’s most important strategic focus,” she says. The brand is currently present in duty free stores in Lima, Santiago, Vancouver, Jordan, Guayaquil, Quito, and in LAN’s inflight magazine.

cacao powder and blended cacao beans, which are designed to be the perfect gift for chocolate lovers. The company’s sales support local fine cacao farmers, through technical education and modern ecological farming techniques. “We work hand in hand with over 2,000 farmers in agricultural education and responsible plantation management, paying fair prices and improving the lives of those who work on keeping native fine cacao varieties from extinction,” says Ribadeneira. Today, Republica del Cacao has expanded its operations to Colombia and Peru, creating fine aroma single origin chocolates and commercializing them through chocolate concept boutiques and duty free shop-in-shops. Republica del Cacao aims to expand its collaborative approach with the small farmer to other fine cacao-producing countries and extend further into new destinations that sell premium chocolates made with the finest cacao varieties from Latin America. The firm sees as potential markets The perfect gift for Jamaica, Dominican Republic, Mexico, chocolate lovers and Bolivia that are cacao-producing Republica del Cacao creates fine chococountries which would allow it to create late bars with single origin cacaos, pure single origin chocolates from each country. But it also aims to expand to Europe and United States providing premium chocolates made with different varieties of cacao from Latin America. The brand’s target Republica del Cacao creates premium single origin chocolates, using group are travelers authentic packaging that tells the story behind each of the products

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

who want to experience new cultures, new cuisines and want to bring home high quality souvenirs. This type of consumer is looking for something different and authentic as a souvenir, believes Ribadeneira. The customer profile is similar in the different markets where it has a presence.

Packaging tells the story of each product Republica del Cacao’s traceability process allows it to create and produce fine aroma single origin chocolates that are found in some of the most important tourist destinations in South America, such as the Galapagos Islands, the city of Cusco, and Cartagena. The company creates premium single origin chocolates, using authentic packaging that tells the story behind each of the products, the support for local fine cacao farmers, the ingredients it is using. “Each chocolate bar has a different story,” she says. This year the brand is launching two new collections. The Limited Edition Collection is a premium luxury collection for customers aiming to purchase a premium souvenir or gift. Meanwhile, the Wellness Collection is a range of three chocolate bars. Two of them are organic and made with 85% and 75% cacao solids. The third one is a 65% chocolate bar with cane sugar. As the brand is mainly focused on travel retail, all of its presentations are designed to be the perfect gift and souvenir for chocolate lovers. “Republica del Cacao offers more than the tangible wrap-andgive gift, we offer an experience- related purchase,” enthuses Ribadeneira.

PREMIER GLOBAL TRADING

PGT introduces Myme Electronic Accessories for Latam duty free Now in its seventh year in business, Premier Global Trading, is a US based, full service sales and marketing company specializing in DF/TR. We are pleased to announce that we are expanding our territory to include Latin America with Myme, our trendy and innovative tech accessories’ brand, says company President Elizabeth Taylor

remier Global Trading represents a variety of major manufacturers and global brands for the sale and distribution of their products throughout the Americas duty free/travel retail and the Caribbean. This year, Premier Global Trading’s travel retail focus is to establish the Myme tech accessories’ brand in travel retail in Latin America. Myme offers a full array of trendy electronic accessories for travel or everyday use. Compatible with most equipment, it is available in Apple MFI certified products and products that are universal. Attractive and smart packaging identifies features and specs in up to 6 languages on every package and with “how-to-use” photo features as well. Myme is able to quickly create products as new technologies emerge. With new items specifically designed to cater to the needs of the traveling consumer. Myme offers a premium look and sound at affordable prices,” she says. The star product is the Unity System – A brilliant new system that is magnet based and allows you to securely place your phone just about anywhere you go. The cradle adheres to any smooth, flat, clean surface with a security system that locks it into place allowing your phone to safely swivel in 360 degrees. According to Hamid Mekki, Myme co-founder and CCO, the Myme Unity system is the most unique, innovative eco system for mobile phones available anywhere to date. Other items geared toward travel retail include waterproof bags to protect phones, water-resistant speakers, back-up

batteries featuring a light on them and many more.

New line designed for athletic market Our new line named Myme FIT is specially designed for sports enthusiasts. This collection includes wireless, sweat-proof ear buds, incorporating a magnet in the buds to lock them in place around your neck when not in use. “Myme is a very contemporary brand, constantly coming out with new products,” says Taylor. Growth market for Premier Global Trading is cruise ships. The Myme brand is listed on 65 cruise ships around the world and this channel is growing. So who is buying Myme products? Everyone, it seems. “There’s no particular age demographic, because these are products that all people need,” says Taylor. “If you are on the run and you forgot your charger, ear buds, cables, adaptors, etc, it’s an inexpensive way to resolve your problem with good quality products. The products are suited to travellers, attractively packaged with good pricing, so we can stand up to the bigger brands.” The retail price points range from US$8 to $30 on average.

Customer service is key

Myme advantage -- we can create unique and interesting fixtures to fit into any merchandising space or opportunity” she notes. Premier Global Trading has updated its website to offer information on all the brands and products they represent, giving customers 24/7 access to see what is available in each brand. “Myme, offering a premium look and sound at affordable prices.,” she enthuses. Elizabeth Taylor will be at Asutil 2017, Rio de Janiero and looks forward to presenting the Myme brand there.

Premier Global Trading’s travel retail focus is to establish trendy tech accessories brand Myme tech into travel retail in Latin America

Taylor is keen to emphasize Premier Global Trading’s customer service credentials. Premier Global Trading is also known for customizing its services to the specific needs of its retail partners. PGT has the flexibility to tailor our programs, always looking to maximize sales and to build our customers’ bottom line. “A www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

STOLI

Line expansion After its earliest days as the global vodka and the past few years re-establishing itself in this light, Stoli is adding new brands and depth to the company’s portfolio by

he craft revolution that began with beer has definitively spread to the world of spirits. While whisk(e)y represents the bulk of the craft spirit market, vodka, rum and tequila have each seen its share of the market grow significantly over the past three years. Stoli Group, which already offers exceptional craft-vodka products such as elit® by Stolichnaya, is expanding into craft rum and tequila with the addition of Bayou Rum and KAH Tequila to its distribution portfolio. The company sees duty free, particularly in cruise lines and American airports, as a key channel for building these new brands, and remains very optimistic about achieving growth in 2017.

Cruise and the Americas Although 2016 had its fair share of challenges, Stoli Group successfully secured new menu listings, cocktails of the day, and exclusive partnerships with cruise lines that delivered strong results across the board. Dayna Dennington, Regional Director North and Central America – Caribbean Duty Free, says: “We expect to see continued growth in cruise lines, a very dynamic channel for us.” In the challenging retail environment, the company will continue to focus on offering unique shopping experiences and selections for the discerning international airport traveler. North America continues to be the leading travel retail market for Stoli, and the region where the company anticipates the most growth over the next few years, 62

but it’s also seen steady growth in Latin America, where Stoli is now the thirdlargest imported vodka brand – a trend driven by the Mexican and Brazilian markets. The recent acquisition of Bayou Rum and KAH Tequila, both of which have been featured in Cannes and at IAADFS, provides Stoli with a new avenue into these markets.

New lines Bayou Rum, which has already carved out a niche in the cruise line channel and is making its way into airports, is a handcrafted, pot-distilled American rum produced from fresh Louisiana sugarcane and offering four SKU’s: Silver, Spiced, Select, and Satsuma liqueur. Stoli Group is excited to be at the center of a growing craft rum category with an Americanmade craft rum that is direct from Louisiana. “We believe this gives Bayou added appeal,” says Dennington, who adds that the rum’s quality “makes it as good to sip as any premium whiskey.” Multiple award-winning KAH Tequila, meanwhile, was designed to pay reverence and honor to Mexico and its people. It features four expressions, each crafted from hand-selected 100% blue agave and each presented in its own uniquely decorated, handcrafted and spirited skull bottle. Dennington says KAH Tequila is “made for duty free with its unique packaging design, super-premium positioning, and great liquid.”

Activations and experiential events To promote Bayou Rum and KAH Tequila, Stoli is focused on the integration

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MAX MISHLER

of interactive, multi-sensory activations and experiential events that leave a lasting impression. These 360-degree activations build on Stoli Group’s airport activations for vodka products, including the recent Stoli Gluten Free activation at the Las Vegas McCarran International Airport with customer Dufry. Dennington explains, “With a strong emphasis on Stoli Gluten Free ingredients and production processes, we successfully introduced this innovative product to consumers through tastings, GWPs and on-shelf promotional pricing.” Noting market trends, Stoli successfully introduced a gluten free vodka to the market last year

MONARQ

MONARQ recently launched Compass Box, a spectacular range of innovative blended Scotch, blended malts and blended grain whiskies spot on with current trends

Southern rule For MONARQ Group, double-digit growth is the norm, and that has continued in LATAM in recent months by

WENDY MORLEY

obert de Monchy, CEO of MONARQ group, says doubledigit growth has continued in the past three quarters as it has in recent years. As the Brazilian Real has stabilized and consumer confidence has returned, he sees a positive change in the region: “Brazilian borders are all picking up, so Uruguay, Paraguay, Argentina, Chile and Peru are also performing very well.” In Caribbean and LATAM, MONARQ services both domestic and duty free, but in the US the company also serves the duty free channel. “In duty free our focus is in three regions,” says de Monchy. “The US, Caribbean, Latin America. In Latin America, our particular focus for duty free is the South Cone.”

Expanding regions While LATAM has been depressed, the Caribbean has been strong, though not by any means across the board. While some countries have seen overnight guests increase in double and even triple digits, others have fallen into negative growth.

Does de Monchy see any correlation with the South American vs US economies? Might the countries that tend to see more South American tourists see things pick up in coming months? “We don’t really see this connection/ tendency,” says de Monchy. “Despite economic challenges in key countries such as Puerto Rico, Barbados and Trinidad, the overall Caribbean region has been performing well in 2016 and continues to do well. Latin America is showing a stronger growth percentage but is on its way back.”

Craft, heritage, authenticity As with other areas globally, de Monchy says he sees a general trend towards brands with heritage, authenticity and craftsmanship. “Categories that are gaining particular interest are single malt and specialty whiskies such as blended malts, Bourbons and new world whiskies,” he says. “Gin also remains another vibrant category, especially in the premium and super-premium segments.” Another trend he notes is towards local and regional spirits such as cachaça, pisco, rum, Tequila and mezcal. “Premium brands that are linked to the mixology trend, like vermouth and bitters, could well be next,” he suggests.

Ever-growing portfolio The news with MONARQ almost invariably includes new items in its portfolio,

and the current conversation is not an exception. “We recently launched Compass Box – a spectacular range of innovative blended Scotch, blended malts and blended grain whiskies,” says de Monchy. “In my opinion, this brand is absolutely spot on with today’s consumer trend. Our Japanese whisky portfolio with IWAI, Cosmo, Akashi and Togouchi are in high demand. As with the rest of our spirits portfolio, we warehouse these whiskies in Miami free trade zone, which ensures an uninterrupted supply. Another new one that’s very interesting is Paul John Single Malt from Goa in India, a multipleaward-winning new world whisky in a strong pack. While those might be the company’s newest brands, MONARQ has other stillnew brands that continue on an exciting growth curve. “Last but not least, Tomatin Single Malt Scotch is performing very well –beautiful pack, amazing quality and certainly not over priced. At the San Francisco Spirits Competition, the Tomatin range won numerous Golds and Double Golds and, above all, Tomatin 36 YO was announced ‘Best Scotch and Best Single Malt Scotch and Best Distillers’ Single Malt Scotch.’ Of course it can be no surprise that Heineken continues to do well in the region. It’s obviously a super-strong brand and we continuously activate the brand through promotions such as GWP’s.”

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LIQUOR NEWS

Diageo introduces Johnnie Walker Blenders’ Batch Bourbon Cask & Rye Finish Diageo Global Travel has just launched Johnnie Walker Blenders’ Batch Bourbon Cask & Rye Finish. This innovation is a new addition to its series of experimental whiskies: Johnnie Walker Blenders’ Batch – limited editions available only in a small number of select markets including travel retail. Johnnie Walker Blenders’ Batch Bourbon Cask & Rye Finish, featuring whiskies from just five distilleries including Dufftown and the now closed Port Dundas, has an intense flavor and honeyed sweetness. The liquid has been drawn from over 200 whisky samples, aged in first-fill bourbon casks and finished for up to six months in former rye casks. Johnnie Walker Blenders’ Batch Bourbon Cask & Rye Finish is inspired by time spent by Master Blender Dr. Jim Beveridge blending bourbons and ryes in Kentucky. He said: “Blended from just a handful of single malts and carefully chosen grain whiskies matured in first fill bourbon casks and finished in casks that formerly held rye whisky, Johnnie Walker Blenders’ Batch Bourbon Cask and Rye Finish is a rich, sweet, intensely honeyed and smooth Scotch whisky, with the warming vanilla spiciness usually associated with the iconic Johnnie Walker Black Label. To my mind, it’s the best of Scotch but with an exciting twist inspired by the best of traditional American whiskey flavors.” The limited edition Johnnie Walker Blenders’ Batch Bourbon Cask & Rye Finish is the second release from the Blenders’ Batch series, inspired by the recent success of Johnnie Walker Select Casks – Rye Cask Finish. It is available now in selected travel retail outlets globally. Johnnie Walker Blenders’ Batch Bourbon Cask & Rye Finish was drawn from over 200 whisky samples, aged in first-fill bourbon casks and finished for up to six months in former rye casks

Edrington buys back The Glenrothes While Edrington has continued to own the Glenrothes distillery, which has been owned by the Glasgow company and its predecessor, Highland Distillers, since 1887. In 2010 the company sold the brand to Berry Brothers & Rudd (BBR) as part of a deal that saw Edrington pick up the Cutty Sark brand, which uses Glenrothes whisky as part of its blend. This move will see the brand reunited with its distillery. Edrington also owns the cooperage nearby. BBR had already been a distributor of The Glenrothes before 2010, and the two companies have continued to have a close working relationship during the seven years since. The close relationship will continue, as BBR will still distribute the brand in the UK. Meanwhile, in other markets Edrington and its joint venture distribution companies have already been distributing the brand in many markets. “It has been a great honour to be the guardians of The Glenrothes brand over the past seven years,” said BBR chief executive Dan Jago of the sale. “Berry Bros. & Rudd has nurtured The Glenrothes brand and we are delighted our distributor and importer business Fields. Morris & Verdin will continue to distribute The Glenrothes in the UK.” In 1994, The Glenrothes began a new “vintages” concept under Master Blender John Ramsay, with renowned Global Brand Ambassador Ronnie Cox. Master Blender Gordon Motion began as Master Blender in 2009 upon Ramsay’s retirement, and will continue in that role. While The Glenrothes is well known to offer its whisky in vintages, since 1994, The Glenrothes Select Reserve blends different vintages

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

LIQUOR NEWS

St Lucia Distillers announces new packaging for Chairman’s Reserve rum St Lucia Distillers, the sole distillery on the island of Saint Lucia global markets, which fit the strategy we have for Chairman’s and producer of award-winning rums, has just revealed new Reserve,” says Matthieu de Lassus, Chairman’s Reserve Export improved packaging of their rum brand “Chairman’s Reserve.” Director. “Chairman’s Reserve will compete more effectively at the Chairman’s Reserve’s new packaging is meant to embody the international level in the premium rum category, and more broadly spirit of Saint Lucia. against all premium aged spirits.” To create this new packaging, St. Lucia Distillers acquired the With this vision, St. Lucia Distillers will re-release the brand services of an international design agency known for working with “1931” as a super-premium reserve rum in the Chairman’s Reserve prestigious brands. The new labels, though clearly upgraded, will portfolio. Now to be known as “Chairman’s Reserve 1931,” this rare still be instantly recognizable by the current Chairman’s Reserve aged rum will round off the new, polished portfolio of Chairman’s enthusiast community. “Chairman’s Reserve will no longer be Reserve. “Chairman´s Reserve Forgotten Casks” will be available understated. The bold new look will say to the world what Chair- in July 2017 and “Chairman´s Reserve 1931” in September 2017. man’s Reserve drinkers already know – Chairman’s Reserve is the finest rum in the world” says Margaret Monplaisir, Saint Lucia Distillers Managing Director. “The improved look also makes Chairman’s Reserve a more fitting ambassador of all that is Saint Lucian.” “We expect the brand’s rejuvenated direction to attract dynamic St Lucia Distillers has redesigned its packaging to better represent its prestigious place in global spirits new distribution partners in priority

Accolade wines launches gifting range Accolade Wines is proud to announce the launch of a brand-new gifting range across three of its premium travel retail brands: Hardys from Australia, Flagstone from South Africa and Mud House from New Zealand. These exclusive retail-ready packs reflect the premium wines within, and exude the gift worthiness that shoppers have come to expect from the travel retail channel. The combination of impactful design and quality materials aim to drive the wine category within the gifting mission and encourage shoppers to trade up. The Eileen Hardy Shiraz and Chardonnay: These iconic wines, originally launched in 1972 in honor of the Hardy family matriarch, are nestled in right blue gift box that showcases the instantly recognisable Eileen Hardy stamp and signature.

Hardys HRB Cabernet Sauvignon and Chardonnay: The elegant black (Cabernet Sauvignon) and white (Chardonnay) boxes make a perfect gift package for Hardy’s HRB range, created by crossregional blending of hand-selected grapes. Flagstone Velvet: A vibrant purple gift box represents the full-bodied, deep ruby blend inside, with notes of cinnamon and spice, intense dark berries, velvety tannins and a hint of smooth dark chocolate. Travel-retail exclusive Mud House Hill No.5 Single Vineyard Sauvignon Blanc: The tin, which stands out with its bright red colour and the nikau palm so reminiscent of the Mud House brand, holds a wine overflowing with fruit concentration as classic tropical, citrus and green bean flavours fill the front palate.

Accolade’s new gift boxes beautifully represent the wines within, offering new options for gifting while traveling

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WILD TIGER RUM – INDIA

Gautom Menon, Chief Brand Officer, Wild Tiger Rum

A BRAND THAT ROARS

Wild Tiger Rum is offering travel retailers “Instagrammable moments” with its Indian-made spirit, as the brand’s Founder explains by JAS RYAT

oon after entering the travel retail channel, Wild Tiger Rum topped the sales charts onboard Tigerair. An impressive debut, as Wild Tiger has been present in the channel for less than a year. The brand, which is made in India, continues to dominate onboard the Singapore Airlines-operated carrier, according to Gautom Menon, Chief Brand Officer, Wild Tiger Rum. Other initial launches have taken place in India with Dufry Bangalore and Flemingo Internationaloperated airports in Chennai and Kolkata. “We also have listings performing well in Fiji,” he says. “Recently we made our cruise line debut with Birka Cruises in the Nordic region and the launch was a roaring response. We find ourselves with listings in the pipeline from the main cruise and airlines operators in Nordic and cruise and airport retailers in the Caribbean, in addition Wild Tiger will soon be available across duty free in Chile and with key operators in Paraguay and Uruguay. Travel retail is not an easy channel in which to make inroads for any emerging brand, but we have stayed committed and have shown that we are in this for long term and results are slowly beginning to suggest this.”

Importance of provenance The concept, the liquid and packaging have been well accepted, says Menon, as 66

has the brand’s Wild Tiger Foundation CSR program, but he cautions that the lack of shelf space in-store is an obstacle in travel retail. “We find that that appeal of Indian provenance is more widely accepted as we move farther from the subcontinent. Being distant adds a kind of exotic appeal and aura to the brand. Retailers are very welcoming on the conservation front and would like to be seen to work with emerging brands such as ours that have strong appeal and emotive connection, but listings are rather hard to come by and we are often told that shelf space is the number one road block.” The bold, tiger-stripepackaging – unique to each bottle –has proved eyecatching, making consumers stop and take a second look. The conservation message also leaves an indelible mark, says Menon, but the bespoke packaging is the first interface with the passenger. So who is buying the brand? Menon says passengers seeking unique collectibles and souvenirs are the main target audience. Brand provenance is very important, and even more so with the emergence of the craft and artisanal spirits. “In the past it was all about packaging, value pricing and just marketing, but with so much information available at their fingertips, consumers are looking for engaging products that they can feel connected with and share their experiences unabashedly in

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Wild Tiger Rum’s stripepackaging – unique to each bottle –has proved eye-catching, making consumers stop and take a second look

what we call “Instagrammable moments.” Menon believes the liquor category should not always be margin driven for retailers but more experience-driven. “Retailers should be willing to take the punt and experiment,” he adds. He also thinks that rum, like whisky, should be merchandised by region, including rums from the Indian Ocean and Asia Pacific.

Travel retail aspirations Given the orders already in the pipeline, travel retail is currently 40% of the brand’s sales. “We expect to be a brand that does at least 60% of our volume in this channel, so yes, it’s a very vital channel for us, more so given all the turbulence in the liquor industry in India with the recent regulations and court orders. We are in the process of firming up a better route to market and we believe we can disrupt the category like never before. Rum deserves that shot in the arm and we are happy to play the flag bearers role.” In an exciting development, Wild Tiger is about to launch its second variant, an exotic spiced rum made using natural spices from India, and plans are afoot to introduce one variant every year over the next three years in order to complete the offering from the Wild Tiger family and some exciting travel retail exclusives.

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TOBACCO NEWS

Davidoff offers

For Davidoff, it wasn’t enough to offer the three exciting flavors from Nicaragua, Brazil and the Dominican Republic; it now offers a unique braiding of all three

something never

seen before

avidoff Cigars has a mission to broaden the cigar horizons of the world’s aficionados and help them explore and experience the wide world of cigars. Recently, Davidoff created the unique Culebras Limited Edition, taking its latest Brazilian Escurio, Nicaragua and Yamasá cigars and braiding them together in the unconventional Culebra format. Zino Davidoff spent years traveling around South America, Central America and the Caribbean, learning everything he could about tobacco, studying how it was cultivated, dried and fermented, but most importantly about how best to blend tobaccos to create a world of complex and enjoyable flavors. Following in Zino’s footsteps, Davidoff Master Blenders are on the same mission, to craft blends that will help aficionados to discover the wider world of tobaccos and experience cigars with exciting and surprising tastes, from various regions of Nicaragua, the Dominican

Republic, Brazil, Ecuador, Mexico, Peru and many others. Each one of these tobaccos and their varieties have flavor characteristics that will help craft singular taste experiences. For the current unique offerings, Master Blenders from the volcanic soil of Nicaragua with its spicy Estel tobaccos, to the intriguing mixtures of Brazilian Escurio with its spicy sweet Mata Fina and Cubra tobaccos, to taming the intensity of Yamas’s earthy spicy leaves, aging these tobaccos to perfection and crafting a variety of unique blends like no other. “It is time to leave your island and experience the world of cigars around you! Our mission is to open aficionados’ world and palates to offer them new and exhilarating experiences through masterfully crafted blends. If they say you should see the world, we at Davidoff say you should taste it first. We truly believe that it is not where a cigar comes from, but where it takes you and how it fills your time beautifully,” says Charles Awad,

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

Senior Vice President – Chief Marketing Officer at Oettinger Davidoff. For Davidoff, it was not enough to offer the exciting tastes of bitter sweetness from Nicaragua, the spicy and sweet Brazilian Escurio and the bold intensity of Yamas. Now Davidoff Master Blenders have crafted the first Davidoff Culebras Limited Edition, a unique opportunity to explore these three very diverse blends braided together in the unconventional Culebra format. The Davidoff Culebras Limited Edition is limited to 400 boxes (9600 cigars) worldwide, available exclusively at Davidoff Flagship stores. The Culebras cigars (one braid with three cigars) come in small black matte lacquered wooden cabinet boxes or alternatively in a larger box format with eight Culebras. The cigars are already available in the US. Outside the US, the product will be launched worldwide starting in May 2017.

QUESTIONNAIRE

ALL ABOUT

Dayalan Nayager, Managing Director Global Travel, Diageo Where were you born and raised? I was born in Durban, South Africa and grew up in the suburb of Merebank. If you attended post-secondary school, what did you study? I completed my Bachelor of Commerce degree majoring in Marketing and Management, and I completed a postgrad degree in Business Management. Are you married? Do you have children? Yes I am married, and have no children. What is your favorite movie? The Shawshank Redemption.

My favorite Single Malt –Lagavulin 16 My favorite liqueur – Baileys

tion of malaria and polio and controlling the spread of HIV.

Do you have a passion in your life (or more than one)? What? Yes, I have a passion for cooking.

Which historical figure do you most admire? Nelson Mandela.

Do you have a pet (or more than one)? If so, what animal and name? I do not have a pet at the moment, but I am definitely a fan of dogs. If I had to get a dog it would be Labrador Retriever because of its playfulness, friendliness and loyalty.

Where and when were you happiest in your life? Definitely at the present moment.

Do you prefer country or city? This is a tough one. I would like to say country, but after a week away from the city I definitely miss it, therefore I would say city.

What is the last book you read? To Kill a Mockingbird, by Harper Lee.

What is your favourite place to vacation? The Amalfi coast, in Italy.

What would you choose as your last meal? Lamb biryani and dhal.

What’s the first thing you do in a new place? Clean it, and then unpack all our personal belongings so that it feels like home as quickly as possible.

Your favourite drink? Representing the world’s largest drinks company makes choice quite difficult, especially with so many great brands. I would therefore have to split this into categories: My favorite aperitif – Tanqueray and tonic My favorite beer – Guinness My favorite Blended Scotch – Johnny Walker Blue

If you could choose any place in the world to live, where would it be? San Francisco.

Which living person do you most admire? Bill and Melinda Gates, for both their business achievements and their commitment towards the eradica-

THE AMERICAS DUTY FREE & TRAVEL RETAILING JUNE 2017

What in the world would you most like to change? Sounds like a beauty pageant answer, but I would love to eradicate poverty, and ensure that everyone can afford education. What about yourself would you most like to change? I have had to learn the art of being patient because, as an action-orientated person, I like to get things done straight away which is not always possible. What is the most important piece of advice anyone ever gave you? The best advice I ever got was from my father [pictured with Dayalan above]. He is my role model in life and he taught me from a very young age the importance of appreciating what I have and making the best of any situation. What is something about you that most people would find surprising? I have won a lot of contests in my lifetime. True story.

COBRA MULTI-STRAND BRACELETS