AMERICAS DUTY FREE by Paramount Publishing Ltd.

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MARCH/APRIL 2012 • VOL 22, NO 1

és y

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año

IAADFS 2012

Grupo Wisa heads south p.

LATAM stays strong p.

Paraguayan border report p.

Essence keeps it fresh p.

106

Letter from the Editor

The Americas Duty Free & Travel Retailing (ISSN 0962-0699) is published four times a year March/April, June/July, October, November/ December) by Global Marketing Company Ltd., 26 Pearl Street, Mississauga, Ontario L5M 1X2 Canada. It is distributed throughout Central America, South America, the United States, Canada, U.S. Virgin Islands, U.S. Pacific islands and the islands in the Caribbean.

Riding the wave he IAADFS organization continues to enhance and improve its already successful and enjoyable annual trade show. This year, there is a single registration option that incorporates all social events. This includes the gala dinner, where attendees will have the chance to enjoy the music of Willy Chirino, a talented singer and entertainer. Furthermore, those who appreciate the chance to unwind at Club Americas can look forward to live entertainment for the very first time. In this special IAADFS issue, our top story focuses on duty free retailer Grupo Wisa. The company has experienced solid growth in Mexico and Central America and is now making its move into South American border stores to become a true player in the Latin American travel retail scene. “Our move into South America effectively makes us a bona fide Latin American company as opposed to an operator with regional stores,” Grupo Wisa’s Marcelo Montico told Americas Duty Free. “Brazilian shoppers are refined and very selective in what they purchase—and they purchase a lot. This is especially true if it’s a question of finding a high-end brand that they don’t normally see in the area.” Also in this issue, we focus on success stories that we’ve discovered in Paraguay this past year—due in no small part to the financial

boom in neighboring countries, especially Brazil. Mannah Duty Free, which operates border stores in Ciudad del Este and airport shops at Silvio Pettirossi Airport, says 2011 was “an excellent year,” while Shopping China’s CEO Felipe Cogorno expects the strength of Paraguay’s economy to continue to be bolstered in part by traveling Brazilians hungry for the latest trends in everything from fashion and spirits to electronics and fragrances. On the supplier side, we have a special vodka report for our readers. Even though some have suggested the subcategory is oversaturated, it continues to grow year on year and offers some of the most innovative products in the spirits category. We also present success stories in other product categories, from fragrances all the way to confectionery. Retailers and suppliers aren’t the only ones riding the wave of success; Americas Duty Free is very proud of this issue, our biggest IAADFS edition to date. I look forward to sharing this issue with you in person in sunny Orlando. Kind regards,

Subscriptions: $200 for one year. Art and photographs will not be returned unless accompanied by return postage. The views expressed in this magazine do not necessarily reflect the views and opinions of the publisher or editor. March/April 2012, Vol. 22, No. 1. Printed in Canada. All rights reserved. Nothing may be reprinted in whole or in part without written permission from the publisher. © 2012 Global Marketing Company Ltd. The Americas Duty Free & Travel Retailing 26 Pearl Street Mississauga, Ontario L5M 1X2 Canada Tel: 1 905 821 3344; Fax: 1 905 821 2777 www.dutyfreemagazine.ca PUBLISHER Aijaz Khan aijaz@globalmarketingcom.ca EDITORIAL DEPARTMENT EDITOR Hibah Noor hibah@dutyfreemagazine.ca CONCESSIONS, LIQUOR & TOBACCO EDITOR Ryan White ryan@dutyfreemagazine.ca ART DIRECTOR Patrick Balanquit patrick@globalmarketingcom.ca CONTRIBUTORS Andrew Brooks James Ross ADVERTISING SALES ADVERTISING & MARKETING MANAGER Kim Carrera kim@dutyfreemagazine.ca

Hibah Noor Editor hibah@dutyfreemagazine.ca

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

CIRCULATION & SUBSCRIPTION MANAGER Deepa J deepa@globalmarketingcom.ca

Letter from the Editor

En la cresta de la ola del éxito

a organización de IAADFS sigue perfeccionando y mejorando su exitosa y agradable exposición comercial anual. Este año, cuenta con una sola inscripción que incorpora todos los eventos sociales. O sea, la cena de gala, en la que los asistentes tendrán la posibilidad de disfrutar la música de Willy Chirino, talentoso compositor y cantante. Además, los que aprecian la oportunidad de relajarse en Club Americas tendrán a su disposición entretenimiento en vivo por primera vez en la historia. En este número especial dedicado a la IAADFS, nuestro artículo principal se concentra en el conocido minorista duty free Grupo Wisa. La compañía ha experimentado un sólido crecimiento en México y Centroamérica, y ahora está operando en las tiendas de frontera suramericanas, para convertirse en un participante real del sector minorista de viajes latinoamericano. “Nuestra entrada en Suramérica nos convierte efectivamente en una compañía latinoamericana de bona fide, y no un operador

SIGNUPNOW!

con tiendas regionales”, expresó Marcelo Montico, de Grupo Wisa, a Americas Duty Free. “Los compradores brasileños son refinados y muy selectivos en lo que compran, y compran bastante. Esto es especialmente cierto si es cuestión de encontrar una marca de lujo que no ven normalmente en la zona”. En este número también nos enfocamos en historias de éxito que descubrimos el año pasado en Paraguay, debido en gran parte al boom financiero en los países vecinos, especialmente en Brasil. Mannah Duty Free, que opera tiendas de frontera en Ciudad del Este y establecimientos en el Aeropuerto Silvio Pettirossi, afirma que el 2011 fue “un año excelente”, mientras que Felipe Cogorno, Director Ejecutivo de Shopping China, espera que la fuerza de la economía de Paraguay siga siendo impulsada en parte por los viajeros brasileños en busca de las últimas tendencias en diferentes renglones del mercado, desde modas y licores a efectos electrónicos y perfumes. En el campo de los proveedores, contamos con un informe especial sobre el vodka para

Subscribe to The Americas Duty Free & Travel Retailing magazine and its bi-weekly eNewsletter to keep you informed of the latest news. Simply fill out and return this subscription card to the following address, or fax with your credit card details to +1 905-821-2777

nuestros lectores. Aunque hay quien afirma que la subcategoría está sobresaturada, la misma sigue creciendo de año en año, y ofrece algunos de los productos más innovadores en la categoría de espirituosos. Además, presentamos historias de éxito en otras categorías de productos, desde perfumes hasta confitería. Los minoristas y proveedores no son los únicos que cabalgan en la cresta de la ola del éxito. Americas Duty Free se enorgullece de este número, la mayor edición dedicada a la IAADFS hasta la fecha. Espero compartir este número con cada uno de ustedes personalmente en la soleada Orlando. Un cordial saludo,

Hibah Noor Editora hibah@dutyfreemagazine.ca

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

ENJOY WITH ABSOLUT RESPONSIBILITY®. ABSOLUT® GUSTAFSON. CHERRY, STRAWBERRY, CARDAMON & CHAI FLAVORED VODKA. PRODUCT OF SWEDEN. 40% ALC./VOL. ©2012 PERNOD RICARD AMERICAS TRAVEL RETAIL, WHITE PLAINS, NY

MARCH/APRIL 2012 • VOL 22, NO 1

32 Contents 22 32

IN BRIEF Business Monitor International releases Q1 Brazil tourism report ■ ASUR not awarded Brazil airport concession ■ FRCH and Liverpool set new design standard with Playa del Carmen duty free store ■ Marco Arilli leaves HKG Duty Free ■ Innova Distributors to launch Go Travel kiosk at Lima’s Jorge Chavez International ■ Wandering Monkey set to build on success in 2012

Heading south

REGIONAL REPORT: ARGENTINA

The knock-on effect Americas Duty Free speaks to three operators with home bases in Paraguay to learn how Brazil’s economic boom has benefitted their businesses and the country in general

Americas Duty Free habla con tres operadores con sede en Paraguay para conocer cómo el boom económico de Brasil ha beneficiado a sus negocios y al país en general

Argentina has known for some time the benefits that tourism provides to the economy, and now the government is taking clear steps ensure that the industry continues growing

Argentina ha disfrutado desde hace algún tiempo los beneficios que el turismo le proporciona a la economía, y ahora el gobierno está tomando medidas claras para garantizar el crecimiento continuo de esa industria

PARAGUAY IN TRAVEL RETAIL

Reacción en cadena

Up to speed

A toda máquina

If Latin American operators have their way, the considerable momentum achieved in 2011 will continue well into this year and, with any luck, beyond

Si los operadores latinoamericanos logran lo que se proponen, el impulso considerable alcanzado en el 2011 continuará este año y, con suerte, en los próximos

After a successful 2011 in Mexico and Central America, Grupo Wisa takes the next step in its evolution with the planned opening of border stores in Uruguay

Luego de un exitoso 2011 en México y Centroamérica, Grupo Wisa da un nuevo paso en su evolución con la apertura programada de tiendas de frontera en Uruguay

All systems go

Todos los sistemas funcionan

TOP STORY: GRUPO WISA

Rumbo al Sur

LATIN AMERICA REPORT

DIAMONDS INTERNATIONAL

Shining bright With the opening of a new duty free store in St. Thomas, Diamonds International continues its focus on the excellence of its service and brilliance of its gems

VISIT US A AT T CO COTY TY BEAUTY BEAUTY - BOOTH BOOTH #1515 OR CONTACT CONT TA ACT T: GMP SERVICES - VIVIAN WISCHT VIVIAN VIVIAN.WISCHT@GMPSERV .WISCHT@GMPSERV MPSERV V.COM PH: (305) 895-2600

Contents

AIRLINE NEWS

HARTSFIELD-JACKSON AIRPORT

NON-AERONAUTICAL REVENUE

74 76

A joining of giants

100

PORTLAND DESIGN

102

GUEST WRITER: ANNE KAVANAGH

LAN and TAM boost global clout by forming joint LATAM Airlines Group

Southern comfort The City of Atlanta awards massive F&B and retail contract for Hartsfield-Jackson International

104 106

ESSENCE CORP. – ESSENCE BEAUTY

108

ESSENCE CORP. – CLARINS GROUP

110

TAIRO INTERNATIONAL

114

BEAUTY NEWS

116

BEAUTY BEAT: FRAGRANCES

122

BEAUTY BEAT: SKINCARE & COSMETICS

Caribbean footfall ASSOCIATION Q&A

A banner year Indications suggest that 2012 may be memorable year for the industry’s leading organizations

Un año excelente Todos los indicios sugieren que el 2012 podría ser un año memorable para las principales organizaciones del sector

88 90 92 98

AIRMALL USA

Strong out of the gate Leading concessionaire Airmall USA kicks 2012 off with a number openings in airports across the US and promises to bring more innovation before year’s end

LS TRAVEL RETAIL NORTH AMERICA

Better, smaller, faster LS travel retail North America and ZoomSystems prove that good things do indeed come in small packages with the opening of iStore Express in Calgary Airport

HMSHOST

Options open HMSHost continues to ensure that North American travelers have a wide variety of F&B choices when passing through some of the region’s busiest airports

FRONTIER DUTY FREE ASSOCIATION

From one year to another Americas Duty Free talks to FDFA Executive Director Laurie Karson about the 2011 show and current issues on the table in 2012 for the Canadian duty free industry

Retail and the ﬁght for airport reputation

PARBEL

ST. THOMAS DUTY FREE A European duty free consortium sets its sights on St. Thomas, USVI—the first of many ventures in the region

Portland Design’s approach to travel retail environments has helped advance new thinking about the shopping experience

Simply by conversing and connecting with travelers, airports can open up an entirely new element in a very important relationship

The other moneymaker Non-aeronautical revenue is becoming an increasingly attractive income source for airports—for a whole lot of reasons

New by design

Parbel sets the agenda 2012 brings a full slate of new and continuing initiatives for L’Oréal’s travel retail arm in the Americas

Essence keeps it fresh Beauty brand distributor kicks the new season off with a host of luxurious offerings

The science of skin Clarins says protein research backs its new skinfirming creams

Tairo aims higher Mexico/Caribbean beauty distributor celebrates steady growth, retools for more expansion

Diverse offers A host of beauty companies are bringing unique concepts to the travel retail market

Beauty boosters A host of alluring scents fill the air as suppliers roll out their best offerings yet for the warmer seasons

Beauty regime Creative cosmetics and revolutionary skincare: traveling consumers will have plenty of options to choose from this season

VISIT US AT COTY BEAUTY - BOOTH #1515 OR CONTACT: GMP SERVICES - VIVIAN WISCHT VIVIAN.WISCHT@GMPSERV.COM PH: (305) 895-2600

Contents

124

SUNCARE REPORT

126

L’OCCITANE

128

WORLDCLASSBRANDS

Beauty on the outside Skin care specialists work to turn the tables in favor of healthy, science-based protection

The southern touch L’Occitane launches new hair care range, relaunches two skin care products

Class to the core Duty free specialist Worldclassbrands unveils new watch, jewelry lines in run-up to this year’s IAADFS

130

JEWELRY NEWS

132

SECTOR USA

134

WATCH REPORT

136

SUNGLASS REPORT

140

The jewel in the crown The New Year kicks off with fresh collections and new developments

A statement in time Sector introduces new spokesperson and launches initiative in duty free

Growth is the watch word

Shades of success The Americas is a natural marketplace for the sunglasses sector. Americas Duty Free takes a closer look at its fortunes

GUEST WRITER: OSCAR GUZMAN

Positioning your concept to the right opportunity LESPORTSAC

The prints of style LeSportsac rolls out new designs for spring, featuring designs by illustrator Kate Sutton

143

FURLA

144

TOMMY HILFIGER GROUP

148

WRITING INSTRUMENTS REPORT

154

CONFECTIONERY REPORT

160

GUEST WRITER: JACK TABBERS

The new and the renewed

Tommy Hilfiger aims to leverage its brand awareness in the travel retail market

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

A travel retail professional discusses his strategy for brand leadership

The write stuff The writing instruments category is expanding, thanks to some innovative new technologies and approaches

Confectionery conquests These top performers are upping their game in the Americas as IAADFS approaches

Confectionery – the three keys to the door of success

167 169

Special Report: Vodka

172

RUSSIAN STANDARD

174

VODKA ROUNDUP

182

SPRING VODKA COCKTAILS

184

WILLIAM GRANT & SONS

186

THE EDRINGTON GROUP

Furla’s IAADFS debut to feature Fall/Winter 2012/2013 collection of new and reinterpreted bags

High potential

Parker’s partner

A sweet tooth, the impulse factor and brand power can build an even better category

Opportunities are increasing in the Americas watch market, but so is the competition

Bijoux Terner expands AdiXion, a new retail concept, to capitalize on market trends

142

146

LATR

PREMIUM VODKA REPORT

The best gets better The premium and super-premium vodka category continues to be redefined with new products and market strategies

Standard bearers Russian Standard Vodka offers duty free shoppers a premium-category taste of Imperial Russia

Taste tactics Vodka makers differentiate themselves on packaging, ingredients, processes and the taste of the final product

A head start on spring Americas Duty Free asks vodka suppliers for their favorite spring cocktail recipes

Making it better William Grant & Sons comes off a strong 2011, and backed by a stable of premium offerings the company assures that 2012 will be even better

Keeping a good thing going After a solid 2011 that saw its portfolio gain visibilityin duty free, The Edrington Group plans to maintain momentum with various new initiatives in 2012

124

TRAVEL EXCLUSIVE MAKE-UP PALETTE

Contents

202

216 188

WINE REPORT

192

RÉMY COINTREAU GLOBAL TRAVEL RETAIL

196

AGING SPIRITS REPORT

198 200 202 20

A beautiful relationship Americas Duty Free speaks to a number of suppliers who are trying to woo the traveling consumer in the Americas with a variety of interesting wine offerings

A matter of priority Americas Duty Free gets in depth with Rémy Cointreau GTR’s Francois Van Aal, discussing the finer points of supply and demand and the challenges of selling rare Cognacs in duty free

The age difference Finesse, finish, process, materials… the age of a fine spirit is a lot more than just a matter of years

214

KT&G

216

CIGAR REPORT

222

BRITISH AMERICAN TOBACCO

224

NEW & NOTABLE

IN-FLIGHT SPIRITS REPORT

In high spirits Some of the industry’s biggest players tell Americas Duty Free that in-flight sales are challenging, but a great opportunity if approached properly

Opportunities abound Given increasing numbers of traveling Koreans in the US, KT&G sees a place for its brands in airport stores across the country

The big smoke The cigar market caters to discriminating tastes, with travelers being a key demographic

WORLD BRANDS INTERNATIONAL

Channel changers World Brands International builds its name in Americas travel retail

BACARDI GLOBAL TRAVEL RETAIL

150 years of excellence Bacardi celebrates a momentous occasion in style with a new limited edition release and activations at key airports in the Americas

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

A win-win-win situation British American Tobacco’s focus on meeting needs results in a strong portfolio of brands for operators and most importantly a wide selection for consumers

Mickey Finn Apple Infused Whiskey ■ Fireball Whiskey ■ Chupa Chups Destination Tin ■ Timberland Charleston Watch

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77 women - consumer test. **In vitro test. Based on retailers’ orders of all products in the Extra-Firming range combined. ***

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BMI forecasts 21.5% growth in tourist arrivals through to 2015, reaching over 6.73 million tourists

In Brief Business Monitor International releases Q1 Brazil tourism report usiness Monitor International (BMI) recently released its Brazil Tourism Report for Q1 2012. BMI says that it “remains highly positive about the outlook for Brazil’s tourism industry in 2012.” International disembarkations, which are released monthly by the Ministry of Tourism and serve as a proxy for tourist arrivals in the absence of this data being released by the ministry in a timely fashion, show an increase of 15.9% year-on-year over to 6,735,083. April had notably strong growth rates, up by 35% year-on-year to 703,652 international disembarkations. Domestic disembarkations are also on an upwards trajectory, rising by 18.7% year-on-year over 9M11 to 58.8 million. For 2011, preliminary indications from the Ministry of Tourism are that a total of 5.5 million foreign tourists will visit Brazil, marking a new record for Brazilian tourism. With Brazil hosting the football World Cup in 2014 and then the Olympic Games in Rio de Janeiro in 2016, BMI believes tourist arrivals will continue to grow strongly in the years ahead. BMI forecasts 21.5% growth in tourist arrivals through to 2015, reaching over 6.73 million tourists. Over the same period, BMI also expect tourism receipts to increase by 35.4% to total over US$9 billion. In September 2011, Chile’s anti-trust court approved the planned merger between Brazilian airline TAM and Chile’s LAN, which was first proposed in August 2010. This leaves Brazil’s anti-trust authority to approve the merger, which must also be supported by both airlines’ shareholders. In October 2011, TAM said the merged LATAM Airlines Group should be established near the end of Q112, subject to final regulatory and shareholder approval. BMI believes the merger of the two airlines should be positive for the Latin American tourism industry as it should lower costs for passengers as a result of cost synergies and economies of scale. Investment is surging in Brazil’s hotel sector, as chains aim to increase capacity ahead of the World Cup and the Olympics. Accord-

ing to research by international hotel consultancy STR Global, Brazil only had a national hotel supply of 172,561 rooms in July 2011, a figure that seems very low for a country with a population of over 190 million. “Even with a reported 3,928 rooms under construction in September 2011, it is clear that Brazil remains underserved by hotels, ahead of a multi-year period that will include 600,000 visitors entering the country for the 2014 World Cup alone, according to the Brazilian government,” says BMI. Although the government has been providing tax incentives to hotel developers, according to STR Global, many obstacles, including legal, building and environmental requirements, are preventing the hotel industry from developing at a faster pace. “However, the opportunities for hoteliers seeking to enter the Brazilian marketplace are clear,” BMI notes. In September 2011, Hotel News Now reported that Brazilian revenue per available room (RevPAR) increased by 34.7% in January-July 2011, taking it to US$96.71. The average daily rate rose by 28.2% to US$141.76 over the same period. In a key development for the Brazilian hotel industry, the national hotel classification system was revamped in June 2011. The Brazilian System for the Qualification of Accommodation Options (SBClass) will use 1-5 star ratings to identify categories of accommodation. Only hotels and accommodation establishments that have registered and qualified with the Ministry of Tourism will be able to use the new voluntary rating system. BMI believes the development of a national classification system, which is based on international standards and has been developed following research of several other countries’ rating systems, will be a great help to the evolution of the Brazilian hospitality industry, enabling tourists to be better informed about the standard of accommodation available across the country. This will particularly be welcomed by the many thousands of tourists visiting the country for the World Cup and the Olympic Games.

Marco Arilli leaves HKG Duty Free

arco Arilli, Vice President, Merchandising, affiliated with HKG Duty Free for the past three and a half years, has decided to embark on an exciting new venture outside the company. The Khaledi Group and the entire HKG family said in a news release that they extend very best wishes and success to Marco in his new endeavors. "We greatly appreciate Marco’s direct contributions, commitment, loyalty and valued accomplishments achieved in supporting HKG development and results derived over the past several years," the company noted. Alan Huxtable, Vice President, Operation and Business Development, who joined HKG Duty Free in May of 2011, will assume direct responsibilities for merchandising to include procurement, replenishment, category assortment planning, supplier relations, marketing and store development. Alan’s new title will be Vice President, Commercial and Business Development. Alan will also continue his efforts underway in developing new business ventures, thereby globally expanding the HKG business portfolio.

M 22

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Marco Arilli, Vice President, Merchandising, has decided to embark on an exciting new venture outside HKG Duty Free

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When Liverpool began planning to open its second duty free store in Playa del Carmen, the company wanted to create a location that stood out in the crowd

In Brief

FRCH and Liverpool

set new design standard with Playa del Carmen duty free store nown throughout Mexico for presenting upscale shopping experiences in breathtaking spaces, department store chain Liverpool wanted their second duty free store in Playa del Carmen to mirror the sophistication of its larger format stores. Despite working with a smaller space within an already cluttered urban environment, Liverpool and FRCH Design Worldwide created a showcase destination and, in the process, raised shoppers’ expectations for what a duty free shopping experience could be. When Liverpool began planning to open its second duty free store in Playa del Carmen, the company wanted to create a location that stood out in the crowd, offered a welcoming shopping experience and, ultimately, reinforced the Liverpool brand reputation for presenting upscale products in aesthetically spectacular spaces. Moving into a two-level structure with a retail footprint only 29 feet wide and 125 feet deep, however, the company was challenged from the outset to find ways to attractively and effectively present a full range of merchandise without compromising the overall customer experience. As a result, Liverpool turned to its long-time design partner, Cincinnati-based FRCH Design Worldwide. FRCH has completed multiple Liverpool projects over the past decade, including the globally acclaimed Liverpool Interlomas location which opened at the end of 2011.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

To open up the space, the new Liverpool store features a glass front and a floor-to-roof balcony; an up escalator in the front of the store and a down escalator toward the back, organically creating a directional shopping flow; a minimalistic black and white color palette augmented with a clever mix of shapes and textures to maximize visual interest; and stylized exterior photo panels offering shoppers a preview of what they would discover within the store.

ASUR not awarded Brazil airport concession rupo Aeroportuario del Sureste, S.A.B. de C.V. (NYSE: ASR; BMV: ASUR) (ASUR), the first privatized airport group in Mexico and operator of Cancun Airport and eight others in the southeast of Mexico, announced that the consortium formed by it and Advent International were not awarded the concession to maintain, operate and expand any of the three Brazilian airports—Brasilia, Guarulhos and Campinas—auctioned in a live public bidding held last month in Sao Paulo. The winning bids for the three airports totaled US$14.3 billion. The Campinas tender was won by Consórcio Aeroportos Brasil, while Invepar ACSA won the Guarulhos tender. The largest tender in terms of dollar amount, Brasilia, was won by Inframérica.

In Brief

Wandering Monkey set

to build on success in 2012

“2

011 was an exciting year for us,” says Jonathan Corbett, Director of The Wandering Monkey. “We’ve learnt more about our customers, improved our relationships with them and have now developed an exciting strategy for growth in 2012." For this year, Corbett says that the company plans to develop more of the entertainment products for kids on the move that have brought it success in all segments of the duty free and travel retail markets over the last few years. Notable successes for The Wandering Monkey include the Wandering Monkey Activity Pack, launched in 2010, which quickly became the company’s top seller. Other highlights include the Totseat travel high chair, which Corbett says “has done brilliantly in duty free.” And last year the company launched a series of own-branded travel games which will include Snap, Happy Families and a Draw the Monkey Game This year The Wandering Monkey will exhibit at the Airline Retail Conference Singapore, Airline Retail Conference London and TFWA WE in Cannes. The company is still relatively new to the market, but has already garnered an Airline Retail Award for “Most Promising Supplier to In-Flight Retail” at the Airline Retail Conference.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

The best of all worlds

Aldeasa and World Duty Free together, global strength in depth ASIA – EUROPE – MIDDLE EAST – NORTH AMERICA – SOUTH AMERICA

In Brief

Innova Distributors to launch Go Travel kiosk at Lima’s Jorge Chavez International nnova Distributors Inc. has announced plans to launch a new kiosk in Jorge Chavez International Airport (JCIA) in Lima, Peru for travel accessories brand Go Travel, which they distribute. The kiosk will be set up in mid-March and dedicated exclusively to Go Travel products. “The kiosk offers maximum accessibility and visibility,” says Mark J. Lewis-Jones, President for Innova Distributors. “It will be centrally located in the main walkway in the international departures concourse. It will be a well lit, well assorted, attractive and inviting—almost imposing—structure, which is manned and open 24 hours a day, which will give travelers access to all their travel accessory needs and ensure maximum profitability for the parties involved.” Lewis-Jones says that the partnership started with an overture from Lima Airport Partners (LAP), which operates JCIA. “Fiorella McCarty of LAP visited the Go Travel booth at the ASUTIL conference in Cancun last June and was thrilled by the design, innovation, and pricing of the accessories. She asked us if we’d be interested in tendering a proposal based on LAP guidelines.” As luck would have it, Innova Distributors had already partnered with Sergio Casaretto of Class Complements S.A. (dba Crepier) as its in-country Peru distributor. “We couldn’t have chosen a better partner or enjoyed more fortuitous timing,” Lewis-Jones says. “Working with LAP, Class Complements won the concession based upon an exceptional proposal, and the vision of Fiorella McCarty and Sergio Casaretto has turned the opportunity into reality. We hope other travel retail and duty free operators will work with us in a similar fashion after they’ve seen the excellent execution of this project.” The kiosk is 6 meters long, 2.4 meters high and 0.80 meters deep, designed to maximize accessible display area for browsing, with inviting displays and graphics in the multiple light boxes on all sides. The kiosk is able to display about 200 different travel accessories. London-based Go Travel was founded over 30 years ago and specializes in the design, manufacture and marketing of travel accessories. It was the first company to present the industry with a fully coordinated travel accessory range, and is now present in more than 18,000 locations in 50 countries.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

An artist’s rendering of what Grupo Wisa’s new store at El Dorado Airport will look like once completed

Top Story: Grupo Wisa

RYAN WHITE

Heading south

After a successful 2011 in Mexico and Central America, Grupo Wisa takes the next step in its evolution with the planned opening of border stores in Uruguay arcelo Montico, Commercial Director of Grupo Wisa, tells Americas Duty Free that 2011 was “a fantastic year” for the company. Across all of its operations, Grupo Wisa grew 33.5% over 2010 in terms of sales. Mexico, Panama and Bogota—in that order—were the strongest countries for the operator in 2011 in terms of growth. Montico notes that Bogota was a particularly bright spot considering the fact that Grupo Wisa has much less space in El Dorado Airport than their direct competitor Motta Internacional. He says that the company’s success in this regard was achievable thanks to the strength of Grupo Wisa’s exclusive brands. While business was good in Bogota, it was stellar in Mexico—Grupo Wisa opened a number of new retail concepts last year, including a MAC boutique (45 square meters), as well as electronics (90 square meters), sunglasses (35 square meters) and high-end chocolate (60 square meters) stores, all located outside of the main shop. Grupo Wisa also opened two arrivals stores (80 square meters and 120 square meters). “The new departures stores are outside the main store as space there is limited and there isn’t really an opportunity to grow very much within that location,” Montico explains. “We were looking for premium spaces where

the passenger flow was as good as that of the main store and we were fortunate enough to find some great spaces for these satellite stores.” The two arrivals stores are located in a high-traffic area and are essentially the first two stores that passengers encounter when arriving in Mexico. The smaller store contains a selection of bestsellers in each category, while the larger store contains a bit of a more robust mix of all categories plus a selection of mid-range watches. “The allowance for arriving passengers in Mexico is a maximum

economy improved as well. While northern states continued to struggle with violence and insecurity, the Distrito Federal fortunately hasn’t encountered the same problems, he explains. “We’ve also developed a new training program, which has helped business considerably,” Montico says. “On Friday, Saturday and Sunday, we’ve begun giving staff hourly goals with prizes available for reaching these objectives.” The beauty of the program, says Montico, is in its flexibility. For example, Grupo Wisa may offer a prize of US$200 for the

“When all is said and done, we’ll be positioned in the four main border cities: Rivera, Rio Branco, Chuy, and Aceguá.”

Marcelo Montico, Commercial Director, Grupo Wisa

of US$500, which restricts a bit what we can offer in terms of timepieces,” Montico tells us. Offering more options to travelers in Mexico has certainly helped the company’s sales there, but Montico notes that there were a number of considerations last year that contributed to Grupo Wisa’s success: Spend per head increased in 2011 and generally the Mexican

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

highest sales between 6 and 7 pm on a Friday evening if store managers determine that it’s a particularly busy time. It’s a format that allows the operator to take full advantage of high-traffic times as they happen. “In this way we amp up the sales staff to sell as much as they can at key moments and thereby increase the average ticket,” he explains.

Grupo Wisa won the tender for a departures store in El Dorado Airport on December 22, 2011

Change is good A notable development in Mexico is that in November of last year, Continental moved to Terminal 1 (where Dufry operates) as a result of the airline’s merger with United. However, Lufthansa and Air France are moving to Terminal 2, where Grupo Wisa’s stores are. In terms of passenger numbers, the two European airlines combined are moving about the same quantity of travelers as Continental. The real boon for Grupo Wisa, though, is in the type of travelers on the Lufthansa and Air France flights. “In terms of passenger profile,” Montico says,“this development is a big improvement for us as European passengers in general spend more than American passengers.” November, December and January saw fewer passengers in Terminal 2 as Lufthansa and Air France hadn’t yet made the move. However, this was only temporary; The airlines moved to the Terminal in February and Grupo Wisa is expecting big things from this new group of European passengers.

This year and beyond The biggest renovation plans that Grupo Wisa has for 2012 are in Bogota. The company won the tender for a 1,340-square-meter departures store in El Dorado Airport on December 22, 2011. It’s the biggest departures location in the airport. “The store is practically walkthrough in its design and it’s a completely new store, so it will just be a matter of branding it according to La Riviera’s established designs.” In December Grupo Wisa also won a tender at Cartagena Airport in Colombia. The area is a proven tourist draw, and the passenger profile is made up largely of Europeans. Starting in April of this year, Grupo Wisa will have the distinction of being the only duty free operator in the airport. The company will also operate a duty paid store that caters mostly to nationals traveling between Cartagena and the main cities in Colombia. The duty free store will measure 410 square meters and the duty paid store will measure 400 square meters.

While the tender wins in Bogota and Cartagena are certainly good news, a huge development in the evolution of Grupo Wisa as a duty free operator is currently unfolding in South America. While the company’s geographical focus has hitherto been on Mexico, Colombia and points in between, the operator will this year open what Montico calls its Southern Cone operations. From a base in Uruguay Grupo Wisa will begin operations in South America. “We bought a company that operates stores in the region,” explains Montico. “As we’re currently in the middle of the due diligence process, we can’t specify the name of the company. However, the deal has been closed. “We’re also in the process of purchasing another company that operates stores on the border with Brazil,” Montico continues. “When all is said and done, we’ll be positioned in the four main border cities: Rivera, Rio Branco, Chuy, and Aceguá.” The first deal, already confirmed, will net Grupo Wisa 2,000 square meters of commercial space across two stores. The second contract, which is currently being finalized, will add an as yet undisclosed number of new business units. The stores are currently open and selling to travelers, so for Montico and company it will be a matter of making them La Riviera-branded locations and incorporating the portfolio of brands that Grupo Wisa currently sells into the product mix. Notably, many of the brands are not currently available in the region. As such, the company sees a great opportunity to offer travelers something completely new and luxurious, Montico says. “Part of the reason why we decided to make the move into South America in the first place is because we saw that we could add value with numerous prestigious brands that travelers had difficulty finding at the existing stores,” Montico explains. “Brazilian shoppers are refined and very selective in what they purchase—and they purchase a lot. This is especially true if it’s a question of finding a high-end brand that they don’t

normally see in the area.” In terms of branding, Grupo Wisa will use the same architectural concept as in Bogota, taking into consideration of course that the South American locations are border stores as opposed to airport stores. Nonetheless, Montico notes that the South American stores are doing unbelievable business. “They are so busy given the short distance between cities and the huge gap in prices from the local market in Brazil that in many aspects it’s very similar to operating an airport store. “In Central America we have had border stores but they’re very different from the stores in South America,” he continues. “I would really compare the stores on the Brazil border to airport stores without planes, largely because of the profile of the traveler.” Grupo Wisa is planning on having the majority of the stores ready for September at the latest. Business in Chuy, however, is very seasonal, with strong sales in summer and a considerable drop-off in winter. As such, the company will be opening that store in 2013.

Just the beginning The developments at the Brazilian border represent the first phase of a plan to enter deeper into the South American duty free market. It’s a good start, no doubt, but Grupo Wisa has greater ambitions for the future, including competing for airport tenders in Southern Brazil and developing a portfolio of brands owned by Grupo Wisa in Argentina. Montico says that the company is also looking at a number of opportunities in Chile, although it’s too early to mention specifics. “Our move into South America effectively makes us a bona fide Latin American company as opposed to an operator with regional stores,” Montico tells us. “It adds very significant value to the company, as well as a new and exciting aspect to the service we provide to our valued supplier partners. We’re very excited to start operations in the dynamic c South American travel retail market.”

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

Top Story: Grupo Wisa

Rumbo al Sur

Luego de un exitoso 2011 en México y Centroamérica, Grupo Wisa da un nuevo paso en su evolución con la apertura programada de tiendas de frontera en Uruguay The new airport store in Bogota will be the biggest departures location in El Dorado Airport

arcelo Montico, Director Comercial de Grupo Wisa, le asegura a Americas Duty Free que el 2011 fue un “año fantástico” para la compañía. En todas sus operaciones, Grupo Wisa logró un incremento del 33.5% con respecto al 2010 en términos de ventas. México, Panamá y Bogotá—en ese orden—fueron los países más sólidos para el operador durante el 2011 en términos de crecimiento. Montico enfatiza que Bogotá fue un lugar particularmente notable, considerando que el Grupo Wisa cuenta con mucho menos espacio en el Aeropuerto El Dorado que su competidor directo, Motta Internacional. El alto funcionario afirma que el éxito de la compañía al respecto se pudo alcanzar gracias a la fortaleza de las marcas exclusivas de Grupo Wisa. Y si bien las operaciones fueron buenas en Bogotá, resultaron estelares en México, donde Grupo Wisa inauguró varios conceptos nuevos de comercio minorista el año pasado, como una boutique MAC (45 metros cuadrados),

así como tiendas de efectos electrónicos (90 metros cuadrados), lentes de sol (35 metros cuadrados) y chocolates de lujo (60 metros cuadrados), ubicadas fuera de la tienda principal. Además, Grupo Wisa también abrió dos tiendas en la sección de llegadas (80 metros cuadrados y 120 metros cuadrados). “Las nuevas tiendas en la sección de llegadas están fuera de la tienda principal, pues allí el espacio es limitado y no hay realmente oportunidad de crecer demasiado en ese lugar”, explica Montico. “Estábamos buscando espacios de primera, donde el flujo de pasajeros fuera tan bueno como el de la tienda principal, y tuvimos la gran suerte de encontrar algunos espacios excelentes para estas tiendas satélites”. Las dos tiendas en la sección de llegadas están unicadas en un área de tráfico intenso, y son esencialmente las dos primeras que encuentran los pasajeros a su arribo a México. La más pequeña contiene una selección de productos de mejor venta en cada categoría, mientras que la más grande cuenta con una

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

The new departures store at El Dorado Airport measures 1,340 square meters

mezcla un poco más robusta de todas las categorías, y una selección de relojes de rango medio. “La cantidad permitida que pueden introducir los pasajeros que llegan a México es un máximo de US$500, lo cual restringe un poco lo que podemos ofrecer en términos de relojes”, añade Montico. La oferta de más opciones a los viajeros a México ha contribuido realmente a las buenas ventas de la compañía en ese sitio, pero Montico destaca que el año pasado hubo varias consideraciones que contribuyeron al éxito de Grupo Wisa: el gasto per cápita se incrementó en el 2011, y además, la economía mexicana mejoró. Aunque los estados norteños siguen luchando con la violencia y la inseguridad, afortunadamente el Distrito Federal no ha confrontado los mismos problemas, agrega el alto funcionario de Grupo Wisa. “También hemos creado un nuevo programa de entrenamiento que ha ayudado considerablemente al negocio”, dice Montico. “Los viernes, sábados y domingos hemos comenzado a establecer objetivos por hora al equipo, con premios para quienes los cumplan”. La belleza del programa, asegura Montico, reside en su flexibilidad. Por ejemplo, Grupo Wisa puede ofrecer un estímulo de US$200 a las ventas más altas entre las 6 y 7 pm de un viernes en la noche, si los gerentes de la tienda determinan que es una hora particularmente dinámica. Es un formato que le permite al operador aprovechar al máximo los horarios de tráfico intenso en la medida que ocurren. “De esta manera estimulamos al equipo a vender lo más posible en momentos claves, e incrementar las ventas promedio”, añade Montico.

Cambiar es bueno Un acontecimiento notable en México es que en noviembre del año pasado, la aerolínea Continental se instaló en la Terminal 1 (donde C O N T I N U E D O N PA G E 3 6

Top Story: Grupo Wisa

Grupo Wisa will use much the same architectural concept for its Uruguayan border stores as has been developed in Bogota C O N T I N U E D F R O M PA G E 3 4

opera Dufry) como resultado de su fusión con United. Por su parte, Lufthansa y Air France también se están trasladando a la Terminal 2, donde operan las tiendas de Grupo Wisa. En términos de cifras de pasajeros, las dos aerolíneas europeas combinadas están transportando la misma cantidad de viajeros que Continental. Sin embargo, el beneficio real para Grupo Wisa reside en el tipo de viajeros de los vuelos de Lufthansa y Air France. “De acuerdo al perfil del pasajero”, explica Montico, “este acontecimiento es una gran mejora para nosotros, pues los pasajeros europeos en general gastan más que los estadounidenses”. En noviembre, diciembre y enero pasaron menos pasajeros por la Terminal 2 pues Lufthansa y Air France no se habían trasladado aún a la misma. Pero estas cifras son temporales, pues ambas se trasladaron a la terminal en febrero, y Grupo Wisa tiene grandes expectativas con respecto a este nuevo grupo de pasajeros europeos.

Este año y los próximos Los planes de renovación más grandes que tiene Grupo Wisa para el 2012 están en Bogotá. La compañía ganó la licitación de una tienda de 1,340 metros cuadrados en la sección de salidas del Aeropuerto - El Dorado el 22 de diciembre del 2011. Es la mayor instalación en la sección de salidas del aeropuerto. “La tienda es prácticamente un sitio de tránsito obligado en su diseño, y es completamente nueva, por lo que sólo habrá que ocuparse de las marcas que venderá según los diseños establecidos de La Riviera”. En diciembre, Grupo Wisa también ganó una licitación en el Aeropuerto de Cartagena, Colombia. La zona es de probado atractivo turístico, y el perfil de los pasajeros está compuesto en su mayoría por europeos. A partir de abril próximo, Grupo Wisa tendrá la distinción de ser el único operador duty free del aeropuerto. La compañía también operará una tienda con pago de aranceles dedicada fundamentalmente a los colombianos que viajan entre Cartagena y las principales ciudades del país. La tienda duty free abarcará unos 410 metros cuadrados, y la tienda con pago de aranceles unos 400 metros cuadrados. 36

Si bien el hecho de ganar las licitaciones en Bogotá y Cartagena son realmente buenas noticias, un gran acontecimiento en la evolución de Grupo Wisa como operador duty free se está produciendo actualmente en Suramérica. Aunque el enfoque geográfico de la compañía se ha concentrado en México, Colombia y localidades entra ambos, el operador inaugurará este año lo que Montico denomina “sus operaciones en el Cono Sur”. Desde una base en Uruguay, Grupo Wisa iniciará operaciones en Suramérica. “Adquirimos una compañía que opera tiendas en la región”, explica Montico. “Como en estos momentos estamos en medio del proceso de debida diligencia, no podemos especificar el nombre de la misma. Sin embargo, ya se ha realizado la transacción”. “También estamos en el proceso de adquirir otra compañía que opera tiendas en la frontera con Brasil”, continúa Montico. “Cuando culmine el mismo, estaremos ubicados en las cuatro ciudades fronterizas principales: Rivera, Rio Branco, Chuy, y Aceguá”. La primera adquisición, ya confirmada, le proporcionará a Grupo Wisa 2,000 metros cuadrados de espacio comercial en dos tiendas. El segundo contrato, que se está finalizando actualmente, incorporará una cantidad no revelada de nuevas unidades comerciales. Como las tiendas están abiertas y vendiendo a los pasajeros, para Montico y compañía sólo será una cuestión de convertirlas en instalaciones de marca La Riviera e incorporarle a la mezcla de productos el portafolio de marcas que vende Grupo Wisa. Notablemente, muchas de las marcas no están disponibles actualmente en la región, con lo cual la compañía considera una gran oportunidad de ofrecerles a los viajeros algo completamente nuevo y lujoso, según Montico. “Parte de la razón por la cual decidimos operar en Suramérica en primer lugar, es porque vimos que podíamos incorporar valor con numerosas marcas prestigiosas que a los viajeros les resultan difíciles de encontrar en las tiendas existentes ”, explica Montico. “Los compradores brasileños son refinados y muy selectivos en lo que compran, y compran bastante. Esto es especialmente cierto si es cuestión de encontrar una marca de lujo que

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

no ven normalmente en la zona”. En términos de marca, Grupo Wisa usará el mismo concepto arquitectónico que en Bogotá, tomando en consideración, por supuesto, que las instalaciones suramericanas son tiendas de frontera y no de aeropuerto. No obstante, Montico destaca que esas tiendas están haciendo increíbles negocios. “Tienen tanto tráfico, a pesar de la corta distancia entre ciudades y la enorme diferencia de precios del mercado local en Brasil, que en muchos aspectos la operación es muy similar a la de una tienda de aeropuerto”, dice. “En Centroamérica hemos tenido tiendas de frontera, pero son muy diferentes a las tiendas en Suramérica”, continúa. “Yo compararía realmente las tiendas en la frontera del Brasil con tiendas de aeropuerto sin aviones, sobre todo debido al perfil de los viajeros”. Grupo Wisa tiene en proyecto tener lista la mayoría de las tiendas en septiembre, como máximo. Sin embargo, los negocios en Chuy son muy de temporada, con ventas sólidas en verano y una disminución considerable en invierno. Por eso la compañía inaugurará esa tienda en el 2013.

Sólo el comienzo Los acontecimientos en la frontera brasileña representan la primera fase de un plan para penetrar a profundidad en el mercado duty free suramericano. Es, sin duda, un buen comienzo, pero Grupo Wisa tiene mayores ambiciones para el futuro, como competir por licitaciones aeroportuarias en el sur de Brasil, y crear un portafolio de marcas propiedad de Grupo Wisa en Argentina. Montico afirma que la compañía también está analizando varias oportunidades en Chile, aunque es demasiado pronto para dar más detalles al respecto. “Nuestra entrada en Suramérica nos convierte en una compañía latinoamericana de bona fide, y no un operador con tiendas regionales”, asegura Montico. “Y le añade un valor muy significativo a la compañía, así como un aspecto nuevo y atractivo al servicio que les proporcionamos a nuestros valiosos colaboradores de suministros. Estamos muy entusiasmados de comenzar operaciones en el dinámico mercado minorista de viajes en c Suramérica”.

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Regional Report: Argentina

Ischigualasto Park in northwestern Argentina

Up to speed

RYAN WHITE

Argentina has known for some time the benefits that tourism provides to the economy, and now the government is taking clear steps ensure that the industry continues growing

rom the bustling city of Buenos Aires to the natural beauty of Iguazú Falls, it’s clear that Argentina has a lot to offer tourists. Americas Duty Free spoke with Enrique Meyer, Argentina’s Minister of Tourism, to get more details on just how many people are visiting the country, who they are, what they’re spending and what this means for the country in general. A lot has been written about the economic might of Brazil, and Meyer explained to us that Argentina is experiencing a boom of its own, at least in part due to with its neighbor to the north. According to the latest figures from Argentina’s Dirección de Estudios de Mercado y Estadística (The Office of Market and Statistics Studies), in 2011 tourism in

Argentina increased 8% over 2010. The total number of foreign tourists entering the country last year was on the order of 5.7 million. This impressive number actually puts Argentina in the top spot in terms of tourism in South America for 2011, with Brazil com-

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

ing in at second place with 5.4 million tourists. As could be expected, Meyer tells us that in terms of the nationalities that visit Argentina, Brazilians are in first place. Chileans and Europeans came in second and third, respectively.

“ Thanks to the natural beauty that our country possesses, the quality services that we offer visitors and the infrastructural developments that have taken place over the last few years, tourism is growing.” Enrique Meyer, Argentina’s Minister of Tourism

Promoting travel within Argentina Doing the tango in Buenos Aires

No surprise also is the fact that Brazilians are spending more than any other nationality when visiting Argentina: “According to our statistics, we saw a 12% increase in tourist spend in 2011,” says Meyer. “The total spent by tourists in Argentina last year was US$5.4 million. With an average spend per head of about US$160 a day, Brazilians are spending the most.” Tourism is obviously important for Argentina’s economy and is a key element of President Cristina Fernández de Kirchner’s plan for the country’s continued growth. In fact, Meyer’s position was established in mid-2010 as a means of putting more of an emphasis on tourism as a driver of growth. “If we see tourists visiting a certain part of Argentina,” says Meyer, “it really equates to a new opportunity for us

Travel by Argentineans within the country is another priority for Meyers, and Aerolineas Argentinas and the Ministry of Tourism have signed an agreement to jointly promote domestic destinations, products and Argentine tourist attractions through kiosks in major shopping malls. “The presence of Aerolineas Argentinas in shopping malls serves the purpose of being much closer to clients and offering them a more comprehensive service,” the airline said. Passengers and frequent travelers will be able to make reservations and purchase tickets at the kiosks. The first two stands were opened in Buenos Aires at the Alto Palermo and Abasto shopping malls, and the third was opened at the Cordoba Shopping Villa Cabrera mall in Cordoba city. More new openings are planned in Buenos Aires at the Paseo Alcorta, Alto Avellaneda, Dot Buenos Aires and Patio Bulrich malls, and in Mendoza City at the Mendoza Plaza Shopping Mall. “The opening of stands in shopping malls is a very important step for Aerolineas Argentinas, which strives to get closer to its customers and to be aware of their needs. The signing of this agreement with the Ministry of Tourism will help to promote tourism and improve the regional economies,” said Mariano Recalde, President of Aerolineas Argentinas.

as a country.” In mid-2011 the President unveiled a strategic plan to increase tourism to 8 million visitors a year by 2020. This concentration on foreign visitors, combined with a hard stance against corruption and crime, has made Argentina a very attractive getaway spot for vacationers. Currently tourism represents 7% of Argentina’s GDP and is an important source of jobs for thousands of Argentineans, and given the country’s plans for the next decade

or so these figures can be expected to increase. “Thanks to the natural beauty that our country possesses, the quality services that we offer visitors and the infrastructural developments that have taken place over the last few years, tourism is growing,” Meyer tells us. “More importantly, it’s growing in a sustainable manner right across the country, contributing to the economies of each region. This is a fundamental factor for building a strong country as a whole.

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

Regional Report: Argentina

Pictured is London Supply’s Puerto Iguazú location, which will soon double in size and have a new underground parking structure

the numbers are truly impressive—over the last decade there has been a growth in passengers at the airport exceeding 500%. To handle traffic that shows no signs of slowing down in the near future, the renovations will see the airport triple in size. London Supply welcomed 133 participants at this year’s golf tournament While the projects at El Califate and the Puerto Iguazú store won’t be completed until 2013, Heredia told us that the rest of the initiatives should be finished this year. “It’s a cycle of continuous improvement here at London Supply,” he told us. “There’s always something we can do to better people’s experience, whether that’s at our stores, at the airports we manage or with our corporate social responsibility program.” And speaking of improving people’s lives, Heredia told us that the operator’s 8th annual Francisco Heredia, Commercial Manager, London Supply charity golf tournament, held in January in Punta del Este, was a huge success. A total of Keeping travel retail fresh unit for its Puerto Iguazú location, as well as 133 people joined the fun this year, beating No discussion of the travel industry in nearly doubling the store space there; the last year’s number by nearly 19%. London Argentina would be complete without includ- continued renovations to El Califate Airport; Supply raised US$204,576 for Fundación ing duty free operator and airport manage- the addition of elevators and walkways among Peluffo Giguens, an organization dedicated ment company London Supply. For those in the different levels at the downtown duty to fighting cancer in children. The golf tourthe travel retail industry, the company is free store in Ushuaia; the addition of a new nament was originally conceived to help Funknown as a true innovator across all facets of level at the downtown Rio Grande store that dación Peluffo Giguens build a state-of-theits business, from its unique store designs will see store space nearly double; and con- art telemedicine center that allows children and groundbreaking airport concepts to its tinued work on an important CSR initiative to receive treatment from specialists all around fundraising work helping youth and families spearheaded by President of London Supply the world without the need to travel abroad. “South America is a wonderful place to Teddy Taratuty, which will result in the conacross the country. In a recent conversation with Francisco struction of a high school in Puerto Iguazú. develop business,” concluded Heredia. “As In line with the Ministry of Tourism’s opposed to simply reading about the big changes Heredia, Commercial Manager at Argentinabased London Supply, Americas Duty Free comments on the tourism boom in Argentina, happening at London Supply this year, we learned that the operator has a number of new Heredia notes that passenger numbers at El invite all to join us in Puerto Iguazú from May projects in the works for 2012, including the Califate have been good over the last year. 30 to June 2 for the annual ASUTIL conference c construction of an underground parking When viewed from a wider lens, however, so they can see for themselves!”

“There’s always something we can do to better people’s experience, whether that’s at our stores, at the airports we manage or with our corporate social responsibility program.”

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Regional Report: Argentina

Argentina offers a wide variety of tourist attractions to suit anyone’s taste

A toda máquina Argentina ha disfrutado desde hace algún tiempo los beneficios que el turismo le proporciona a la economía, y ahora el gobierno está tomando medidas claras para garantizar el crecimiento continuo de esa industria

esde la animada ciudad de Buenos Aires a la belleza natural de las Cataratas del Iguazú, está claro que Argentina tiene mucho que ofrecerles a los turistas. Americas Duty Free entrevistó a Enrique Meyer, Ministro de Turismo de Argentina, para enterarse de más detalles acerca de cuántas personas visitan el país, quiénes son, qué gastan, y lo que esto implica para la nación en general. Mucho se ha escrito sobre el poder económico de Brasil, y Meyer nos explicó que Argentina está experimentando un boom propio, al menos en parte gracias a sus vecinos del Norte. Según los datos más recientes de la Dirección de Estudios de Mercado y Estadística de Argentina, en el 2011 el turismo a ese país se incrementó un 8% en relación con el 2010. La cifra total de turistas extranjeros que entraron al país el año pasado estuvo en el orden de los 5.7 millones. Esta importante cifra coloca a Argentina a la vanguardia en términos de turismo en Suramérica durante el 2011, y a Brasil en segundo lugar con 5.4 millones de turistas. Como podría esperarse, Meyer reveló que con respecto a las nacionalidades que visitan 42

Argentina, los brasileños ocupan el primer lugar, y los chilenos y europeos el segundo y tercero, respectivamente. Tampoco es sorpresa el hecho de que los brasileños están gastando más que las demás nacionalidades cuando visitan Argentina: “Según nuestras estadísticas, experimentamos un incremento del 12% en los gastos de los turistas durante el 2011” afirma Meyer. “El total gastado por los turistas en Argentina el año pasado fue de US$5.4 millones. Los brasileños son los que más gastan, con un gasto promedio per cápita de unos US$160 diarios”. El turismo es de obvia importancia para la economía de Argentina, y un elemento clave para el plan de la presidenta Cristina Fernández de Kirchner para el crecimiento continuo del país. A propósito de esto, el cargo que ocupa actualmente Meyer fue creado a mediados del 2010 como medio de darle más énfasis al turismo como impulsor de crecimiento. “Si vemos turistas visitando una región determinada de Argentina”, explica Meyer, “esto equivale realmente a una nueva oportunidad para nosotros como país”. A mediados del 2011 la Presidenta dio a conocer un plan estratégico para incremen-

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

tar el turismo a 8 millones de visitantes anuales para el 2020. Esta concentración en los visitantes extranjeros, combinada con una posición sólida contra la corrupción y el delito, ha convertido a Argentina en un lugar muy atractivo para los vacacionistas. En la actualidad, el turismo representa el 7% del Producto Interno Bruto de Argentina, y es fuente importante de empleo para miles de argentinos. Además, dados los planes del país para la próxima década, se espera que esas cifras aumenten. “Gracias a la belleza natural que posee nuestro país, a los servicios de calidad que les ofrecemos a los visitantes, y a los desarrollos de infraestructura que se han llevado a cabo en los últimos años, el turismo está creciendo”, asegura Meyer. “Más importante aún, está creciendo de forma sostenible en todo el país, contribuyendo a las economías de cada región. Este es un factor fundamental para crear un país sólido en conjunto”.

Mantener actualizado al sector minorista de viajes Ningún análisis de la industria de viajes en Argentina estaría completo sin tener en cuenta a London Supply, operador duty free y compañía de administración de aeropuertos. Para los miembros del sector minorista de viajes, la compañía es conocida como una verdadera innovadora en todas las facetas de su operación, C O N T I N U E D O N PA G E 4 4

Regional Report: Argentina C O N T I N U E D F R O M PA G E 4 2

desde sus originales diseños de tiendas y conceptos vanguardistas de aeropuertos, hasta su trabajo de recaudación de fondos para ayudar a la juventud y a las familias de la nación. En una conversación reciente con Francisco Heredia, Gerente Comercial de London Supply, radicada en Argentina, Americas Duty Free supo que el operador cuenta con varios proyectos nuevos en marcha para el 2012, como la construcción de una unidad subterránea de estacionamiento en sus instalaciones de Puerto Iguazú, así como la casi duplicación del espacio de tiendas allí; las renovaciones continuas en el Aeropuerto El Califate; la instalación de ascensores y pasarelas en los diferentes niveles de la tienda duty free del distrito comercial en Ushuaia; la adición de un nuevo nivel en la tienda del distrito comercial de Río Grande que casi duplicará el espacio; y el trabajo continuo en una importante iniciativa de CSR de Teddy Taratuty, Presidente de London Supply, que dará por resultado la construcción de una escuela de enseñanza secundaria en Puerto Iguazú. En concordancia con los comentarios del Ministerio de Turismo acerca del boom del sector en Argentina, Heredia destaca que la cantidad de pasajeros en El Califate alcanzó cifras notables el año pasado. Sin embargo, al verlo desde una perspectiva más amplia, las

Promover el turismo nacional en Argentina Como el turismo nacional en Argentina es otra prioridad de Meyers, Aerolíneas Argentinas y el Ministerio de Turismo han suscrito un convenio para promover conjuntamente los destinos, productos y atracciones turísticas nacionales en quioscos ubicados en importantes centros comerciales. “La presencia de Aerolíneas Argentinas en los centros comerciales tiene el propósito de estar mucho más cerca de los clientes, y ofrecerles un servicio más integral”, explican autoridades de la aerolínea. Además, los pasajeros y viajeros frecuentes podrán hacer reservaciones y adquirir boletos en esos quioscos. Los dos primeros quioscos ya fueron inaugurados en los centros comerciales de Alto Palermo y el Abasto en Buenos Aires, y un tercero en el centro comercial Córdoba Shopping Villa Cabrera en la ciudad de Córdoba. También está programada la apertura de otros en los centros comerciales bonaerenses de Paseo Alcorta, Alto Avellaneda, Dot Buenos Aires y Patio Bulrich; y en la Mendoza Plaza Shopping Mall de la ciudad de Mendoza. “La inauguración de quioscos en centros comerciales es un paso muy importante para Aerolíneas Argentinas, que se esfuerza en acercarse más a sus clientes y estar consciente de sus necesidades. La firma de este convenio con el Ministerio de Turismo contribuirá a la promoción del turismo y al mejoramiento de las economías regionales”, concluye Mariano Recalde, Presidente de Aerolíneas Argentinas.

cifras son realmente impresionantes, pues en la última década se ha registrado un aumento de pasajeros en el aeropuerto que supera el 500%. A fin de asumir un tráfico que no muestra señales de disminuir en un futuro cercano, las renovaciones triplicarán la capacidad del aeropuerto. Si bien los proyectos en El Califate y en la tienda de Puerto Iguazú no estarán concluidos hasta el 2013, Heredia afirma que el resto de las iniciativas se terminarán este año.

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“Es un ciclo de mejoras continuas en Supply”, asegura. “Siempre podemos hacer algo para mejorar la experiencia del público, ya sea en nuestras tiendas, en los aeropuertos que administramos, o con nuestro programa de responsabilidad social corporativa”. Y hablando de mejorar las vidas de otras personas, Heredia puntualiza que el 8vo evento torneo anual benéfico de golf, que se llevó a cabo en enero en Punta del Este, fue un gran éxito. Este año participó un total de 133 personas, superando la cifra del año pasado en cerca del un 19%. London Supply recaudó US$204.576 a beneficio de la Fundación Peluffo Giguens, organización dedicada a combatir el cáncer en los niños. El torneo de golf se concibió originalmente para contribuir a que la Fundación Peluffo Giguens creara un centro de telemedicina equipado con la más moderna tecnología, donde los niños reciben tratamiento de especialistas de todo el mundo, sin necesidad de viajar al extranjero. “Suramérica es un sitio maravilloso para desarrollar negocios”, concluye Heredia. “En vez de limitarse a leer información acerca de los grandes cambios que se llevan a cabo este año en London Supply, los invitamos a participar con nosotros en la Conferencia Anual de ASUTIL, que se llevará a cabo en Puerto Iguazú del 30 de mayo al 2 de junio, ¡para que c puedan verlos con sus propios ojos!”.

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Latin America Report

All systems go

If Latin American operators have their way, the considerable momentum achieved in 2011 will continue well into this year and, with any luck, beyond

Keeping pace Paraguay-based operator Bright Star is in many way indicative of the overall positive trend in the Latin American duty free market of late. Average spend at the company’s stores in Silvio Pettirossi Airport increased over 2010, and passenger numbers were also up, largely attributed to new carriers—namely Sol del Paraguay and Copa Airlines—that began

service there last year. “Compared to 2010 we saw a general increase in sales across all categories,” says Antonella Nuovo, Trade Manager at Bright Star. “Sales in perfumes, cosmetics and accessories increased the most last year.” Linked to the increased traffic at the airport is of course the robust economy in many areas of Latin America. Nuovo says that this is also a contributing factor to Bright Star’s

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

RYAN WHITE

significant growth over 2011. However, a good portion of the credit must go to the company itself. Nuovo tells us that throughout last year Bright Star worked hard to improve internal processes and collaborate even more closely with suppliers on the introduction of new brands and promotions. For example, in December of 2011 Bright Star partnered with Chandon to offer travelers that purchased US$250 or more a free

Bright Star’s main departures store in Silvio Pettirossi Airport now features new fixture containing an LCD panel to communicate launches

bottle of Chandon Extra Brut. “It was the perfect gift with purchase at the perfect time,” Nuovo says. “Many customers told us that they planned to use the Champagne when toasting during New Years.” Nuovo reports good results from the initiative, with noticeable increases in the average ticket. Also during the same period the operator offered other GWPs from such brands as The Body Shop, L’Occitaine, Burberry,

Giorgio Armani, Guylian, Ferrero, Nestlé and more to similar effect. Bright Star has started this year with renovations to its main departures store in Silvio Pettirossi Airport. The company has installed new furniture near the registers that Nuovo describes as “much more practical and modern.” Each new fixture contains an LCD panel to communicate launches, with the secondary effect of creating more standout for products.

Furthermore, the layout of the furniture makes passing to the registers easier for shoppers. In the same store, more space has been given to the fragrance section and the sunglasses area has been tweaked to create more standout. Nuovo tells us that the response has been positive. “We’re very pleased with the way the renovations turned out,” she says. “In fact we’ve already made plans to make similar changes in our second departures store at the airport.”

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Latin America Report

To celebrate the tenth anniversary of the opening of its stores at Cancun Airport, WDFG organized a host of events, from tastings and promotions to flash mobs, musical performances and dances

“A tendency toward growth” Pedro Castro, Operations Director for Latin America, Middle East & Asia at World Duty Free Group (WDFG), tells us that 2011 was a good year for the company, and for travel retail in general, “showing a tendency toward growth.” For the first nine months of 2011, Autogrill-owned WDFG’s earnings totaled an impressive €1.36 billion (US$1.8 billion), representing an increase of 10% over the same period in 2010. The company’s UK, Spain and Canadian operations contributed significantly, but WDFG’s Latin American business arm— consisting of operations in Mexico, Chile, Peru and Curaçao—had its own important part to play last year. Certainly helpful is the fact that there were increases in passenger numbers across the board—some bigger than others—at Latin American airports where

WDFG operates (Mexico, +1.4%; Peru, +15%; Curaçao, +24%; and Chile, +34%). Although passenger increases at Cancun Airport are lagging somewhat behind those in other regions, it should be noted that the airport is known to serve more passengers than any other airport in Latin America on a yearly basis, meaning that even a small increase on already strong numbers is, comparatively speaking, significant. As such, the airport is obviously a priority for WDFG. The operator will undertake a large-scale effort in Cancun during the first semester of this year, renovating its stores in the commercial area of Terminal 2. The first phase of the work will see the main departures store, which currently measures 735 square meters, increase in size by 325 square meters. The additional space will be used for promotions, and WDF will also

“Our fragrance store in [Cancun’s] Terminal 2 departures will be renovated. The space will be used for activations in coordination with major brands.” Pedro Castro, Operations Director for Latin America, Middle East & Asia, World Duty Free Group 48

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

install a tasting bar and large LED panels for promotional purposes. “Our fragrance store in Terminal 2 departures will also be renovated,” says Castro. “It currently measures in at 85 square meters and will receive another 40 square meters of space. Promotions are also key activities at this store, and the space will be used for activations in coordination with major brands.” Also proof of the importance of the Cancun operations to WDFG is the company’s recent concentration on promotions and activations there. To celebrate the tenth anniversary of the opening of its stores at Cancun Airport, WDFG organized a host of events, from tastings and promotions to flash mobs, musical performances and dances. “This is the first time we’ve done this type of event in Cancun and given its success it is very possible that passengers will be seeing more of this from WDFG in other airports in Latin America.”

An unforgettable experience Top Brands International currently operates 28 stores, both domestic and duty free, located in Belize, Salvador, Panama, Honduras, Guatemala, Puerto Rico, Cuba and Colombia. Danny Yohoros, Vice President of Top Brands, recently spoke with Americas Duty Free about the company’s latest projects, which involve renovations to the Belize stores, expansion plans and a new customer loyalty program. “When the renovations are complete our four El Dorado-branded stores in Belize will have a total of 1,400 square meters of selling space,” Yohoros says. The impetus for the renovations was to make sure that the offer at the stores is complete and to ensure that shoppers can find exclusive products there. When all is said and done consumers will be able to choose from all the major duty free categories in Belize, including fragrances, cosmetics, spirits, tobacco, confectionery and luxury accessories—each including prestigious international brands. Yohoros tells us that 2011 was a year “full of many successes” for Top Brands. Across its operations business grew by 30% and well outpaced expectations. “Latin America is a very stable region at the moment,” Yohoros explains. “Strong competition, a high demand

Continuing to serve travelers in Bogota Motta Internacional S.A. announced early this year that it was awarded one of the two duty free concessions at the new El Dorado International Airport in Bogota. The new El Dorado Airport is currently under construction and is expected to open in the second half of 2012. OPAIN, who is in charge of building and operating the new airport, has stated that the new El Dorado will be the most modern and efficient airport in Latin America. OPAIN estimates that in 2012 the airport will handle 6 million international passengers. “We are extremely pleased that our Attenza stores will continue to service the passengers that travel through Bogota, and we will be working closely with OPAIN to create a shopping experience like no other in the new El Dorado Airport,” said Erasmo Orillac, CEO of Motta Internacional S.A. When all is said at done at the new airport, Motta will operate a 1,250-square-meter departures store and a 600-square-meter arrivals store. Orillac told us that the new spaces will improve the product variety on offer at the stores and allow for more display areas. “2011 was overall a very good year for our operations in Colombia and Panama,” Orillac told us. “We have a good working relationship with OPAIN and look forward to a successful 2012.”

for the products we offer and the generally healthy economy have helped us strengthen our business.” Largely as a result of the positivity that abounds in Latin America at the moment, Yohoros tells us that Top Brands is currently looking to expand its business. The company already has new projects on the go, but it’s too early for Yohoros to give details. “The bottom line is that we’re always trying to find ways to evolve and grow,” he says when asked about the projects. “Innovation— being on the cutting edge—is very important.” While the company’s expansion plans remain under wraps for the moment, another way Top Brands is bettering itself is through a new customer loyalty program that centers on a calendar of unique promotions and a highly personalized form of customer service. “One of our prime goals is to create unforgettable exchanges between consumers and our El Dorado Duty Free sales staff,” Yohoros concludes. “Rather than simply shopping for items, we want our clients to live the El Dorado experience.”

“2011 was overall a very good year for our operations in Colombia and Panama. We have a good working relationship with OPAIN and look forward to a successful 2012.” Erasmo Orillac, CEO, Motta Internacional

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Latin America Report

Todos los sistemas funcionan

Si los operadores latinoamericanos logran lo que se proponen, el impulso considerable alcanzado en el 2011 continuará este año y, con suerte, en los próximos

Mantener el ritmo Bright Star, operador radicado en Paraguay, es en gran medida indicativo de la tendencia positive general del mercado duty free actual en Latinoamérica. El gasto promedio en las tiendas de la compañía en el Aeropuerto Silvio Pettirossi aumentó en el 2010, y la cantidad de pasajeros también, atribuido en gran parte a nuevos transportistas—como Sol del Paraguay y Copa Airlines—que iniciaron sus servicios allí el año pasado. “En comparación con el 2010 experimentamos un incremento general de las ventas en todas las categorías”, afirma Antonella Nuovo, gerente comercial de Bright Star. “Las ventas en perfumes, cosméticos y accesorios fueron las que más aumentaron el año pasado”. Por supuesto, la robusta economía en numerosas regiones de Latinoamérica está vinculada al incremento del tráfico en el aeropuerto. Nuovo afirma que es además un factor que también contribuyó al crecimiento significativo de Bright Star en el 2011. Sin embargo, buena porción del crédito se le debe atribuir a la compañía. Nuovo nos dijo que el año pasado Bright Star se esforzó en mejorar los procesos internos y colaborar aun más con los proveedores en la introducción de nuevas marcas y promociones. Por ejemplo, en diciembre del 2011 Bright Star creó una alianza con Chandon para ofrecerles a los viajeros que compraran $250 o más una botella de Chandon Extra Brut sin costo

The new fixtures at Bright Star’s main departures store in Silvio Pettirossi Airport have the secondary effect of increased standout for brands

alguno. “Fue el regalo perfecto con la compra en el momento perfecto”, asegura Nuovo. “Muchos clientes nos dijeron que se proponían usar la champaña para sus brindis de Año Nuevo”. Nuovo reporta buenos resultados de la iniciativa e incrementos notables en el gasto promedio. También durante ese mismo período el operador ofreció otros regalos con compras de marcas como The Body Shop, L’Occitaine, Burberry, Giorgio Armani, Guylian, Ferrero, Nestlé y más, con efectos similares. Bright Star ha comenzado este año con renovaciones para su tienda principal en la sección de salidas del Aeropuerto Silvio Pettirossi. La compañía instaló un nuevo mobiliario cerca de las cajas registradoras que

“Una tendencia al crecimiento” Pedro Castro, director de operaciones para Latinoamérica, el Oriente Medio y Asia de World Duty Free Group (WDFG), asegura que el 2011 fue un buen año para la compañía, y para el sector minorista de viajes en general, “mostrando una tendencia al crecimiento”. En los primeros meses del 2011, los ingresos de Autogrill, propiedad de WDFG, totalizaron la impresionante cifra de €1.36 mil millones (US$1.8 mil millones), representando un incremento del 10% con relación al mismo 50

período del 2010. Las operaciones de la compañía en el Reino Unido, España y Canadá contribuyeron significativamente, pero la rama comercial de WDFG en Latinoamérica—compuesta por operaciones en México, Chile, Perú y Curazao—desempeñó un importante papel el año pasado. Realmente útil es el hecho de que se produjeron incrementos en cantidad de pasajeros—algunas mayores que otras— en aeropuertos latinoamericanos donde opera

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Nuovo describe como “mucho más práctico y moderno”. Cada nueva pieza contiene un panel LCD para comunicar las nuevas ofertas, con el efecto secundario de crear más presencia de los productos. Más aun, la estructura de ese mobiliario facilita el tráfico de compradores por las cajas registradoras. En la misma tienda, se le ha dado más espacio a la sección de fragancias y la de lentes de sol se ha reformado para crear más presencia del producto. Nuovo nos explica que la respuesta ha sido positiva. “Estamos muy complacidos con la forma en que han resultado las renovaciones. A propósito, ya estamos planificando cambios similares en nuestra segunda tienda de la sección de salidas del aeropuerto”, añade. WDFG (México, +1.4%; Perú, +15%; Curazao, +24%; y Chile, +34%). Aunque el incremento de las cifras de pasajeros en el Aeropuerto de Cancún está quedándose a la zaga en comparación con otras regiones, debe destacarse que el mismo presta servicios anualmente a más pasajeros que los demás aeropuertos de Latinoamérica, lo cual equivale a que incluso un leve incremento en cifras de por sí sólidas es, hablando comparativamente, significativo. Como tal, el aeropuerto es obviamente una prioridad para WDFG. El C O N T I N U E D O N PA G E 5 2

Latin America Report C O N T I N U E D F R O M PA G E 5 0

operador llevará a cabo una iniciativa en gran escala en el aeropuerto de Cancún durante el primer semestre del año, renovando sus tiendas el la zona comercial de la Terminal 2. La primera fase del trabajo se enfocará en la tienda principal de la sección de salidas, que abarca actualmente 735 metros cuadrados, incrementando la instalación en 325 metros cuadrados. El espacio adicional se usará para promociones, y WDFG también instalará un bar de degustaciones y enormes paneles LED con propósitos promocionales. “Nuestra tienda de fragancias en la sección de salidas de la Terminal 2 también se renovará”, afirma Castro. “En estos momentos mide 85 metros cuadrados y recibirá otros 40 metros cuadrados de espacio. Las promo-

ciones también son actividades claves en esta tienda, y el espacio se usará para activaciones en coordinación con marcas importantes”. Otra prueba de la importancia de las operaciones de Cancún para WDFG es la reciente concentración de la compañía en promociones y activaciones allí. Para celebrar el décimo aniversario de la apertura de sus tiendas en el Aeropuerto de Cancún, WDFG organizó diversos eventos, desde degustaciones y promociones a multitudes instantáneas, presentaciones musicales y bailes. “Es la primera vez que hemos realizado este tipo de evento en Cancún, y dado su éxito es muy posible que los pasajeros disfrutarán otros más que ofrecerá WDFG en otros aeropuertos de Latinoamérica”.

One of Top Brands’ prime objectives is to make sure that it offers shoppers a wide variety of internationally renowned brands across categories

Una experiencia inolvidable Top Brands International opera actualmente 28 tiendas, tanto nacionales como duty free, ubicadas en Belice, Salvador, Panamá, Honduras, Guatemala, Puerto Rico, Cuba y Colombia. Danny Yohoros, vicepresidente de Top Brands, habla con Americas Duty Free acerca de los proyectos más recientes de la compañía, consistentes en renovaciones de las tiendas de Belice, planes de expansión y un nuevo programa de lealtad del cliente. “Cuando concluyan las renovaciones de nuestras cuatro tiendas de marca de El Dorado en Belice, tendremos un total de 1,400 metros de espacio comercial”, explica Yohoros. El ímpetu para las renovaciones fue garantizar que la oferta en las tiendas sea completa, y que los compradores puedan encontrar productos exclusivos en las mismas. Cuando el trabajo esté concluido, los consumidores podrán elegir sus favoritos entre las principales categorías duty free en Belice, como fragancias, cosméticos, espirituosos, tabaco, confitería y accesorios de lujo, cada una de las cuales contará con prestigiosas marcas internacionales. Yohoros añade que el 2011 fue un año “lleno de muchos éxitos” para Top Brands. En todas sus operaciones las ventas aumentaron en un 30% y superaron con creces las expectativas. “Latinoamérica es una región muy estable en este momento”, explica Yohoros. “La competencia sólida, una alta demanda de los productos que ofrecemos y la economía generalmente saludable, nos han ayudado a fortalecer nuestro negocio”. En gran medida como resultado del espíritu positivo que impera actualmente en Latinoamérica, Yohoros nos dice que Top Brands se propone en estos momentos ampliar sus

operaciones. La compañía ya tiene nuevos proyectos en marcha, pero es demasiado pronto para que Yohoros revele más detalles al respecto. “En resumen, siempre tratamos de buscar maneras de evolucionar y crecer”, asegura el alto funcionario cuando se le pregunta acerca de los proyectos. “La innovación— estar a la vanguardia—es muy importante”. Si bien los planes de expansión de la compañía no se van a revelar por el momento, otra manera mediante la cual Top Brands está perfeccionándose es con un nuevo programa de lealtad del cliente que se enfoca en un calendario de promociones originales y una forma altamente personalizada de servicio al

cliente. “Uno de nuestros objetivos principales es crear intercambios inolvidables entre los consumidores y nuestro personal de ventas de El Dorado Duty Free”, concluye Yohoros. “En vez de comprar simplemente nuestras mercancías, queremos que nuestros clientes vivan la experiencia El Dorado”. c

Seguir prestando servicios a los viajeros en Bogotá Motta Internacional S.A. anunció a principios de año la obtención de una de las dos concesiones duty free en el nuevo Aeropuerto Internacional El Dorado en Bogotá. El nuevo Aeropuerto El Dorado está actualmente en construcción, y se espera que inicie operaciones en la segunda mitad del 2012. OPAIN, compañía a cargo de la operación del nuevo aeropuerto, ha dicho que el nuevo El Dorado será la instalación más moderna y eficiente de Latinoamérica. OPAIN estima que en el 2012 el aeropuerto recibirá 6 millones de pasajeros internacionales. “Nos sentimos extremadamente complacidos de que nuestras tiendas Attenza sigan prestándoles servicios a los pasajeros que viajan a Bogotá, y colaboraremos estrechamente con OPAIN en la creación de una experiencia de compras incomparable en el nuevo Aeropuerto El Dorado”, expresa Erasmo Orillac, director ejecutivo de Motta Internacional S.A. Cuando el nuevo aeropuerto esté concluido, Motta operará una tienda de 1.250 metros cuadrados en la sección de salidas, así como otra de 600 metros cuadrados en la sección de llegadas. Orillac asegura que los nuevos espacios mejorarán la variedad de productos que ofrecen las tiendas y permitirán más áreas de muestra. “En general, el 2011 fue un buen año para nuestras operaciones en Colombia y Panamá”, concluye Orillac. “Tenemos una optima relación de trabajo con OPAIN y esperamos un exitoso 2012”.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

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This year’s renovations will see 5,000 square meters added to the company’s flagship store

Paraguayan Border Stores

Shopping China makes a concerted effort to cater to its largely Brazilian customer base with a range of highend offerings across categories

The knock-on

effect

RYAN WHITE

Americas Duty Free speaks to three operators with home bases in Paraguay to learn how Brazil’s economic boom has benefitted their businesses and the country in general

Booming business ith border stores in Paraguay, Bolivia and Uruguay, successful chains of auto parts stores, gas stations and food courts, a large fleet of heavy and light trucks and fully computerized warehouses that track orders from the US, Europe, Central America and Asia, Shopping China has flourished over the last 80 years due to a clear focus on its largely Brazilian customer base. The company is set to expand its footprint this year with the construction of two new border stores in Chuy and Rivera, Uruguay, in addition to renovations at its flagship Pedro Juan Caballero store. The flagship location, already measuring a whopping 35,000 square meters, will see 5,000 more square meters added this year. “This will give us the opportunity to significantly increase space in a number of important categories,” says Felipe Cogorno, CEO of Shopping China. Categories that will benefit from the renovations include cosmetics, spirits and accessories. In preparation for the renovations, Shopping China is working with brandowners to develop personalized furniture custom-made for the store. Cogorno says that once the renovations are finished the Pedro Juan Caballero location will be “one of the best

“Shopping China is prepared for a productive 2012 that will feature plenty of new and exciting developments for shoppers.” Felipe Cogorno, CEO, Shopping China stores in Latin America.” The big news with Shopping China in 2012, however, is that the company will begin construction on two new stores later this year. Work was originally slated to start in 2011, but Cogorno tells us that in a project this size, small delays are inevitable. While Shopping China already operates a store near downtown Chuy, the new location will be on the outskirts of the city on the road to Punta del Este. Given the large proportion of tourists traveling to Punta del Este for vacations, Cogorno sees the new Chuy store as a one-stop-shop for Brazilians on the way to the upscale resort town. “The stores will be very big, on the order of 17,000 square meters each, and they’ll offer the same wide range of products—from liquors, tobacco, clothing, food, P&C, accessories and

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

more—that we offer in our other stores.” Of course, big changes like this don’t happen unless business is going well. Average spend per head stands at about US$550 and Cogorno says that in general things are going very well, both with the company and the economy in its home base of Paraguay. “The GDP of Paraguay grew 14.7% between December of 2009 and the end of 2010,” he explains. “This was the biggest leap in terms of the GDP in the history of the country. “Furthermore, the success of Paraguay is to a great extent a reflection of the financial boom happening in neighboring countries, namely Brazil,” Cogorno continues. “All in all Shopping China is prepared for a productive 2012 that will feature plenty of new and exciting developments for shoppers.” C O N T I N U E D O N PA G E 5 8

In February of 2011 Monalisa welcomed a record 14,000 people to its flagship location in one day

Paraguayan Border Stores

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40 years and counting Monalisa’s flagship store contains a vast wine cellar, considered by many to be one of the best in South America

Customers visiting Monalisa’s main store can browse many newly renovated departments, including P&C (pictured)

To commemorate its 40-year anniversary, Paraguay-based travel retailer Monalisa has been making a number of changes inside its main store. In 2011 the P&C and watches sections were renovated, with such prestigious brands as Richard Mille, Parmigiani, Roger Dubuis, Chopard, Ivo Pitangui and others added into the mix. Monalisa is currently in the process of making changes to its home, sports, fashion and gourmet foods sections. Visitors to the store can also find the newly renovated corner dedicated to the Cartier brand, and Vice President of Monalisa Charif Hammoud tells Americas Duty Free that the Bvlgari section of the store will also receive a makeover this year. In addition to the changes happening at the flagship location, Monalisa’s perfumery store in Asunción will be brought in line with the changes made in the P&C section of the main store. “We will also be opening two more fragrance shops this year in San Lorenzo in the Gran Asunción area,” Hammoud says. The stores will measure approximately 120 square meters each and carry an assortment of the most popular brands. In fact, 58

“We concentrate on always offering products of the highest quality and offering a very personalized service to our clients within a relaxed atmosphere.” Charif Hammoud, Vice President, Monalisa Hammoud notes that the secret to the company’s success to date is in being keenly aware of what the customer wants and making sure that it’s available in store. “The growth in store traffic last year was significant in comparison to 2010,” Hammoud explains. “In fact, we had a record day in February of 2011 when we welcomed approximately 14,000 people to our flagship location in one day! We concentrate on always offering products of the highest quality and offering a very personalized service to our clients within a relaxed atmosphere. I think largely because of this attention to detail, 2011 was a very successfully year.” While business is obviously good at the

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moment, Monalisa is looking forward to an expected boost in visitors when the much talked about shopping mall, entertainment complex and all-round tourist attraction Paseo Tres Naciones (P3N) opens in Hernandarias, Paraguay. The project, spearheaded by Monalisa with a US$200 million investment, is designed to cater to shoppers and funseekers from Paraguay, Bolivia and Brazil. The project is expected to be completed in early 2014. “The three countries are becoming more and more integrated and P3N is an answer to the changing needs of the region,” Hammoud tells us. “We have high hopes that P3N will help continue this regional evolution.” C O N T I N U E D O N PA G E 6 0

Paraguayan Border Stores

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In addition to a spatial increase, the Silvio Pettirossi departures store will be converted into a walkthrough

Key categories will benefit from the upcoming increase in space at the Silvio Pettirossi departures store

Border and airport success Grupo La Petisquera, parent company of Mannah Duty Free, is unique among the companies discussed above in that it operates border stores in Ciudad del Este and airport shops at Silvio Pettirossi Airport in Paraguay. While Mohamad Said Mannah, President of Mannah Duty Free, agrees with Cogorno and Hammoud that Paraguay experienced “an excellent year” in 2011, he’s slightly less bullish regarding 2012 simply because the last 12 months were so unprecedented. “I don’t expect 2012 to be quite the year that 2011 was for the country in general,” he says. “Last year Paraguay actually experienced the third-largest growth in percentage terms of any country in the world. Climate issues affecting crops this year may end up affecting the GDP.

With respect to the rest of Latin America, though, I think Paraguay is in a very good position largely because of increased investment and the relative stability of the dollar.” Last year Mannah saw a 20% increase in traffic through its stores and recorded an average spend per head of US$88. This translated into an increase in sales of 6.5% over 2010, well surpassing the company’s expectations. Mannah attributes the big increases to the hard work of his marketing team and strong partnerships with quality brandowners across all categories. He also makes a point of mentioning that his company’s goals couldn’t have been met without the increase in passengers to Silvio Pettirossi Airport. This development is due in a large part to Copa

“With respect to the rest of Latin America I think Paraguay is in a very good position largely because of increased investment and the relative stability of the dollar.” Mohamad Said Mannah, President, Mannah Duty Free

Reacción en cadena Americas Duty Free habla con tres operadores con sede en Paraguay para conocer cómo el boom económico de Brasil ha beneficiado a sus negocios y al país en general

Negocios florecientes Con tiendas de frontera en Paraguay, Bolivia y Uruguay, las exitosas cadenas de piezas de repuesto para automóviles, gasolineras y zonas de restaurantes, una enorme flotilla de camiones pesados y ligeros, y almacenes totalmente computarizados que procesan pedidos de Estados Unidos, Europa, Centroamérica y Asia, Shopping China ha florecido en los últimos 80 años debido a un enfoque claro en su extensa clientela brasileña. La compañía tiene en proyecto ampliar su alcance este año con la construcción 60

de dos nuevas tiendas de frontera en Chuy y Rivera, Uruguay, además de renovaciones en su tienda insignia Pedro Juan Caballero. La tienda insignia, que ya abarca un espacio sorprendente de 35,000 metros cuadrados, contará este año con otros 5,000 metros cuadrados más. “Esto nos dará la oportunidad de incrementar significativamente el espacio en varias categorías importantes”, afirma Felipe Cogorno, Director Ejecutivo de Shopping China. Entre las categorías que se beneficiarán con

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Airlines and Sol del Paraguay, the two newest carriers operating in the country. This year the company is doing its part to keep sales up by making some big changes to its airport departures store. Mannah will increase the size of the location by 40 square meters and convert the store into a walkthrough. Apart from the obvious advantages of having 100% of travelers pass through the store, the spatial increase will bode well for key categories. “We are also pleased to announce that we’ll be opening a new store in the central hall of a prestigious hotel in Asunción,” Mannah told us. “The shop will measure 100 square meters and contain the highest-quality products in spirits, accessories, clothing, sporting goods and more.” Despite doubts about whether Paraguay as a whole can duplicate its breakout performance last year, Mannah says that his company and the country as a whole has a lot to look forward to in 2012: “Sol de Paraguay will be adding routes this year to Sao Paulo and Montevideo, which is certainly good for our airport duty free business. We’re also looking forward to implementing the changes to our departures store and getting the new Asunción location up and running. I think these positive changes will bring about some excellent results.” c las renovaciones están los cosméticos, espirituosos y accesorios. En preparación para las renovaciones, Shopping China está trabajando con los dueños de marcas para crear mobiliario personalizado a la medida de la tienda. Cogorno afirma que una vez terminadas las renovaciones, la tienda de Pedro Juan Caballero será “una de las mejores tiendas de Latinoamérica”. Sin embargo, la gran noticia de Shopping China en el 2012, es que la compañía iniciará la construcción de dos nuevas tiendas en este año. Los trabajos debían comenzar en el 2011, pero Cogorno afirma que en un proyecto de tales dimensiones, los pequeños retrasos son inevitables. Si bien Shopping China ya opera una tienda cerca del sector comercial de Chuy, la nueva instalación estará ubicada en las afueras de la C O N T I N U E D O N PA G E 6 2

www.habanos.com

Paraguayan Border Stores

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ciudad, en camino a Punta del Este. Dada la gran proporción de turistas que viajan a Punta del Este para disfrutar de sus vacaciones, Cogorno estima que la nueva tienda en Chuy será un establecimiento integral para los brasileños que se dirigen a la ciudad resort de lujo. “Las tiendas serán muy grandes, en el orden de los 17,000 metros cuadrados cada una, y ofrecerán la misma amplia gama de productos—desde licores, tabaco, alimentos, P&C, accesorios y más—que ofrecemos en nuestras tiendas”. Por supuesto, grandes cambios como éste no se producen a menos que los negocios marchen bien. El gasto per cápita totaliza cerca de US$550 y Cogorno afirma que, en general las cosas van viento en popa, tanto con la compañía como con la economía en la sede de Paraguay. “El PNB de Paraguay creció en un 14.7% entre diciembre del 2009 y finales del 2010”, explica. “Este fue el mayor salto en términos de PNB en la historia del país”. “Más aún, el éxito de Paraguay es en gran medida reflejo del boom financiero que se está produciendo en los países vecinos como Brasil”, continúa Cogorno. “En resumen, Shopping China está preparado para un 2012 productivo que traerá muchos logros nuevos y atractivos para los compradores”.

40 años y muchos más Para conmemorar su 40 aniversario, Monalisa, minorista de viajes radicado en Paraguay ha estado llevando a cabo varios cambios dentro de su tienda principal. En el 2011 las secciones P&C y de relojes se renovaron con marcas tan prestigiosas como Richard Mille, Parmigiani, Roger Dubuis, Chopard, Ivo Pitangui y otras adiciones a la mezcla. Monalisa está enfrascado actualmente en el proceso de hacer cambios en las secciones de productos para el hogar, deportes, modas y alimentos gourmet. Los visitantes de la tienda también podrán encontrar la esquina recién renovada dedicada a la marca Cartier, y Charif Hammoud, Vicepresidente de Monalisa le ha dicho a Americas Duty Free que la sección dedicada a Bvlgari será objeto de renovación este año. Además de los cambios que se llevan a cabo en la instalación insignia, la tienda de perfumería de Monalisa en Asunción se hará corresponder con los cambios realizados en la sección P&C de la tienda principal. “También abriremos este año otras dos tiendas de perfumería en la zona de San Lorenzo, en Gran Asunción”, asegura Hammoud. Las tiendas abarcarán 120 metros cuadrados cada una aproximadamente, y contarán con un surtido de las marcas más populares. A propósito, Hammoud destaca que el secreto del éxito de la compañía hasta la fecha es estar muy consciente de lo que quiere el cliente, y

garantizar que esté disponible en la tienda. “El crecimiento en tráfico de la tienda fue significativo en comparación con el 2010”, añade Hammoud. “De hecho, tuvimos un día récord en febrero del 2011 cuando recibimos cerca de 14,000 personas en nuestra tienda insignia ¡el mismo día! Nos concentramos en ofrecer siempre productos de la más alta calidad, así como un servicio muy personalizado a nuestros clientes en una atmósfera relajada. Creo que, en gran medida, esta atención al detalle fue responsable de que el 2011 fuera un año muy exitoso”. Si bien los negocios son obviamente buenos en estos momentos, Monalisa visualiza un aumento esperado de visitantes cuando el Paseo Tres Naciones [P3N], el tan comentado centro comercial, complejo de entretenimiento y atracción turística en su totalidad, sea inaugurado en Hernandarias, Paraguay. El proyecto, liderado por Monalisa con una inversión de US$200 millones, tiene el objetivo de dedicarse a los compradores y las personas que buscan diversión procedentes de Paraguay, Bolivia y Brasil. Se espera que el proyecto esté concluido a principios del 2014. “Los tres países se están integrando cada vez más, y P3N es una respuesta a las necesidades cambiantes de la región”, apunta Hammoud. “Tenemos grandes esperanzas de que P3N contribuya a continuar esta evolución regional”.

Éxito en tiendas de frontera y aeropuertos Grupo La Petisquera, compañía matriz de Mannah Duty Free, es distinta con respecto a las compañías anteriores en que opera tiendas de frontera en Ciudad del Este y tiendas en el Aeropuerto Silvio Pettirossi de Paraguay. Si bien Mohamad Said Mannah, Presidente de Mannah Duty Free, coincide con Cogorno y Hammoud en que Paraguay experimentó “un año excelente” en el 2011, es un poco menos optimista con respecto al 2012, simplemente porque los últimos doce meses fueron realmente sin precedentes. “No espero que el 2012 sea similar a lo que fue el 2011 para el país en general”, afirma. “El año pasado Paraguay experimentó realmente el tercer crecimiento más grande en términos de porcentaje en comparación con cualquier otro país. Los problemas climáticos que afectan las cosechas este año pudieran afectar el PNB. Con respecto al resto de Latinoamérica, sin embargo, creo que Paraguay está en una posición muy buena, sobre todo por las crecientes inversiones y la relativa estabilidad del dólar”. 62

El año pasado Mannah experimentó un crecimiento del 20% en tráfico en sus tiendas, y reportó un gasto promedio per cápita de US$88. Esto, traducido en un incremento de las ventas de 65% con respecto al 2010, superó con creces las expectativas de la compañía. Mannah atribuye los grandes incrementos al esfuerzo de su equipo de mercadotecnia, y a sólidas alianzas con dueños de marcas de calidad en todas las categorías. También puntualiza que los propósitos de su compañía no se habrían logrado sin el aumento de pasajeros en el Aeropuerto Silvio Pettirossi. Este hecho se debe en gran parte a Copa Airlines y a Sol de Paraguay, los dos nuevos transportistas que operan en el país. Este año la compañía se esfuerza en mantener un alto nivel de ventas haciendo algunos cambios considerables a su tienda en la sección de salidas del aeropuerto. Mannah incrementará el tamaño de la instalación en 40 metros cuadrados, y convertirá la tienda en un sitio de tránsito obligado. Aparte de las obvias ventajas de que el 100% de los viajeros pasen

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por la tienda, el incremento espacial será beneficioso para las principales categorías. “También nos complace anunciar que inauguraremos una nueva tienda en el pasillo central de un prestigioso hotel en Asunción”, revela Mannah. “La tienda tendrá una extensión de 100 metros cuadrados y contendrá los productos de más alta calidad en las categorías de espirituosos, accesorios, ropa, artículos deportivos y más”. A pesar de las dudas acerca de que Paraguay en general pueda duplicar su sorprendente rendimiento del año pasado, Mannah asegura que su compañía y el país en conjunto tienen mucho que esperar del 2012: “Sol de Paraguay incorporará rutas este año a Sao Paulo y Montevideo, lo cual es ciertamente bueno para nuestra operación duty free de aeropuertos. También esperamos implementar los cambios a nuestra tienda de la sección de salidas, y poner en marcha nuestra nueva instalación en Asunción. Creo que estos cambios positivos c propicien resultados excelentes”.

Please visit us at the IAADFS Duty Free Show of the Americas 11-14 March at booth 838

Diamonds International

Shining brightly

Diamonds International carries over 75 brands, including in-house brands Crown of Light, Gift Collection and Safi Kilima

With the opening of a new duty free store in St. Thomas, Diamonds International continues its focus on the excellence of its service and brilliance of its gems BY RYAN WHITE

iamonds International has a strong presence throughout the cruising regions, but the island of St. Thomas is clearly one of its most vibrant markets. There are currently an impressive 14 Diamonds International showrooms on the island alone, located in such prime areas as Havensight Mall, Yacht Haven Grande, downtown Charlotte Amalie and Crown Bay Center. On January 11, 2012, the company celebrated the soft opening of its newest St. Thomas store in the AH Riise mall. Plans are currently in the works for a grand opening in the coming months. The location measures nearly 400 square meters and carries the same selection of fine brands that has made the family-run business a household name in the Caribbean, Alaska and Mexico. Visitors to the stores can find Diamonds International’s own in-house brands Crown of Light, Gift Collection and Safi Kilima, as well as a selection from Ivanka Trump, Di Modolo, Ammolite by Korite, Kabana, Marah Lago, Forever Mark, Rebecca, AP, Zenith, Bulova, Girard Perigeaux, Longines, Corum, Romain Jerome and Ernst Benz. The new store also boasts a dedicated Philip Stein boutique.

“Our success can be attributed to our commitment to customer care and the vast array of diamond jewelry, time pieces and other luxury goods that we have on hand,” explains Wendy Tarapani, Managing Director of Diamonds International. “We carry over 75 brands and offer more and more stunning pieces each season.” In addition to the selection at the stores, Diamonds International offers “extremely competitive” duty free prices, says Tarapani. Furthermore, customers are invited to compare brands side by side before making a purchase. In fact, customer service is a top priority for the company. On St. Thomas alone Diamonds International has over 200 trained employees that are knowledgeable about their wares, as well as friendly and approachable. “We focus on building lasting relationships,” Tarapani says. “Our staff understands the value it has for helping select the right piece for their clients. Our on-site jeweler and enormous inventory assures that every customer finds exactly what they came in for.” The company’s state of the art and user friendly online presence also simplifies the

“Our success can be attributed to our commitment to customer care and the vast array of diamond jewelry, time pieces and other luxury goods that we have on hand.” Wendy Tarapani, Managing Director, Diamonds International 64

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The newest Diamonds International location in St. Thomas’ AH Riise mall has doors that open directly onto Main Street

process of selecting the perfect diamond. In May 2006, the Diamonds International website earned an official honoree Webby Award, a coveted international distinction from the International Academy of Digital Arts & Sciences. The focus on the customer and the quality of the products has paid off for Diamonds International. Tarapani tells us that average spend per head at the stores hovers at an amazing US$1,000. While the vast majority of the client base at the St. Thomas locations is made up of Americans (about 90%), the company also caters to a good many Latin Americans. Tarapani says that 2011 was an improvement over 2010, and regardless of what this year holds Diamonds International is determined to continue upping the ante when it comes to its offerings and stores. Two new locations were recently opened in Falmouth, Jamaica and Nassau, Bahamas, and a big project is planned for Aruba, where Diamonds International already has a store. The company tells us that more details on the Aruba initiative will become available in the very near future. It’s clear that there’s a lot happening at Diamonds International of late, but Tarapani’s outlook is refreshingly simple: “We take pride in our employees and the level of customer service,” she says. “This is a Diamonds Interc national standard.”

Airline News

Inside a TAM Boeing 777—both airlines will keep their identities within LATAM

A joining of giants

LAN and TAM boost global clout by forming joint LATAM Airlines Group he whole is greater than the sum of the parts. That may be a cliché, but the people in charge of South America’s LAN Airlines and TAM Airlines clearly hope that it will come to apply to the operations of the newly created LATAM Airlines Group, formed with the conclusion of an agreement between the two airlines last September. If it does, the effect will be momentous. TAM, based in Brazil and a member of the Star Alliance, is already Latin America’s largest airline, while LAN Airlines, Chile’s national flag carrier and a member of the oneworld Alliance, isn’t far behind. LATAM will include LAN and its affiliates in Peru, Argentina and Ecuador, LAN Cargo and its affiliates TAM, TAM Mercosur and all other holdings of LAN and TAM. LATAM will be listed in New York, Santiago and Sao Paulo. LAN’s regional affiliates include LAN Peru, LAN Ecuador, LAN Argentina, and the recently launched LAN Colombia. The company and its affiliates serve over 76 destinations around the world, and a further 93 additional international destinations through various codeshare agreements. TAM, including Pantanal, which operates as a separate airline within the TAM Group, operates direct flights to 45 cities in Brazil and 18 cities in South America, the United States and Europe. Through agreements with companies in Brazil and abroad, TAM's network

encompasses a further 92 airports in Brazil and 92 international destinations, including Asia. A major part of the rationale for the formation of LATAM Group was the entry into the Latin American market of increasingly large international competitors. “International players are consolidating, either through mergers or broad anti-trust agreements,” LAN says. “These airlines are looking at Latin America for growth. Regional consolidation creates the opportunity for a Latin American carrier to enter on an equal footing with the world leaders.” According to estimates by both airlines, LATAM Group will operate more flights to more destinations than any other Latin American carrier, and connections between the home countries of LAN and TAM will be greatly strengthened. Last August, the two airlines said they had a combined fleet of over 240 aircraft, with more than 220 additional aircraft currently on order. They expect the operational synergies realized by the formation of LATAM will actually lead to network expansion, instead of reducing airplane orders. The first step in the formation of LATAM was the signing of a non-binding agreement in September 2010. In January 2011 this became a binding agreement, and the merger was finalized in December after a series of reviews by anti-trust authorities in the various countries where the group’s constituent airlines operate. Some minor alterations were

A Boeing 767-300 belonging to LAN member airline LAN Chile

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ANDREW BROOKS

mandated: for example, regulators required LAN to transfer four slots at Sao Paulo Guarulhos Airport to competitors who wanted to operate flights to Santiago, and ordered LATAM to give up membership in either Star or oneworld by August of this year. In Europe, the merger has been approved by the antitrust regulators of Italy, Germany and Spain. Furthermore, the shareholders of LAN and TAM have approved the merger unanimously. The new arrangement isn’t a merger in the conventional sense, where two or more commercial entities combine to form a third and give up their own identities in the process. “Both companies will remain separate as LAN and TAM,” LAN says. “We’ll make all the necessary efforts to integrate LAN and TAM systems and their ways of working in order to connect both on a deeper level, but each company will keep its identity, maintenance and operational centers, and so on.” LAN and TAM will continue to operate under their existing operating certificates and brands, and each will maintain its current headquarters—LAN in Santiago and TAM in Sao Paulo. LATAM itself will have its headquarters in Santiago as well. LAN says that LATAM will be among the leading airline groups in the world in terms of size, profitability and c market reach.

Hartsfield-Jackson Airport

Current F&B concessions at Hartsfield-Jackson; nine of the eleven packages awarded were for F&B slots

Southern

comfort The City of Atlanta awards massive F&B and retail contract for Hartsfield-Jackson International

artsfield-Jackson Atlanta International Airport, which is located on the southwest edge of the greater Atlanta metropolitan area, is the world’s largest airport in terms of passenger traffic, serving more than 92 million passengers each year, connecting with more than 150 destinations within the US and almost 80 internationally. The airport is currently undertaking a US$6 billion capital improvement program, including a new energy-efficient car rental center, a new 12-gate international terminal and upgrades to concourses, people movers and parking services. Hartsfield-Jackson has steadily garnered awards for its retail and F&B concessions, as well as operations, architecture and construction. These include the Global and North American Airport Efficiency Excellence Award from the Air Transport Research Society (ATRS)—the ninth year in a row that ATRS has given Hartsfield-Jackson an efficiency award, either global or North American. The concessions program has always been a major focus for Hartsfield-Jackson, and the airport’s attention has paid off. HartsfieldJackson received three major awards at the Airport Revenue News annual conference in March 2011: the 2011 Best Overall Concessions Program award, the Best Concessions Program Design award (for the second year running) and the 2011 Best Concessions Customer Service award. In January of this year, Atlanta City Council announced a comprehensive, US$3 billion concessions award for the airport. According to the City of Atlanta’s Aviation General Manager Louis Miller, the decision process took more than 2,300 man-hours. At press time, although the Mayor of Atlanta, Kasim Reed, had signed the legislation that would award the contracts, the individual contracts had not been signed. However, the details of the concession award had been made public. The award encompassed 11 separate packages, which were awarded to 11 separate consortia. Each consortium included multiple sub-concessionaires, with a total of more than 40 companies winning contracts. Nine of the contracts—five on a large scale and the other four on a smaller scale—were for food and beverage concessions, and the remaining two were for retail. The two retail contracts, each encompassing 13 outlets in the new Maynard H. Jackson Jr. International Terminal scheduled to open this spring, went to LTL ATL JV and Paradies-Atlanta II JV.

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The five major F&B contracts went to: ■ Hojeij Branded Foods (eight concessions) ■ Concessions/H&H JV3 (10 concessions) ■ Host + ATLchefs JV3 (11 concessions) ■ Delaware North Companies Travel Hospitality Services (DNCTHS) Atlanta Partners (10 concessions) ■ Host + ATLchefs JV5 (seven concessions) Four further F&B contracts are on a smaller scale, and were awarded to: ■ Atlanta Restaurant Partners ■ Global Concessions Inc. ■ Mack Inc. ■ Vida-Velocity Management On the retail side, LTL ATL JV, which is backed by HMS Host, has won a contract that includes Tommy Hilfiger, Wall Street Journal, Kiehl’s, CNN, Johnston & Murphy and others. Paradies-Atlanta II JV will bring CNBC News, New York Times Bookstore, Swarovski and The Body Shop, among others, to the airport. The award was passed by Atlanta City Council in a 12-3 vote after some nine hours of debate. The concessions award wasn’t always smooth sailing; last fall the city had to re-issue its request for proposals after receiving some non-compliant bids. Following the latest award, a number of unsuccessful bidders have challenged the award, which in itself isn’t unusual for a prize this big, but could potentially cause some delays. Mayor Reed has stated publicly that the opening of the airport’s new international terminal will go ahead as scheduled. The award covers a total of 150 sites at the airport. The contracts will be among the largest ever awarded in the State of Georgia, with F&B gross sales estimated at US$347.3 million for each year of the next decade. The City’s Aviation Department, which runs the airport, will derive more than US$51 million per year from those sales. Atlanta businesses that have won slots in the new award include well-known local eateries The Varsity, Shane’s Rib Shack, Sweet Georc gia’s Juke Joint and The Pecan.

Hershey innovation brings more of what people love! Iconic global brands and innovative new Travel Retail Exclusive products from Hershey — America’s leader in chocolate. For more information, visit us at booth #1315.

Non-aeronautical Revenue

Scenes at ASUR’s Cancun Airport: passengers prefer a good selection of retail and F&B, situated in big, bright spaces

The other moneymaker

Non-aeronautical revenue is becoming an increasingly attractive income source for airports—for a whole lot of reasons ANDREW BROOKS BY

he economic slump of 2008-2009 is largely a thing of the past for the international air travel market. However, airport managers, like their counterparts in any other field, are seeking ways to shield themselves from future financial shocks by broadening their revenue base, and they’re especially eager to develop non-aeronautical revenue (NAR), or revenue that doesn’t stem directly from aviation and aviation-related services. “Non-aeronautical revenue is becoming more important,” says Liying Gu, Senior Director, Economic Affairs and Research, Airports Council International—North America (ACINA). “Aviation activity is highly correlated with the health of the economy. When a recession hits, air travel is badly impacted and airports need to strengthen their balance sheets.

Non-aeronautical revenue helps.” Gu adds that airline bankruptcies, while relatively rare, have a catastrophic effect on the airports that serve as their hubs. Think of the effects of the bankruptcy of US Airways and Trans World Airlines on Pittsburgh and St. Louis, respectively. “When airlines restructure during bankruptcy proceedings, they may walk away from their lease agreements or renegotiate for much smaller space.” Airports also gain more control over their own fortunes when they broaden the types of NAR they have access to, Gu says. “Pittsburgh has attracted a number of large distribution centers. This helps utilize the land the airport is sitting on and adds more cargo activity.” Being a hub for a large logistics provider, as are Memphis and Louisville (for FedEx and UPS, respectively), attracts companies

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to set up their own distribution centers nearby. “It’s well known that the way to get an edge in the improvement of revenues and returns for airports is through NAR,” says Fiorella Carty Borjas, Retail Manager for Lima Airport Partners SRL, which manages Jorge Chavez International Airport (JCIA) in Lima. “This is because aeronautical revenues (AR) are heavily regulated and/or contested by the airline industry. Therefore, AR usually increases at a lower rate than NAR.” The economic slowdown only gave added impetus to this motivation. Duty free and other retail accounts for 50% of JCIA’s total NAR. The airport closed 2011 with a 28% increase in NAR year over year, which Carty says is especially positive since 2010 NAR figures were up 20% over 2009. Duty free closed 2011 with a higher growth rate than the average for the year, while “other retail” about

The private administration of Lima’s JCIA has fostered strong commercial development at the airport

matched it and F&B also increased, but not by as much as the other categories. “Overall, very impressive growth,” Carty says.

A growing revenue pool In the US, as of 2010 the largest NAR category is parking and ground transportation, at about 42% of total NAR. Second is car rental at about 20%, terminal retail—including duty free—are at about 8%, food and beverage 7% and other services around 5%. “One of drivers for duty free is the tax rate,” Gu says. “In countries with a very high tax rate and a very high percentage of international passengers, duty free naturally becomes a larger proportion of revenue.” While in large European airports, international passengers are in the clear majority, even in large US airports in Atlanta, Los Angeles and JFK, domes-

tic passengers are still the majority. “HartsfieldJackson in Atlanta is the world’s busiest passenger airport,” Gu says, “and yet it has a very high proportion of connecting domestic passengers because it’s the hub for Delta.” In Latin America and the Caribbean, the biggest NAR category is retail concessions, at 39%, due to tourism and also because parking and car rental are much less important there than they are in North America (at about 6% and 4%, respectively). Food and beverage, meanwhile, is comparable to US airports at 4%. “NAR has become a very important issue in the airport industry,” says Carty. “At JCIA the importance of NAR has certainly increased over the past few years as a result of the strong commercial development that has taken place under the private administration of the airport.” In 2011, NAR represented 26% of total

airport revenue, up from 16.5% in 2005. Airport management monitors the sales and performance of commercial concessionaires and works with them to resolve problems, Carty says. Sound advance planning is a major success factor, and carefully structured and executed bid processes also play a key role in achieving optimal concessions layout and passenger flow, a good mix of retail and F&B, good brand and product mix and an inviting environment. “Service levels are key in travel retail,” Carty says. “As opposed to many airports throughout the world, all of our commercial outlets—retail and F&B—are open all the time, 24/7. This, together with good service, is highly appreciated by our passengers.” Moreover, the airport has a marketing plan with several campaigns throughout the year,

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

Non-aeronautical Revenue

Portland’s work at Larnaca International Airport in Cyprus reflects the design consultancy’s view that retail and duty free help build the airport “brand”

as well as catalogs with special discounts and advertising, all aimed at inducing impulse shopping behaviors.

Motives and benefits ACI-NA statistics show that in 2010, total aeronautical revenue for all commercial service airports in the US was US$8.9 billion, while non-aeronautical revenue topped out at US$7 billion—in other words, NAR represents around 44% of all airport revenue. But that percentage varies widely from one airport to another, Gu says. At Tampa and Orlando, NAR accounts for about 70% of total revenue. Chicago O’Hare is also a large hub airport, and yet NAR there amounts to only about 30% of the total. NAR represents around 28% of total airport income for the airports managed by ASUR (Aeropuertos del Sureste), which manages nine airports in Mexico. “This proportion has been increasing—ten years ago NAR was about 4% of the total,” says Manuel Gutierrez Sola, ASUR’s Chief Commercial Officer. ASUR has fostered NAR growth in a number of ways—not the least of which by streamlining its operations and by managing concessionaires more closely. ASUR selects concessionaires with the best revenue potential and then works with them on a daily basis to improve their offer. “We’re out on the floor with the concessionaires every day to see how we can sell more,” Sola says. “We do monthly surveys with every concessionaire to see how we’re doing and to make sure that the right merchandise is on the shelves in the right amount. We want to 72

build long-term relationships.” One result has been that turnover is almost non-existent. So far duty free concessions are present only in three out of the nine airports ASUR manages, but they still account for 26.38% of NAR, while retail accounts for 31.72%. That proportion has remained stable for the last few years. In 2013, ASUR will undertake a new duty free development at Huatulco, a tourist airport on the Pacific coast. “If you look at all passenger-dependent revenue, it represents about 85% of total NAR,” Gu says. “So airports are trying to diversify their revenue streams by increasing non-passenger-dependent revenue.” Airports are looking at commercial land use, developing industrial parks, golf courses and even oil development (Dallas Fort Worth is one example). Better passenger service and business development are primary motivators for ASUR in working to increase NAR, Sola says. “We want to improve passenger service. Here in Cancun you can see that passengers are very happy to find this kind of location, where they can enjoy restaurants, art & crafts, retail and other services. On the business side, NAR helps us to make new investments in our airports and expand to manage new ones.” Ibrahim Ibrahim, Managing Director of Portland, a UK-based design consultancy that creates customer-facing environments for the retail, leisure and travel sectors, adds his own list of motivators for increasing NAR. “Airlines, especially low-cost airlines, aren’t willing to pay as much,” he says. “Also, there’s a captive audience factor and a good sales opportunity.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

There’s potential for good margins, airports being one of few consumer growth sectors.” Ibrahim says retail and duty free are very important for airports, not just for the income they bring in, but also in terms of improving the passenger experience. “They’re a reflection of the airport’s own ‘brand,’ and, by extension, that of the region or city or country that they represent.” The breadth of land uses and revenue streams ties into to the emergence of the “airport city” concept, where a large airport can become almost a self-contained urban area in its own right. The idea is a relatively new one, and so far—in the US anyway—is only in the development stage in most cases, as in Chicago, Dallas Fort Worth, Los Angeles Ontario, Louisville, Memphis and Miami. “The airport city idea will tend to attract non-traveling customers too,” Ibrahim says. “Ultimately, the airport could become a commercial hub as well as a traveling hub.” c

travel accessories Authorized distributor for Latin America: Innova Distributors Inc, info@innovadistributors.com

Tel: +13057672878

St. Thomas Duty Free Estée Lauder occupies a prominent spot in the AH Riise Mall

Caribbean footfall A European duty free consortium sets its sights on St. Thomas, USVI—the first of many ventures in the region

f amassing flight miles is any indication, Jan Baljet, Director of St. Thomas Duty Free, is a busy man these days. But you don’t need to know he flew upwards of 250,000 miles last year to realize that he has a lot on his plate, because Baljet is a central figure in one of the more dramatic stories to emerge in Caribbean duty free in recent years. In November, St. Thomas Duty Free, a consortium of European duty free investors, announced that it had signed a license agreement to operate retailer AH Riise’s fragrance, tobacco and liquor duty free operations at the AH Riise Mall in St. Thomas, US Virgin Islands. St. Thomas Duty Free also concluded the outright acquisition of AH Riise’s liquor, cosmetics, fragrances and tobacco duty free business at the Haven Sight and Crown Bay cruise terminals and the departures store at Cyril E. King Airport, one of the busiest airports in the eastern Caribbean. AH Riise’s liquor import operations were also acquired. The AH Riise Mall agreement has a 15-year term. The mall, which includes Swatch and Swarovski boutiques, measures around 800 square meters and will be by far the biggest revenue generator among the properties St. Thomas Duty Free operates. The departures store at the airport measures around 400 square meters, a major addition to the 100-squaremeter arrivals store St. Thomas Duty Free already runs there. Each cruise terminal has two locations, each measuring 100-150 square meters. It’s a good slice of space to pick up in one go, but it’s just the beginning for Baljet and his team. “We’ll be making a lot of changes to the product assortment,” he recently told Americas Duty Free.“In a few weeks we’ll have a dedicated Chanel boutique in the mall, and that’s just a part of our refocusing on luxury goods. A lot of products will be going out and a lot of new ones coming in.” There are already MAC and Estée Lauder boutiques in place, among others. A newly founded Miami-based company called Duty Free Services will house the liquor and perfumes & cosmetics buying teams. This company will analyze the assortment and make the changes on the shop floor. The business is naturally very seasonal, and Baljet will even out the bumps with a three-tiered product assortment strategy. The A assortment is the basic level and represents products that are maintained in stock year round. The B assortment complements the A assortment at a slightly higher level, and the C assortment is tailored

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ANDREW BROOKS

for the 5- to 6-month tourist season with high-end goods. Baljet plans to make greater efforts to bring in local shoppers to offset the slowdown in the off season. “The C level caters to the cruise lines, which bring people in from the US, and also increasingly from Brazil,” Baljet says. “Brazilians are becoming a bigger part of the airport business as well.” Business in the mall probably goes several notches beyond “brisk” at the height of the season, he says. “You should see it on a Wednesday when we have seven ships in port! The prices are lower than they are in the US, and shoppers are allowed five bottles of liquor—plus one local product—and five cartons of cigarettes.” And now Diamond International has just opened its flagship store at the mall, which is also guaranteed to improve traffic. The European duty free investors who formed Duty Free St. Thomas are very involved in the Caribbean, says Baljet, and this move represents just the first step in a staged approach to expansion in the region. When he spoke with us, Baljet was hard at work on a larger regional project on the distribution side, which he said would likely come to fruition in 2013. There are other plans in the works that he wasn’t in a position to discuss. “Great things are coming,” c he says. “This is a new adventure for us.” The MAC boutique in the AH Riise Mall— look for more luxury brands as St. Thomas Duty Free takes the helm

Association Q&A

A banner year

Indications suggest that 2012 may be memorable year for the industry’s leading organizations BY RYAN WHITE ith IAADFS numbers looking very solid at publication time, ASUTIL coming off a record 2011 in Cancun and the TFWA Asia-Pacific exhibition & GATE ONE2ONE conference still riding high on an regional boom despite lingering economic concerns in parts of the globe,

A full hall in Orlando Americas Duty Free: Can you give me an update with regard to inscriptions as of the third week of January? Michael Payne: We’re about at the same level that we were at this time last year, perhaps a hundred or so above. However, these numbers aren’t really indicative of any final figures at the moment. The deadline was just last Friday and the registration process tends to get much more aggressive from this point on and then of course you have to wait and see what the on-site numbers turn out to be. We’ll have a strong year.

2012 is shaping up to be a memorable year for all three organizations. Americas Duty Free sat down with Michael Payne, Executive Director of IAADFS; Alain Maingreaud, Managing Director of TFWA; and Francisco Heredia, President of ASUTIL, to get their thoughts on why 2012 is set to be a banner year. ADF: What about exhibitors? MP: The exhibition space is completely sold out. We’re currently trying to figure out a way to accommodate a few more exhibitors if we can but the fire marshall has the final say. This, of course, is very heartening. I suspect total numbers will end up a little bit ahead of last year but we really won’t know that until the show is over. ADF: Can you give us a breakdown of the booths by category? MP: Sure. At this stage we have 150 exhibiting companies. The breakdown is as follows: 15 for confectionery and food; 35 for fragrance and cosmetics; 9 for gifts and writing instruments; 32 for jewelry/accessories/luggage; 47 for liquor, which is the largest category; 10 for tobacco; and 2 for services. The breakdown may change slightly, but not much. The net total exhibition space works out to about 74,000 square feet.

“I haven’t seen final numbers for 2011 yet in a formal way, but the sense you get from talking to people is that business has been strong and they can see improvements over 2010.”

Michael Payne, Executive Director, IAADFS

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Association Q&A

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ADF: Can you give me a sense of the mindset of members this year? MP: To my reading, the attitude is very positive and upbeat. I think one indicator is how quickly exhibition space is taken, and our space went very quickly this year. Also, it seems that people want to do more social events this year, and many exhibitors are updating their booths. The mood seems very positive about the show and 2012 in general. Travel numbers are up, which is obviously a good tracker for us. You can still find regional differences obviously, but people seem very upbeat and looking forward to doing business at the show this year. ADF: How do you feel the industry fared in 2011 as compared to 2010? MP: That would be a bit subjective on my part because I haven’t seen final numbers for 2011 yet in a formal way, but the sense you get from talking to people is that business has been strong and they can see improvements over 2010. Spend is up, travel is up and in some cases more importantly the spend per product is up, meaning that travelers in many cases are going back to buying higher-priced items in the stores. ADF: In a recent press communication, you mentioned a

A winning formula Americas Duty Free: What is planned for the 2012 TFWA Asia Pacific & GATE ONE2ONE trade show and conference? What changes have been made for this year? Alain Maingreaud: TFWA Asia Pacific & GATE ONE2ONE is set to break new records in terms both of exhibitor numbers and square meters of exhibition space booked at Singapore Suntec. With over three months still to go, we have already confirmed stand space for 211 companies, just one short of the final number of companies which exhibited last year. As always there will be abundant opportunities to network in style, not least at the TFWA Welcoming Cocktail at Raffles, the Singapore Swing Party at Garden Asia, a new venue, and at the ChillOut Party at the Mandarin Oriental. However, the most important place to network is of course at the conference, and in the exhibition itself. This year we are adding airlines to the very popular ONE2ONE pre-scheduled meetings programme that we offer to airports attending the event. Delegates can also continue their discussions in the comfort of the TFWA Asia Pacific Bar with cocktails sponsored by exhibitors after the show closes for the day. ADF: Are there any speakers confirmed? AM: Yes, we have confirmed a number of speakers both for the plenary and break-out sessions for Monday’s conference. We are

number of changes to this year’s show. These included a single registration option that includes all social events; upscaled entertainment at the Gala Evening with Willy Chirino; live entertainment in Club Americas; the addition of soccer and Zumba to sports day; the elimination of the Sunday afternoon picnic; and an upgraded Opening Reception. Are there any other changes we should know about? MP: Last year we had an educational session on Sunday afternoon that was targeted toward WHO issues. This year we’re going to have another Sunday afternoon seminar that will be open to everyone and entertaining. We have a speaker scheduled named Tim Gard, from Comic Visions. He focuses on travel issues and experiences with a lot of humor. It should be very entertaining. It’s a casual event on Sunday afternoon but with some real networking and content-driven value. ADF: Can you tell us who the 2012 sponsors are? MP: Brown-Forman, Pernod Ricard, Philip Morris, Advanced Wireless, Bacardi, Cross, Hershey’s and Botran Rums thus far. Some other companies are considering sponsorship opportunities so there may be more. These sponsorships represent a major contribution to the Show and IAADFS is very appreciative of their generosity. delighted to have the CEO of one of the major fashion houses, Eraldo Poletto of Furla, taking part in the plenary session. We will also be bringing in some experts on specific themes to shed new light on some of the issues we’ll be dealing with. The full programme is available, along with details of all the speakers, on the TFWA website. To give you an idea, we will be featuring a dedicated session on the Asia Pacific airline market and in-flight duty free sector with leading players from this field. There will be a special focus on China once again which will include dedicated research we are carrying out this year on Chinese consumers. New ways to communicate with, engage and entice consumers will be the central theme of the session on technology and new media. And we’ll also be looking at the other emerging markets within Asia, both from an economic perspective as well as the growth of travel and tourism within these markets, and the opportunities for the industry there. ADF: What sponsors have signed on? AM: We have had an enthusiastic response to the invitation to sponsor some aspects of TFWA Asia Pacific & GATE ONE2ONE and so far we have confirmed Qatar Duty Free as Platinum Sponsor, as well as Singapore Changi, Ferrero and Perfetti Van Melle for the conference and workshops. We have also renewed our partnership with Singapore Airlines, who are the official carriers for the event. Interparfums will partner with us for the annual golf tournament at Sentosa Golf Club. We are still in discussion with several other companies which are considering sponsorship of some form.

“With over three months still to go, we have already confirmed stand space for 211 companies, just one short of the final number of companies which exhibited last year.” Alain Maingreaud, Executive Director, TFWA

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L E

N O U V E A U

P A R F U M w w w.r em i n i scencepar i s.c om

Association Q&A

C O N T I N U E D F R O M PA G E 7 8

ADF: Are there any airport or duty free related projects currently in the works in Asia that you’re particularly excited about? If so, please explain. AM: At the time of writing we still haven’t heard the results of the Hong Kong tenders which received so much media speculation towards the end of last year. It will be interesting to see the outcome. Other than that, there will be more tenders coming out of India with both Mumbai and Cochin calling for proposals for their duty free operations. The Indian market is a complex one and the Delhi Duty Free tender generated a good deal of interest. It will be interesting to see if Mumbai follows a similar business model. The Chinese market is always interesting given its dynamism and potential growth. The world’s largest duty free complex at Haitang Bay in Sanya on the resort island of Hainan, which was officially announced by Charles Chen of China Duty Free group during TFWA Asia Pacific & GATE ONE2ONE last year, is set to be spectacularly successful. There seems to be no end to the demand among Chinese consumers. Travel retail has well and truly entered the digital age and we are seeing some interesting developments on the technology and social media front by airports and retailers. There have been some dynamic

steps forward by certain retailers in the region such as Singapore Changi, Duty Free Philippines and Sydney Airport to embrace new media and new technology. ADF: Is there anything else you’d like to add? AM: At TFWA we too aim to be as up-to-date with today’s technology as possible. The past few years have seen dramatic improvements in our e-communication through a greatly improved interactive website; e-news communication and also the online Exhibition Directory, which is new for TFWA Asia Pacific & GATE ONE2ONE. This year we are going one step further with a Smartphone application which gives delegates the opportunity to have at their fingertips the complete programme for the TFWA Asia Pacific & GATE ONE2ONE week, including exhibitor listing, conference programme, details of the show, leisure activities and social events. In addition, TFWA will set up an interactive signage system in the exhibition hall through four multi-touch screens to help delegates to find their way between meetings with exhibiting brands. All the developments above are great tools for improving the efficiency of presence at TFWA Asia Pacific & GATE ONE2ONE and will, I am sure, contribute to a very successful show!

A return to South America Americas Duty Free: Have you decided on a theme for this year’s ASUTIL conference? Francisco Heredia: This year’s theme will be “A Waterfall of Opportunities.” What I can tell you is that the theme will certainly center on the boom we’re experiencing in the region at the moment as it relates particularly to the duty free industry in the region. As you know, many of the best duty free stores in the world are located in Latin America. We’ll be exploring the reasons for this and trying to define as best we can the many complex reasons why a given duty free shop is successful. ADF: Can you tell me about sponsors for the 2012 conference? FH: We have numerous sponsorship deals currently being worked out, but at the moment it’s too early to name companies. ADF: What details can you give us about this year’s conference? FH: I was just in Iguazú with José Luis Donagaray [Secretary General of ASUTIL] firming up the hotel arrangements and I can tell you the conference is going to be spectacular. The event will take place

at the Grand Hotel and Casino in Iguazú. We will also have two surrounding hotels, the Panoramic and Loi Suites, linked by shuttles. Attendees will also have the chance to visit Iguazú Falls, truly a natural wonder, as part of the social activity. ADF: Do you have any information about the Gala Dinner or any other events? FH: We’re planning on hosting the Gala Dinner at London Supply’s duty free store in Iguazú. ADF: Is there anything else you’d like to say to prospective attendees? FH: The annual ASUTIL conference will take place May 30 to June 2, 2012. Last year we had a record number of attendees and based on the interest that we’ve seen so far, we may yet again break the record in 2012. The conference provides a great opportunity to network in a relaxed setting and discuss important issues related to the channel in Latin America during the conference. We look forward to seeing you there!

“Last year we had a record number of attendees and based on the interest that we’ve seen so far, we may yet again break the record in 2012.” Francisco Heredia, President, ASUTIL

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

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Association Q&A

Un año excelente

Todos los indicios sugieren que el 2012 podría ser un año memorable para las principales organizaciones del sector ion sólidas cifras de la IAADFS a la hora del cierre de esta edición, la ASUTIL logrando un notable 2011 en Cancún y la Exposición Asia Pacífico y Conferencia GATE ONE2ONE de la TFWA disfrutando a plenitud un boom regional, a pesar de las preocupaciones económicas en otras partes del planeta, el 2012 promete ser un año memorable para

A salón lleno en Orlando

las tres organizaciones. Americas Duty Free entrevistó a Michael Payne, Director Ejecutivo de IAADFS; a Alain Maingreaud, Director Gerente de TFWA; y a Francisco Heredia, Presidente de ASUTIL, para que expresaran sus puntos de vista con respecto a la perspectiva de que el 2012 sea un año excelente.

Back by popular demand at the 2012 IAADFS exhibition is the Jack Daniel’s barbeque

Americas Duty Free: ¿Puede actualizarnos acerca del estatus de las inscripciones en la tercera semana de enero? Michael Payne: Estamos al mismo nivel con respecto a esta fecha el año pasado, tal vez unos cien o más por encima. Sin embargo, estas cifras no indican realmente ningún resultado final en este momento. El plazo se inició el viernes pasado, y el proceso de inscripción suele ser mucho más agresivo a partir de este punto, y, por supuesto, hay que esperar para ver cuáles serán las cifras de asistencia en el lugar. Tendremos un año notable. ADF: ¿Y en cuanto a los expositores? MP: El espacio de exposiciones está totalmente ocupado. En estos momentos estamos tratando de hallar una manera de acomodar a unos cuantos expositores más si podemos, pero las autoridades del Departamento de Bomberos tienen la última palabra. Esto, por supuesto, es muy alentador. Sospecho que la cifra total alcanzará un nivel un poco más alto con respecto al año pasado, pero no lo sabremos hasta que termine la exposición. ADF: ¿Puede darnos un desglose de los quioscos por categoría? MP: Por supuesto. En esta etapa contamos con 150 compañías expositoras. El desglose es el siguiente: 15 en confitería y alimentos; 35 en fragancias y cosméticos; 9 en regalos e instrumentos para escribir; 32 en joyería/accesorios/equipaje; 47 en licores, la categoría con más expositores; 10 en tabaco; y 2 en servicios. El desglose podría cambiar ligeramente, pero no mucho. El espacio total neto de la exposición es de unos 74,000 pies cuadrados.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

ADF: ¿Puede darnos una idea de la perspectiva mental de los miembros este año? MP: A mi entender, la actitud es muy positiva y entusiasta. Creo que un indicador es la rapidez en que se ha ocupado el espacio de exposición, el cual se agotó con gran celeridad este año. Además, parece que se quieren realizar más eventos sociales este año, y muchos expositores están actualizando sus quioscos. C O N T I N U E D O N PA G E 8 4

We seek nothing but perfection

For Pierrette Trichet, Cellar Master of the House of RĂŠmy Martin, the search for perfection is nothing but doing her job as an Artisan. Nothing but selecting the best vines in the Cognac region. Nothing but creating perfection in the blending of the eaux-de-vie. Nothing but mastering time. Nothing but staying authentic. Nothing but perfection.

Association Q&A

C O N T I N U E D F R O M PA G E 8 2

El ánimo parece muy positivo en cuanto a la exposición en general. Las cifras de viajeros se han incrementado, lo cual es obviamente una buena señal para nosotros. Obviamente, aun existen diferencias regionales, pero todo el mundo está entusiasmado y ansioso por hacer negocios en el evento de este año. ADF: ¿Cómo cree que le fue a la industria en el 2011 si se compara con el 2010? MP: Responder a esa pregunta sería algo subjetivo de mi parte, porque no he visto aun las cifras finales del 2011 de manera formal, pero la idea que se tiene luego de hablar con gente del sector es que los negocios han sido sólidos y se pueden advertir logros con respecto al 2010. Los gastos han aumentado al igual que los viajes, y en algunos casos, algo más importante aún, el gasto por producto se ha incrementado, lo cual equivale a que los viajeros en muchos casos están volviendo a comprar mercancías costosas en las tiendas. ADF: En un comunicado de prensa reciente, usted mencionó va-rios cambios en el evento de este año, entre los que figuran una opción de inscripción solamente que incluye todos los

eventos sociales; entretenimiento de lujo en la Noche de Gala con Willy Chirino; entretenimiento en vivo en Club Americas; la incorporación del fútbol y Zumba en el día deportivo; la eliminación del picnic del domingo en la tarde, y una Recepción Inaugural actualizada. ¿Hay otros cambios que debamos conocer? MP: El año pasado realizamos una sesión informativa el domingo en la tarde, dedicada a temas de la Organización Mundial de la Salud (OMS). Este año vamos a llevar a cabo otro seminario el domingo en la tarde, entretenido y con acceso para todos los asistentes. Vamos a presentar al orador Tim Gard, de Comic Visions, especialista en temas y experiencias de viajes con mucho humor. Será bien entretenido. Es un evento informal el domingo en la tarde, pero con un valor real de contacto profesional y contenido. ADF: ¿Puede decirnos cuáles son los patrocinadores del 2012? MP: Brown-Forman, Pernod Ricard, Philip Morris, Advanced Wireless, Bacardi, Cross, Hershey’s y Botran Rums hasta ahora. Otras compañías están considerando oportunidades de patrocinio, por lo que habrá más. Estos patrocinadores representan una importante contribución a la Exposición, y la IAADFS aprecia en grado sumo su generosidad.

Una fórmula exitosa Americas Duty Free: ¿Qué se ha planificado con respecto a la Exposición Asia Pacífico y GATE ONE2ONE 2012 de la TFWA? ¿Qué cambios se han hecho para el evento de este año? Alain Maingreaud: La Exposición Asia Pacífico y GATE ONE2ONE 2012 de la TFWA romperá nuevos records, en términos de cifras de expositores y metraje cuadrado de exposición reservados para el Singapore Suntec. Con más de tres meses por delante, ya hemos confirmado espacio de quioscos para 211 compañías, con solo uno de diferencia con respecto a la cantidad final de firmas expositoras del año pasado. Como siempre, habrá oportunidades abundantes de contacto profesional con estilo, y no menos en el Coctel de Bienvenida de TFWA en Raffles, la Fiesta Swing de Singapur en Garden Asia, un lugar Nuevo, y la Fiesta de Relajación en el Mandarin Oriental. Sin embargo, el sitio más importante para contactos profesionales es, por supuesto, la conferencia, y en la propia exposición. Este año estamos incorporando aerolíneas al popular programa de reuniones preprogramadas ONE2ONE, que les hemos ofrecido a los aeropuertos que asisten al evento. Los delegados también podrán continuar sus conversaciones en la comodidad del TFWA Asia Pacific Bar con cocteles patrocinados por los expositores luego de que la exposición termina cada día. ADF: ¿Hay oradores confirmados? AM: Sí, tenemos varios oradores confirmados, tanto para la plenaria y las sesiones de trabajo de la conferencia del lunes. Nos complace contar con el Director Ejecutivo de una de las principales casas de modas, Eraldo Poletto de Furla, para la sesión plenaria. También tendremos algunos expertos en temas específicos que tratarán acerca de los problemas que estamos confrontando actualmente. La programación completa, conjuntamente con detalles de los oradores, está disponible en el sitio Web de TWFA. Para darle una idea, tendremos una sesión dedicada al Mercado de aerolíneas y el sector duty free a bordo de Asia Pacífico, con importantes expertos

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

China, in-flight duty free, new media and emerging markets in Asia will be areas of focus at this year’s GATE ONE2ONE conference

de este campo. También nos enfocaremos nuevamente en China, con una investigación dedicada que estamos llevando a cabo este año con consumidores chinos. Las nuevas formas de comunicación, contacto y atracción del consumidor serán el tema central de la sesión dedicada a la tecnología y nuevos medios. Además, nos concentraremos en otros mercados en surgimiento en Asia, tanto desde una perspectiva económica como desde la del crecimiento de los viajes y el turismo en esos mercados, y las oportunidades que tiene el sector en esas regiones. ADF: ¿Qué patrocinadores han confirmado su participación? AM: Hemos tenido una respuesta entusiasta a la invitación de patrocinar algunos aspectos de Exposición Asia Pacífico y GATE ONE2ONE 2012 de TWFA, y hasta ahora tenemos confirmado a & Qatar Duty Free como Patrocinador de Platino, así como a Singapore Changi, Ferrero y Perfetti Van Melle para la conferencia y los talleres. C O N T I N U E D O N PA G E 8 6

Association Q&A

C O N T I N U E D F R O M PA G E 8 4

También hemos renovado nuestra alianza con Singapore Airlines, transportista oficial del evento. Además, Interparfums cola-borará con nosotros en el torneo anual de golf en Sentosa Golf Club. Aun estamos sosteniendo conversaciones con otras compañías que están considerando el patrocinio de alguna forma. ADF: ¿Hay algún proyecto de aeropuerto o duty free actualmente en proceso en Asia que le despierte un entusiasmo particular? De ser así, explique, por favor. AM: En este preciso momento no hemos tenido noticia de los resultados de las licitaciones en Hong Kong que fueran objeto de tanta especulación de los medios a finales del año pasado. Aparte de eso, habrá más licitaciones en India, pues Mumbai y Cochin están soli-citando propuestas para sus operaciones duty free. El mercado indio es complejo, y la licitación de Delhi Duty Free generó gran interés. Será interesante ver si Mumbai sigue un modelo de negocios similar. El mercado chino es siempre interesante, dado su dinamismo y crecimiento potencial. El complejo duty free más grande del mundo en Haitang Bay en Sanya, en la isla resort de Hainan, anunciado oficialmente por Charles Chen de China Duty Free durante la Exposición Asia Pacífico y GATE ONE2ONE del año pasado; se proyecta como particularmente exitoso. La demanda de los consumidores chinos parece no tener fin. El sector minorista de viajes ha entrado con el pie derecho en la era digital, y estamos apreciando algunos progresos interesantes en

el frente de tecnología y medios sociales por parte de aeropuertos y comerciantes minoristas. Se han tomado algunos pasos dinámicos en la región por parte de ciertos comerciantes minoristas como Singapore Changi, Duty Free Philippines y el Aeropuerto de Sídney para incorporar nuevos medios y nueva tecnología. ADF: ¿Desea añadir algo más? AM: TFWA también se propone estar lo más actualizada posible con la tecnología actual. Los últimos años han sido testigos de relevantes progresos en nuestra comunicación electrónica con un sitio Web interactivo muy perfeccionado; la comunicación electrónica de noticas y además el Directorio de la Exposición en Internet, algo nuevo en la Exposición Asia Pacífico y GATE ONE2ONE. Este año vamos a dar otro paso adelante con una aplicación para teléfonos inteligentes que les dará a los delegados la oportunidad de tener acceso a la programación completa de la semana de la Exposición Asia Pacífico y GATE ONE2ONE, incluyendo relación de expositores, programa de la conferencia, detalles de la exposición, actividades de diversión y eventos sociales. Además, TFWA creará un sistema de señalización interactiva en el salón de exposiciones con cuatro pantallas multitáctiles para que los delegados puedan orientarse entre reuniones con las marcas expositoras. Todos los progresos mencionados anteriormente son excelentes herramientas para perfeccionar la eficiencia de la presencia en la Exposición Asia Pacífico y GATE ONE2ONE de TFWA y ¡estoy seguro que contribuirá a un evento muy exitoso!

Regreso a Suramérica Americas Duty Free: ¿Han decidido un tema para la conferencia de ASUTIL de este año? Francisco Heredia: Estamos actualmente en ese proceso. Lo que puedo decirle es que el tema se centrará sin duda alguna en el boom que estamos experimentando en la región en estos momentos, y su relación particular con el sector duty free que opera en la misma. Como sabe, gran parte de las mejores tiendas duty free del mundo están ubicadas en Latinoamérica. Vamos a explorar las razones de esta situación, y tratar de definir lo mejor que podamos las numerosas razones complejas por las cuales tiene éxito una tienda duty free determinada. ADF: ¿Qué puede decirnos acerca de los patrocinadores de la conferencia 2012? FH: En estos momentos estamos negociando numerosos acuerdos de patrocinio, pero aun es demasiado pronto para dar el nombre de las compañías. ADF: ¿Qué detalles puede darnos acerca de la conferencia de este año? FH: Recién estuve en Iguazú con José Luis Donagaray [Secretario General de ASUTIL] concretando las coordinaciones hoteleras, y puedo decirle que la conferencia va a ser espectacular. El evento se llevará a cabo en el Grand Hotel and Casino de Iguazú. También contaremos con dos hoteles cercanos, el Panoramic y Loi Suites, vinculados al evento por medio de un servicio de transporte continuo. Los asistentes también tendrán la oportunidad de visitar las Cataratas del Iguazú, una auténtica maravilla natural, como parte de las actividades sociales. ADF: ¿Ya tiene información disponible con respecto a la Cena de Gala o de otros eventos?

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

FH: Estamos planificando realizar la Cena de Gala en la tienda duty free de London Supply en Iguazú. ADF: ¿Desea decirles algo más a los asistentes potenciales? FH: La conferencia anual de ASUTIL se llevará a cabo del 30 de mayo al 2 de junio de este año. El año pasado tuvimos una cifra récord de asistentes, y basándonos en el interés que hemos visto hasta ahora, podríamos volver a romper el récord en el 2012. La conferencia proporciona una gran oportunidad de hacer contactos profesionales en un entorno relajado, y tratar temas importantes relacionados con el canal c en Latinoamérica durante la conferencia. ¡Espero verlos allá!

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In addition to its retail offerings, Airmall USA also has F&B operations in many US airports; pictured is the food court at BWI

Airmall USA

Strong out BY

RYAN WHITE

of the gate

Leading concessionaire Airmall USA kicks 2012 off with a number openings in airports across the US and promises to bring more innovation before year’s end

he New Year started out with a bang for Airmall USA. The concessionaire recently opened a number of novel operations at airports across the country. The developer and manager of the retail and F&B concessions at Pittsburgh International Airport (PIT), Boston Logan International Airport’s (BOS) Terminals B and E, Baltimore/Washington International Thurgood Marshall Airport (BWI) and Cleveland Hopkins International Airport (CLE), Airmall USA boasts among the highest per-passenger spends on the continent and consistently receives accolades for

duty free offerings to new heights,” noted Michael Caro, Vice President of Airmall Boston. “The virtual stores are a perfect example of the level of passenger engagement that travelers can expect. They are typically seen in other parts of the world such as Europe and Asia, but while International Shoppes undertakes the task of updating and refreshing the permanent units here in Boston, they are ensuring that passengers can still purchase top-shelf duty free merchandise virtually since actual space is limited.” The virtual stores are located in front of three barricades ranging in size from 20 to 50

“The virtual stores are a perfect example of the level of passenger engagement that travelers can expect [at Airmall Boston].” Michael Caro, Vice President, Airmall Boston innovation and customer service. The operator is set to continue in its industry-leading with the opening of virtual duty free stores at BOS, The Burgh Sportz Pub at PIT, and Travel + Leisure Travel and Kidsworks at CLE.

A novel solution Airmall USA recently partnered with International Shoppes, the newly appointed duty free operator at the Airmall at Boston Logan International Airport (BOS), to tap into cutting edge technology to serve the discerning passenger while making permanent improvements to several concessions units. Three recently opened virtual duty-free stores in Terminals B and E are enabling airline passengers to purchase liquor, tobacco and fragrances that are then packaged and hand-delivered to the gate. “At Airmall Boston, we are pleased to be opening a new chapter in duty free retail with the addition of International Shoppes as the designated operator. Their commitment to quality and customer satisfaction is well documented, and we know they will take our 88

feet that depict the duty free goods available for purchase. Armed with tablet devices, associates at each virtual store can perform credit card transactions and can then arrange for gate-side delivery (up to 40 minutes prior to departure). “At International Shoppes, we realize that accessibility and convenience are the keys to customer satisfaction, and that is particularly true during a transitional phase,” added Scott Halpern, Vice President of International Shoppes. “We’re working closely with vendors such as William Grant and Sons, a liquor distributor, to transform what was a barricade into a revenue-generating operation that focuses on travelers’ needs while we work to provide new and more exciting stores.”

Triple header The City of Pittsburgh and a love for professional sports go hand in hand, and Airmall is tapping into the region’s passion for professional sports with the introduction of The Burgh Sportz Pub to the concessions program at

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

PIT. Air Ventures, LLC, an Airport Concessions Disadvantaged Business Enterprise (ACDBE) company, has signed leases for two locations— one on Concourse B (1,300 square feet) and a second unit on Concourse D (530 square feet). “The City of Pittsburgh has an international reputation as the City of Champions, and enthusiasm for our professional teams is truly part of our culture in western Pennsylvania,” says Jay Kruisselbrink, Vice President of Development for Airmall Pittsburgh. “At Airmall, we want travelers to experience that energy when they come to Pittsburgh International Airport, and we firmly believe that The Burgh Sportz Pub will become a preferred destination for travelers of all kinds—from sports enthusiasts to the casual fan.” The Burgh Sportz Pub is a Pittsburghthemed sports bar featuring Pittsburgh sports memorabilia that honor the legacy of the region’s professional football, hockey and baseball teams. The pub will also offer passengers the chance to purchase signature glasses honoring Pittsburgh’s championship franchises. The Burgh Sportz Pub join Auntie Anne’s and Cinnabon, both of which have signed a lease to open storefronts at the Airmall at PIT in 2012, for what could be considered a triple header at PIT. Auntie Anne’s offers an array of pretzel flavors to satisfy any craving, including original, cinnamon sugar, almond, pepperoni, sour cream and onion and garlic. Auntie Anne’s measures 400 square feet and will be located on Concourse A. Cinnabon serves fresh, aromatic, oven-hot cinnamon rolls as well as a variety of other baked goods and specialty beverages. Cinnabon, also 400 square meters, will be located on Concourse A. Auntie Anne’s, Cinnabon and both locations of the Burgh Sportz Pub are expected to open in the spring and summer of this year. “Excitement is building for all of the changes coming to the Airmall at PIT,” Kruisselbrink added. “Earlier this month, Airmall announced that it would welcome Bar Symon

to the concessions program. It’ll be the first airport restaurant for celebrity Chef Michael Symon, a hugely successful restaurateur who also earned the title of ‘The Next Iron Chef ’ on the Food Network.”

Specialty concepts At CLE, Airmall recently announced the addition of two concepts to the retail core of its concessions program near the Concourse B security checkpoint: the opening of the Travel + Leisure Travel Store and Kidsworks. Fans of the popular magazine Travel + Leisure will enjoy the new Travel + Leisure Airmall Boston and International Shoppes recently opened three virtual duty-free stores in Terminals B and E at BOS

“We firmly believe that The Burgh Sportz Pub will become a preferred destination for travelers of all kinds—from sports enthusiasts to the casual fan.” Jay Kruisselbrink, Vice President of Development, Airmall Pittsburgh Travel Store, a one-stop travel shop created by the magazine and Hudson Group. The store offers a wide array of products aimed at enhancing the travel experience, such as luggage and travel accessories including rolling luggage, duffle bags, travel blankets and pillows, and messenger bags. Families traveling through CLE or parents looking for a gift to bring home after a business trip will be able to shop at the new Kidsworks, filled with imaginative toys and reading material. Kidsworks offers a broad selection of interesting and exciting educational toys, crafts, travel games and toys, electronic games, plush toys and dolls. The latest and greatest fad toys, other assorted toys and children's books are also featured. “Specialty concepts such as the Travel +

Leisure Travel Store and Kidworks help to make the Airmall at CLE a truly dynamic concessions program,” said Tina LaForte, Vice President of Airmall Cleveland. “Travel + Leisure is sure to delight the enthusiastic traveler, and Kidworks will be a one-stop shop for parents looking for a unique gift or families hoping to keep their children entertained with an educational toy, game or book on the go.” “The Travel + Leisure Store and Kidworks join several well-known concepts and Cleveland originals that are located in the airport’s main terminal,” said Airport Director Ricky Smith. “We’re pleased at how the concessions program at CLE continues to grow and transform, and we know passengers are responding favorably to the wide array of offerings c now available.”

* Krispy Kernels only uses premium-quality U.S. peanuts

Crunch. Go nuts.

LS travel retail North America

Better, smaller, faster

Giving travelers options

LS travel retail North America and ZoomSystems prove that good things do indeed come in small packages with the opening of iStore Express in Calgary Airport BY RYAN WHITE

s a result of a partnership undertaken late last year, LS travel retail North America and ZoomSystems recently announced the opening of the first iStore Express automated retail shop in a Canadian Airport. Opened in Calgary International Airport’s (YYC) Terminal D on January 27, the automated retail shop offers consumers a wide range of personal mobile electronic devices and accessories—including bestselling tablets, headphones, speakers and portable games—from leading brands Apple, Sony, Monster, Blackberry and many more. More units are currently being deployed in various Canadian airports, including Vancouver, Edmonton, Montreal and Ottawa. Additional locations are being discussed for deployment later in 2012. “It brings us great pleasure to partner with both ZoomSystems and Boutique iStore to bring to Canadian travelers and consumers such a compelling retail offering. We look forward to continued placement and growth through this strong partnership,” said Jonathan

At LS travel retail’s full-size iStores—the latest of which was opened in February in Calgary—Apple products lead the way in terms of sales (pictured is Toronto Pearson’s iStore location)

Alpert, Vice President Merchandising for LS travel retail North America. "We are excited to license our brand for this innovative retail channel and bring our products to customers in a way that is fun, fast and secure. We look forward to eventually bringing iStore Express machines to other retail venues beyond airports in future," said Mike Battat, President of Boutique iStore. "This is a great partnership. The combined branding, merchandising, technology and distribution expertise will allow the iStore Express Automated Retail shop to deliver an immediate and rewarding experience to the customer," said Jack Lawrence, President and CEO of ZoomSystems. “Our partnership with ZoomSystems in Canadian airports complements the deployment of our Boutique iStore concept quite nicely,” Savaria told us when news of the partnership between LS travel retail North America and ZoomSystems first broke. “The automated retail systems carry our best-selling items, so from a procurement and replenishment point of view this deal makes a lot of sense.”

“The automated retail systems carry our best-selling items, so from a procurement and replenishment point of view this deal [with ZoomSystems] makes a lot of sense.” Gerry Savaria, President and CEO, LS travel retail North America

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

LS travel retail North America and Boutique iStore Canada also recently opened a fullsized iStore at Calgary International Airport (YYC) in Concourse A. The store will provide YYC guests with a wide range of personal mobile electronic hardware and accessories, including laptops, tablets, e-readers, cameras and portable games, from leading brands. At the time of the opening of the iStore in Toronto Pearson International Airport, Savaria told us that a high percentage of the iStore’s sales are achieved through Apple merchandise, with the iPad tablet standing out as the clear winner. This, of course, is in line with market data released at the end of 2011 indicating that the iPad represents more than 95% of all tablets sold in the US. "We are excited to be part of Calgary’s award-winning concessions program, and we look forward to serving passengers with our unique fashion approach to mobile digital products. As more and more people buy more smartphones, tablets and e-readers, iStore will be there to provide accessories to travelers to protect and enhance these and other mobile devices,” said Mike Battat, President of Boutique iStore Canada. Jonathan Alpert added: "We are energized by our ongoing partnership with Boutique iStore and bringing this very contemporary concept to Calgary—one of Canada's busiest airports—is a major milestone for our team." A little over a year after signing an exclusive agreement, LS travel retail and Boutique iStore Canada already have seven locations in operation in four airports. The very first US iStore will open at Boston-Logan early this month with additional US locations planned c for later in 2012. Recently opened at YYC’s Terminal D, the iStore Express automated retail shop offers consumers a wide range of personal mobile electronic devices and accessories

HMSHost

Options

open

HMSHost continues to ensure that North American travelers have a wide variety of F&B choices when passing through some of the region’s busiest airports BY RYAN WHITE Bubbles Wine Bar was first introduced by HMSHost at Amsterdam’s Schiphol International Airport and named by Executive Life magazine as one of the “chic-est airport bars”

MSHost is part of Autogrill S.p.A., the world’s largest provider of food, beverage and retail services for travelers. Along with the rest of the Autogrill Group, HMSHost is recognized as an industry leader that creates innovative dining and shopping locations at airports and on motorways worldwide. The first quarter of 2012 was business as usual for HMSHost. The company opened numerous F&B locations in airports across North America, including two new wine bars at Chicago O’Hare Airport, three eateries at Toronto Pearson Airport and Shula’s Bar&Grill at Southwest Florida International Airport. The company’s credo is to offer travelers “an unparalleled blend of local, regional and international brands,” and with these latest openings travelers are sure to find something delicious to suit their tastes, no matter how exotic or refined.

Euro style in

Chicago

“Travelers to and through Chicago O’Hare will enjoy visiting either of these stylish, relaxing wine bars with gourmet menus.” Stephen Douglas, Vice President of Business Development, HMSHost The Windy City recently welcomed two stylish new wine bars to Chicago O’Hare International Airport. The locations opened just in time for travelers going through the airport on Valentine’s Day. The Chicago Department of Aviation (CDA) and HMSHost opened Bubbles Wine Bar in Terminal 3 and Beaudevin Wine Bar in Terminal 1. Both locations offer travelers fine wines and sparkling wines that can be paired with gourmet entrées and small plates, perfect for enjoying with a sweetheart, friends or solo. “On behalf of Mayor Rahm Emanuel, we are so pleased to welcome Beaudevin and Bubbles

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

to O’Hare and provide to our travelers further world-class dining and drink options,” said CDA Commissioner Rosemarie S. Andolino. “Beaudevin and Bubbles are examples of the efforts Chicago is committed to making at our airports to cater to our global travelers’ palates with distinctive dining and beverage options, from sit-down restaurants to cafes to wine bars.” “Beaudevin” loosely translates into “the beauty of wine.” Located in Concourse C near Gate 17, the wine bar offers travelers to chance to relax in an informal, European-influenced C O N T I N U E D O N PA G E 9 4

HMSHost Thai Express, Extreme Pita and Purblendz are located at the Domestic Pier’s Terminal 1 in Toronto Pearson International Airport C O N T I N U E D F R O M PA G E 9 2

atmosphere, reminiscent of a château cellar, combining traditional design materials with contemporary elements. By offering travelers a choice of more than 20 red, white or sparkling wines, Beaudevin enhances the wine experience for travelers with wines by the glass, bottle or flight. Small plates including Olives de Provence or figs, as well as tartines including Roasted Herbed Chicken, Turkey Berry Goat Cheese or Scottish Smoked Salmon, are designed to complement the floral elegance of a Chardonnay or Pinot Grigio, or the richness and refinement of a Mouton-Cadet Bordeaux or Louis Martini Cabernet Sauvignon. The Bubbles Wine Bar, located in Terminal 3 near Gate H4, focuses on bubbly beverages together with sushi roll pairings. First introduced by HMSHost at Amsterdam’s Schiphol International Airport and named by Executive Life magazine as one of the “chicest airport bars,” Bubbles has now crossed the Atlantic to become one of the newest treasures of US domestic airports. With an elegant approach to dining, Bubbles features boutique beers and sparkling wines together with delectable dishes of specialty sushi rolls, such as Maki Classic Rolls including the California Roll or the Spicy Tuna Roll. Specialty rolls include the Spider Roll with deep fried soft shell crab, avocado, asparagus, chives, spicy mayo and tobiko (red flying fish roe). “Travelers to and through Chicago O’Hare will enjoy visiting either of these stylish, relaxing wine bars with gourmet menus, where they can linger over a full-bodied Cabernet Sauvignon with a charcuterie plate, or step in for a brief bite of sushi and a pleasant Ecco Domani as they find their way to a nearby gate,” said Stephen Douglas, Vice President of Business Development, HMSHost. “We’re sure Beaudevin and Bubbles will delight travelers and wine lovers of all kinds.” In support of O’Hare’s ongoing commitment to sustainable best practices, Beaudevin offers several wines made with organically grown grapes. These wines include the Bonterra Chardonnay, King Estate Acrobat Pinot Gris, Benziger Cabernet Sauvignon, Paul Dolan Vineyards Zinfandel and Parducci Cabernet Sauvignon. Passengers will be able to enjoy the soothing sounds of piano music and make song requests of pianists when available; however, the piano music won’t end when the pianist’s shift does. Self-playing pianos with more than 2,000 songs will entertain passengers at both wine bars, giving travelers a chance to relax and unwind. 94

Quick and casual in Toronto “Extreme Pita and Thai Express are terrific healthy, fast casual restaurants and Purblendz is a great way to cap off a meal. Travelers will love these new additions to Toronto Pearson.” Joe Waller, Vice President of Business Development, HMSHost The nature of airport traveling is one of hurry. Often there is little time to find a bite to eat. At Toronto Pearson International Airport, three new fast and casual restaurants are now open and making the traveler’s day better. Along with the Airport, HMSHost recently celebrated the delivery of Canadian favorites Thai Express, Extreme Pita and Purblendz to guests in the Domestic Pier’s Terminal 1. “The redevelopment of our retail and dining experience at Toronto Pearson is an essential element of our goal of becoming a global hub and in our ability to attract, serve and delight our guests. Our guests told us they want to see more variety and value so we are excited to welcome these well-known and popular brands to our airport,” said Pamela GriffithJones, Chief Commercial Officer at Toronto Pearson International Airport. Thai Express is the leading Thai quick-service restaurant in Canada, combining traditional Thai cuisine with new world design and flavors, which include the freshest ingredients available. All dishes are made to order at a spice level of mild, medium or extra. After glancing through the menu, travelers choose a combination of meat and vegetables that together result in robust flavors found in stir fry dishes, or the favorite and traditional Pad Thai. Extreme Pita and Purblendz are set in a

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

shared space in the Terminal. The brands are based in Mississauga, Ontario and are part of the Extreme Brandz group of companies, which stands for inspired healthier eating. With gourmet recipes from around the world, and chef-inspired tastes, Extreme Pita’s menuboard features names like The Chief, Chick-Chick Boom and Uncle Philly. Sandwiches, salads and unique flatbread pitas are also available. Extreme Pita is also the first national quick-service restaurant in Canada to include caloric information on its menu board. Right next door to Extreme Pita, Purblendz offers all natural smoothies which are great on their own or make a great compliment to a fresh pita or salad. Purblendz smoothies have no additives, boosters or formulated supplements—just natural fruit and vegetables, making their smoothies a healthier, great tasting and pure option. “Extreme Pita and Thai Express are terrific healthy, fast casual restaurants and Purblendz is a great way to cap off a meal. The food is fresh, made-to-order and delicious. Travelers will love these new additions to Toronto Pearson,” said Joe Waller, Vice President of Business Development, HMSHost. All three restaurants are located post-security near Gate 145. C O N T I N U E D O N PA G E 9 6

HMSHost

Shula’s drink menu includes premium wines from California, Italy, Chile and New Zealand, as well as a Pomegranate martini, all offered in a comfortable and relaxed setting

C O N T I N U E D F R O M PA G E 9 4

Premium all the way in

Florida

“We know travelers appreciate a great meal while they’re on the road and now, visitors to Southwest Florida International Airport will be able to enjoy the Shula’s experience” Renee Tedesco, Vice President of Business Development, HMSHost At Southwest Florida International Airport, HMSHost and the Shula Family earlier this year celebrated the grand opening of Shula’s Bar&Grill. The new Shula’s Bar&Grill location is a joint venture partnership between PJLF Enterprises and HMSHost. “We’re glad that the new Shula’s Bar&Grill joins our roster of restaurants,” said Robert M. Ball, Executive Director of Southwest Florida International Airport. “With its pre-security location, visitors and travelers alike can enjoy Shula’s flavorful steaks and extensive menu.” “We are excited about growing our presence in the Fort Myers’ area with Shula’s Bar&Grill at Southwest Florida International Airport,” said David Shula, President of Shula’s Steak Houses. “The success we’ve had in Naples over the last 11 years has made it a natural for us to expand.” Travelers can choose from enticing meals of Filet Mignon or a New York Strip steak and signature appetizers of blackened ten-

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

derloin tips and crab cakes. Shula’s drink menu includes premium wines from California, Italy, Chile and New Zealand, as well as a Pomegranate martini, all offered in a comfortable and relaxed setting. This is the second location for Shula’s Bar&Grill at an airport. The first Shula’s Bar&Grill located in an airport opened with HMSHost in May 2011 at Miami International Airport. “Working with the Shula family to expand their restaurant business is a pleasure,” said Renee Tedesco, Vice President of Business Development, HMSHost. “We know travelers appreciate a great meal while they’re on the road and now, visitors to Southwest Florida International Airport will be able to enjoy the Shula’s experience of signature steaks and one of their delectable cocktails.” Shula’s Bar&Grill is located in the presecurity area of the RSW’s main terminal. c

Frontier Duty Free Association Attendees toast at the Gala Dinner to another successful year in Canadian duty free

Americas Duty Free talks to FDFA Executive Director Laurie Karson about the 2011 show and current issues on the table in 2012 for the Canadian duty free industry RYAN WHITE

he 26th annual Frontier Duty Free Association (FDFA) convention and trade show took place in November 2011 and once again wowed attendees with an energized trade show and some very useful conference content. In a speech given to member operators and the press, FDFA Executive Director Laurie Karson gave an overview of the 2011 conference and trade show. “Our supplier registrants are at 148, which is actually more than last year,” she said. “Operator registrants are at 58, which is a little less than last year when we had about 63 operators/buyers. We did, however, see an increase in the airport buyers for this year’s convention.” “The unity of this association is critical to our future viability and maintaining the pillars of this industry,” added President of FDFA Abe Taqtaq when speaking to member operators. “We hope that you will continue to be committed to this association, committed to its programs and committed to giving your feedback. We all have good ideas and putting these good ideas together is what will make us stronger going forward. I’m very optimistic about the coming year.”

Sunday evening kicked off with a well attended Welcome Reception, with the tradeshow and supplier suites opening for business on Monday morning. Attendees were offered the chance to continue networking in a more relaxed setting at the Pernod Ricard & Labatt Lounge on Monday evening. On Tuesday attendees took a break from the all-day tradeshow to listen to keynote speaker Doug Stephens, known as Canada’s Retail Prophet, speak about the importance of social media. On Wednesday the tradeshow closed down at 1:00 pm, with the supplier suites staying open until 3:00 pm. At 6:00 pm delegates enjoyed a Cocktail Reception sponsored by Imperial Tobacco Company before the highly anticipated Gala Dinner and Gold Standard Awards.

Going for gold The FDFA once again celebrated the achievements of buyers, suppliers and distributors at its most recent Gold Standard Awards. For the Best New Specialized Product, Troika Keychains, distributed by Distributions Fontaine Inc., took home the award. In the Best

“It is the efforts of the FDFA in regard to advocacy work that continue to allow our industry to exist.” Laurie Karson, Executive Director, FDFA 98

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

“The unity of this association is critical to our future viability and maintaining the pillars of this industry.” Abe Taqtaq, President, FDFA Fragrance/Cosmetics Product category, Daisy Eau So Fresh by Marc Jacobs, distributed by Coty Prestige Retail & Export, won top honors. The Best New Spirits/Tobacco/Beer Product award was given to Johnnie Walker Double Black, distributed by Diageo GTME. Winning operators included Ivana Boston from Sault Ste. Marie Duty Free Store for Outstanding Customer Service; Peace Bridge Duty Free Inc. for Best Marketing Award; Niagara Duty Free for Best Marketing/Promotion of a Canadian-made Product; and Niagara Duty Free for Best New Idea. The Small Supplier of the Year award was given to Peter Mielzynski Agencies Ltd., while Large Supplier of the Year was awarded to Distribution Fontaine, Inc. The highlight of the night for many, the Platinum Awards, were given to Boutique Hors-Taxes de Philipsburg (Category A) and Blue Water Bridge Duty Free Shop (Category B).

Business as usual After a short break over the Christmas holidays, the FDFA owner/operators met for a one-day meeting to discuss business, government relations and other key topics that are relevant to the land border duty free industry. This year, members headed to lovely San Francisco, California on February 17 and 18. “San Francisco hosts the largest gift show in the US, which many of our members attended the day after our semi-annual meeting,” Karson told us when asked about San Francisco as a choice for this year’s meeting. “Over 17 stores attended and a wonderful line-up of speakers was organized. We are also very thankful to Pernod Ricard Americas Travel Retail, who hosted our operator's dinner on February 17.” Presenting at this year's FDFA Semi-Annual meeting was David Goldstein, President and CEO of the Tourism Industry Association The mood was jovial at the Cocktail Reception immediately preceding the Gala Dinner and Gold Standard awards

of Canada. This year marked Goldstein’s first presentation to the organization. He discussed Canada's tourism objectives, where the country stands now, what the hopes are for the future and how the duty free industry is part of the overall vision. “David is a veteran lobbyist and leader in Ottawa and brings a dynamic and progressive outlook for the future of tourism,” Karson told us. “Given duty free’s obvious relationship with tourism, and US/Canadian tourism's importance to our industry, this presentation was very relevant and insightful.” Simon Kennedy, Senior Deputy Minister of Industry Canada, also spoke at the meeting this year regarding the Perimeter Vision. Kennedy is the key spokesperson for Canada on the Perimeter Vision and explained that the Prime Minister of Canada and the President of the US recently issued the “Declaration on a Shared Vision for Perimeter Security and Economic Competitiveness,” which called for the development of a joint action plan. Work on the plan has now been successfully completed, he said, essentially creating a practical road map for enhancing security while speeding up legitimate trade and travel across the Canada-US border.

A voice for the industry The FDFA is continuing with its dialogue with the Canadian Border Services Agency (CBSA) regarding the Strategic Review. It is the objective of the FDFA to ensure that while government wants to streamline each government department so that it is efficient, the industry’s pillars remain intact. “We were hopeful that our discussions with the CBSA regarding the Strategic Review would be concluded at the end of 2011, but given recent discussions and presentations by the CBSA, we have more in-depth dialogue to come with the government,” explains Karson. “Nonetheless, thus far, communications with government officials have been positive.” The Strategic Review as it relates to the duty free industry is essentially a governmental examination taken out at regular intervals to ensure that the services provided by the CBSA are effective and efficient, that they respond to the priorities of Canadians and that they are in line with core federal responsibilities. The Strategic Review ensures that funding is allocated to programs that are a high priority for Canadians and that these programs produce results. The FDFA’s goal within the process is to ensure that industry pillars remain intact and that decisions made in relation to the streamlining of the duty free shop program are done in a manner that creates greater efficiencies and less administrative oversight, thereby avoiding an undue impact to Canadian border stores’ operational activities. Karson stressed that government relations is one very important member benefit that the FDFA provides to the duty free industry in Canada. “The efforts of the FDFA in regard to advocacy work are what continue to allow our industry to exist,” she concluded. “We will continue to apprise our members of our efforts and discussions with CBSA officials.” c www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

Portland Design

New by design

Portland Design’s approach to travel retail environments has helped advance new thinking about the shopping experience BY ANDREW BROOKS

ondon-based Portland Design creates customer-facing environments for a range of markets, and does a lot of work in the travel retail sector. According to Lewis Allen, Portland’s Director of Environments, the company’s approach to its markets and customers has developed as attitudes to retail have evolved among its client base, which, in travel retail, includes airports, retail operators and brands. Portland works in more parts of the world now than it ever has before—including China, India, Italy, Israel, Dubai and Latin America—and advances in the attitudes of its customers toward the retail experience have given Portland a definite edge. “The more forward-looking airports and retail operators are doing a lot more innovative things,” Allen says. “We’ve been lucky enough to be positioned as a brand that’s associated with a fresh approach to the generic. In the past 12 months, we’ve been successful in attracting airport and retail operators who recognize that there’s an opportunity to do something different in travel retail.” That new approach revolves around finding new ways to combine food & beverage with duty free retail, paying more attention to developing a true sense of place—as opposed to simply throwing disparate concepts into the retail mix and the commercial environment— and finding a way to foster a shopping mindset in the passenger by understanding and managing every step of the journey through the airport. In addition, Allen believes in the importance of “travelizing” the retail offer, where a brand hones its approach specifically for the travel retail context instead of simply reproducing in an airport the same approach it uses on high street. Over the past year the projects Portland is involved in have expanded in terms of both volume and type. Allen describes Portland’s 100

The local produce display at Larnaca—tailoring to local markets and tastes is a priority for Portland

Duty free is a global market, and shoppers expect full access to world leaders

current work as more interesting as they are focused on exerting an effect on the customer experience. Furthermore, he says the recent initiatives are more “strategic” in conception. “Now we get involved in discussions before the master plan is even developed,” he says. The master plan has typically been an exercise in maximizing commercial potential, and that’s not about to change. What is different now is the adoption of a “pull” model rather than the old “push” model that simply bombards the passenger with purchase messaging. More subtle and persuasive influences have been found to be more effective, Allen notes. “Now in terms of macro engagement with airport operators, we sit with senior management and commercial teams to talk about the kinds of ideas and influences that will be brought to bear, before any paperwork is done in terms of planning and drawing,” Allen explains. “For us this has filled in a missing part of the conversation—the part that really dives the DNA of an experience.” Allen cites the example of the new Larnaca International Airport in Cyprus, which opened in November 2009 with a new commercial core

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

designed by Portland. A few months after the opening, statistics showed that sales were up 29% year over year, an especially striking figure when you consider that passenger numbers rose only five percent for the same period. Portland works with airports, duty free operators and directly with brands. This gives the company a strong familiarity with the needs of all levels and enables it to play an active role in developing the creative crossdisciplinary exchanges required to get the most out of a given opportunity. “We can understand the different points of view and concerns, bridge some of the gaps that exist and foster better conversations between the different stakeholders,” Allen says. “These days there’s a lot more retail savvy out there, a sense of openness to new ideas. Sure, there’s still a degree of laissez faire out there, but we’re seeing a healthy level of debate about the airport of the future across all groups.” For Allen, the whole is always greater than the sum of the parts. “Airports can be better. We’ve been pushing that message for a while, and after talking about it for so long I think c we’ve finally found our audience.”

Guest Writer

Retail and the fight for airport reputation Simply by conversing and connecting with travelers, airports can open up an entirely new element in a very important relationship BY ANNE KAVANAGH

anaging the reputation of an airport is a challenge. Let’s face it; people simply seem to love hating airports. It’s easy to do and travelers often try to outdo each other with their favorite airport horror story. In some ways, travelers often take any problem in the airport experience as a personal attack—even if the target of their anger should not be the airport but an electrical storm over the Rockies. From “over-priced coffee” to “destroying the environment,” airports are a global whipping horse. But in this battle for reputation, I believe retail is an airport’s strongest weapon. In the United Kingdom, my agency was among the leading pioneers in developing a new approach to airport retail PR. From the mid1990s I was Retail PR Consultant to BAA, owner and operator of seven of the UK’s airports, including Heathrow, as well as Pittsburgh, Indianapolis and Boston in the US. PR was a big priority for the business because the management team, all domestic retailers with extensive experience, knew the importance and success that comes when PR drives footfall. The holistic year-round campaigns we developed put airport shopping on the map with the UK media and made retail the jewel in the crown as far as BAA’s general media profile was concerned. With so much airport privatization right across the Americas, commercial income has to work harder and I believe a planned approach to PR will help drive that revenue stream, as it did so successfully for BAA. This begins by the airport launching a conversation with the customer. Social media is the simplest and most economical route. Facebook, Twitter and foursquare enable fast, easy and cheap conversations with the target shopper. Pretty much all airports use social media for operational interaction with travelers, but what about the stores and restaurants? All you need do is provide a few lines of duty free news, run a competition and ask people what they think. Put simply, get talking! A good example is the 2011 launch of The Fashion Gallery from Lagardère Services, a stunning multibrand luxury fashion store at Singapore Changi. To interact with fashion lovers and raise awareness

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of the store, we installed a magic mirror enabling shoppers to take photos of themselves in store with the latest fashion and accessories ranges and post them directly to facebook. In 2 weeks a staggering 10,000 hits on facebook created a buzz about the store as a great fashion destination. Few Americas airports match this focus on shopper communication. LAX does it really well on facebook, with fantastic interaction on everything from construction projects to details of new F&B openings and charity campaigns. Almost 45,000 people like LAX on facebook and well over one million have visited the site. The LAX personality is friendly, fun and informative. Most other major airports in the region seem to focus entirely on operational news. Relevant, of course, but such neutral, corporate communication has its limits in being anything more than a transaction with the traveler. A key reason why travelers castigate airports for every

“With so much airport privatization right across the Americas, commercial income has to work harder and I believe a planned approach to PR will help drive that revenue stream.” Anne Kavanagh, CEO, Kavanagh Communications problem they ever face is that they are perceived as impersonal, even soulless places. Retail experiences create airport personality and PR is the human voice enabling shared conversations with the traveler. Simply by conversing and connecting with travelers—stories about new stores, current promotions and offers—the airport opens up a new element in the relationship. The power of PR enables an airport to build its own army of traveling brand ambassadors, encouraging shoppers to share with friends how much they liked the experience, the range, the service, the exclusive items. I’m not suggesting that travelers will suddenly forgive every unserviced washroom, lost bag or delayed flight, but retail PR does provide the airport with a fantastic weapon in the fight for reputac tion. Best of all, it will have travelers doing the talking.

Parbel

sets the agenda

Parbel’s Ralph Lauren pop-up lounge was staged in Miami International Airport from December 16 to January 16

2012 brings a full slate of new and continuing initiatives for L’Oréal’s travel retail arm in the Americas BY HIBAH NOOR

“W Javier Labarta, CEO of L’Oréal Travel Retail Americas, Parbel

e are continuously innovating—this is what the consumer wants,” says Javier Labarta, CEO of L’Oréal Travel Retail Americas, Parbel. Labarta recently spoke with Americas Duty Free to give us a look at the company’s work schedule and priorities for 2012. A number of projects are at the top of the list, all involving relaunches and new lines. First, the Rénergie anti-aging franchise will be renewed with the launch of Rénergie Multiple Lift. Rénergie Multiple Lift is described as the first skincare product that acts on the skin’s multiple layers for a visible lift of the face’s multiple zones. “In just four weeks,” the company says, “the forehead appears Rouge in Love is designed to attract a younger clientele to Lancôme

pushed up, cheeks re-plumped, the oval reshaped, contours defined and the neck lifted.” Labarta says Rénergie is the top antiaging franchise in the world. Another 2012 milestone is the launch of Rouge in Love, designed to attract a younger clientele to the brand. The new lipstick contains shades of long-lasting colors. Featuring what L’Oréal describes as an ultra-light second skin texture, Rouge in Love complements the wearer’s mood by providing a buildable makeup finish that caters to tailor-made looks, ranging from natural sheer to lacquered effects. Following on the successful launch of the Big Pony Men fragrance, Ralph Lauren is bringing out a new collection of four fragrances formulated for women in the 18-30 age bracket, whom Labarta describes as “multi-taskers: professionals, wives, lovers, best friends, athletes...” This customer “needs to be able to show her every side. Today, she is not just looking for a single perfume but a collection of colorful scents that tells the whole story of who she truly is.”

Lancôme’s Rénergie anti-aging franchise will be renewed with the launch of Rénergie Multi-Lift

The fragrances start with a floral backdrop, each with a different interpretation: citrus, fruity, green and oriental. “These fragrances answer the way women 18 to 30 classify the feminine fragrance market in four categories in their own language: playful, addictive, casual, polished,” Labarta says. “The new team of four fragrances for women will launch in April 2012 and you will be able to discover your very own ‘Life in Color.’” Labarta promises a “spectacular” launch at POS, but specifics are under wraps for now. For men, Yves Saint Laurent’s L’Homme Libre represents a fresh look at the original

Following the successful launch of the Big Pony Men fragrance, Ralph Lauren is bringing out a new collection of four fragrances formulated for women

L’Homme perfume. Starting with top notes of basil and violet leaf enhanced by sharp spicy notes of nutmeg and pink pepper, the fragrance’s deep woody vetiver and patchouli notes are enriched with warm tones of leather to reinforce a masculine sensibility. Benjamin Millepied, star of the New York City Ballet and choreographer of the cult film “Black Swan,” is the face of L’Homme Libre. Biotherm is launching Skin Vivo Uniformity, a skincare product designed to address skin distress symptoms beyond the ‘usual suspects’— wrinkles and loss of firmness. “Women are changing, and so are their struggles,” Labarta says. “New symptoms are adding to their concerns—dark spots, redness, dull skin, roughness, loss of elasticity… skin’s youthfulness is also expressed in terms of texture and tone.” Giorgio Armani has good works in mind for this year with the development of its “Aqua For Life” program. “In 2011, the Giorgio Armani Group committed in its partnership with GCI to build water systems that could provide every year at least 40 million liters of safe drinking water,” Labarta says. Some 27,000 people in 16 communities have received water in rural Ghana, where about 40% of the population lacks access to safe water. Armani supported the project by providing 100 liters of water every time someone purchased one of the brand’s two fragrances associated with water— Acqua di Giò and Acqua di Gioia. “The customer can also participate via the Internet to spread the word through social media, and collect even more liters of water,” Labarta says. “This has helped Armani surpass the initial 40 million liter target, eventually reaching 43.3 million liters of safe drinking water in total.” Armani has committed to continue its support this year for new Green Cross International Smart Water for Green School infrastructure projects to collect and distribute at least 40 million liters of water a year in both Ghana and, for the first time, Bolivia.

A brand for all markets Summing up L’Oréal Travel Retail Americas’ grand strategy, Labarta emphasizes the strength of the company’s brand portfolio, which includes French, Italian, American and Japanese marques. L’Oréal prioritizes to cover some key market segments. “Lancôme as a French Global Luxury cosmetic brand, YSL the luxurious ‘haute couture,’ Giorgio Armani

representing Italian flair, Kiehl’s as an alternative brand and Ralph Lauren as American lifestyle,” Labarta says. “We’re gifted to work with such an amazing portfolio.” L’Oréal Luxe Travel Retail America is outperforming the market, and 2011 continued the trend with an expanded market share, Labarta says. “This is very important for the company, not only for what it represents as objective results, but most importantly because it means that the consumer in North America and Latin America has freely chosen our products. This is the greatest satisfaction for a company that believes in spreading a sense of beauty to everyone.” Speaking about Parbel’s skincare and perfume lounges, Labarta says that the company fully intends to continue to foster the ‘moment of meeting’ between customer and brand this way. And the brand’s face time definitely benefited from the Ralph Lauren podium staged at Miami International Airport at the end of 2011. “We created a truly innovative experience,” Labarta says. “We were working with a space outside of a store, so we tried to use it as creatively as we could while still respecting the airport regulations, the brand, and of course making it a unique experience for the customer. Our goal was to put the brand at top of mind for the consumer and remind them of the shopping opportunities available while they travel.” The rotunda space featured wraparound visuals highlighting the Ralph Lauren men’s lines World of Polo and The Big Pony Collection. The podium itself housed a customized, 3D motion-sensor Polo game, developed on Xbox Kinect software, that enabled the customer to become virtually a part of the Ralph Lauren Polo team. It also held four Android pads presenting a quiz that helped the traveler determine which Ralph Lauren fragrance best suited them or the person they were gifting. “The purpose of this was to reach a larger audience, and bring people into the store that might otherwise not enter,” Labarta says. “It was certainly worth the effort. The results were phenomenal—selling +194% units versus the month prior, and +176% versus December 2010.” The experience was educational, Labarta says, and provided a good look at new, technology-enabled ways to grab the attention of the traveling customer. “We’re looking towards a more digital front, as it truly provides a global reach and allows for even the smallest airport space to be animated. With that, iPads are definitely something we’re looking at in order to bring ‘retailtainment’ on the shelf level.” c

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

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Essence Corp. – Essence Beauty

Essence

keeps it fresh Beauty brand distributor kicks the new season off with a host of luxurious offerings

HIBAH NOOR

iami-based Essence Corp., which distributes prestigious beauty brands in the Americas and Caribbean duty free markets, plans to focus on developing Burberry Body, Versace Yellow Diamond and Live in Love by Oscar de La Renta, among others, for the first semester of 2012, says President Jean-Jacques Bona. Burberry Body, which was launched in September 2011 in more than 150 countries around the world, features top notes of fresh green absinthe, illuminating peach and freesia. The heart notes are formed by a floral bouquet of natural rose absolute and iris, blended with subtle warm tones of sandalwood. The base consists of woody cashmerean, vanilla, amber and musk. The juice is housed in a multi-faceted glass bottle designed around a color palette of nude, pale nude, white and rose gold, with a rose gold engraved check. The bottle, designed by Burberry’s Chief Creative Officer Christopher Bailey, is intended to be desirable as an object in itself, with the iconic Burberry check etched onto the lid. “The visual is stunning,” says Patricia Bona, Vice President of Essence Corp. “It has a global appeal.” She says that the well-known Burberry trench coat is reflected in the mood and feel of the campaign, with images shot by Mario Testino under Bailey’s creative direction, and with British actress and model Rosie HuntingtonWhitely as the first Burberry Body, sporting the iconic trench coat. The desirability of the bottle is also a keynote for Yellow Diamond Versace, the latest offering in the crystal-inspired fragrance collection Versace launched in 2004 with Crystal Noir. “People collect these crystal bottles like Crystal Noir and Bright Crystal,” says Patricia Bona. Cut into facets, the glass vessel bears the stamp of the bottles used to house the previous fragrances in this line, and is designed to reflect the light effects created by a diamond. The box bears a characteristic baroque Versace

decoration, with shades of color The Live in Love flacon ranging from pale to vivid yellow. was personally “The yellow color recalls the designed by Oscar de la brightness, sensuality and great Renta energy of this fragrance, able to depict and emphasize the charm and femininity of a woman,” says Designer Donatella Versace. The logo is rendered in vivid, “almost electric” blue to stand out in contrast against the yellow shades. Mario Testino is also behind the Yellow Diamond visuals, and the campaign, shot in Paris, is headlined by top Australian model Abbey Lee Kershaw. Oscar de la Renta’s Live in Love is described as “an expression of Oscar de la Renta’s desire to make every woman feel like the most beautiful woman in the world. With Live in Love, he has created an unforgettable scent for a woman to fall in love with.” The fragrance is the creation of Jean Marc Chaiilan, Ann Gottlieb and Carlos Benaim. The Live in Love scent opens with sparkling ginger orchid and bergamot, merged with hyacinth, green muguet and galbanum. The fragrance has a heart of florals, including jasmine sambac, orange flower and rose. Creamy white woods and musk intertwine with amber, sandalwood and cedarwood to form the base. The faceted glass bottle, which Oscar de la Renta designed himself, is patterned on a dress. The scent is available in Eau de Parfum Spray sizes of 100 mL, 50 mL and 30 mL, as well as in a 200 mL Body Lotion. “Our main promotional activities surrounding new launches are held in main airports in Sao Paulo, Buenos Aires, Miami and New York,” says Jean-Jacques Bona. “Airports give you a launch period of two weeks; we have beauty advisors spraying perfumes at the entrance of the stores, we also implement pop up areas and other signage and decor.” The markets in the Americas represent a mix of offsetting circumstances for Essence. Bona says that spend is shrinking in the Caribbean because of the influx of greater numbers of tourists from the US. “We get the volume, but not the spend per passenger. It’s the opposite in South America; there’s big purchasing power there and the culture of buying abroad because the pricing is very high on the local market. The c more they buy the happier they are.”

Versace Yellow Diamond Burberry Body

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Essence Corp. – Clarins Group

Extra Firming Day wrinkle lifting cream

The ssence Corp., the agent of Clarins Group, represents fine fragrances, skincare and cosmetics in the Americas, with a focus on travel retail as well as Latin America’s local markets. Essence Corp. became the regional sales and marketing office of Clarins Group in 2003, when the Clarins Group Division was created. Clarins Group now features major brands such as Clarins, Azzaro and Thierry Mugler, and has more recently supported the development of fragrances for brands such as Porsche Design, David Yurman and Swarovski. The Clarins range of Extra-Firming skincare creams was first launched back in 1978, and has enjoyed considerable market success. At present, the company says, over two million creams are sold annually, which equates to one every eight seconds. The line is research-based, and is known for introducing innovations into the market. One of Clarins’ key launches for the first semester of 2012 is Extra Firming Day wrinkle lifting cream, which acts on the connecting links between dermal fibers and cells. The research innovation behind the release, Clarins says, is the discovery of the proteins that form these links. Clarins Extra-Firming Day cream is designed for all skin types, and counteracts skin slackening, reduces wrinkles and firms the oval of the face by acting on the three key elements of dermal structure and the links between them: elastic fibers, collagen fibers and fibroblasts. To complement Extra-Firming Day cream, Clarins has developed the Extra-Firming Night rejuvenating cream, which also leverages research to target the environment of stem cells in the epidermis, based on the identification of three key proteins that protect the environment of stem cells, helping them to last longer. The company says the Night cream Extra-Firming Night rejuvenating cream reinforces the firming action of the Extra-Firming Day cream, reduces the deepening of lines, helps prevent the appearance of dark spots and restores a more even complexion by protecting the three elements responsible for optimal dermal renewal: keratinocyte stem cells, Langerhans cells and skin nerve endings. The Day cream features fragrance notes of rose and camelia, and the Night cream notes are lily of the valley, jasmine and iris. Each cream is also offered in a separate version designed for dry skin.

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science of skin

HIBAH NOOR

Clarins says protein research backs its new skin-firming creams

Market notes This launch arrives at a time when the travel retail market is evolving and is focusing on the needs of specific travelers. For example, Asian overseas travelers have emerged as one of the biggest luxury goods shoppers in travel retail shops. In the Americas, this phenomenon is especially notable at terminals in Los Angeles and JFK. In response, Clarins has been widening its assortment in the region by offering products adapted to their specific concerns and preferences. “These customers buy skincare wherever they travel. They’re big consumers of serum,” notes Jean-Jacques Bona, President of Essence Corp. “At the same time Latin customers buy skincare and body products, but they are bigger purchasers of fragrances.” On the training front, Clarins has reworked the content of its Beauty Advisor seminar because launches happen so frequently and training has to take place in the field. One seminar a year doesn’t cut it anymore, Bona says. “We’re really focusing on sales techniques. Clarins has put together a module for selling in the local market, which is adapted for the duty free side.” All the brands are developing their own sales techniques, and in a context where reaching people frequently in any location is essential, a lot more learning is done remotely via the Internet. Meanwhile the annual seminar is also changing. Much more time is devoted to role playing exercises and workshops, Bona says. The training sessions are conducted by region, with one seminar for North America, one for South America, one for the Caribbean and one for Central America. This way different languages and launch dates can be more easily accommodated, Bona says. c

Tairo International

A group shot from the last day of the Beauty Advisor Seminar held by Tairo International at the Westin Diplomat Hotel in Hollywood, Florida, near Miami

Tairo aims higher

HIBAH NOOR

Mexico/Caribbean beauty distributor celebrates steady growth, retools for more expansion hen Tairo celebrates its 15th anniversary this year, the luxury beauty distributor will have an impressive history to look back on. The successful distributor to the Caribbean and Mexican duty free market was founded by husband and wife team Robert and Tania Bassan in 1996, and has since then established an enviable record of success, attracting a large roster of prestigious names (see sidebar). Last year the company held a major Beauty Advisor Seminar at the Westin Diplomat Hotel in Hollywood, Florida from September 30 to October 3, to spread the word about new and existing products and to build the motivation of front-line sales staff. Ninety beauty advisors and buyers from around the Caribbean were in attendance, and the seminar kicked off with an introductory evening event where attendees, dressed in a wide variety of colors and garments, were given the opportunity to tell other attendees a bit about their respective cultures. Next day, President Robert Bassan got the seminar rolling by announcing that prestige skincare brand StriVectin had become the latest name to join the Tairo portfolio. Later he followed up by announcing two further additions to the Tairo lineup: FCUK fragrances and the Oscar Blandi haircare range. Other announcements included new fragrance launches for Coty Prestige, Coty Beauty and Lolita Lempicka, which were introduced and presented by Tairo Brand and Area Managers. The Managers also highlighted new initiatives from Yves Saint Laurent and P&G Prestige Products. The event offered attendees plenty of entertainment and networking opportunities, including a dinner boat cruise along Biscayne Bay in the Miami Beach area, which finished off with music and dancing against the backdrop of the Miami skyline. At the end of the presentations, attendees were whisked away to Aventura mall

Tairo staff presented a number of new fragrances which are ready to hit the duty free shelves in the Caribbean and Mexico

Attendees enjoyed a dinner Friday night at GGâ&#x20AC;&#x2122;s Waterfront Bar & Grill Restaurant

C O N T I N U E D O N PA G E 1 1 2

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Tairo International

C O N T I N U E D F R O M PA G E 1 1 0

for some free-time shopping: Tairo reports that many needed extra luggage to take their new acquisitions home with them. Finally, the event wrapped up with a bowling competition. “Everyone left with smiles on their faces and a renewed drive to sell,” says Robert Bassan. The event marked a successful 2011 for Tairo – a year that came ‘sand-

wiched’ between two important years. In 2010 the company realigned its brand teams to build internal efficiencies, increase customer service levels and streamline the organization for faster growth in future. And this year Bassan says that the company will take that trademark teamand customer-centered approach into its 15th anniversary, with a focus on “thanking our clients and suppliers for their ongoing support.” c

Steps to success

1996

Tairo founded by husband and wife team Robert and Tania Bassan, dedicates itself to the distribution of beauty products in the Caribbean and Mexican duty free markets; the company starts by distributing small independent European brands

1998 1999 2002 2003

Tairo makes its “first impression in the region,” partnering with Satinine for the distribution of the Ferrari fragrance brand and St. John and Perfumes Isabell

2004 2005

Tairo is appointed distributor for Ferrari fragrance Tairo is appointed distributor for Parfums Lolita Lempicka (Pacific Creations) Watershed year for Tairo, as the company is appointed distributor for American Designer Fragrances (ADF) brands (Kenneth Cole, Marc Jacobs, Michael Kors) – ADF is a division of Parfums Givenchy, an LVHM Moët Hennessy Louis Vuitton company; Lancaster purchases Kenneth Cole & Marc Jacobs and appoints Tairo as distributor for Caribbean and Mexican duty free; Tairo begins working with the entire Lancaster portfolio of brands; P&G Prestige Products joins forces with Tairo for the distribution of its brands in the region Tairo institutes Retail Partner of the Year program Yves Saint Laurent (YSL) appoints Tairo as distributor for the region; P&G acquires Cosmopolitan Cosmetics and continues its partnership with Tairo brands, to include Gucci and Dunhill

2006

P&G expands its portfolio by purchasing Dolce & Gabbana fragrances; Coty Prestige (formerly Lancaster) purchases Unilever and maintains its partnership with Tairo – brands include Calvin Klein and Vera Wang. Bryan Hollander joins the Tairo team as Vice President.

2008

Tairo is appointed distributor for prestige French boutique brand Hanae Mori; L’Oréal purchases YSL Fragrance & Cosmetics and continues its partnership with Tairo

2009 2010 2011 112

The seminar wrapped up with a casual and relaxing night out at Lucky Strike

The region is impacted by global slowdown Sales begin to rebound; Tairo and P&G expand their partnership to include the Mexican duty free market; company restructures, forming a series of independent brand-oriented teams to provide better focus and service, and to allow for further portfolio expansion TPR Holdings and StriVectin are added to Tairo’s portfolio

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Tairo International

reveals 2012 launch plans Tairo International has provided a glimpse of the new launches it has planned for 2012. Coty Prestige’s new Calvin Klein Sheer Beauty fragrance leads off with a March launch in the Caribbean. The launch will emphasize visual impact, with animations featuring large window stickers. The following month, Coty Prestige will launch a new Roberto Cavalli fragrance for women, with Elisa Sednaoui as the face of the brand and in-store animations and window displays setting the pace. For May, Coty Prestige will introduce the new celebrity fragrance Truth or Dare from Madonna, which it describes as a “contemporary and sexy reinvention of a classic, robust signature white floral.” The bottle will feature gold and white coloring. May also sees the launch of men’s fragrance Nautica Aqua Rush from Coty Beauty, described as “spicy and fresh, crisp and woody; capturing the nautical heritage of the iconic brand.” Friction, a new fragrance by FCUK from TPR Holding, is currently entering the Caribbean market. The outer packaging features Lindsay Lohan and model Petey Wright. These launches follow the January introduction of two new Yves Saint Laurent fragrances, L’Homme Libre and Saharienne. The multi-storefront launches featured window stickers.

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We have over 30 years experience in the Canadian duty free market and a commitment to excellence. BILSI staff are experts in Canada Customs regulations, transportation management and 3rd party logistics. Our mission is to provide our clients with the highest level of customer service covering their shipments to and within Canada and the USA.

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Beauty News

Diverse offers

A host of beauty companies are bringing unique concepts to the travel retail market

TPR and GMP Services join forces to introduce Oscar Blandi Hair Care in Americas travel retail PR Holdings LLC, a consumer products holding company that acquired a controlling interest in Oscar Blandi Hair Care Products last year, has recently appointed GMP Services as agent for Oscar Blandi Hair Care products for the Americas travel retail market. Following the acquisition, GMP appointed Tairo International to distribute to the Caribbean and Mexican markets and DFX Distribution for Canadian border stores and some airports. “The Oscar Blandi hair care brand has tremendous growth potential, which we intend to unlock utilizing strategic brand building, heavy sampling and public relations efforts,” says TPR President Brian Robinson. “As a stylist, Oscar Blandi has a fantastic reputation, a loyal celebrity following and he really gets it when it comes to innovation and product development.” For his part, Blandi is looking forward to a productive partnership. “We’re very excited about our agreement with TPR Holdings,” he

says. “Brian Robinson and his team have proven expertise in terms of understanding how to grow a brand globally. It’s a great opportunity to see my vision further commercialized and grown to the proper scale. We have some really exciting things planned and our focus will continue to be the premium sector of the hair care marketplace.” The Oscar Blandi Hair Care line includes premium shampoos, conditioners and shine serums. Hero items include the Dry Shampoo, Pronto Colore Root Touch Up & Highlight Pen and Jasmine Oil Serum. Oscar Blandi products have received beauty award recognition in Allure, Self and Redbook. Blandi also owns and operates a namesake salon in New York City.

Demeter Fragrance

Library expands with Clean Skin and Moonbeam

Demeter recently announced two new additions to the Demeter Fragrance Library: Clean Skin and Moonbeam. Clean Skin, available in March, is described as a light, virtually transparent and delicate fragrance, with elements of orange, lemon, bergamot, peach, white rose, ylang ylang and a soft vanilla undertone designed to emulate the smell of clean skin. “Smells like the best version of you—just better,” Demeter says. Moonbeam, which will be available in April, offers a combination of green leaves, jasmine, lily of the valley, amber and precious woods. “Moonbeam captures the dual nature of the moonbeam, reflecting elements of both the innocence of light and the passion of night,” Demeter says. “Inspired by the poetry of Shelley, Moonbeam in a study in the contrasts between light and dark.” Demeter’s Fragrance Library includes over 250 fragrances, inspired by everyday objects and experiences, and made with 95% natural ingredients—without artificial colors or phthalates, and minus extra packaging. Best selling scents include Baby Powder, Pure Soap and Laundromat.

Moonbeam

Clean Skin

Ferragamo launches Signorina in local and duty free markets Ferragamo has announced the forthcoming debut of its new Signorina fragrance. The new scent will open in local markets first: Mexico in March, Central America, the Caribbean, Puerto Rico and Colombia in April, and the rest of South America in August. Duty free launches will follow the local market premieres. “Signorina is the celebration of chic girls with a sophisticated, subtly cheeky and fresh scent signature,” Ferragamo says. “A new fragrance creation with elegant and all-Italian style by Salvatore Ferragamo, inspired by the strong bond between Salvatore Ferragamo and trendy feminine young ladies with timeless modernity, creativity and a hint of audacity.” 114

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The fragrance features bright notes of currant spiced with fresh pink pepper that complement the scent’s natural green notes. A floral heart is built on the fusion of fresh jasmine, peony and rose. The pannacotta texture together with soft musk and woody patchouli notes suggest Italian elegance and a layer of what Ferragamo describes as “an unexpected addictiveness.” In addition, Ferragamo will launch the new Attimo L'eau Florale EDT, starting with an April rollout throughout South America, followed by an August launch into the Mexican market. In the Americas, new developments for First American include new children’s products such as the Smurfs fragrances (already launched), and the forthcoming Looney Tunes and Kung Fu Panda scents

First American’s duty free debut features children’s fragrances First American Brands has announced its debut in duty free, with the initial placement of new brands in the Middle Eastern duty free market. The company already has a strong global presence in local markets, and has ambitious plans for the rollout of a broad range of fragrances designed for children. In the Americas, new developments for First American include new children’s products such as the Smurfs fragrances (already launched), and the forthcoming Looney Tunes and Kung Fu Panda scents. Launched at the same time as the movie, the Smurfs fragrances come in original packaging similar to a milk box. Designed to be suitable as a gift for children, the line consists of five 50 mL EDT unisex fragrances, and one exclusively for girls. In addition, the range includes two bubble baths—350 mL and 700 mL — and six different tin can sets, which are shaped as the classic mushroom Smurfs house. The characters featured are Papa, Smurfette, Grouchy, Gutsy, Clumsy and Brainy. “The scents are fresh and inviting for children,” First American says, “and capture a playful aurora of youth and a connection to the energetic world of the Smurfs.” The Looney Tunes line features Bugs Bunny, Tweety and Daffy Duck in 50 mL and 100 mL TV-shaped EDT sprays, packaged in eight different colored boxes. The collection includes large and small gift sets for each character enclosing one shower gel and a key chain in addition to the fragrance. The Bugs and Lola Bunny, along with Tweety and Sylvester bubble baths, which all come in two different sizes (354

Vince Camuto

highlights recently launched fragrance Over the last several months, fashion, footwear and lifestyle designer Vince Camuto has been busy promoting his eponymous new fragrance. Americas Duty Free caught up with Camuto at last year’s TFWA WE event in Cannes, where the fragrance was initially introduced to travel retail. Amid the buzz that the launch generated during the evening cocktail hour, we were fortunate enough to be able to speak with him. “The inspiration behind the fragrance is that it’s the ultimate luxury - yet it is still accessible,” Camuto told us. “We’ve come out with a fragrance that women will love. We applied all the things that women love in our footwear, handbags and clothing— great style, affordable pricing and an exceptional essence. So from our base in New York, we toured all over the world, to exotic lands and nearby destinations - all these places have scents and memories which we brought together to create the perfect fragrance for a modern, sophisticated woman.” The Vince Camuto fragrance is a floral chypre created by celebrated perfumer Steve DeMercado. It opens with the nectar of osmanthus, a rare Chinese flower with a flavorful scent, blended with Bulgarian white rose. “The contrast of deep, rich notes of leather and the delicate essence of night blooming jas-

Signorina by Ferragamo

mL and 710 mL), complete the product range. First American is also introducing the new Betty Boop fragrance collection. The range includes four scents: Party Betty, Princess Betty, Sexy Betty and Angel Betty. “The Queen of Cartoon” provides the inspiration for the bottle. All four fragrance EDP come in 75 mL sprays, and the collection includes four 10g solid perfume and four gift sets enclosed in a cosmetics bag. This year First American will also launch the first fragrance by fashion designer Angel Sanchez. mine create an alluring signature,” Camuto says. “As the fragrance evolves, its sensuality lingers as warm, enticing notes of vanilla, patchouli and warm amber Brazil are embraced by soft, creamy skin musk.” The Vince Camuto Fragrance Collection consists of 100 mL Eau de Parfum Spray (US$78), 50 mL Eau de Parfum Spray (US$60) and 200 mL Body Lotion (US$40). The outline of the Camuto family crest surrounds the cap and appears on a be-ribboned medallion adorning the façade of the bold, angular bottle. A hot pink seal featuring the Camuto crest is also imprinted on the white packaging. Vince Camuto told us that through an exclusive partnership with Canadian retailer The Bay, he intends to maximize the potential of the Canadian market. The name recognition of the brand itself, and of the famous people who follow it, will undoubtedly provide a massive boost to marketing campaigns everywhere. “We have 40 to 50 celebrities that wear our clothing and shoes, like Katie Holmes, Kim Kardashian, Barbara Hershey,” Camuto says. “If our name is on it, women know that they are going to get outstanding value and fashion-forward sensibility. They know that in every category, Vince Camuto delivers truly modern luxury - fabulous quality at a price point that is c not out of reach.” The Vince Camuto fragrance is a floral chypre created by celebrated perfumer Steve DeMercado

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Beauty Beat: Fragrances

Wishes and Dreams by bebe Company: Inter Parfums Inc., Essence Corp. Description: Inspired by beauty, love and style, this sparkling chypre scent is encased in a flacon that mimics the curvy silhouette of a woman’s body. The metallic champagne gold box is decorated with crystals in holographic foil Booth: 1703

Beauty

boosters

A host of alluring scents fill the air as suppliers roll out their best offerings yet for the warmer seasons L’Eau d’Issey pour Homme Sport by Issey Miyake Company: Beauté Prestige International Description: With bergamot and grapefruit, L’Eau d’Issey pour Homme Sport evokes the freshness of the open air and high altitudes. The heart emanates a spicy note of nutmeg, and the fragrance derives the smoky notes of vetiver roots and the woody essence of cedar Booth: Atlanta Room

Angel Eau de Toilette by Thierry Mugler

Bois d’Orient Company: Jean-Charles Brosseau Description: The citrus beginning is a fresh cocktail of lemon and mandarin accompanied by spearmint and juniper berries. Mediterranean fig with oriental cinnamon and juicy raspberries makes up the middle notes. The dry down consists of cedarwood, sandalwood and white musk with a hint of cistus and praline Booth: 1708

Company: Clarins Division, Essence Corp. Description: Angel Eau de Toilette is described as “a unique harmony of scents”. The oriental, gourmand and powdery fragrance was composed by Amandine Marie (Robertet) Booth: 1703

Lanvin Avant-Garde Company: Essence Beauty Division, Essence Corp. Description: Lanvin’s Avant-Garde juice bears all the hallmarks of Lanvin menswear, described as “the contemporary embodiment of French masculine style.” AvantGarde features oriental woody scent encapsulated in a simple flacon with an ergonomic shape, refined curves and a sensual touch. “An elegant reinterpretation of an evening suit.” Booth: 1703

Beyoncé Pulse

Azzaro Pour Homme Night Time Company: Clarins Division, Essence Corp. Description: This new scent retains the iconic signature of the original fragrance but with a twist. The juice is composed of green and woody notes Booth: 1703

Nautica Aqua Rush Company: Coty Beauty Price: US$55: 100 mL edt; US$42: 50 mL edt Description: Nautica Aqua Rush infuses a blend of sea breeze accord with cooling watermint and teak wood. The flacon is reminiscent of a sail and the outer carton conveys the energy of a crashing wave Booth: 1515

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Company: Coty Beauty Price: US$50:100 mL edp; US$42: 50 mL edp Description: This new fragrance by Beyoncé reflects the star’s incredible energy and powerful femininity. Beyoncé Pulse’s fresh notes mingle to create a unique citrus, floral gourmand, anchored by Beyoncé’s favorite flower, the orchid Booth: 1515

Beauty Beat: Fragrances Marc Jacobs Daisy Petite Flowers On The Go Company: Coty Prestige Description: Marc Jacobs offers Daisy and Daisy Eau So Fresh in a unique new limited edition package. The whimsical packaging mimics the original daisy bottle. These portable posies sport retro-chic petals Booth: Crystal Salons M & N

Success by Trump Company: Five Star Fragrance Company Description: Inspired by Donald Trump’s own success in real estate, business, publishing and television, his fragrance is described as an empowering scent. Created in collaboration with Yann Vasnier from Givaudan and developer Jennifer Mullarkey, this fragrance was carefully crafted with a unique blend of notes Booth: 1614

Sheer Beauty by Calvin Klein Company: Coty Prestige Description: The fruity floral Sheer Beauty follows up on the statement made by Calvin Klein’s Beauty. This edition features the signature Beauty flacon with a blush-colored gradient and a clear cap is set on top Booth: Crystal Salons M & N

True Reflection Company: Five Star Fragrance Company Description: An oriental fragrance that opens with a burst of sparkling Italian bergamot, plum and peach. The floral heart blends night blooming gardenia, chocolate orchid and lotus flower for a unique mix, while the earthy finish of textured woods, patchouli and skin musk rounds out the scent Booth: 1614

L’eau De Chloé Company: Coty Prestige Description: The iconic Chloé bottle houses distilled rose water with citrus and hints of patchouli. The flacon features a soft green ribbon finished with a silver metal cap Booth: Crystal Salons M & N

Ombre Platine

Established 1969 for Women by Gap Company: Inter Parfums Inc., Essence Corp. Description: This modern fragrance combines the freshness of citrus and floral notes accented with a woody accord. The transparent bottle features the name of the fragrance in debossed text Booth: 1703

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Company: Jean-Charles Brosseau Description: A floral oriental, fruity and powdery composition is added to JeanCharles Brosseau’s portfolio. Fragrance notes include lily, tuberose, sandalwood and pink pepper combined with bergamot, coconut and vanilla Booth: 1708

Tous Sensual Touch Company: Perfumes Y Diseño Comercial Sl Description: Tous Sensual Touch is a fresh, floriental, woody aroma designed by Veronique Nyberg. The feminine scent is described as “a personal potion of sensuality,” says the company Booth: 1615

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Beauty Beat: Fragrances Cherry Princess Company: L’Occitane Description: This floral and fruity fragrance blends the juicy scents of cherries. All of the products in the collection contain a cherry extract from the Luberon. The new edt is available in 50 mL Booth: 1609

Black XS L’EXCES by Paco Rabanne Company: Puig Description: Black XS L’EXCES is a woody aromatic fragrance composed of lavender, sage and green apple, described as a sensual accord of amber wood, patchouli and praline with the intensity of black cardamom and cypriol Booth: Crystal Salons P&Q

Black XS L’EXCES for Her by Paco Rabanne Company: Puig Description: This fragrance is a floral woody oriental with modern, sophisticated accents, composed of tamarind flower, black vanilla and flower of cacao and davana. The packaging establishes a rock attitude with a modern interpretation of the rock universe, a contrast of silver and shiny with a matte finish Booth: Crystal Salons P & Q

Love Fury by Nine West Company: Inter Parfums Inc., Essence Corp. Description: Nine West, a leader in fashion footwear, debuts its first fragrance. The concoction of fresh fruits, florals, warm woods and amber is described as “mysterious and sexy” by the company. Working exclusively with Firmenich, the largest privately-owned company in the perfume business, Nine West sets out to create “a signature fragrance, a scented statement for the woman wearing it” Booth: 1703

London Blooms Collection Limited Edition by Jo Malone Company: Estée Lauder Description: The new trio of Jo Malone scents draw inspiration from a botanical theme based on the British garden. The three choices embody contrast: peony and moss, white lilac and rhubarb, and iris and Lady Moore Booth: Crystal Salon K & L

Crazy Rem Company: Reminiscence Paris Description: Inspired by bright Miami colors, the floral Crazy Rem starts with top notes of pink peppercorn and bergamot combined with ylang ylang and tuberose. A blend of coconut oil, tiare flower and Tahitian monoi is reminiscent of the beach. The fragrance concludes with sandalwood vanilla and musk

House of DKNY Coffret Company: Estée Lauder Description: The House of DKNY introduces a new travel exclusive set containing four travel-oriented miniature fragrances: Be Delicious EDP 7 mL, Be Delicious Fresh Blossom EDP 7 mL, pureDKNY Verbena 7 mL and Original DKNY Women EDT 4 mL Booth: Crystal Salon K & L

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Beauty regime

*Photo courtesy of Guido Mocafico, Clarins

HydraQuench Cream-Gel

Revitalift Repair 10 Instant Serum Company: L’Oréal Paris Description: This breakthrough serum is concentrated with antiaging actives that start fighting 10 signs of aging within an hour of application. The formula leaves the skin firmer, toned and supple, preparing it for the application of the Revitalift Repair 10 Day or Night cream Booth: Canary Salon 4

*Photo courtesy of Guido Mocafico, Clarins

Creative cosmetics and revolutionary skincare: traveling consumers will have plenty of options to choose from this season

Company: Clarins Division, Essence Corp. Description: A daily skincare gel for normal to combination skin. Its smooth texture has the softness of cream and the cooling effect of gel, while providing the hydrating effectiveness of Clarins’ exclusive combination of hyaluronic acid complex and katafray bark extract Booth 1703

HydraQuench Intensive Serum Bi-Phase Company: Clarins Division, Essence Corp. Description: This intensive hydrating care for dehydrated skin features a bi-phase hydric and lipidic texture that is fine, lighter and sensorial, to give a non-oily finish and comfort the skin Booth: 1703

Company: Clarins Division, Essence Corp. Description: This lightweight foundation with matifying effect works for combination and oily skin. The formula subtly imbues the user with the signature scent of all Clarins foundations Booth: 1703

Expert Color Palette Travel Retail Exclusive Company: Estée Lauder Description: This makeup palette is filled with strong shades. Pure Color Long Lasting Lipstick, Kissable LipShine, Pure Color EyeShadow and Estée Lauder Signature Silky Powder Blush are all available in one portable palette, complete with Magnascopic Maximum Volume Mascara Booth: Crystal Salon K & L

Company: L’Oréal Paris Description: After the success of Revitalift Repair 10 Day cream, L’Oréal Paris completes the range with a night cream, the first integral skincare that fights 10 signs of aging and UV damage during sleep Booth: Canary Salon 4

Dr. Andrew Weil for Origins MegaBright Skin tone correcting serum Company: Estée Lauder Description: A formula that Estée Lauder says is clinically proven to instantly brighten skin and improve clarity and radiance, fighting the causes of skin discoloration while combating the existing visible signs (dark spots, uneven skin tone) and preventing their future development Booth: Crystal Salon K & L

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Ever Matte Mineral Powder Compact Company: Clarins Division, Essence Corp. Description: The “shine stopper” complex combines the benefits of plants with the purity of mineral pigments to matify, control shine and smooth skin texture Booth: 1703

Ever Matte SPF 15

Revitalift Repair 10 Night Cream

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*Photo courtesy of Guido Mocafico, Clarins

Beauty Beat: Skincare & Cosmetics

*Photo courtesy of Guido Mocafico, Clarins

Pronto Heat Protect S pray by Oscar Blandi Company: TPR Holdings LLC Description: Offering 450-degree heat protection and safeguarding hair from all hot tools, this dryspray formula is enriched with keratin proteins to nourish, strengthen and protect. It provides instant style-refreshing benefits, enabling hair style to be easily and effortlessly reshaped Booth: 1515

Dermatologist Solutions Clearly Corrective Dark Spot Solution by Kiehl’s Company: L’Oréal Group Description: A fast-acting serum that evens skin tone and diminishes dark spots to impart overall radiance and luminosity to the skin. The formula’s key ingredient, power-packed Activated C, a breakthrough “anticluster” technology first brought to market in this Kiehl’s formula, is the latest-generation of Vitamin C derivative ingredients available, says the company Booth: Canary Salon 4

Invisible Fluid Makeup Smokey Eye Collection by Bobbi Brown Company: Estée Lauder Description: The set includes a dual-ended brush for quick and easy applications, Long-Wear Gel Eyeliner and Lash Glamour Extreme Lengthening Mascaraboth in the blackest black. Eye shadow colors include, Ivory, Dusty Plum, Eggplant, Star Sparkle, Volcano Sparkle, Diamond and Caviar Booth: Crystal Salon K & L

DayWear Anti-Oxidant Beauty Benefit Creme SPF 35 Company: Estée Lauder Description: Estée Lauder says this is “a whole new approach to achieving beautiful skin.” Powered with an advanced complex of skin-essential anti-oxidants, Estée Lauder’s new Beauty Benefit Creme “does it all” in one step for even, healthy-looking skin Booth: Crystal Salon K & L

Extremely YSL For Eyes Company: L’Oréal Group Description: An exclusive new eye palette made up of eight shades, from smoking black to gold, ice blue to brown and light rose to purple. A black YSL mascara and two original long applicators (foam and brush) come with the set. The purple case can be re-used, alone or with its removable palette Booth: Canary Salon 4

Company: Estée Lauder Description: A technologically advanced intuitive liquid makeup that harnesses the power of Estée Lauder’s exclusive new, patent-pending IntuiTone technology in shades for skin of every ethnicity. This new generation of foundation guarantees true-to-life shade match by working with natural undertones Booth: Crystal Salon K & L

Color-Protect Shine Infusing Hair Oil Treatment by Kiehl’s Company: L’Oréal Group Description: Each treatment infuses hair with a unique combination of lightweight oils, at least three times the concentration found in traditional leave-in conditioners, and are specifically formulated to address a particular hair concern with some of Kiehl’s efficacious natural ingredients: the hydrating and nourishing power of olive and avocado oil, a vibrancy and color boost from sunflower seed and apricot oil, as well as argan oil and sesame seeds to lock out humidity and reduce frizz Booth: Canary Salon 4

Eyecing Fatigue-Fighting Eye Cream by Freeze 24/7 Company: TPR Holdings LLC Description: Based on new technology, Eyecing heals, nourishes, revitalizes, detoxifies and moisturizes skin cells to restore a fresh, youthful appearance. This treatment battles the signs of weariness with specially formulated Hydroptix171 Youth Boosting Complex, a proprietary, time-released polymer that works to revitalize skin and reduce the appearance of fine lines, puffiness, bags and dark circles around the eye area. Hydroptix-171 Youth Boosting Complex features Peptide 171, used here for the first time ever in skincare Booth: 1515

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Suncare Report Dermatologist Solutions Super Fluid UV Defense SPF 50+ by Kiehl’s

Beauty on the outside

tendencies of environmental pollutants and help prevent premature aging of the skin,” Perez says. “Instantly absorbed, they give the skin a coveted glow.” BY HIBAH NOOR The three key products in the range—Sun Protection Emulsion for the face, Sun Protection Body Lotion and Ultra Protection Stick Eye - Lip (SPF 30) - Nose (SPF 40) include filters that protect against damaging UVA and Skincare specialists work to turn the tables in UVB rays. La Prairie says that detoxifying anti-oxidants form a second line of defense. favor of healthy, science-based protection Additional sea-sourced minerals moisturize and or years, skincare specialists have been combating a widen- nourish the skin. The anti-oxidants in Sun Protection Emuling range of environmental factors that combine to assault the skin and age it prematurely. It’s been a back and forth sion are derived from the red algae porphyra battle, and companies rely more and more on complex sci- umbilicalis. This product also possesses antientific research to help formulate advanced products. aging agents and a blend of emollients that La Consumers are now looking to skincare that can roll back the clock Prairie says keeps skin moisturized and enhances on aging and preserve the skin’s youthful appearance. As in any mar- its barrier function. The product “lightly and ket, the fatal mistake is to stand still—a truth that applies even more invisibly covers those often-neglected areas— today as climate change accelerates and environmental toxins increas- including the ear lobes—with a protective barrier that keeps harmful UVA and UVB rays out ingly threaten skin’s health. Here are a few of the skincare specialists who are in the fight for and beneficial moisture in,” La Prairie says. the long term, as their new products and market strategies illustrate. “This sleek, portable swivel-stick is something you’ll want to have with you at all times for frequent touch-ups to guard against environmental damage.” Soothing After Sun Mist Face - Body and Gradual Tanning Lotion Face - Body round out the Soleil Suisse Sun Defense Système range. La Prairie’s new Soleil Suisse Sun Defense Système has been formu- Soothing After Sun Mist Face - Body is designed for sun-parched skin lated to fight the skin-aging effects of sunlight, environmental con- and contains minerals and botanical extracts. “This gentle mist helps ditions and other factors. Based on the company’s biotechnology restore the skin’s equilibrium, while instantly diminishing redness and research, the five-product range constitutes what La Prairie calls “a calming irritability,” La Prairie says. “Its action is enhanced by boernew lifestyle of protective skincare for both women and men,” with havia diffusa root extract, which relieves the skin’s sensitivity.” Gradual Tanning Lotion Face - Body is a self-tanning agent that sunscreen, anti-oxidants, moisturizers, earth- and sea-derived elements, La Prairie says is designed to produce an authentic tan while acting along with La Prairie’s proprietary Cellular Complex. Put together, these products go beyond providing exceptional pro- safely and naturally. The dihydroxyacetone (DHA) self-tanning agent tection, according to Lola Perez, General Manager Travel Retail reacts with the amino acids in the upper layer of the skin, with its selfAmericas for La Prairie. “They also effectively neutralize the toxic tanning action becoming visible after about two hours. A second selftanning agent, erythrulose, complements the effect of La Prairie’s new DHA to produce a long-lasting uniform tone, totally Soleil Suisse Sun Defense Système free of streaking, La Prairie says. Designed for daily yearround use, Gradual Tanning Lotion Face - Body also provides mineral-enriched hydration, and soothes and softens the skin while protecting it against environmental stressors. The Americas is still a relatively small market for luxury suncare products, Perez says, but awareness of skincare is building, which is a positive lead for La Prairie’s products that combine skincare and suncare. La Prairie’s suncare sales are strongest in Argentina and Uruguay, where tanning is very popular. At the same time, customers there and elsewhere want to keep skin looking youthful and protect it from damaging external factors, which places them in La Prairie’s sweet spot. On the promotional side, La Prairie is offering a suncare “Refresh Bag,” which customers can use to take sun and skincare products to the beach. “The bag is insulated, so it protects your products from getting too much heat from the sun,” Perez says.

La Prairie’s new protective lifestyle

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Waterwhite Advanced Brightening range by H2O

H2O Plus: the brighter the better H2O Plus has recently released Waterwhite Advanced Brightening Hydrator Lotion SPF 30 into the suncare market. The product is designed to hydrate and protect skin while diminishing visible signs of discoloration caused by sun exposure, says Anna Kaplan, H2O’s Plus Senior Product Development Manager. The product features broadspectrum UVA/UVB protection and an oil-free moisturization. Kaplan says that the product’s competitive differentiators include H2O Plus’s Marine Brightening technology, based on knotted sea kelp and Asian plant extracts, which diminish discoloration and enhance luminosity, and its marine botanicals, which contribute vitamins that nourish, smooth and hydrate the skin. One market change in the Americas, Kaplan says, is the release by the US Food and Drug Administration (FDA) of new sunscreen rules for labeling. The new changes go into effect next summer, and are designed to provide the consumer with more information, in particular about the importance of both UVA and UVB protection. “Sales of sunscreen have evened out across the Americas,” Kaplan says. “As consumers become better versed in the dangers of the sun and skin cancer and understand the power of anti-aging prevention, SPF has become a staple product in the majority of women's beauty regimens.” She adds that users don’t have to live in sunny climates to appreciate the importance and benefits of shielding the skin from UVA/UVB rays.

Science is the key for Kiehl’s The Kiehl’s Travel Retail Americas division, based in Miami is currently focusing its suncare efforts on its Dermatologist Solutions Super Fluide UV Defense SPF 50+, says Division Manager Gabriela Rodriguez. The product has become a must-have since it was launched in 2010, she says. “This is everything you want in a sunscreen: strong protection against both UVA & UVB rays and a long lasting wear,” Rodriguez says. It is also conspicuously lacking in non-desirables such as a chemical smell or the clichéd thick white goop in the mirror, she adds. “Its ultra-lightweight formula is oil free and goes on flawlessly under makeup or moisturizers. Our Super Fluide formula prevents up to 90% of skin aging, including lines and wrinkles, uneven texture and tone, breakdown of collagen and elastin, and brown spots.” Product differentiators include advanced skincare patents—some of the most advanced on the market, according to Rodriguez. “Super

Fluide UV Defense benefits from our patented photo-stabilized technology to protect your skin from the sun. When applied on the face the skin has a barrier against both the skin-aging UVA rays and the skin-burning UVB rays. Its texture is an absolute delight for all of us that remember putting on traditional sunscreens in the past.” Rodriguez says that more and more customers in the Americas are aware of the importance of suncare, and that Kiehl’s tries to boost that growing awareness by educating its skincare consultation customers about the danger of unprotected sun exposure. “The advantages are immense and the consequences dramatic for those that choose not to wear any sun protection, so we want to make sure that all Kiehl’s customers have the benefit of this information.” A significant portion of suncare sales for Kiehl’s comes from places you’d expect, like Hawaii and Mexico, but the company is also experiencing a sales increase across the US in locations such as Atlanta and San Francisco that aren’t necessarily known for sunny weather. This indicates a general increase in awareness about the importance of using sunscreen, Rodriguez says. Travelers are above all looking for expertise, Rodriguez says. “They want sunscreen that works from a company they trust. Kiehl’s has had 160 years of experience developing the most efficacious formulas and we include only the finest ingredients. Our Dermatologist Solutions Super Fluide UV Defense SPF 50+ is – as the name implies – formulated and tested by dermatologists, and is safe for sensitive skin.” When asked what promotional activities Kiehl’s undertakes, Rodriguez’s reply is straightforward. “What more incentive could you need to buy suncare than the many years of beautiful skin that you’ll enjoy? We believe that a broad-spectrum sunscreen is not only vital but a crucial aspect of your daily skincare routine, and thus it’s one of our Healthy Skin Essentials, which is a trio of powerpacked skincare products that we promote year round to all c of our customers.”

L’Occitane

The southern L’Occitane launches new haircare range, relaunches two skincare products BY HIBAH NOOR

touch

kincare specialist L’Occitane was founded in Provence in 1976 by Olivier Baussan. Inspired by the cultures of the Mediterranean, Baussan focused on developing natural products and fragrances with a strong aesthetic appeal to the customer. Today the company has more than 1,500 boutiques around the world. The company’s approach is to combine nature and research, following the principles of phytotherapy, and at the same time to make its products while fostering the handing down of culture and local know-how, respect for people and the environment. The company creates patented natural complexes and tests the effectiveness and tolerance of its formulas under medical supervision. “For over 30 years, L’Occitane has used essential oils, which penetrate hair fibers easily and deliver nutrients that are essential for the hair’s health and vitality,” says Maria Carolina Villanueva, Trade Marketing Specialist, L’Occitane Americas Export & Travel Retail. “We already have a repairing line and a volumizing line in travel retail, but we know there is a need for colored hair.” Coming up in August is the rollout of L’Occitane’s Radiance & Colour Care Collection, based on the premise that colortreated hair is more vulnerable than natural, untreated hair and requires special care. With every wash, color tends to fade and lose intensity. One of L’Occitane’s strengths has always been the use of essential oils, which penetrate hair fibers easily and deliver nutrients to improve the hair’s health and vitality.

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The Radiance & Colour Care Collection is available in 250 mL shampoo, 250 mL conditioner and a 250 mL mask. The company says that the range is based on a complex of five essential oils, each with distinct properties: • geranium – regeneration • palmarosa – aids microcirculation • bergamot – invigorates • rosemary – stimulates the scalp • cedar – energizes The three key product elements, L’Occitane says, are a sulphate-free formula that cleanses the hair, a UV screen to protect hair color from the sun, and grape seed extracts, which are naturally rich in antioxidants. L’Occitane has also relaunched its Shea Butter face care range. The update includes a new shea concentrate and a complex of natural sugars, both of which work to protect and nourish normal to very dry skin. Villanueva Shampoo from L’Occitane’s new says the key difference Radiance & Colour with the relaunched Care Collection product is the fact that it features an outstandingly high concentration of shea without impairing the product’s comfortable texture. “A combination of natural sugars reinforces the skin’s ecosystem by protecting and stimulating the cutaneous flora which acts as a natural defense system,” Villanueva says. “The skin’s defense mechanisms are strengthened; it is more resilient and better protected.” Villanueva adds that the product gives normal to dry skin a visibly strengthened appearance. The Shea Butter product had its genesis in the early 1980s, when L’Occitane launched a sustainable joint-development project with the women of Burkina Faso. The project started with 10 women, who gathered shea nuts and produced shea butter, and has since grown to more L’Occitane than 12,000, who provided relaunches its Shea Butter face 380 tons of shea butter in care range this year 2010.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

L’Occitane’s moisturizing cream from the Immortelle Brightening range

The Immortelle Brightening range has also been relaunched. The relaunch incorporates the original Corsican-derived flower Immortelle (xeranthemum) and bellis perennis – better known as the daisy – which was present in the original product and evens out skin tone by acting on the three key steps in melanin synthesis. The relaunch has added garden nasturtium extract, which improves the skin’s ability to reflect light, enhancing the complexion. “The two formulas work together in synergy, providing triple action to correct wrinkles, reduce dark spots and brighten the complexion,” Villanueva says. She adds that in vitro tests demonstrate that the new formula provides a further 25% reduction in dark spots, a further 28% improvement in skin firmness and a further 40% reduction in wrinkles over the original c product.

Worldclassbrands Worldclassbrands will be showcasing its newest addition, UK’s Rotary Watches during IAADFS

Class to the core

L JOIA De Majorca is Worldclassbrands’ own house brand and is carried aboard 38 major airlines and in more than 200 duty free stores worldwide

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Duty free specialist Worldclassbrands unveils new watch, jewelry lines in run-up to this year’s IAADFS BY

HIBAH NOOR

enny Di Cristafano, President of Worldclassbrands has unveiled the company’s latest brands and product lines, which will be on display at IAADFS 2012 in Orlando, Florida in March. The agent for luxury brands including Bulova, Crislu, Festina and Chamilia does business in more than 400 travel retail and duty free locations around the world, in addition to inflight sales aboard more than 50 major airlines. It also serves cruise lines and the diplomatic and special services markets. Worldclassbrands is now more than 20 years old. “Our latest addition is Rotary Watches from the UK, which we are launching at IAADFS,” Di Cristafano says. “The major attribute of the collections is high quality and top value.” The collection features Swiss and non-Swiss watches in a variety of series. The Evolution series comprises reversible watches for men and women, with a design that accents the straps. The series also features a range of mens’ and women’s bracelets. Alongside Evolution, Rotary also offers an ultra-thin group of watches for men and women, and the Aquaspeed sports watch collection offered in chronographs, again in Swiss and non-Swiss models. Also on offer from Rotary are “Les Originales,” which Di Cristafano says are “unique in their contemporary updated look for the person who wants to be smart but not trendy.” Finally, the Rotary Timepieces series, which range from US$160 to $495 with dress and sport models for men and women. Di Cristafano expects this range to do very well in duty free. Rotary was founded in Switzerland in 1895 and remains a family-owned business to this day. Worldclassbrands is entering its second year as agent for Hamlin Ultra Thin Watches, and is presenting the brand’s new ultra-thin and sport entries, which have already gained significant market traction in the Americas as well as globally. On other fronts, Di Cristafano notes that Chamilia’s beaded concepts continue to perform well in the duty free market, being especially well suited for gifting. The beaded range includes the Terrazzo series of beaded necklaces and bracelets, and the themed Treasure bead series. JOIA De Majorca, Worldclassbrands’ own house brand, is carried aboard 38 major airlines and in more than 200 duty free stores worldwide. While the brand shares its parent’s Illinois home base, its heart lies with the organic man-made pearls that are crafted in the town of Manacor on the Spanish isle Majorca. The design team has a mandate to introduce three new collections every year. The brand has recently reinforced its pendant offerings, Di Cristafano says, hoping to benefit from a surge in the pendant category in duty free, where the brand’s Diamond and Soft as Silk ranges are already especially strong performers. Crislu, another of the company’s stalwarts, specializes in cubic zirconia jewelry and is the only branded CZ jewelry collection, according to Di Cristofano. Crislu is now rolling out branded corners in the duty free market. The Officina Bernardi jewelry brand from Italy was taken on last year and continues to enjoy high acceptance, Di Cristafano says. And Festina, which occupies the niche watch category, is maintaining its strong global presence. Festina specializes in chronographs, including a Chrono Bike series that references Festina’s role as official timekeeper for the Tour de France, the Tour de Suisse and the Tour of Poland (“La Vuelta”). Festina was founded c in Switzerland in 1902.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Accessory News

Maille timepiece by EQUSS

The jewel in the crown The New Year kicks off with fresh collections and new developments

HIBAH NOOR

EQUSS enters the Americas with strong sales Australian fashion and accessory company EQUSS is continuing to accelerate its recent entry into Americas duty free, which began with the distributorship agreement concluded last year with Horizon International Duty Free. There are several listings under negotiation throughout the region, says Alex Chaves, Managing Director of EQUSS. Chaves notes that EQUSS already touched down in the Americas thanks to an agreement with Mannah Duty Free in Ciudad del Este in Paraguay. Sales of products such as the three-zone Horaria watch and the new Maille watch collection are doing well, Chaves says. “We are very confident that we will keep increasing our footprint in the

Americas market, as our products are made to fit its needs.” The Maille timepiece features a slim stainless steel watch case and leather strip trimmed with checked stitches. A touchstone of the collection is the EQUSS logo charm that hangs under the watch case and adds a feminine touch. Maille offers Japan movement, is water resistant to 5ATM, and comes with a one-year international warranty. In addition to breaking into the Americas, EQUSS has announced the opening of its new concept store at the Muscat International Airport in Oman. The new store is located at the departures area after immigration. To celebrate the opening, a crystal heart-shape pendant will be given to customers who purchase any item at the shop.

Swarovski rolls out Crystal Forest in Americas airport duty free Swarovski has highlighted its successful Crystal Forest concept in a shop in shop, which had its first airport travel retail launch in the Caribbean and Latin America with Dufry at Puerto Rico International Airport. The corner covers 11.5 square meters at the busiest airport in the Caribbean. “Swarovski is rolling out its new-image Crystal Forest worldwide,” says Nelson Rivera, Swarovski’s Senior Sales Manager for the Caribbean and Mexico Travel Retail. The new architectural concept features a distinctive facade and branding, conveyed through crystal applications such as the swan icon, crystal columns, chrysalis special art pieces, crystal strands and more. Swarovski opened a 40 square meter corner at Gold Coin Jewelers in Philipsburg, St. Maarten last November, and more are on the way. “We’ll be opening a new corner at the Santo Domingo Airport next month,” Rivera says. “We will also be

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opening this season a huge corner with Dufry at Terminal 1 in the Main Boulevard at Mexico City International Airport.” Also on tap for this spring are stand alone stores in Agora Mall in Santo Domingo, and in Cozumel’s Royal Village this April. Swarovski will be doubling the size of its successful boutique in partnership with Island Companies in Grand Cayman. The Caribbean and Mexican travel retail markets are performing well for Swarovski’s fashion jewelry, posting double digit growth in 2011, Rivera says. Swarovski hopes to maintain the momentum generated by the Crystal Forest concept. “The Caribbean has 10 partner boutiques. The boutique in Puerto Rico is managed by Swarovski North America. The new partner boutique at the Hard Rock Hotel in Punta Cana that opened last May surpassed our sales expectations,” adds Rivera.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Swarovski’s display in Puerto Rico International Airport

LIGHTEST STRONGEST NEWEST VISIT US AT THE 2012 IAADFS Duty Free Show of the Americas ORLANDO WORLD CENTER MARRIOTT 11TH-14TH March, Booth 1231

THE MARK OF A TRUE LEADER IS ONGOING INNOVATION Tumi continues its legacy of innovation and technological advancement by offering unparalleled protection and durability in exceptionally lightweight designs. Tumi introduced military-spec ballistic nylon as a luggage fabric over 30 years ago and foreve r changed the travel goods indus try. To oday with TEGRA- LITE™, Tu m i once a g a i n uses advanced “ballistics” materials in new ways to create travel designs that offer the ultimate i n p ro te c t i o n , y e t a re significantly lighter than similar products. TEGRA- LITE™ is made from Tegris™, a revolutionary polypropylene thermoplastic composite material created by Milliken & Company for use in lifesaving armor,, NASCAR race cars and protective gear for NFL players. Tegris™ is exclusive to Tumi for travel and accessory products around the world.

©TUMI, INC. 2012

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ULTRA-PROTECTIVE BUMPER GUARDS Strengthens structural integrity with continuous casing inspired by automotive bumpers

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ULTRA LIGHTWEIGHT | SUPERIOR IMPACT RESISTANT EASY MANEUVERABILITY | SOPHISTICATED STYLE

Sector USA

Black Eagle watch with black and yellow accents

A statement in time BY

HIBAH NOOR

Sector introduces new spokesperson and launches initiative in duty free

ounded almost 40 years ago in Milan, Sector is a global watch brand whose products are designed to bring Italian style to the performance watch category. Sector features a collection of sport, technical and functional timepieces for a customer category defined as “the fashionconscious individual who leads a ‘no limits’ lifestyle.” Design hallmarks range from oversized cases with dials in a spectrum of colors to stainless steel designs. Sector recently named NBA star Kris Humphries as its new spokesperson. “As a fashion savvy professional athlete, Humphries is a natural fit for Sector, which has brought the sports-meets-fashion trend to the accessories market,” the company said in making the announcement. “The Sector brand has always been associated with world-class athletes involved in challenging sports,” said Phil Schwetz, President of Sector USA. “As both an elite athlete and a trendsetter off the court, Kris embodies our brand and its customers. Sector has a ‘no limits’ motto and I always tell people, watch Kris –he attacks the backboard like no one else in the league. His tenacity is the definition of ‘no limits’”. Humphries added, “I have always been a watch enthusiast, and the Sector brand represents everything I’m about—an active lifestyle, competitive spirit and striving to be the best I can be.” Earlier last year, Sector introduced its anticipated Shark Master Collection, which includes steel cases, Swiss movement and curved sapphire crystal. The company announced that a portion of the sales of the collection will benefit the Kris Humphries Foundation, an organization founded in 2007 to fight childhood obesity through creating active communities. Big black on black watches with bright stitching details have become one of the most popular accessory trends recently. Sector has positioned its Oversize range with this trend in mind, offering Oversize in Black and Oversize Dual Time. Oversize in Black is available with orange or aqua stitching. Key features include a quartz chronograph movement, a stainless steel case, a sports strap, water resistance up to 100 meters and a unique inner timing ring with additional crown for operation. Oversize Dual Time combines brown, black and silver colors and is powered with two independent quartz movements, which means that watch has two independent sub-dials for tracking time in different time zones. Both are located on the brown dial, which is accented with black shades. The Black Eagle series is designed around Sector’s eagle icon, with black and yellow accents. The stainless steel watch features quartz movement, water resistance to 50 meters, a charcoal dial, double “O” ring system and a strap composed of technical material. “There will always be new product categories that capture consumer interest, however one of the true mainstays within duty free retail remains the watch category,” says Schwetz. “New brands, new styles and new looks all infuse excitement and action within the watch category. Fashion is about keeping it new and fresh, and from Sector’s standpoint, its Italian design combined with its DNA as a true performance based sport brand continues to generate excitement and growth for the brand. A successful watch needs to have the ‘how factor’—‘how’ does it look on the wrist. Sector more than passes that test.” The economy has affected all business segments, Schwetz says, “however with travel on the rise and with the branding and unique styles that Sector offers, we’re excited about the prospects. As we’re in the process of re-introducing Sector to this territory, we’re clearly looking at duty free retail for growth in the coming years and our experience to date indicates that this will be the case.” “As someone who travels a lot, I really like the convenience of duty free shops,” Humphries told Americas Duty Free. “They’re quick, easy, the international staff is friendly c and you always get a deal.”

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

A stylish piece from Sector’s Oversize Dual Time Collection

Kris Humphries was named Sector’s brand ambassador at the company’s event sporting the Blue Tide watch from Sector's Shark Master Collection

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Swatch is introducing three golden additions to The Chrono collection

Watch Report

Growth is the

watch

word

JAMES ROSS

Opportunities are increasing in the Americas watch market, but so is the competition

t seems that the time is now for the watch business in Americas travel retail. Both retailers and suppliers have been aware of a growing interest in timepieces from consumers due to the fact that more players have been entering the field and creating choice – mostly at the lower end of the market – and because right through the financial downturn the high end market has held up well. Exports of watches and movements from the Swiss Watch Federation (see table below) show that the Americas is second only to Asian demand. In the 11 months to November export sales to the Americas grew by +16.1%, to CHF 2,372.3 million (US$2,593.1 million) compared to the same period in the year before, whereas Asia’s growth was 25.5%. The figures also show a general trend to upscaling in North America which is a mature market for watches. Here unit exports grew by 11.6% but value exports were up by 18.0% showing that average prices are increasing. In Latin America the exact opposite is true: unit exports increased by 12.5% ahead of the 10.3% seen in value sales indicating that strong emerging markets and their populations are still buying watches for their functionality rather than status or craftsmanship. Demand is therefore biggest at lower price points and the pressure on retailers is to offer brands like Timex rather than Tiffany and Misaki instead of Montblanc. According to Swatch Group in the US, demand for quality Swiss watches “grew in 2010 despite two years of global financial uncertainty” and it claims its brands gained market

share in all segments thanks to a strong focus on distribution, retail expansion and novel marketing. For example Breguet, at its top end, has sponsored the New York Philharmonic’s opening night while Omega is still reaping the rewards of being the timekeeper at the Winter Olympics in Vancouver that year. What does all this mean for the duty free channel? Both northern and southern sides of the Americas are developing at different paces, in price terms, due to the different maturities of their respective traveling consumers but, in both cases, sales are rising in the relevant segments that attract these travelers, not least from Brazil. So while the high-end business has scope for further development in North America, the opportunity across the region as a whole is at price positions below that – and this is where most newcomers are coming in. The Swiss watch figures also indicate that while Latin markets are growing fast in general, in the watch business the region only produces one third of the sales of its northern counterpart which means there are opportunities to take advantage of this developing consumer market. One newcomer to travel retail is Ice-Watch which has made good headway. Its colorful watches make an immediate statement and their pricing is accessible. At Kronos America, the brand’s exclusive distributor in the US and all Americas duty free markets including the Caribbean, President Christian Jamin says: “The watch category has continued to grow significantly throughout the Americas. The Caribbean remains very strong for recognized,

Regional Americas watch sales Jan-Nov 2010 vs 2011 (in CHF*) 2011

2010

Change 11 vs 10

Unit sales

Value in CHF

Unit sales

Value in CHF

Units

Value

North America

3,429,753

1,820,239,712

3,074,590

1,542,002,910

+11.6%

+18.0%

Latin America

1,303,703

552,096,776

1158,741

500,637,070

+12.5%

+10.3%

Total Americas

4,733,456

2,372,336,488

4,233,331

2,042,639,980

+11.8%

+16.1%

* 1 CHF = 1.088 USD at Feb 1, 2012

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Source: Federation of the Swiss Watch Industry

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

All of Fossil’s brands performed well but some of the highlights included Michael Kors, Diesel and, of course, Fossil watches

international brands because it is a destination for international tourists. Brazil enjoyed substantial business due to its favorable exchange rate which has increased purchasing power and drawn domestic consumers into duty free shops. Neighbouring Paraguay also experienced positive growth due to Brazilian consumers.” Border duty-free retailer, Shopping China, which has four locations on Brazil’s borders, says that Tommy watches, made by Movado Group, have been among its biggest sellers across all departments. Other fashion Tomato and grape are new colors from IceWatch for winter 2011-2012

Hour Passion's most recent shop opening at Venice airport Adding sparkle - Stone Sili Black from Ice-Watch

designer watches such as Guess, made by Callanen International, a subsidiary of Timex, and ck Calvin Klein, made by Swatch Group, all have potential in duty free in Latin markets where international fashion brands have strong appeal. Fossil, too, has made some strong gains in its watch business which includes a number of licensed brands. Fossil Inc Travel Retail Division Director Diane Harrington says: “We had a very strong watch year in travel retail. All of our brands performed well but some of the highlights included Michael Kors, Diesel and, of course, Fossil watches. Although we experienced much growth overall, our biggest increases were in Latin America and the Caribbean.” UK-based Scorpio Distributors is now developing the Americas duty free market having seen its Aviator and Avalanche brands do well globally: the Middle East and Europe both showed the best growth year-on-year, with Asia close behind. Aviator offers value by mixing good design with a high specification for the price while Avalanche fills the current demand for inexpensive colorful, trendy watches. Director of Travel Retail Sales Garry Stoner says: “The Americas is a development region

High tech Aviator from Scorpio

When will Tech-Airport enter the US? Tech-Airport, the retail division of Swatch formed in 2004, has yet to enter the Americas market under its Hour Passion multi-brand fascia – which might seem surprising given that the region includes ones of the fastest developing emerging duty free market in the world (Brazil), and one of the top three global markets in the channel (the US). The company also has subsidiaries in Brazil, Canada, Mexico, Panama and the US so it is not short on local expertise. Swatch says it does not comment on its regional development plans but it is likely that the company is biding its time for the right locations in the Americas. So far Hour Passion has opened in eight European airports in France, Switzerland, Ireland and Germany, with a total of 19 global locations up to the end of last year. Tech-Airport, which also operates mono-branded Swatch and Omega stores at airports, says it will have a network of 40 sales outlets by the end of 2012 which should mean the possibility of some non-European western hemisphere airport expansion. The hold up may be the airports themselves. Nayla Hayek, the Chair of Swatch Group has referred to TechAirport’s expansion within “worldclass airports” which might suggest slow progress in the Americas where the words world-class and airports are rarely heard in the same sentence. By Skytrax’s star rankings just two airports make its 3-star list; Atlanta and Houston George Bush, both of which have low international passenger traffic. And even airport group ACI’s last published ASQ awards did not give any big Americas international airports recognition except Vancouver in Canada.

for these brands; over the past 12 to 18 months we have started to introduce them into the market and, after some successful initial trials, we are using this year’s IAADFS to launch both brands to all markets in the region, supported by new point of sale merchandising units and many new styles.” Supplier views on what’s driving purchasing naturally vary, but one thing they agree on is brand. Harrington says: “The customer is looking for what’s new and exciting. It’s all about the brand and the styling.” Kronos’ Jamin adds: “In today’s smart phone, digital age, watches are no longer needed for checking the time. They are fashion accessories of self expression, and status symbols so, more than ever, brands are focusing on bright colors, materials and designs.” He argues this is the reason sales of fashion watches, specifically reasonably-priced brands below US$300, are driving today’s market. “For example, the Sili Collection from Ice-Watch in a multitude of different colors and priced at US$110 continues to be

our best selling collection,” Jamin says. Despite travel retail’s reputation as a highend channel, value certainly sells. Scorpio’s Aviator for example, is exclusive to duty free which means shoppers are picking it out based on the value for money they get on its design and specification in relation to branded competitors. Its Avalanche lines are often accompanied by a GWP – another carrot that the company seems to dangle with success. Looking ahead, there seems little that can interrupt the growth of the watch market. Individual segments may suffer if the pressure on price does not ease up and if more brands continue to enter the channel, but the category’s overall sales are set to rise. Stoner points out that in some cases “stores are becoming over ranged, which looks messy and confusing and could turn potential buyers off making a purchase”, while the economy of the US has also made other suppliers twitchy. On the whole, however, they are positive and optimist that watch brands have c a good time coming to them.

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

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Sunglass Report

Shades of

success

The Americas is a natural marketplace for the sunglasses sector. Americas Duty Free takes a closer look at its fortunes BY

JAMES ROSS

Brazilian tourism wave has been lapping the shores of the US and the entire South America region for some time now thanks to the strength of the country’s currency, the Real, whose value against the US dollar has risen by more than 35% since December 2008. Its effect has been profound for the duty free and travel retail business, which has been buoyed by the extra spending this shopping-addicted nation has brought. For sunglasses, it has also been good news. Traveling Brazilians are lovers of shades as part of their lifestyle and these accessories are considered an essential part of their traveling repertoire. At Latin American border duty free operators the trend for buying more sunglasses has been evident in the previous 12 months. Felix Lugo from Shopping China, which operates four locations on Brazil’s borders, says: “The sunglasses department has had a very good performance in our stores in 2011, Ray-Ban particularly.” At each of Shopping China’s locations 90% of clients are Brazilian, with the rest divided among Argentinians, Uruguayans, Bolivians, and Paraguayans. Lugo says that one of the key factors in encouraging a sale to travelers is “a spacious and pleasant place in which to make their purchases” as well as strong marketing and promotions. Leading the charge for better in-store environments has been Luxottica, the leading supplier in the duty free market and the owner of Ray-Ban. In the Americas, the company has been busy upgrading and revamping a number of its top sales locations such as Brazil’s São Paolo-Guarulhos Airport, Buenos Aires Ezeiza Airport in Argentina and Punta del Este Airport in Uruguay which, last year, led to initial sales and volume uplifts in the region of 90% to 107%. Luxottica – whose owned and licensed brands include Burberry, Chanel, Dolce & Gabbana, Donna Karan, Oakley, Polo Ralph Lauren, Prada, Tiffany and Versace – has been heavily championing category management in travel retail. At last year’s TFWA show at Cannes the company added an awards scheme at its Category Management Workshop for the first time with five awards including best in-store environment and sunglasses retailer of the year. However, other Americas retailers and locations were notable for their absence from the other four shortlists which suggests they might have some work to do to get their standards up to those in other regions. Suppliers admit there is still more to be done. Marcolin USA Travel Retail/Duty Free Sales Manager Marco Lares says: “Overall there is a tremendous improvement in dutyfree sunglasses retailing;

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Marcolin is concentrating its efforts on a few but strongly recognized brands such as Diesel, Swarovski, Tod’s, Cavalli, Dsquared² and Tom Ford

from product selection, display, pricing, availability, and knowledge of the collections. But there is still room for improvement as we continue to see the channel as a natural choice for our category.” At Maui Jim, Travel Retail Director Giles Marks adds: “There is always more to be done, but I strongly believe the category will continue with its record-breaking performance. Statistically, we know it is enjoying a very high global growth rate in travel retail – and the Americas are no different.” Up until now, the polarizing brand has focused on major airport locations, but Marks says that its additional presence on cruise ships has helped boost its overall success. South America-based B+D, whose niche is design, believes in-store improvements are tangible. B+D Marketing Executive Candelaria Pourtalé says: “There is no doubt that the duty-free sunglasses category has improved throughout the region; you now see a vast array of designs in line with market trends in almost every store. The floor areas dedicated to eyewear are expanding and there has C O N T I N U E D O N PA G E 1 3 8

Sunglass Report

Luxottica has been heavily championing category management in travel retail

C O N T I N U E D F R O M PA G E 1 3 6

been an increase in the number of special eyewear sections within many duty free shops in the past 12 months.” B+D launches a new collection and campaign every year to meet the changing needs of its consumers and at the IAADFS Orlando show it will unveil its new XTND Stay on, an item it claims “will surprise all the attendees”. This year’s sunglasses collection will also take the consumer back to the origins of retro style mixed with sophistication and glamour according to Pourtalé. All round, 2011 was a strong year for suppliers. Maui Jim’s travel retail sales surged by double digits in both airport locations and on cruise ships while Marcolin saw “exceptional” performance in the fashion/luxury category with Tom Ford and Roberto Cavalli leading its sales in this segment. “Overall, the Latin American and Caribbean region had the best growth due to the high name recognition of these collections,” says Lares. A hard-to-miss B+D sales unit with Dufry

B+D’s dual offer of readers and sunglasses gives it a special synergy, it believes, which helps drive purchase. “In the Americas our brand is very well positioned and we know that the customer values our design concept,” says Pourtalé. “We have seen good growth in almost every outlet where we are selling our eyewear and we feel that growth is fairly constant in all market segments and at all price points. Consumers realize that travel retail stores are great places to buy eyewear and operators are now giving them a wide selection of brands to choose from.” The overall strength of the Americas market makes it a target for newcomers, not least because of its vast size. Polaroid for example – currently in the process of being bought for US$87.5 million by Italain eyewear giant Safilo – is believed to be assessing it now. “The Americas is an area that we don’t have much business in, but there are huge opportunities, and we just need the manpower to be able to develop there,” says Polaroid Eyewear Global Travel Retail Manager Rebecca Harwood Lincoln. “It will be a key market that will be targeted over the coming years.” Safilo, which is represented in Americas travel retail by Travel Traders Inc, is reticent to talk about its duty free business. In the over138

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

all eyewear market it has been losing ground to Luxottica in recent years and in duty free it is understood to be the same. Safilo’s ninemonth sales for 2011 grew by 1.9% (6.7% at constant currency) to €833.5 million (US$1,088 million) whereas its larger rival saw sales increase by 5.9% (9.6% at constant currency) to €4,713 million (US$6,157 million). Five years ago the companies were closer in size, with Safilo turning over €1,122 million (US$1,465 million) in 2006 compared with Luxottica’s €4,676 million (US$6,109 million). Safilo will also lose its licensing agreement to make Giorgio Armani eyewear at the end of this year – to rival Luxottica. Sales from this licence accounted for a hefty €125 million (US$163 million) of its €833.5 million (US$1,088 million) nine-month sales last year. Safilo retains some strong proprietary brands including Safilo and Carrera, and still has big designer names such as Alexander McQueen, Boss Black, Boss Orange, Dior, Gucci, Jimmy Choo, Marc Jacobs, Tommy Hilfiger and Yves Saint Laurent – a stable that still has potential in the Americas. And in its favor is the fact that variety and fashion brands do count in the Americas market. Marcolin’s Lares says: “We are only concentrating our efforts in a few but strongly recognized brands such as Diesel, Swarovski, Tod’s, Cavalli, Dsquared² and Tom Ford.” The company is also timing its launches across categories so that, for example, the launch of its Diesel limited edition sunglasses coincided with the Diesel Loverdose fragrance launch in Americas duty free. Marks adds: “New products are always key, but new lens technology is what consumers are looking for. Promotions for our retailers help to keep the brand exciting, but inevitably, the driving force behind growth is bringing unique, exciting sunwear to the market. We were able to do this in 2011, and we feel very confident this will continue in 2012.” Possibly the only cloud on the horizon for the individual suppliers in the category is the fiercely competitive nature of the in-store environments where brands have to fight for the limited space – and where every square centimetre counts. No doubt skilled negotiations and solid sales results c will win the day there.

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Guest Writer

Positioning your concept to the right opportunity BY

OSCAR GUZMAN

Bijoux Terner expands AdiXion, a new retail concept, to capitalize on market trends ast summer Bijoux Terner, the company that made a name for itself offering quality fashion accessories at an irresistible price, introduced AdiXion, a new concept with multiple price points. We opened our first AdiXion fashion boutique in Miami International Airport in July. Unlike our other nearly 700 locations which exclusively sold one brand at a single price, the 74 square meter AdiXion store debuted with five new brands and prices that ranged from US$20 to $50. The introduction generated buzz around the market and was an undeniable success. Today, we have agreements in place to open seven more AdiXion stores in early 2012, all in travel retail environments. AdiXion’s growth is no accident. It is the product of timing a concept carefully positioned to follow market trends. Luxury goods had long been underrepresented in duty free,

of our locations in duty free or travel retail environments, capitalizing on the growth in the luxury goods sector became a major priority. To do that, however, we needed to expand on Bijoux Terner’s traditional simpleprice-point strategy without compromising our defining principles. The result was AdiXion, a new retail concept with multiple brands, each at a different price level. With AdiXion, we took the same principles of Bijoux Terner – amazing merchandise and merchandising, incredible value and simple pricing – to the next level. In their definition of luxury goods, Generation includes fashion, jewelry, accessories, and gifts. Many of those categories are ones that we have always carried in our Bijoux Terner locations. For AdiXion, we built on our core competencies and tailored what we were already doing to a higher luxury market.

“AdiXion’s growth is no accident. It is the product of timing a concept carefully positioned to follow market trends.” Oscar Guzman, Marketing & Project Manager, Bijoux Terner but over the past few years that began to change. Generation Group, the Swedish firm that pioneered research within the duty free and travel retail industry, forecasts growth in luxury goods to outpace that in most other sectors over the next three years. Between 2010 and 2015, Generation expects that the luxury goods sector will grow nearly 10% per year. At Bijoux Terner, we have the word “luxury” right in our slogan, and, with so many 140

Each brand filled specific needs to seize specific opportunities within the trend. Each brand emphasized luxury and value, with fashion and jewelry accessories, and many had their own wonderful packaging, great for gift giving. Voux products aimed at a young and casual consumer, while another brand, Xest Jolie, included more elegant products for a more mature consumer. We introduced high-quality

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

women’s bags across several of the brands and price levels. One of the brands, Déjà Voux, even offers incredible three-piece gift sets. The multi-branded store, however, stayed true to Bijoux Terner’s simple-price concept by creating simple price points for each new brand. Positioning to the opportunity, to the trend in luxury goods, is what made the AdiXion introduction a success. With 2011 fading in the rearview mirror, companies are turning their attention to 2012 and beyond. The truth is that sometimes companies focus too much on what they do today and not on what they should be doing tomorrow. To do that, you need to look beyond the windshield at the world in front of you. At the same time, it’s important not to abandon the values and functions that make up who you are today. The trend in luxury goods was the right opportunity for Bijoux Terner. The categories within the sector are ones that we have nearly 40 years of experience with, so we knew we could leverage our core competencies to capitalize on this trend. The key lesson of AdiXion then is to position your concept not just to any opportunity, but to the right opportunity. So keep looking forward for your right opportunity, and if you find it at the right time, don’t c forget to position yourself to seize it.

Introducing

BLOOMINGDALE’S

MACY’S

INFO@MICHELGERMAIN.COM

LeSportsac

The

prints of style

LeSportsac rolls out BY HIBAH NOOR new designs for spring, featuring designs by illustrator Kate Sutton

he vintage look is big in bags these days, says a spokesperson for American fashion handbag brand LeSportsac. For leather bags in particular, the vintage-look color and style constitute a major trend, one that the company has developed with cotton ripstop and the photo-real technique. “The LeSportsac mission is to be a ‘fun’ brand that brightens up people’s daily lives,” the spokesperson says. “We always offer fashionable but high quality and functional products—lightweight, durable, hand-washable, foldable.” For duty free, where quick, impulse purchases are the norm, the spokesperson singles out the brand’s eye-catching, quickly recognizable prints, functionality, high quality and affordability. “The prints are different and we do add new styles, but we keep the main styles the same, so those who already know LeSportsac can make a quick purchase if they just like the print.” In Americas duty free, the Classic Hobo shoulder bag, Weekenders gym or travel bag, backpacks, rectangular cosmetics pouches and Kasey crossbody bag are current best sellers. The fact that LeSportsac offers new prints every month is a key differentiator, as are the brand’s limited edition collections which are always running concurrently with the main line. “The brand’s eye-catching colors and fun prints coupled with its utilitarian functionality typically have strong full-price sell-through,” the spokesperson says. LeSportsac has revamped its Artist in Residence collection for 2012 with the introduction of designs by renowned UK illustrator Kate Sutton. The styles are proportional, webbing has been slimmed down, binding has been added and brushed bronze zippers and detailing round off each entry in the new line. With a military inspiration, each of the styles emphasizes a casual feel combined with functionality and wearability. The new collection includes backpacks, totes, crossbodys and cosmetics. The collection is being rolled out in three prints. “Garden Pals” shows a handdrawn garden party that features cats knitting outdoors, lawn-mowing bears, smiling butterflies and flowers, and vegetable gardens on a soft pink background. “Happy Campers” is a take on French toile, showing a cream background with a textured feel and depicting beavers, bears and other animals engaged in outdoor activities. “Fairground” situates the active menagerie at a county fair, with the scenes depicted against a bright blue backdrop. In addition, two placement features are available in select styles. “In the Garden” is a floral bordered placement featuring the characters from “Garden Pals” and “Fair Day”—a selection from “Fairground”—showcasing the swirl bubble blowing elephant. The collection also features the “Daisy,” “Onion” and “Strawberry” shaped pouches captured from the prints. The assortment will also include “Fennel,” a soft military green. The collection is available online (shipping available within US) at LeSportsac.com and all LeSportsac flagship boutiques worldwide as of February. (The brand is also sold in department stores and selected specialty stores.) In the Americas duty free market, LeSportsac is currently building its business in Uruguay-Brazil border shop locations such as Rivera, Chuy and Rio Branco, and is also looking to broaden its footprint in airports, especially in Brazil. “We have great presence in the travel retail market, especially in the Asia/Pacific market,” says the company spokesperson. “We are considering expanding within the Americas, using c the know-how we’ve gained from our success in the Asia/Pacific market.”

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LeSportsac has revamped its Artist in Residence collection for 2012 with the introduction of designs by renowned UK illustrator Kate Sutton

Furla

The the

new and renewed

Papermoon is aimed at the fashion-conscious buyer

HIBAH NOOR

Furla’s IAADFS debut to feature Fall/Winter 2012/2013 collection of new and reinterpreted bags

remium accessories brand Furla will be attending IAADFS for the first time this year, and will highlight its Fall/Winter 2012/2013 collection. The range is based on a “made in heart-minded Italian style” theme inspired by the slogan “Furla and I,” and offers an artistic take on the idea that every woman can find her best friend in a bag. Italian contemporary performance artist Sissi is contributing her interpretations to Furla’s advertising and marketing campaign for the collection. The theme for the new season is the latest statement of Furla’s focus on renewing tradition, and is articulated with materials and colors inspired by city living. The collection looks at four different moments of the day, constructing a narrative through various color blocks, effects and finishes. The first theme emphasizes novelty and animal prints centered on yellow, orange and pink neon colors. The second, set against a morning backdrop, utilizes “deep but cold” blue, green and turquoise, metallic finishes

and double faced materials inspired by street art, skyscrapers, neon lights, digital advertising boards and signs. The third theme, inspired by sunset colorings, works with mandarin orange, primula yellow, lipstick red, pink and purple. Glitter accents evoke ‘rockstar’ evenings spent with friends. The fourth theme—the clubbing end of the day— contrasts neutral, natural shades with warm colors and features the eccentric use of animal prints, particularly zebra, snake and leopard, playing up the clash of classic and graphic in what Furla describes as “real urban jungle style.” The themes are expressed in a range of successful carryover lines such as Piper, Piper Lux, Candy, Globetrotter and Amazzone, plus the restyled lines Urban, Cindy and Wave, in addition to seven completely new lines that have been added along with a business/travel line in nylon and leather positioned at competitive entry price points. For travel retail, particularly in the Americas, Furla is highlighting a range of lines. Papermoon is a design-driven range aimed at the fash-

“For Furla it’s all about expanding within the Americas travel retail market, and for that reason we’re exhibiting for the first time at the Duty Free Show of the Americas — which I’m very excited about.” Gerry Munday, Head of Travel Retail, Furla Candy boston bag

Beat is a reinterpretation of the classic doctor’s bag

ion-conscious buyer looking for easy-to-wear bags in new shapes. The Candy rubber and rubber/print boston bags feature red, pink and orange colors along with metallic multi-glitter combinations that recreate a nightclub effect. Tribe is an entry/mid-market range of multifunction, reversible shoppers that carries the “Furla and I” theme—Furla expects this line to do especially well in travel retail. Beat is a reinterpretation of the classic doctor’s bag into a double merino fashion statement in traditional or fashion colors with contrasting lining—lead and onyx, purple and blue, or all over onyx. The lightweight Pop line of unisex business and travel bags also includes small leather goods such as iPad covers, in blue, green, onyx, lipstick red, army green and petrol blue. For travel retail, it’s important to have the right collection, says Furla’s Head of Travel Retail Gerry Munday. “It has to be commercially viable and offer a sufficient range of styles, colors, sizes and price points to suit all buying needs and regional preferences within the sector. While we don’t—as yet—produce any lines which are exclusive to travel retail, each Furla collection more than meets these requirements.” Despite the challenging economic climate, Furla enjoyed excellent results in 2011 and is very optimistic for 2012, both globally and specifically for travel retail, Munday says. “For Furla it’s all about expanding within the Americas travel retail market, and for that reason we’re exhibiting for the first time at the Duty Free Show of the Americas—which I’m very excited about.” Shows like IAADFS play a critical role in developing the company’s relationship with suppliers, but Furla maintains close connections year-round in between the major events as well, Munday says. Furla’s IAADFS debut comes as the company announced two summer openings—at Las Vegas Airport in T3 with The Nuance Group for a 15 square meter shop in shop, and a 12 square meter zone at the Senses Duty Free downtown Galleria in Santo Domingo, c Dominican Republic.

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

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Tommy Hilfiger Group

High

HIBAH NOOR

potential

Tommy Hilfiger aims to leverage its brand awareness in the travel retail market

“W

e want to position Tommy Hilfiger as one of the leading brands in global travel retail,” says Georg Faisst, Vice President of the Tommy Hilfiger Group. “Taking the global awareness level of Tommy Hilfiger into account, we are sure that we will reach that. Also, having a look at demographics at airports, I’m convinced that there is a huge potential for an accessible premium brand like Tommy Hilfiger. Airport retail is very focused on luxury goods, and taking increasing mobility into account, there is a demand for accessible premium products at airports.” Faisst, who joined the company at the end of January after leaving Hugo Boss, defines Tommy Hilfiger as “an American classic brand with a preppy twist. The twist is one of Tommy Hilfiger’s characteristics from the point of view of the consumer, an interpretation of classic American sportswear with surprising details. The character Tommy portrayed to the consumer is youthful, confident, classic—but in a cool way.” Paramount among new developments for the brand in Americas duty free are extensions and renovations taking place in Brazil, Faisst says. In addition, Tommy Hilfiger is entering North American travel retail, with a new shop in Atlanta International Airport opening at the beginning of May. The Tommy Hilfiger branded store will cover 111 square meters and carry men’s wear, women’s wear and accessories. “In Latin America, Tommy Hilfiger is already the leader in travel retail,”

Tommy Hilfiger is defined as “an American classic brand with a preppy twist”

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Faisst says. “It is present at all major airports in South America. Our efforts now will concentrate on upgrading and extending our existing points of sale.” There are also many opportunities at international hubs in North America, Faisst adds, with Miami, New York and Los Angeles topping the list as venues for further growth. For travel retail, the focus is on easy to pick items, which Faisst says translates into higher sales of one-size products. Tommy Hilfiger is also focusing on merchandise such as polo shirts and v-neck and crew-neck sweaters. “In general, the merchandise mix is more core-driven in comparison to the domestic market,” Faisst says. “In fashion retailing you are comparing the ratio top to bottom. We also see a clear difference there. There are less bottom sales in travel retail. It is of great interest for us to analyze the data from our points of sale. This market feedback loop helps us to optimize our product mix.” The Tommy Hilfiger Spring 2012 collection “celebrates the adventure of great style,” the company says. “Prep classics are modernized through saturated colors and energized patterns. Structured, slim shapes are at home in the city, but still these clothes beg to be taken off the grid.” Classic knits and polos are rendered in colors inspired by pop art, while iconic American shapes are updated in contemporary fabrics and execution for a modern interpretation of prep. Color blocking and nautical stripes (used in a variety of ways, including as mac taping down a side seam on a pair of jeans) underscore the overall boldness of the designs. The women’s spring 2012 line is based on slim chino pants, redesigned classic striped tops and colored classic shirts. Tailored for a casual look with pant cuffs and sleeves rolled and based on bolder colors, the line includes the outdoorsy Prep Camp, the urban stylings of Prep City and the summery designs of Prep Camp. On the men’s side, the accent is on lightweight luxury warm-weather knit sweaters, classic fit shirts in a variety of patterns and colored, remastered shorts. Prep City stresses a sharp, sartorial look with a twist, Prep Weekend features weekend casuals, and Prep Camp focuses on the c same summery flavors as its counterpart on the women’s side.

LATR David Dayan: visibility and interactivity are key to building brand leadership

Parker’s partner A travel retail professional discusses his strategy for brand leadership BY ANDREW BROOKS

ver the last year, fine writing instruments maker Parker has leveraged the expertise of David Dayan, International Travel Retail Director for Parker (LATR), to shepherd its re-entry into travel retail. Parker now has its sights set on reclaiming its leadership in this market. We recently had the opportunity to speak with Dayan about LATR’s plans.

Americas Duty Free: How has 2012 started out for LATR and the work you do for Parker? David Dayan: This year is going to be a year of development and innovation. It’s been a year since Parker got back into travel retail, and we opened 125 Parker points of sale in 2011. Following a year of setting up, I wanted to make sure that Parker was well represented to all our partners, large and small, so I visited more than 40 countries to talk with them and find the best way to collaborate. I met more than 50 customers to better understand their space issues as well as the best way to present the writing instrument category. ADF: What did you find out in these meetings? DD: The writing instrument field remains an important category in term of impulse purchases. Despite the attraction of new technologies, the pen is still the gift of choice. Our strength in 2011 was the launch of Ingenuity, which is a new way of writing, an engineering feat or a “stroke of genius” you could call it, which has had huge success with consumers. In order to improve our sales, we have to be more visible and interactive. That’s why this year we’ll be setting up a lot of animations in airport locations that highlight Ingenuity. ADF: What kinds of animations will these be? DD: We’ll take spaces usually reserved for perfume to promote the Parker brand. These are principally located at the entrance of duty free shops. Our salespeople will make the events interactive, inviting passengers to try this new way of writing in a global environment that matches our image and that has been developed specifically for the event. ADF: Can you tell us what the locations will be? DD: The list for 2012 isn’t complete yet, but I can tell you airports in Jakarta, New York, Miami, London, Moscow, Gdansk, Atlanta and Asuncion have already signed up. 146

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Parker’s Ingenuity Plume—“a new way of writing” based on Parker 5th technology

ADF: Will you be introducing new products in 2012, same as in 2011? DD: Sure—but to be clear, we’ve decided to launch new products only at Cannes TFWA. Our innovations will not only be focused on products but also on our concept, which is consistently being developed for duty free. We’re working in collaboration with the Moisnard architectural office, who established the Parker duty free concept in 2010. This year we’ll be presenting new furniture which will combine luxury and accessibility with the brand colors. Our second strategy for 2012 is inflight. Given the success of Ingenuity, we have created an “Ingenuity box set,” which is used only for inflight. We also offer airlines the opportunity to list five products from our range, with different price points to match passenger demand. We’ve been approached by many airlines, and KLM has become the first in the world to present Ingenuity on board. We’ll also enlarge our range of products—in categories other than writing but staying within the travel retail environment. ADF: What’s your main goal for 2012? DD: Our partners were very glad to see the good sales Parker had in 2011. So we’ve decided to upgrade our existing locations, developing real estate that’s dedicated to the brand, like the shop-in-shop. We’ll also be building our presence in Asia and Europe. ADF: Will you be attending all the major duty free events with Parker? DD: Of course, yes! We’ll be present and visible at TFWA Singapore, Cannes and also ASUTIL and MEDFA. ADF: Are you planning any surprises like the pop-up store you did at the Palais entrance in Cannes last year? DD: We’re always trying to be original and innovative. I hope to be somewhat surprising at this year’s TFWA in Cannes—but I can’t say anything more or it won’t be a surprise! ADF: Any further comments? DD: In the next three years you won’t enter a duty free shop anyc where without seeing Parker.

May 30 - June 02 Duty Free: a waterfall of opportunities

htt p : // conferen ci a 20 12 . a suti l. org/

Writing Instruments Report

The

write stuff

The writing instruments category is expanding, thanks to some innovative new technologies and approaches

ross is among the leading brands in writing instruments, says David Ferreira, the company’s National Accounts & Travel Retail Manager. Cross has other strong categories when it comes to the travel retail market, such as reading glasses and journals, but in the US, all channels combined, Cross is number one in fine writing instruments, he says. For 2011, Cross’s sales figures are well above their pre-recession levels. Ferreira says he expects the sales numbers to keep rising through 2012, thanks to some major developments that should boost the brand’s organic sales. Overall, travel retail sales in the Americas represent 5.1% of Americas sales (2011 figures) for the company. The growth in travel retail sales continues to outpace overall growth, leading to a strong increase in travel retail’s proportion of overall sales. For Parker, which started out in travel retail two years ago, the record so far has been one of very impressive growth – the kind of growth one might not expect from a ‘newcomer.’ One year ago Parker had some 80 travel retail points of sale, and when Americas Duty Free spoke with Parker Global President Jean-Charles Hita a few weeks ago, that number was closer to 130. Within a year, Hita says, he has every reason to hope that the number will have grown to around 200. 148

Parker’s pop-up store at Cannes 2011

ANDREW BROOKS

Parker’s newly opened Saint Petersburg boutique, designed by Bruno Moinard. Illustration credit: Bruno Moinard

“By 2013 to 2015 travel retail will be among our top four market channels,” Hita says. The others include Parker’s own retail network and department stores. “When we got started again in travel retail it was about 2% of total sales. Our goal is to bring it to double digits – around 10-15%. It’s growing extremely quickly.” That growth will come from geographical expansion, particularly in Southeast Asia and Latin America, as well as entry into new sales channels, airlines in particular being a prime option. “We have rolled out our Parker 5th Technology in Saudi Airlines and JAL and we have other new airlines coming in March,” Hita says. Besides getting back into the airline business, which they were absent from for several years, Parker will be expanding its current

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

footage in duty free stores. The company has signed on for an expansion of its shop-in-shop at Miami to 11 square meters and it intends to pursue similar initiatives overseas, in Bangkok, Jakarta and Bali. For Caran d’Ache, the travel retail channel is holding steady at about 15% of total export sales (2011 figures), pretty much the same level as in the year prior, says Urs Messerli, International Duty Free Manager/Export Manager, Americas. “In 2011 we slightly exceeded sales versus 2010 in travel retail. However, we should keep in mind that in 2010, we had very strong double digit growth versus 2009. We experienced a double digit growth rate from January to March 2011 versus the same period in C O N T I N U E D O N PA G E 1 5 0

More than 60 years of experience in the Travel Retail Industry DUTY AND TAX FREE t DISTRIBUTOR t WHOLESALER t RETAILER

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Writing Instruments Report

Cross kiosk at Miami International Airport’s Terminal D

The newly launched RNX.316 pen – stainless steel version C O N T I N U E D F R O M PA G E 1 4 8

2010, but due to currency issues this growth rate slowed down during the following quarters.” Going by Generation Research’s “Best & Most” figures, Caran d’Ache occupies the number three spot in worldwide duty free distribution for the writing instruments category in inflight sales. The brand is sold aboard 15 major airlines, in addition to its presence at more than 60 international airports. For Hita at Parker, a major surprise has been that the product mix in duty free has been higher than he expected. The major component of domestic sales in the Americas, for example, comes in at around US$20$40. In travel retail Parker has been

Caran d’Ache’s 45 square meter stand at Cannes 2011

informal and children’s gift-giving categories, Messerli says. The top end includes the new RNX.316 collection (“RNX” stands for “round and hexagonal”), which had a very strong launch at Cannes last year, and the Ecridor Collection, which retails at US$150-$350. The informal gift category embraces the “849” pen sets in single or multipack variants, retailing at US$30-$100, as well as the Prismalo aquarellable pencils at US$25-$65 – this is the first water-soluble color pencil, initially launched in 1931. The company has always had a specific duty-free range of writing instruments and color products, primarily multipacks with individual gift packaging for pens and color travel gift sets tailored for children. Last year the company launched its RNX.316 collection, which has been listed for inflight sales aboard Swiss International Airlines, TAP-Portugal,

“The good news is that all regions across the world are growing.” Jean-Charles Hita, Global President, Parker selling the same lines but on higher price point finishes. “We sell a lot of our Sonnet, Urban and Parker IM lines at around US$50-$150,” Hita says. “These are exactly the same lines but with more expensive finishes. For example with our new Jotter line we do sell the plastic version in travel retail too, but most of the sales in that line are with the stainless steel finish, which is higher-end.”

There’s room at the top Also well entrenched at the high end of the market, Caran d’Ache’s top products cover off the premium, 150

Euro Atlantic Airways and STP Airways. Regionally, Europe and Asia head up Caran d’Ache’s most profitable markets, with the Americas in third spot, followed by the Middle East and Africa. Airport shops are the primary pipeline, followed by airlines, ferries and the “other shops” category, Messerli says. In the Americas, partnership with selected retailers is the key focus for the company, which is always on the lookout for prime airport locations as well as off-airport slots. For Cross, the primary sales drivers in travel retail have been readers, writing instruments and journals, Ferreira says. The strongest sales per square foot come from South America, “due to high brand recognition and savings of up

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

to 70% in some markets,” he says. Reading glasses make up to 55% of sales overall, and as much as 90% in some markets, he adds. Parker doesn’t have any products designed specifically for travel retail, because the company is still relatively new to this market. “People traveling through an airport haven’t seen our pens in an airport store before except in a very few countries,” Hita says. “That’s why we don’t need to come to this market with new products.” He says that in a few years the company probably will start tailoring its products for travel retail, but that the market shouldn’t look for anything along those lines in 2012-2013. C O N T I N U E D O N PA G E 1 5 2

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Writing Instruments Report

C O N T I N U E D F R O M PA G E 1 5 0

For Caran d’Ache, gift with purchase promotions seem to do the job very well for both the brand’s fine writing instruments and color products categories, Messerli says. And in addition to regular sales staff training – which always has a strong motivational effect in addition to its educational aspect – Caran d’Ache regularly organizes incentives for its vendors. “Consumers buy our brand because it offers true value,” Messerli says. “We’re a house of craftsmanship. We’re committed to making products that have enduring quality and our aim is to distinguish ourselves through service.” Messerli describes Caran d’Ache as the ‘Patek Philippe’ of fine writing instruments, citing values such as tradition, innovation, exclusivity, high quality (its products are 100% Swiss made and come with a lifetime guarantee), aesthetics and service.

Telling the story For Cross, a new focus on the self-serve experience is proving to be valuable in offering customers all the information and tools they

need to get what they want at the point of sale, Ferreira says. The company is also expanding on the duty paid side in the US and Canada, he adds. The focus on self service gives Cross a way to convey added product information to the interested buyer. Ferreira feels that making product information available is critical given the kind of sales cycle these products have. “As people don’t buy pens or readers every day, they aren’t very aware of the specificities of our products,” Ferreira says. “We try to show the benefits of our products at the point of sale. For our pens, we highlight the lifetime warranty, the precious materials such as gold and hand-polished lacquer. For the readers, we’ll point out things like aspheric lenses.” At Parker, trade shows have proven to be an important link to the market for Hita and his travel retail team. Last year in Cannes, he says, the company mounted a pop-up store at a high-visibility location right outside the entrance to the Palais de Festival. “We met all our customers from around the world,” Hita says. “For them it was important that Parker made a statement in Cannes. They saw us there

the year before, and they saw us in Singapore – we were able to convince them that Parker is playing for the long term in duty free.” As far as expansion goes, Hita says he knows Parker is taking market share from the competition in South and North America. “We weren’t there before,” he says. “We’re gaining their space.” In other areas, notably Southeast Asia, the company is pressing the category open, in particular with offerings like the Parker Ingenuity Collection, which displays the Parker 5th Technology. More importantly, the marque is moving up in the world. Where before Parker appeared in the stationery section or in bookstores, now it’s showing up among the more fashion-forward categories. “When we opened in Bangkok we were located with the watch brands – Breitling, Seiko, Swarovski editions,” Hita says. This year, Parker’s Americas campaign includes openings in Panama with Grupo Wisa and throughout Latin America with Dufry and Dufrital. “The future is very promising for us in this channel,” Hita says. “The good news is that all regions across c the world are growing.”

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Confectionery Report

Confectionery

conquests These top performers are upping their game in the Americas BY ANDREW BROOKS ccording to Belgian chocolate maker Neuhaus, the confectionery market is growing strongly in the Americas, posting 12% year over year growth from the first half of 2010 to the first half of 2011. The premium subcategory has played a leading role, leveraging the strong presence of US, Chinese, Brazilian and Japanese travelers. For 2012 Neuhaus outperformed the category with triple-digit growth. Amy Hildreth, ALFA Brands’ Operations Manager, agrees that the market is strong. “The confectionery category is healthy, despite other difficulties in the marketplace worldwide,” she says. “We are growing our base with new introductions and line extensions as well as organic growth through increased distribution in all market segments.” Perfetti van Melle (PVM) would be in line with the upbeat tone, having grown its volume in the Americas by almost 50% over 2010. The company’s work over the past two years to solidify and extend its distribution network in the Americas has clearly paid off, and 2012 is likely to be an excellent year throughout the hemisphere, where the company now has four skilled distributors at work, in addition to direct deliveries. So far the company deals mainly with airport and border stores, but in 2012 PVM plans to cast its

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sights wider, eyeing other channels such as cruise lines. Jacques Isler, Export Manager Travel Retail for Swiss chocolatier Chocolat Frey, says that the company is working to expand its footprint in the US, starting from its strong foothold in Florida. In South America, where the company is already well established, particularly in Argentina, Uruguay, Paraguay and Brazil, the ongoing market concentration, driven in large part by Dufry’s recent acquisitions there, is reducing the points of contact – while at the same time reducing individualization of accounts. “We’re now evaluating various partners for more travel retail channels into the US,” Isler says. “At Orlando we will work on building those relationships.” Isler is optimistic about the company’s future in travel retail, because it already commands an impressive 38% of the chocolate market in Switzerland. This gives it a brand presence that has already proven to translate well into travel retail. This is reflected in Chocolat Frey’s approach to promotions, which include price promotions and gift with purchase, but also extend to more interactive varieties such as contests and dippable chocolate fountains. For 2012, Neuhaus plans to maintain its

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

The Chocolat Frey stand at the new Nuance flagship store at Zurich Airport

Chocolat Frey continues to add to its flagship Chocobloc range

emphasis on the store-in-store concept as a brand vehicle. “Thanks to the performance of the brand in the Americas and a good understanding of the premium category by the partners of the company, Neuhaus is getting more space and the opportunity to personalize the selling environment,” the company says. The concept has proven to be adaptable, and can be expressed as a corner or as a boutique, among other formats, as a given market dictates. Neuhaus has a strong position in New York JFK International Airport, and notes the success of its recent entry into Mexico, Panama and Brazil. Other projects include further South American markets and the northwest coast of North America, where Asian consumers are a strong constituency. C O N T I N U E D O N PA G E 1 5 6

Confectionery Report

C O N T I N U E D F R O M PA G E 1 5 4

Market makers Nestlé International Travel Retail (NITR) generally takes a unified approach to travel retail, but is also very much aware of regional specificities that need to be addressed. So travel retail as a whole represents a very distinct market, and NITR leverages the difference. In the run-up to Cannes last year, NITR revealed that it anticipated the following key drivers would play a stronger role in worldwide travel retail for 2012: ■ healthy consumption and reduced indulgence; ■ premiumization; ■ demand for increased value and more affordable product; ■ sustainability and corporate social responsibility; ■ gifting and sharing formats; ■ adapted formats and packaging for busy lifestyles/convenience; and ■ a continued increase in the number of BRIC – and particularly Chinese – travelers in travel retail. NITR anticipates a growing demand for premium gifts and convenience/on the go snacking and sharing products. For 2012 the company will focus on the launch of its new Nestlé Swiss Premium range. At IAADFS it will showcase its new travel retail exclusive collection, consisting of multiple new products in different sales-driving business categories such as premium gifting, snacking and sharing, and family gifting. For ALFA Brands, the focus is primarily

ALFA’s Jelly Belly travel grouping

within North America, with some presence in Mexico and the Caribbean. For most of 2011 the higher Canadian dollar had a negative effect on the northern border business, according to Hildreth. “Most of the consumers buying at the border stores are Canadians who tend to spend less overall than Americans,” she says, “and confectionery and food product sales have been affected accordingly.” As a related phenomenon, the market from ALFA’s point of view is increasingly price sensitive and more and more geared toward personal consumption. “Consumers crossing the border usually have other passengers in their vehicles and they are looking for items to share with them,” Hildreth says. “Therefore they prefer larger resealable bags that have a perceived higher value. They are also looking for items that are ‘healthier’ and more wholesome.” To serve its Canadian core, ALFA has

NITR’s CTP cross-category queuing system is one element of the Perfect Store concept

New snacks have been introduced in the King Henry’s All Natural line

opened a new distribution center near Toronto’s Pearson International Airport, and is establishing strategic alliances to boost product distribution into the US. “We are also capitalizing on opportunities to build brand-identified fixtures as we have done with Saveria at New York JFK and we are doing with International Shoppes at Boston Logan,” Hildreth says. Chocolat Frey’s best sellers are its Chocobloc range and its 300g chocolate tablets for everyday consumption. These will be headliners at IAADFS, along with a new 5X100g assortment pack that displays one of every Chocobloc variety. “People are looking for the whole range, from luxury products to gifting to products for self-consumption,” Isler says. “It’s always been that way and always will be. We have found that even during the recession the demand for Chocolat Frey’s higher-end products didn’t slow down.” Although confectioners may skew to one or another demographic from year to year, the overall picture remains pretty stable over the long term. C O N T I N U E D O N PA G E 1 5 8

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Confectionery Report

The Neuhaus travel exclusive 12-chocolate collection The Neuhaus Collection – one of the company’s star performers in travel retail

C O N T I N U E D F R O M PA G E 1 5 6

Top performers For Neuhaus, best sellers in Americas travel retail continue to be its iconic ballotin and the Neuhaus Collection. The latter benefits from its colorful gift presentation, which stands out on the shelf, the company says. It helps that the Collection includes two truffle contenders – one alcohol free – a Milk Assortment, a Dark Assortment and a mix of Milk Dark and White, all leading performers. The ballotin meanwhile, besides being a Neuhaus icon, performs well thanks to a range of sizes and assortment of chocolates. “In the Americas, South America is the core of our business in travel retail,” says Alan Brennan, Customer Marketing Manager for NITR. “Within that sphere, the real engine is Brazil, with associated countries like Argentina, Chile and Uruguay also making major contributions.” In South America overall, Nestlé Swiss, the travel retail specific brand that relaunched in 2008, Kit Kat and Smarties are the leaders, with Kit Kat at the top in Brazil. “We’ve seen strong sales growth within the snacking and sharing subcategory,” says Frederic Porchet, NITR’s Marketing Manager. “Sharing bags for people going home, to use for gifting or sharing, are doing really well for us. Also, the Nestlé Swiss brand is now more anchored in the informal gifting part of the category. It’s going to give us a big uplift for 2012, with the launch of a set of six new premium products within the brand.” These will be introduced as the Nestlé Swiss Premium Collection. NITR will support the launch with dedicated fixtures for key airports, samplings, visuals and high profile events to engage the traveling shopper. For snacking and sharing, the majority of 158

packs are in a share format, says Brennan, ranging from a 150g self-consumption format to 350g/750g and upwards for sharing. “The pack formats meet different shopper needs from self treat/consumption and everyday sharing to the ability to create special moments with premium sharing packs of brands such as After Eight, Nestlé Swiss and Quality Street.” The Kit Kat share bag and variety pack remain two of the best selling lines NITR has in the share bag category. For its part, ALFA addressed demand for healthier products last spring by introducing new snacks in the King Henry’s All Natural line. Other standouts in travel retail are Pretzel Pete’s Gourmet Pretzel Nuggets, Jelly Belly’s Grab & Go Bags and 10 Flavor Gift Box. At IAADFS, ALFA will introduce new products and line extensions including Feodora Chocolate and Pralines featuring all natural chocolate, Hans Freitag Cookies and Wafers, Biffar Dried Fruit and Ginger, and selections from Jelly Belly, Pez and King Henry’s. For 2012, PVM is rolling out a range of line extensions for travel retail. Chupa Chups has a new series of gifting items – a pair of working binoculars in varied colors with lollipop, a balloon-activated racecar with two lollipops and a souvenir tin with travel images that contains 16 different flavored lollipops, designed as a memento or for gifting. “We believe there is massive potential in chewing gum in travel retail, and 2012 sees a new focus on this area for us,” PVM says. It’s expanding its portfolio of sugar-free Mentos gum with a new two-pack of Mentos three layer gum with a textured gel middle layer and green tea extracts, available in a mint and fruit (a strawberry, green apple and raspberry combination) version. It is also introducing new five c and 10-stick travel packs.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

PVM’s balloon-activated racecar is one of a new series of Chupa Chups gifting items

New packs of three-layer gum are part of PVM’s extension of the Mentos lin

Guest Writer

Confectionery – the three keys to the door of success A sweet tooth, the impulse factor and brand power can build an even better category BY JACK TABBERS

s delegates fly in to Orlando, those of us in the confectionery category will look out of the aircraft window at a region that offers starkly mixed messages. Looking out the starboard window, the dark clouds of the economic climate in North America continue to provoke uncertainty and threaten growth. Meanwhile, through the port window, parts of Latin America, particularly Brazil and Panama, bask in the warmth of accelerated growth. We don’t have to leave ourselves at the mercy of the region’s economic climate to drive our direction. Instead, let's look more closely at how we operate confectionery to maximize its performance at every location across the Americas. It's not rocket science... there are three key reasons why we have the power to take greater control of our market. Firstly, confectionery is the consumer’s favorite category – 90% of people love chocolate. And they love it regardless of the economic weather. In fact, there is an argument that the category is recession-proof in that many consumers turn to confectionery as a comfort in a downturn just as readily they turn to it for marking a celebration. Secondly, that love for chocolate is a powerful influence on shopping behavior. Confectionery provokes more impulse purchasing than any other category. In fact, our research suggests that around 70% of confectionery purchases are made on impulse. Confectionery shoppers are also the most likely to also shop in other categories too, and they are more inclined to make multiple purchases, so driving a higher average basket value across the categories. That sweet tooth supports the whole industry. Thirdly, consumers have exceptionally high recognition levels for the world’s leading confectionery brands. For example, my own two leading brands – M&M’s and Snickers – are the world’s number one and two 160

selling brands respectively. Like our gum brand, Wrigley’s, these brands are instantly recognizable, trusted, high quality products – a perception provoked in shoppers worldwide, with Mars products sold in around 100 countries. I strongly believe these three elements are the keys to open the door to greater sales success. The challenge is to address the category’s failure to utilize these keys to their full extent. Currently, the category is selling primarily to those who are making pre-planned purchases and is focused too strongly on value.

At Mars we have developed a series of merchandising programs that can be adapted to the specific needs of each location, thus maximizing their cost effectiveness and sales impact. These programs range from a core presentation for smaller locations right through to a stunning tailored store-in-store experience for major airports. We’ve already worked with forward-thinking retail partners at airports across the world, developing a radical new approach that delivers a stronger shopping experience and drives higher footfall, conversion and basket size. Recently, working with DFA and the New York Port Authority, we launched the M&M’s

“Confectionery shoppers are the most likely to also shop in other categories too, and they are more inclined to make multiple purchases, so driving a higher average basket value across the categories.” Jack Tabbers, General Manager, Mars ITR

We aren’t exploiting the shopper’s love of chocolate, the category’s uniquely high impulse factor or the incredible power of the brands. The heart of a new category-led strategy is a focus on the consumer’s love of the leading brands, including presenting the offer with two or three ‘hero’ brands to create an unmissable and engaging sense of in-store theater. Value will always have a strong role but it is not the platform for the quality of shopping experience that will maximize the category’s performance.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

store within a store at JFK Terminal. By building an amazing shopping experience around a globally loved brand we are giving consumers what they want – a favorite brand, great in-store experience and easy to find solutions to their purchasing motivations. We've just launched a similar concept in Singapore in January, which is trading strongly, and with many other flagship airports asking for the same category-driven approach from Mars. I'm confident we'll be helping more travelers go home happy. c

Godiva brings highlights to the World of Travel. Please visit Booth 823.

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Confectionery News República del Cacao builds the brand on dark chocolate’s exotic appeal The dark chocolate category is on a roll, says Carmen Castro, Marketing Manager for República del Cacao, an up-market chocolatier based in Ecuador. The category started out as a niche market in developed countries and is now growing around the world, including in less developed markets. And for

República del Cacao, the travel retail opportunity is too good to pass up. The category is growing at a stable rate and the market trend is for new, innovative and developed products, Castro says. Overall the travel retail market is growing by 31.5% per year. Currently República del Cacao has four stores in Ecuador, two in Guayaquil airport, one in Quito airport and a chocolate boutique in Plaza Foch in Quito’s tourist center. Later this year the company is planning on opening three stores one of which will be a 50 square meter store in the Galapagos Islands, while evaluating other opportunities in Latin America. “The dark chocolate industry in travel retail in Latin America is a new market for passengers,” Castro says. “You see a lot of dark chocolate brands in local markets, but it is still rare to find these products in travel retail. República del Cacao is a brand that is capitalizing on this opportunity.” The brand is positioning itself as a destination business, where the purchase motive goes beyond self-consumption. Castro adds that there’s a good slice of business to be had in positioning product as an exotic, sophisticated origin souvenir from the company’s home country, Ecuador. At this year’s IAADFS, República

del Cacao will present two new products: a dark milk chocolate bar and a dark milk chocolate bar with plantain chips. These will join the Galapagos chocolate bar with coffee nibs, two organic chocolate bars and gift presentations, all best sellers in Americas travel retail markets. República del Cacao is the only brand that harvests and produces chocolate in Ecuador, which is the home of Cacao Arriba, considered to be the best cacao in the world— the company itself originated as a project to preserve it. The popularity of dark chocolate rests in part on the antioxidant properties of the cocoa bean, and the articulation of the market into new taste profiles, exotic flavors and more premium options has only accelerated the momentum, to the point where dark chocolate is a primary driver in the growth of the whole premium chocolate market. The growing competition from mass-consumption brands means that República del Cacao has to exploit its strengths as a local, exotic product, Castro says. Airport POS figuratively places the traveling consumer in the brand’s home environments, using natural materials like bamboo and jute. “The mass consumption brands are launching dark chocolate products and they have giant budgets,” Castro says. “Our best tools are brand image and products.”

República del Cacao is the only brand that harvests and produces chocolate in Ecuador, which is the home of Cacao Arriba,says the company

Hershey’s launches travel retail exclusive sharing pouches at IAADFS The Hershey Company is launching four travel retail exclusives during the IAADFS show in Orlando, Florida, with a focus on the sharing market. Sharing is an important market segment within duty free and three of the four brands will achieve worldwide travel retail distribution, with one designed solely for the US market. Hershey’s Snack Size Assortment is available in a 500g pouch. Featuring Hershey’s Milk Chocolate with Almonds, Reese’s Peanut Butter Cups and Hershey’s Cookies ‘n’ Creme in a brightly colored pouch, Hershey’s Snack Size Assortment is geared to travelers seeking chocolate for snacking and sharing. Hershey’s Miniatures are offered in a 500g pouch with mini versions of Hershey’s Milk Chocolate, Hershey’s Special Dark, Hershey’s Mr. Goodbar and Hershey’s Krackel. According to Hershey World Travel Retail Marketing Manager Onye Ebo, “this pouch offers a little something for everyone. It’s

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

the perfect sharing assortment for travelers.” Hershey’s Special Dark Miniatures pouch (500g) is designed for travelers who love dark chocolate. The mildly sweet assortment features three of Hershey’s dark chocolate brands: Hershey’s Special Dark, Hershey’s Special Dark with Peanut and Hershey’s Special Dark with Crisped Rice. For the US market only, Hershey is introducing Kit Kat Miniatures in a 385g pouch. “Kit Kat standard bar sales are growing across all classes of trade in the United States,” Ebo says. “This well-known global brand—familiar and appealing to foreign travelers and Americans—is now a travel retail exclusive. With each piece individually wrapped, Hershey’s Travel Retail exclusives enjoy unique placement in a retail assortment with a strong brand, strong sharing concept, variety of tastes and flavors, and accessible price points for the traveling consumer.” Hershey’s Snack Size Assortment is available in a 500g pouch

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Confectionery News

Jakeman’s brings natural ingredients, new products to the maple sugar niche “We’re encouraged by the strength of travel retail food and confectionery throughout North America,” says Bob Jakeman, President of Jakeman’s Maple Products, a producer of maple sugar products located near Woodstock, Ontario. “Airport sales have returned with double-digit increases, and our new presence at Disney has been very successful as well.” In addition to its unique flavor, maple sugar has a mystique that makes it an attractive purchase, Jakeman says. “It’s considered a great tasting health food, full of antioxidants, vitamins and minerals. You can find honey worldwide, but maple is only produced in northeastern Canada and the US.” Consumers are still discovering the health attributes of maple, Jakeman says, and are beginning to pick up on its value in the kitchen. Jakeman’s best sellers in travel retail include its plastic jugs, maple leaf candy and cookies. The cookies and candies are big as convenient snacking options, and the jugs sell well as gift purchases because they can be packed without fear of leaking during travel. Jakeman sees a growing trend towards upscale bottles, new products and uses in travel retail, and he says that granulated maple sugar is increasingly popular as a healthy alternative to other sugars.

Jakeman’s has revamped its popular Maple Cream Cookies with all natural ingredients

Jakeman’s Maple Blush bottle

At this year’s IAADFS, Jakeman’s will be showing its new Maple Blush bottle, available in 250 and 100 mL sizes. And the brand has revamped its popular Maple Cream Cookies with all natural ingredients for the global market, Jakeman says. “It’s now only available with non-hydrogenated oils, no trans fats and no artificial dyes. By making an all-natural cookie we have found that it actually enhanced the taste.” As always, one of the main challenges in this specialized market is geography. “The market is flourishing Canada-wide and throughout the northern states,” Jakeman says, “but as you move south, we run into lack of awareness and encounter maple syrup knock-offs and adulterations.”

Godiva showcases new Souvenir Range Godiva Chocolatier is launching a number of new and revamped lines at the Duty Free Show of the Americas (booth 823), showcasing a completely revamped Souvenir Collection, as well as introducing a number of travel retail exclusive offers. Godiva has partnered with young graphic designers from the renowned Belgian Design School “La Cambre” to create the exclusive Souvenir Collection, based on a shared passion for cultural heritage and true ‘savoir faire’. The first wave of the revamp includes the destinations Hong Kong, London, Paris, New York, Amsterdam, Taiwan, Italy, Brussels and Japan. Two new locations are also added to the collection: USA and Canada. The launch will be supported by both instore events and exciting presentations to create theatre and engage the traveler. Additionally, to enable customers to find out more about the collection, Godiva is placing a QR code (godivasouvenirs.com) on the sleeve of each gift box. When scanning this code, travelers will be redirected to an exclusive mini website giving more information on the col-

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lection and the young designers involved using movies and images. The idea is to capture the magic of the creation process, inspiring travelers with key messages of passion, heritage and innovation. Godiva’s travel retail business in the Americas has been growing significantly over the past few years. In order to support this continued growth, the company is expanding its team with new roles including a dedicated Area Manager for South America who will focus particularly on emerging markets including Brazil and Uruguay. Godiva is also appointing a Travel Retail Coordinator to support the execution of all promotional activities in the region. During 2012, Godiva will continue to roll out its new travel retail store concept worldwide including special fixtures for boutiques, shopin-shops and general merchandise stores.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

The new design direction is a modern interpretation of the brand, marrying European luxury with the rich Belgian heritage of Godiva creating a fresh, elegant and warm look and feel. Materials are luxurious and rich with details inspired by the Art Nouveau style, strongly aligned with Brussels, married with modern white shelves to perfectly mix old and new. Godiva’s revamped Souvenir Collection

Confectionery News

Ferrero Travel Market to highlight Kinder’s new Dog Stories collection at IAADFS

Ferrero Travel Market will be showcasing the new Kinder Dog Stories confectionery collection at this year’s IAADFS in March. The line, which is exclusive to travel retail, was first previewed in fall 2011. The special Kinder Choco Box, Kinder Surprise T4 and Kinder Chocolate multipack are all decorated with cartoon dogs. The Dog Stories Choco Box (144g), designed for gifting, is shaped like a lunchbox and contains four Kinder Chocolate and four Kinder Country bars. The Dog Stories Chocolate multipack is one of the best sellers in Kinder’s travel range, containing 32 individually wrapped Kinder Chocolate bars presented with five Dog Stories cartoon stickers in a gift box. In all there are ten stickers to collect. The Dog Stories four-pack presents collectible dog character figures in Kinder’s well known egg-shaped chocolate. There are ten figures to collect in the series. Ferrero will also highlight the latest Kinder items that cater to the sharing segment in travel retail. These include the new Kinder Friends 250g pouch, exclusive to travel retail, which contains bite-sized Kinder Bueno, Kinder Chocolate, Kinder Country and Schoko-Bons, and the new style Kinder Mix tetrapack assortment. Ferrero will be exhibiting at booth 838.

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A part of the experience: the Grey Goose Loft at the Virgin Clubhouse in Heathrow’s Terminal 3

The best gets better

ANDREW BROOKS

The premium and super-premium vodka category continues to be redefined with new products and market strategies

Campari’s SKYY Vodka: In this category, sense of quality and style matter as much as price

Iceberg makes a massive entry into US duty free this year

“W

henever you launch a new product in the premium category there’s some work you have to do,” says Natalie Barnes, Brand Marketing Manager, White Spirits for Pernod Ricard Americas Travel Retail. “You’re asking the consumer to spend a little more money. We do a lot of tastings, we have brand ambassadors and we look at any possible way to get the product in the hands of the consumer.” Absolut, which is handled by Pernod Ricard Travel Retail, launched its ABSOLUT ELYX brand into duty free in Argentina, Brazil and Uruguay last August/September. Barnes says that the first shipment sold out fast, and that momentum is still strong, with promotions such as smaller-scale POS tastings continuing. North American duty free will probably launch in July. “This market is all about innovation, exclusivity, luxury and premiumness,” says Anders Olsson, Director of The Absolut Company Global Travel Retail. “It’s an ideal launch pad and test ground. Image values built in duty free/travel retail can also ‘echo out’ into domestic markets.” Jim Perry, Managing Director of Brown-Forman Duty Free, reports that Finlandia is doing well in the Americas, especially where there are a lot of Central European, Nordic and Russian customers. “Overall, the market is doing well this year and we’re seeing good vodka growth across the board.” Pravda Vodka’s duty free launch will come this spring, says Franco Gabriele, President of ALFA Brands. Gabriele is optimistic about the debut as Pravda’s sales are ahead of last year’s. “For IAADFS, we’ll have the full array—1.75 liters, 1 liter, 750 mL, 375 mL and 50 mL and also a 50 mL tasting kit.” Other than a few Canadian duty free stores where it’s been sold for years, Iceberg isn’t widely sold in duty free in the Americas—yet. This year will see its broad-brush entry into US duty free. David Meyers, President & CEO of Iceberg is bullish on the vodka market generally. “In the last few years the vodka market has been growing on a consistent basis due to new product launches as well as line extensions and product innovation in the category,” he says. “We’ve been part of that growth.” Sales of Grey Goose are up significantly over last year, says Leigh Irvine, Regional Director, Americas for Bacardi Global Travel Retail. “As a company we took the brave decision to increase our investment in the brand during the economic downturn,” Irvine says. “That investment, allied to the brand’s unrivalled quality and reputation as the world’s best tasting vodka, has seen it continue to flourish.” Grey Goose has a successful partnership with Virgin Atlantic, and last September it launched the Grey Goose Loft at the Virgin Clubhouse in Heathrow’s Terminal 3. “Despite being a very well established and iconic brand in the North American domestic markets, SKYY Vodka still has a tremendous growth opportunity across all American duty free channels,” says Matthijs Kramer, Global Travel Retail Manager, Campari International SAM. “Additionally we believe that the SKYY Infusions range, with THE AMERICAS DUTY FREE & TRAVEL RETAILING

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Premium Vodka Report

its unique naturally infused flavored vodkas, offers a unique and attractive premium proposition.” David Meyers says Iceberg will showcase its duty free standard 1liter bottle at the IAADFS booths of the company’s agents ALFA Brands and Fishpaws Global Duty Free. Other 2012 plans include a major re-launch with a more premium look, and new products that will appeal to duty free shoppers. The big news from Finlandia, Jim Perry says, has been the introduction of the super premium Finlandia Platinum, which was launched at Cannes last year. Over the next few months the new brand will arrive in select travel retail locations. This and other new flavors will be highlighted at this year’s IAADFS.

The importance of education Perry says customer knowledge is critical. “Consumers appreciate promotions that help them expand their product education. They’re turned off by promotions with high pressure sales pitches or uninformed promotion staff.” He also says women are becoming a bigger market. “We’re very active in building awareness via PR events and competitions and we’re driving new distribution and trial via the on-trade and product sampling,” says David Meyers at Iceberg. “The key is to be selective and consistent in promoting to build the brand. Our goal is to generate strong brand ambassadors for Iceberg.” Building strong relationships at every level of the distribution chain is also key, he adds. Campari will highlight SKYY Vodka at the Duty Free Show of the Americas, along with Wild Turkey Bourbon and Frangelico hazelnut liqueur. “These high-quality products are exceptional calling cards for Gruppo Campari’s portfolio of more than 40 brands,” Kramer says. A successful brand can’t just promote on price, he says, but also needs to convey a sense of quality and style. Accordingly, Campari focuses heavily on these attributes in its promotions. “Special or limited editions are a perfect tool to stay in line with the premium image of the brand whilst creating a buzz and onshelf standout,” he says. “A perfect example is the range of SKYY Infusions, which was designed for consumers who are conscious about an elevated level of quality in what they consume.” Social media campaigns also play a growing role in the marketing mix. In addition to ABSOLUT ELYX, Absolut will use IAADFS to highlight ABSOLUT GUSTAFSON, a new travel-exclusive limited edition which launches globally in April. ABSOLUT GUSTAFSON is flavored with cherries, strawberries and notes of cardamom and chai. The brand was conceived in collaboration with Swedish artist and fashion illustrator Mats Gustafson, who created the artwork for the bottle. Grey Goose will be a showcase product for Bacardi at IAADFS, Leigh Irvine says. The brand is a priority in North America for its strength and maturity as well as its importance to Bacardi and its business partners, and in Latin America for its outstanding growth potential. Irvine is also optimistic about the launch of Grey Goose Cherry Noir in the US domestic market. Taste and quality are key communicators in travel retail, Irvine says. Grey Goose’s position is reinforced through tastings and education around ingredients, the brand’s French provenance and cocktails. Bacardi recently added a Grey Goose iPad app to enable travelers to learn how Grey Goose is made and find cocktail recipes as well as information on their destination, including bars that serve Grey Goose cocktails. 170

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What makes ‘super’ super? Matthijs Kramer believes the definition of “premium” varies from one market to another, but that price, the sophistication of the category and consumer buying power are key determinants when it comes to how a vodka is classified. “Quality is the key indicator,” Kramer says. “That’s all about the care and expense used to deliver a superior product. SKYY Vodka was the very first vodka ever to introduce a quadruple distillation and triple filtration production process, delivering an exceptionally smooth vodka with the Finlandia’s fewest impurities among the world’s super premium leading vodkas.” Platinum Consumers also want a sense of style, which enhances the premium cues. Kramer points out that SKYY was the first vodka to introduce style-driven packaging in the form of the cobalt blue bottle. The brand’s distinctive, sexy marketing has become a standard for the spirits industry, he adds. Leigh Irvine says that what makes Grey Goose a super premium brand is quality and taste. “There’s an extraordinary level of expertise and craftsmanship employed in the creation of Grey Goose that begins in the wheat fields of Northern France and ends when the spirit is bottled in the Cognac region,” Irvine says. “This ‘field to bottle’ story continues to play a key role in our communications.” For Natalie Barnes, the main criterion is taste. “When you have ABSOLUT ELYX neat or on the rocks or chilled, you get a full, smooth, creamy experience you don’t get with other vodkas. You really can taste the craftsmanship.” Premium is defined by quality With sales and price, adds Anders Olsson of momentum peaking, Pravda Absolut Global Travel Retail. “‘Prelaunches into duty miumness’ is also, however, a more free this year diverse and complex quality that comprises both our brand image values and the mindset of our consumers.” Premium is part of the brand DNA for Absolut, which opened the premium vodka segment more than three decades ago, he adds. “Premium vodka is generally defined by the high quality of the ingredients, the distillation process or suggested retail price,” says Jim Perry. “Finlandia is made with only the finest ingredients including six-row barley and pure glacial spring water.” Franco Gabriele says that proper distillation and water quality are crucial. “The water used for Pravda is drawn from the pure Carpathian mountain springs, allowing the vodka to acquire a wonderful elegance,” he says. Other differentiators include sweet rye instead of corn, water filtration using sand and stone and a patented five-distillation process. The clue to Iceberg’s unique value-add lies in its name: the vodka is made from water obtained from icebergs, which has a reputation for being the cleanest anywhere. “We use iceberg water that has been locked up and protected as solid ice for over 12,000 years,” Meyers says. “Impurities are measured in parts per quadrillion—think of one inch in 16 million miles. This is simply the world's purest water.” c

Take a

and you’ll never touch another vodka

The superior smoothness and purity of Russian Standard is clear from the first sip. But don’t just take our word for it. Taste it neat against your usual vodka and you’ll appreciate that ours is truly vodka as it should be.

Russian Standard

Standard bearers Russian Standard Vodka offers duty free shoppers a premium-category taste of Imperial Russia BY ANDREW BROOKS ussian Standard Vodka offers authentic Russian vodkas in four premium-range brands: the flagship Russian Standard Original in the premium subcategory, Russian Standard Gold and Platinum in super-premium and Imperia in ultra-premium. The company operates in more than 75 countries. Sales from its major exports—to the US, the UK, Germany, Canada and Australia—are complemented by growing global duty free sales. In 2011 the company sold more than 2.6 million cases in total. Despite the economic downturn, Russian Standard dominates the premium segment of the Russian vodka market, the largest in the world, says Walter Kooijman, Commercial Director, Global Duty Free and APAC (AsiaPacific). The company’s Russian market share is 40%. That success gives the brand a strong global profile, paving the way for international expansion, and duty free is an integral part of that. “In 2010 we established a position in the top five vodkas in global duty free and in 2011 we have excelled this growth,” says Kooijman. He is especially upbeat about the performance of his premium and super premium products. Russian Standard Gold, launched in 2010, has gained a good slice of the brand’s total duty

free business, and the ultra-premium Imperia is also making good gains, he says. “The duty free markets in the Americas are doing very well in general compared to last year,” Kooijman says. “The traffic is up and the 2008 to 2010 peak of the recession is over. Even though both Europe and the US still experience a challenging economy, travelers are now much more inclined to buy liquors in duty free—this is especially true for the ever-growing traffic coming from Asia.” The company is a relatively young brand in the hemisphere, at least compared with the more established standing it enjoys in the Russian and European markets. But overall duty free growth has been in the double digits, and Kooijman says that while there are still opportunities to boost that by increasing distribution, the main opportunity lies in increasing the brand’s profile and working with duty free operators to highlight the entire premium profile and help to grow the entire vodka market. In many cases where the company has chosen to highlight one of its products, the result has been that the entire portfolio has seen an increase in sales. “All of our SKUs have a clear brand identity, and aren’t cannibalizing each other,” Kooijman says. The company will be attending IAADFS this year along with its global duty free partner

“Consumers around the world know that real vodka is produced only in Russia.” Walter Kooijman, Commercial Director, Global Duty Free and APAC, Russian Standard

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Rémy Cointreau Global Travel Retail. “At the show we will introduce Russian Standard Vodka’s global ‘Vodka as it should be’ campaign to duty free Americas with the launch of an elegant boxed set of miniatures which illustrate the quality of the brand and its ultra-premium expression,” Kooijman says. While the campaign encompasses all four varieties, Kooijman notes that in the Americas Russian Standard Original and Russian Standard Platinum are the two flagship products. Accordingly the company plans to focus on moving customers up from Original to Platinum in this region. Other plans include big investments in key airport shops and continued efforts to expand the brand’s presence with airlines in North America, in both pouring and in-flight sales. Russian Standard is also launching Imperia Crystal Crown, a special limited edition of Imperia that takes as its theme the splendor of Imperial Russia. Crystal Crown has a cylindrical red cap reminiscent of the tall fur-lined hats worn by the Russian “boyar” nobility, studded with 24 Swarovski crystals. “Consumers around the world know that real vodka is produced only in Russia,” Kooijman says. “Our leadership in the premium segment in the Russian market, coupled with high product quality, provides us with the necessary foundation for outstanding perforc mance in export markets.”

Vodka Roundup

Taste tactics

To celebrate its bison grass vodka, in 2011 Zubrowka introduced this special edition with a fur jacket

ANDREW BROOKS

Vodka makers differentiate themselves on packaging, ingredients, processes and the taste of the final product hen you talk to Frank D’A- natural ingredients, including specially filtered cunto about his product, artesian water, utilizing ten-stage filtration and you realize that what’s on a double blending process. The brand is doing the outside can be as impor- well in airport and border duty free shops, suptant as what’s on the inside. ported by tastings and other promotional Frank and his brother are the Founders/Own- activities, says Mariya Yevseyeva, Acting Head ers of Americana Luxury Vodka, which of Marketing. Robert de Monchy, Managing Director launched four years ago. It was the first luxury vodka ever made entirely in the US, and of MONARQ Group, says that MONARQ is Americana definitely wears its national pride in the process of introducing Zubrowka vodka on its sleeve, both in the name and in terms in the Americas. “Our primary focus is to build the brand in the on-trade of the of the packaging: the bottle is made in domestic market first,” he says. “We’ve grades of red, clear and blue glass. achieved excellent distribution for this “We wanted to do America proud,” unique brand in a short period of time, D’Acunto says, “and we feel we achieved especially in important markets such as that with the bottle design.” The botMexico and Argentina.” tle has won design awards, on top of the International Shoppes will be carawards the vodka itself has won, such rying Zubrowka soon, and MONARQ as a Gold Medal “Exceptional” rating is in negotiations on a number of duty in the 2007 International Review of free listings inside the US and elseSpirits by the Beverage Testing Institute. where. Overall, the duty free market While Americana’s volume is still showed growth in the high dousmall—about 2,500 cases a year— ble digits last year and de Monchy D’Acunto says that with recent expects that to continue in 2012. expansion into new markets, Nemiroff is just in the sales should increase dramatprocess of negotiating with ically. Americana is sold in large duty free operators in some 12 US states now, includthe US market, says Yevseyeva. ing California and New York, However the main focus for and new ones are always comnow is to further develop the ing on-stream. D’Acunto is brand’s depth in the US sure that duty free would be domestic market—duty free a great fit. “If we can get the will become a target once that product out and in front of is accomplished. more people there’s no doubt Duty free in 2011 was a big it will be a huge success.” success for Nemiroff, Yevseyeva Nemiroff ’s top sellers says. Sales increased to 25% of worldwide are Nemiroff Origtotal sales, and the company inal, the first white Nemiroff signed on with four big opervodka, and Ukrainian Honey ators in Europe. “The whole Pepper, which has become duty free and travel retail something of a “calling card” industry has already recovfor the company. In the preered from the 2009 crisis, and mium segment, Nemiroff Lex 2012 will demonstrate further is the top performer—due in growth in terms of value and part, no doubt, to a placevolume,” she says. “The vodka ment in Lady Gaga’s music category continues its growth video “Bad Romance.” And worldwide—about 11% in in 2010 the company 2011. What’s really inspiring is launched Nemiroff Distinkt, that Nemiroff sales grew more an “eco-vodka” with aloe rapidly than the pace of the extract. Sporting a green crane label, the vodka is made with Nemiroff’s ultra-premium Lex vodka overall category upsurge.”

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It was an unfortunate accident of birth that Americana Luxury Vodka took its first steps in the middle of a major recession, and this would compound the difficulties faced by any small business, especially in an upscale market. Still, D’Acunto won’t retreat on product quality or on the expensive glass and labor-intensive bottle decoration process. “For us, it’s word of mouth,” D’Acunto says. This means event appearances, tastings and samplings, and an aggressive price profile. The 750ml bottle retails for around US$19.99-$21.99, and the one-liter for about $25.99. Those are huge drops from the original selling price. The company does have new flavors on the drawing board, but for now the main task is to spread the word about the flagship brand. “We market face to face,” he concludes. “People respond very well at tastings when they find how much smoother our vodka is than other luxury vodkas.” c Americana’s unique bottle incorporates the colors of the US flag

Vodka News

Last year Sobieski Vodka sold more than one million 9-liter cases in the US, reaching this milestone more than three years sooner than the nearest competitor

Belvédère Group’s Americas expertise drives sales in the region DANZKA Vodka won three prestigious medals from the Spirits Business in 2011, adding to its already impressive list of accolades

Belvédère Duty Free says it plans on capitalizing on its strong history in the Americas for its key brands—DANZKA Vodka, Sobieski Vodka and Marie Brizard Liqueurs—to grow the business in the region in the future. “Latin America is a cornerstone of the DANZKA Vodka business due to Belvédère Duty Free’s long and historic commitment to the region,” says Torben Vedel Andersen, Sales Director, Belvédère Duty Free. “The world’s best travelling vodka does huge volumes in the Americas and we continue to improve and develop our relationships in Central America, Brazil, Colombia, Peru and duty free—all exceptionally strong markets in Latin America,” says Andersen. The past year was the biggest year ever for DANZKA Vodka in global duty free in terms of 9-liter cases sold. In addition, DANZKA Vodka won three prestigious medals from the Spirits Business in 2011, adding to its already impressive list of accolades. DANZKA Vodka received a Vodka Master in the Scandinavian Vodka category, the highest award possible, as well as a Travel Retail Master in the White Spirit category. The brand also took home a silver medal in the Design & Packaging category. The Belvédère Group hopes to expand on the extraordinary success of its flagship brand Sobieski Vodka in the US, where it is one of the fastest growing brands, to the rest of the region. Last year Sobieski Vodka sold more than one million 9-liter cases in the US, a milestone reached after

only four years. This achievement shatters the previous record by more than three years. “Our vision from day one was bold—to be the vodka brand to reach 1 million 9-liter cases faster than any other in history,” said Chester Brandes, President and Chief Executive Officer of Belvédère Duty Free’s sister company Imperial Brands, Inc. “Thanks to the commitment and effort of a great team at Imperial Brands, I am proud to announce that we have accomplished this ambitious objective.” Bruce Willis, part-owner of the brand for the past couple of years, stars in a series of webisodes with Sobieski’s CEO Krzysztof Trylinski, titled “Bruce Has Ideas.” These videos, featured on www.truthinvodka.com, poke fun at the marketing tricks and trendiness of other vodka brands. For Marie Brizard, Andersen says 2012 is the year Belvédère Group widens distribution to the entire South American continent. Export Director with Belvédère Group, Josette Morieux adds: "At the IAADFS we are presenting our new Area Manager for Latin America, Mr. Thierry Tronquit Prats, who is joining us from Champagne Lanson. This is our renewed commitment to the region where we wish to continue to build sales of our core brands Sobieski Vodka, DANZKA Vodka and Marie Brizard liqueurs." The IAADFS Duty Free Show of the Americas is integral to the continued success of these core brands for Belvédère Group. As such, the company will have a full team at Booth 727, including Belvédère Group CEO Erick A. Skora.

Stolichnaya Premium vodka enhances offering with new Stoli Chocolat Razberi Adding to its impressive portfolio of flavored vodkas, Stolichnaya Premium vodka has launched a brand new flavor variant. Distinguishable by its sumptuous new bottle design, Stoli Chocolat Razberi will be available from March 2012. Produced using Stolichnaya’s four-stage filtration process, Stoli Chocolat Razberi delivers notes of rich, deep chocolate and warm vanilla-cocoa accents followed by a delicate hint of fresh raspberries. The new packaging is a sleek frosted bottle featuring chocolate wrapped around the iconic Stoli logo, pouring down on

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to a plump fresh raspberry Made using Stolichnaya’s four-stage filtration process, beneath. The reverse of the Stoli Chocolat Razberi delivers notes of rich bottle features an embossed chocolate and warm vanillaStoli logo and signature cocoa accents followed by a hint of fresh raspberries cocktail recipe. “Stoli is excited to introduce a chocolate-raspberry flavored product to the vodka category,” said Val Mendeleev, Chief Executive Officer at SPI Group. “The unique frosted bottle packaging, a shift for the brand, is sleek and sensual—the perfect vessel to showcase the liquid held within.”

ALFA Brands Inc. Travel Retail Agent for the US, contact Amy Hildreth ahildreth@alfabrandsdfs.com, Tel: (336) 775-2995

Fishpaws Global Duty Free Travel Retail Agent for the Caribbean, contact Brad Lawson bseclipse@hotmail.com, Tel: (941) 981-9267

Vodka News

Nemiroff commands largest share of Ukrainian vodka market in 2011 Ukranian Vodka Company Nemiroff has announced that according to research performed by Retail Tracking Research International (RTRI), the Nemiroff brand has come out on top of the list of the leading vodka brands in the Ukraine.

“Consumers appreciate vodkas by Nemiroff for their invariably high quality,” says Alexander Glus, Director of Nemiroff. “As we respect our consumers, we have been offering them the best products… based on natural ingredients over a number of

Nemiroff Honey Pepper; the company notes that the variant has been selling particularly well

years. Nemiroff vodka is made by specialists with 20 years [of experience] with the company. “I am certain that the company could not have attained such results without our technologists and our team,” Glus concludes.

Latin American Wines & Spirits launches premium Kazak vodka at IAADFS Latin American Wine & Spirits Marketing Inc. does both duty free and domestic business across Latin America and the Caribbean. The company has been in business since 1981 and will be exhibiting at the IAADFS Duty Free Show of the Americas with its new chill-filtered grain vodka, Kazak. Americas Duty Free recently sat down with Sergio Martinez, Marketing Manager at Latin American Wine & Spirits, to learn more about Kazak and the company’s plans for the vodka in Latin America. The Kazak brand belongs to Latin American Wine & Spirits and is produced in cooperation with a German manufacturer. Martinez told us that in a category as saturated as vodka, cutting through the hype and reaching the consumer with a quality product was a prime consideration for the company when developing the brand. “There are a lot of premium vodkas out there with a lot of pretty bottles,” Martinez says. “The quality of our vodka is excellent. Furthermore, in Germany there is a long tradition of producing high quality spirits that has long been overlooked. Typically, vodkas are pro-

duced in Russia or Poland. The fact that Kazak is produced in Germany under the highest of standards makes it something truly unique.” In addition to the high quality of the vodka, the distinctive black and red packaging of Kazak is sure to create standout on the shelf. The concept behind the slogan, “The Original Black Label Vodka.” was created for the consumer who seeks a luxury product, an exacting production process, but also real value for their money. The price point will hover between Smirnoff and Absolut. According to Martinez, “We want the taste of Kazak to stand on its own. It’s a truly premium vodka at a very competitive price. There is a market niche that has yet to be occupied, and we believe strongly that Kazak is the right fit for this." Visitors to this year’s IAADFS exhibition can experience Kazak, along with the rest of Latin American Wine & Spirits’ award-winning portfolio, at stand 807. Kazak is a luxury chill-filtered grain vodka produced in Germany; the brand will be showcased at this year’s IAADFS show by Latin American Wines & Spirits

White Gold sees continued successes in worldwide duty free White Gold Company broke into duty free and travel retail just two years ago and has already seen some impressive successes. The company’s White Gold vodka has been listed in Gebr Heinemann and Aer Rianta International stores worldwide, as well as with Dufry shops in Russia. The company says that its products are now getting noticed on the worldwide stage. According to a recent IWSR report, vodka brand Gzhelka, produced and distributed by White Gold, is a new entrant on the list of the top 20 fastest growing vodka brands worldwide.

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White Gold says that given the growth of the vodka subcategory, especially in duty free, it sees great potential for its brands as they continue to penetrate the channel. Currently working on its own to supply clients and organize activities, the company is interested in meeting with experienced distributors to discuss increasing the reach of its brands in export markets. The company’s latest offering is a new According to IWSR, the Russian Gold vodka brand called Russian Gold. According brand grew seven times over in duty to IWSR, the Russian Gold brand grew seven free channel in just times over in duty free channel in just one year one year; the brand is White Gold’s and is seen by leading industry players as a latest entrant into duty free product to watch in the vodka subcategory.

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Vodka News

ABSOLUT Gustafson continues gaining ground in the Americas The sensational new traveler’s exclusive limited edition flavor ABSOLUT Gustafson, created in collaboration with Swedish star artist and fashion illustrator Mats Gustafson, will be launched in the global duty free/travel retail market in April. The variant was officially presented for the first time at a glamorous launch party extravaganza at the Plage Royal in Cannes, France on Tuesday, September 20. Following success in previous years with ABSOLUT Flavor of The Tropics and Watkins, the world’s leading premium vodka brand now presents another exciting new flavor designed exclusively for travelers. ABSOLUT Gustafson, flavored with sun-ripe cherries, freshly sliced strawberries and warm oriental notes of cardamon and chai, has been created in collaboration with Mats Gustafson, the world’s undisputed number one fashion artist and illustrator. Gustafson’s bottle design features a dramatic green and bright pink horizon, painted with his characteristic, masterfully light-handed, super-sensitive and sensual brush strokes. “The pink represents the berries, the green the cardamon and the more earthy qualities,” says Mats Gustafson. “The final artwork combines these two color blocks and, for me, they translate into the earth and the sky. The horizon is a great metaphor for traveling, for looking far and beyond.” The ABSOLUT Gustafson launch will be backed by a powerful 360-degree marketing campaign in all available media, including unique brand installations in key duty free/travel retail market arenas. A number of signature drinks and accompanying hors d’ouvres have been created, including ABSOLUT Gustafson and ginger, a mix of ABSOLUT Gustafson and ginger ale. “This launch is very exciting for us,” says Anders Olsson, Director of The Absolut Company Global Travel Retail. “It’s far more than just a oneoff promotion. It continues our proud legacy of creative partnerships in the fields of art and fashion that started back in 1985, with the groundbreaking ABSOLUT Warhol campaign. It is thus a key initiative in our overall brand image building strategy, which is based on constant re-invention. The fact that we are launching this new flavor exclusively for travelers is yet another tribute to the great strategic importance that our market has—and always has had—in the brand image marketing philosophy of ABSOLUT.” ABSOLUT Gustafson will be launched in April by Pernod Ricard Travel Retail

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Spring Vodka Cocktails

Delicious and easy

The reigning king of flavored vodkas, ABSOLUT takes cocktails seriously given the important role they play in marketing new variants. The “Gustafson & Ginger,” made with new ABSOLUT Gustafson, is proof that when you start with a good base, delicious cocktails can be very easy to make. Gustafson & Ginger ■ 1 part ABSOLUT Gustafson ■ 3 parts ginger ale Method: Pour ABSOLUT Gustafson over ice cubes into a highball glass and add ginger ale. Garnish with a lime wedge and two slices of strawberry

A walk on the wild side

RYAN WHITE

lthough there’s still a chill in the air and snow on the ground in many places the world over, most can’t help but think wistfully of spring when this time of year rolls around, especially given the sun-splashed backdrop of the Duty Free Show of the Americas. A yearly tradition for many, the first cocktail outside with friends when warmer weather finally does arrive is a welcome experience indeed, and with that in mind Americas Duty Free presents some of the newest and best vodka cocktails to get readers ready to come out of a long winter’s hibernation.

Apart from having the distinction of being the world’s best traveling vodka, DANZKA Vodka tastes amazing in a great many cocktails given the fact that it’s made with the finest whole grain and pure water. One of our favorites is the “Touch of Jungle,” created by Lars Vestbirk, former Danish Champion in Cocktails and current International Marketing Manager at Belvédère Scandinavia A/S. Touch of Jungle ■ 5 parts DANZKA Vodka ■ 8 parts passion fruit puree ■ Seeds from 1 passion fruit ■ 3 parts vanilla syrup ■ 3 parts club soda Method: Fill a shaker with ice cubes. Add DANZKA Vodka, passion fruit puree, seeds from the passion fruit and vanilla syrup. Shake and strain into a chilled highball glass filled with ice cubes. Top up with club soda and garnish with raspberries.

Dessert anyone? Three Olives Vodka has carved out a very respectable niche in the vodka category through the creation of what are inarguably some of the most creative flavors on the market. In addition to a bevy of delicious fruit flavors to choose from, more adventurous variants include Root Beer, Bubble, Chocolate and Triple Shot Espresso. The latest flavor from Three Olives, Cake, is already listed in a number of duty free stores in the Americas. Fortunately for us, the good folks at Three Olives have come up with the decadent “Pineapple Upside Down Cake” cocktail. Pineapple Upside Down Cake ■ 1 part Three Olives Cake Vodka ■ 1 part Pineapple juice ■ A splash of grenadine Method: Pour vodka and juice over ice and shake. Add a splash of grenadine and garnish with a pineapple slice and a cherry.

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How low can you go?

After nearly two years of working with leading mixologists, vodka connoisseurs and premier producers of spirits, Voli has created the first low-calorie fruit and fusionflavored vodkas on the market. Voli is big on taste, though, and the company has provided us with a 110-calorie twist on a classic vodka cocktail, “The Cos-low-politan.” The Cos-low-politan ■ 2 oz. Voli Lemon ■ A splash of diet cranberry juice ■ ¼ oz. fresh lime juice Method: Pour ingredients into a shaker with ice. Shake and strain into a martini glass and garnish with a lemon twist.

William Grant & Sons

WG&S says that this year travelers will see more birdcages, ice cream carts, bathtubs and barber chairs supported by sampling of Hendrick’s Gin

Making it better

William Grant & Sons comes off a strong 2011, and backed by a stable of premium offerings the company assures that 2012 will be even better BY RYAN WHITE

ith another record year in travel retail under its belt, William Grant & Sons (WG&S) enters 2012 with a renewed commitment to invest in the category globally. With a full team in place covering the Americas, The company says that the industry should expect to see more outstanding brand building activity across the region on all of the company’s premium brands. 2011 saw Glenfiddich become the first ever single malt to break the one million case barrier (IWSR) while maintaining a faster growth in value over volume. Continued investment behind the brand brought innovation to the fore with the launch of Snow Phoenix, Rich Oak 14 Year Old, Age of Discovery and Glenfiddich Malt Master Edition, as well as the first Crystal Stag gondola in the Americas. 2012 will see a second Age of Discovery, aged exclusively in bourbon barrels, launched as a global travel retail exclusive. Hendrick’s, the world’s leading super premium gin, continues to power ahead in terms of passionate and engaging in-store activation. September belonged to Hendrick’s in JFK and Philadelphia airports. High profile sampling activity was run in five stores all month with all sorts of peculiar customer interaction. WG&S says that this year travelers will see more birdcages, ice cream carts, bathtubs and barber chairs supported by fantastic sampling opportunities in stores around the Americas. The most handcrafted Single Malt Scotch Whisky, The Balvenie, continues to appeal to the discerning traveler by offering outstanding travel retail exclusive expressions such as 184

14 Year Old GoldenCask , The Balvenie Forty Year Old and the limited edition Balvenie Tun 1401. In 2012 the company celebrates the 50th anniversary of Malt Master David Stewart’s arrival at WG&S. Stewart’s incredible achievements will be celebrated with the launch of an extremely sought after limited edition release later in the year. Furthermore, in global travel retail the company will be rolling out a new sampling and staff training program to bring the five rare crafts of whisky making alive in store. 2011 was also a great year for Grant’s. For the first time sales broke the five million case barrier and at the same time the brand overtook J&B to become the world’s number three blended Scotch in both value and volume terms (IWSR) achieving WG&S’s ambition to be a “podium blended Scotch.” 2012 will see a continuation of this premiumization policy with full range sampling and tasting activity, particularly in the fast growing LATAM region. Tullamore Dew, the world’s number two Irish Whiskey, now has a new marketing platform worthy of a great global whiskey brand. Alongside the new “Irish true” TV advert and poster campaign, new retail fixtures have been designed. This impact will be redoubled in July with the arrival of the new bottle that was first unveiled at the TFWA World Exhibition in Cannes last year. Additionally, WG&S says that the Sailor Jerry story in Americas duty free really starts now. 2012 will see the first high impact activation on the concourse of the Jet Blue terminal at New York JFK in March complete with tattoo art, motorbikes and sampling.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

2012 will see a second Age of Discovery, aged exclusively in bourbon barrels, launched as a global travel retail exclusive

Not to be forgotten is Stolichnaya. Since 2009 William Grant & Sons has handled the distribution for the brand in US duty free, USVI and Puerto Rico. The company’s policy of premiumization continues with increased focus on the premium variants Elit, Gold and the flavors, as well as the launch of Stoli Choco-Raspberi. Stephen Corrigan, WG&S Director North America says: “With a full complement of great people on board we are now in the right position to drive the brand building agenda across the Americas duty free by focusing our high profile activations in key priority airports and cruise lines across the region and making sure that wherever possible we offer the discerning passenger the opportunity to sample our outstanding premium brands. 2011 was a good, good year for the GTR team at William Grant & Sons in Americas duty free. I’m confident that we c can make 2012 ever better.”

AM_IAADFS12_GULF APR05.qxd 12-02-25 1:02 AM Page 186

The Edrington Group

Keeping a good thing going

Continuing on from the success of the Brugal Reservas range, at the IAADFS 2012 exhibition in Orlando the company will be showcasing Brugal 1888

After a solid 2011 that saw its portfolio gain visibility in duty free, The Edrington Group plans to maintain momentum with various new initiatives in 2012 BY RYAN WHITE

espite lingering economic woes in some regions of the Americas, André de Almeida, The Edrington Group’s Commercial Area Director responsible for Americas Duty Free, makes it clear that he believes “opportunities still abound in the Americas” for suppliers that are ready to stand up and truly listen to what consumers want. Of course, ambition and optimism aren’t the only things that de Almeida and The Edrington Group possess. The company owns a stable of strong and well respected brands, and it is de Almeida’s hope that the significant strides the company made in the Americas in 2011 are just the beginning of a new era for The Edrington Group’s spirits portfolio.

Building on previous success The Edrington Group has already gone a long way toward capitalizing on travelers’ tastes for premium products. The Group’s brands enjoyed double-digit growth last year across global travel retail markets, following on from similarly strong growth in 2010. Performance of the supplier’s brands was excellent across blends, malts and rum categories, asserts de Almeida.

What the future holds This year The Edrington Group will continue to offer both industry insiders and consumers alike more premium releases. Continuing on from the success of the Brugal Reservas range, at the IAADFS 2012 exhibition in Orlando the company will be showcasing Brugal 1888, a special rum matured in the same sherry oak casks as those normally reserved for The Macallan. On hand at the show will also be Brugal Blanco Especial, a smooth and premium white rum that is double distilled, triple filtered and aged for up to two years in American oak casks. “We will also have the newly packaged Cutty Sark blended whisky at the show, one of the top 10 standard blends in the world and the original easy-drinking Scotch whisky,” de Almeida says. “This brand was originally owned by our friends at Berry Bros & Rudd and under the stewardship of The Edrington Group we are aiming to make it an even bigger success. “We are also celebrating the brand through the launch of the book Cutty Sark – The Making of a Whisky Brand, edited by Ian Buxton with a top team of whisky experts and available now,” he adds. To bolster the launches The Edrington Group

“We are very much committed to the region and will look to continue to invest both time and resources in the channel.” André de Almeida, Commercial Area Director responsible for Americas Duty Free, Edrington Group

Whether it be the introduction of the Brugal Reservas range; the re-launch of classic whisky brand Cutty Sark; the Macallan Masters of Photography series with its latest release, the Albert Watson Edition; the Highland Park Vintage 1978 and Leif Eriksson editions; or the unveiling at Cannes of new premium products such as The Macallan Lalique IV 60YO, The Naked Grouse and The Black Grouse Alpha Edition, 2011 was certainly a busy year for The Edrington Group. For his part, though, de Almeida sees the evolution of the company’s portfolio last year in simple terms: “We are continuing to see the benefit of increased demand for premium and luxury products,” he notes. This fact, combined with partnering with operators that “remain focused on the quality of the shopping experience that they offer consumers,” has proven to be an unbeatable formula. 186

plans on concentrating on education, premiumization and innovation, with a full calendar of promotions in 2012 organized in cooperation with distribution partner Rémy Cointreau. IAADFS attendees can get a taste of things to come on March 12 when fifth-generation Maestro Ronero Gustavo Ortega leads the presentation of Brugal 1888 at a special event near the exhibition grounds. The Edrington Group is certainly doing its part to up ante when it comes to the spirits offering in travel retail, but de Almeida concluded by noting that strong cooperation with operators is the best way to continue making gains: “Clearly the potential for growth will also depend on the willingness of operators in the region to work in conjunction with Rémy Cointreau and The Edrington Group. We are very much committed to the region and will look to continue to invest both time and resources in the channel.” c

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

The newly redesigned Cutty Sark with gift box

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Wine Report

A beautiful relationship Americas Duty Free speaks to a number of suppliers who are trying to woo the traveling consumer in the Americas with a variety of interesting wine offerings

pace is always an issue in duty free but more and more operators have been making room in their stores to increase the wine offering for customers, so it’s obvious that buyers see value in the category. Americas Duty Free spoke with four companies about wine in duty free, discussing the differences in taste between consumers in Europe and the Americas, the importance of tailoring an offering to the customer profile, what each of these companies has on tap for 2012 and some possible future trends in the travel retail wine category. Of course, it’s still early days for many wineries and distributors trying to carve out a niche in duty free in the Americas. However, in speaking to Distilleria Bottega, Barry Global Innovation Ltd., Diverse Flavours and Gérard Bertrand, it’s clear that the travel retail wine category is as dynamic and varied as any other in duty free.

West Coasts and Argentineans know a good wine when they see one. Barry Geoghegan, Founder of Barry Global Innovation Ltd., exclusive global travel retail agent for Paul Sapin wines, agrees with Bottega on the point that the wines to which one is exposed necessarily play a large part in one’s taste: “In a lot of cases wine preferences in the US are driven by the local US wines—California and to a lesser extent Washington and Oregon wines.” Some of Paul Sapin’s best customers in travel retail are Canadians, and Geoghegan say that Canadian operators have a more “open attitude” when it comes to listing wines

or border shops, and we plan our purchases accordingly,” Geoghegan explains. “I think the US operators should also try to raise consumer awareness and highlight the superb offer and value that is available in the stores.” Diverse Flavours specializes in South African wines and in 2011 saw great successes in Asia with DFS in Changi, at Bangkok Airport and on Asiana Airlines and Cathay Pacific to name but a few. The company plans on entering the duty free channel in the Americas in 2013 and Managing Director Anthony Budd agrees with Geoghegan when it comes to the attitude of operators and consumers in parts of the Americas.

organic and natural methods that respect the territory and are meant for an environmentallyaware consumption will continue to increase in popularity.” Sandro Bottega, President, Distilleria Bottega

from all over the world. In fact, he brings up a good point when discussing duty free in Canada: Educating travelers about wines is important, but it should not be forgotten that many people still need to be educated on exactly what travel retail is. “In Europe and particularly Ireland, where I am from, duty free is part of travel culture as we have all been brought up to understand that you will find better deals at airport

An aerial view of Château l’Hospitalet

188

RYAN WHITE

“ Wines produced according to

A matter of opinion Sandro Bottega, President of Distilleria Bottega, says that educating the consumer in the Americas about Italian wines is an ongoing process. He feels that the question of why wines from the Old World haven’t yet been as readily embraced in the Americas may have to do with something as simple as a lack of exposure. “Businessmen and people who have had the chance to travel to Italy usually choose high quality wines,” Bottega explains. “New consumers are instead attracted simply to the names of the areas and vines.” Of course, Bottega is careful not to over generalize. He tells us that that Brazilians, Canadians, Americans from the East and

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

“I believe the Americas can be a very good target for South African premium wines as the consumer is very open to trying new categories and experiences,” Budd says. “Brazil in particular is an exciting market.” Furthermore, Budd is in agreement with the notion that travel makes for a consumer with a broader spectrum of experience with which to appreciate wines. He also has advice for operators, suggesting that they “should

Distilleria Bottega’s Amarone Prêt-à-Porter was conceived by famous Hollywood designer Denise Focil

challenge themselves to include wines from around the world—including those from South Africa—to give consumers more choices both in quality and price range.” Christophe Balay, Travel Retail Director of Gérard Bertrand Wines, makes an interesting point when discussing the difference in taste between wine drinkers in Europe and those in the Americas: “A good synthesis of what we have observed is that the European consumer asks himself, ‘Where does this wine comes from?’ and the consumer in the Americas asks, ‘What is this wine made with?’” Gérard Bertrand takes guessing out of the equation by mentioning both the terroir and the varietals or blend on its wines. Another plus for the company is its large variety of offerings. Gérard Bertrand offers a wide range of wines, from varietals to its Legend Vintage. Consumers with a taste for sparkling and fortified wines will also find them in the Gérard Bertrand portfolio. The range of products available effectively allows the company to address several different habits of consumption. “Consumers whose preference goes to sweet wines enjoy our Muscato! brand,” says Balay. “We also work a lot on wine and food pairings. Our Gris Blanc, a very pale Grenache rosé, is a perfect partner for Asian food. Our Cremant wines have had great success in classical restaurants. Our Icone wines perfectly fit with French Gastronomie Restaurants such as Chez Benoit in New York City.”

Keeping it fresh Of course, a key element to catching the attention of consumers is continually offering something new. Distilleria Bottega’s latest products are Bottega Diamond, a special Pinot Noir from Oltrepo’ Pavese bottled in a very unique package enriched by crystal diamonds that reproduces the Bottega logo, and

Amarone Prêt-à-Porter, conceived by famous Hollywood designer Denise Focil. Bottega Diamond is a dry, harmonic and velvety sparkling wine characterized by a straw yellow color and a fine and persistent perlage. Dry, velvety, fruity and persistent on the palate, it is enriched by a slight aroma of bread crust and a pleasant aftertaste of fresh fruit and spices. Amarone Bottega, Il vino Prêt-á-porter features a white leather label and is nestled in a white leather case embellished with debossed black lettering: a collectible piece that brings to mind a vintage suitcase. The case is enriched with metal studs and has a metal plaque engraved with the Alpinestars by Denise Focil logo. The bottle was also the inspiration for a recent charity event benefitting the Breast Health Institute, which provides help for women who suffer from breast cancer.

“ I believe the Americas can be a

very good target for South African premium wines as the consumer is very open to trying new categories and experiences.” Anthony Budd, Managing Director, Diverse Flavours

For its part, Paul Sapin is contributing significantly to the environment with its multi-layer polyethylene terephthalate (MLP) wine bottle, which consists of one layer of PET, one layer of nylon and a third layer of PET. The bottles have been proven in laboratory settings to last up to two years. In addition to this already significant advantage over PET, three MLP bottles weigh the same as two glass bottles of equal size, which is certainly good for reducing carbon emissions.

As previously mentioned, Canadians are snapping up the bottles, and Paul Sapin currently has over 20 references listed in duty free north of the border with wines from Chile, Australia, New Zealand, France, Italy and South Africa. This year Geoghegan is looking toward securing more listings in US airports and Caribbean port stores. The company will also be launching new exclusive gift packs in MLP during 2012, including a six-bottle gift pack featuring 18.75 cl bottles

A selection of Diverse Flavours’ duty free portfolio of South African wines

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

189

Wine Report The Rocks Chardonnay 2009, one of Paul Sapin's Australian offerings

of red and white wine from around the world. The company is also developing three and four 75 cl bottle packs in order to encourage travelers to purchase their full wine allowance. “Our wines appeal to a wide range of customers who love wine and consume it as an informal beverage,” Geoghegan notes. “We have customers in the Caribbean who buy it for boating trips, in Northern Ontario consumers choose it while on fishing or hunting trips and people who are heading to a summer house consume the wines by the pool or on the beach, where glass is usually not permitted.” The theme of environmental consciousness continues with Gérard Bertrand—the company is currently in the midst of organizing an international development program for is unique biodynamic Cigalus wine, available in red, white and rosé. Planned also is the Legend Vintage collection of fortified rare wines, which will include 1929, 1936, 1939 and other vintages. Diverse Flavours is seeing a similar amount of success in Asia, where with DFS at Changi Airport the company’s bottles, ranging in price from US$30 to US$120, are selling well. In addition to the listings already mentioned, travelers can find Diverse Flavours’ wines at King Power’s downtown shops in Bangkok, onboard All Nippon Airways (ANA) and Emirates flights, as well as on Korean Air’s Cybersky shop. Proof of the ground that

estates with ease and reliability. Quantity is not important—quality is,” Budd explains. “We also recognize that each operator has unique requirements and we are happy to work closely with them in delivering exciting new products which meet their specific consumer demands.”

A look into the future With many operators understanding more and more the benefits of catering to wine connoisseurs and accordingly allotting more space for the category in store, we asked Bottega about what he feels will be trending in

“ I firmly believe that other

categories will also look to reduce packaging and weight, just as we have done for the wine category.” Barry Geoghegan, Founder, Barry Global Innovation Ltd.

the near future: “Wines produced according to organic and natural methods that respect the territory and are meant for an environmentally aware consumption will continue to increase in popularity,” he said. “Consumers are becoming increasingly wiser and more environmentally conscious.”

“ A good synthesis of what we have

observed is that the European consumer asks himself, ‘ Where does this wine come from?’ and the consumer in the Americas asks, ‘What is this wine made with?’” Christophe Balay

Diverse Flavours is breaking is the fact that in mid-2011 the supplier had the distinction of being the first ever South African company to exhibit at TFWA Asia Pacific & GATE ONE2ONE in Singapore. The most recent additions to Diverse Flavours’ portfolio are two ranges from Ernie Els Wines and Eagles’ Nest Wines, and Budd sees great potential for them in the future. However, as the company moves forward toward its latest goal of conquering the Americas, the portfolio isn’t likely to be the only thing that attracts duty free operators. “Our business model of flexibility, speed and service offers operators the opportunity to consolidate great wines from multiple wine 190

Bertrand is certainly in a position to help make this dream a reality. The company was awarded Best European Winery earlier this year by Wine Enthusiast Magazine, and many of its wines from the South of France have been given high ratings by well respected publications. Saint Chinian and Minervois, for example, both received a 90/100 from Wine Enthusiast, while Tautavel earned the same score from Wine Spectator.

As a distributor, Geoghegan views the issue of environmentally friendly wines first and foremost from a packaging perspective: “I firmly believe that other categories will also look to reduce packaging and weight, just as we have done for the wine category,” he explains. “The culture that you pay for what you carry is here to stay.” Balay believes that the duty free channel in the Americas is ready for operators at large to make room for a South of France subcategory that offers a range of wines at varying price points. As a leader in super premium South of France wines, Gérard

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Budd, on the other hand, sees opportunities in the numerous countries throughout the world where burgeoning middle classes are now beginning to purchase and travel more: “Wine consumption increases particularly in those countries where per capita consumption remains low, but where a growing middle class is increasing their wine knowledge and interest in wines. The South African wine category will benefit from this increase and will offer a new exciting range of products for the c consumer to try and experience.” Gérard Bertrand’s Cigalus, Legend Vintage 1929 and Gris Blanc

Rémy Cointreau Global Travel Retail

A matter of priority

Despite lower margins in duty free, the channel is still a priority as a shop window for Rémy Martin Cognacs given the focus on luxury

Americas Duty Free gets in depth with Rémy Cointreau GTR’s Francois Van Aal, discussing the finer points of supply and demand and the challenges of selling rare Cognacs in duty free BY RYAN WHITE Americas Duty Free: Can you tell us generally how business is and which of your spirits are selling best? Francois Van Aal, Area Director Americas, Rémy Cointreau Global Travel Retail: Rémy Cointreau continues to enjoy global growth, with Rémy Martin and Louis XIII leading the way. This is witnessed in all areas of our business, both domestically and in global travel retail. ADF: With the growth of any spirits supplier, ensuring supply necessarily becomes an issue. Given the rarity of the liquids you’re dealing with, I’m assuming this is a priority for you. FVA: With sales surging, especially in Asia, the issue of supply shortages is being looked at carefully. Both Rémy Martin and Louis XIII are currently progressing at a strong pace supported by strong price increases, innovation, an improved activation program, better execution in the market place and a continued high investment. Even though Rémy Martin owns one of the largest Fine Champagne eaux-de-vie inventories in Cognac, the worldwide demand is very strong and supply is limited. This is something that we are taking very seriously at Rémy Cointreau and need to manage to avoid any shortages in the years to come.

“We will not pull out from travel retail, but we will have to focus on the most premium places — on the most upscale airports — as a priority.” Francois Van Aal, Area Director Americas, Rémy Cointreau Global Travel Retail ADF: How do you manage this issue? FVA: The solution is to prioritize markets/channels and ensure that our Cognacs are sold at the right price. Eaux-de vie rarity and scarcity in relation to Rémy Martin and Louis XIII are already a reality, which reinforces the absolute need to allocate volumes strategically, to bring prices to a much higher and more homogeneous position around the world and to focus on the image building channels over the volume building channels. ADF: I can imagine that ensuring higher margins in duty free presents more of a challenge. FVA: Travel retail is a strategically important market for Rémy Martin and Louis XIII in terms of brand building. Rémy Cointreau has, is and will always remain committed to supply the travel retail markets, but only if the right conditions are met. We will not pull out from travel retail, but we will have to focus on the most premium places—on the most upscale airports—as a priority. Given the stock constraints we face on VSOP, XO and more specifically Louis XIII, the quantity allocated to each market will need to strictly reflect the priorities defined by Rémy Cointreau.

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

ADF: Suppliers often talk about duty free being an important “shop window” for brands. Is it fair to say then that this is the main draw for you in duty free? FVA: It is all about common sense. All brands know that they cannot get the same profitability in duty free as they can in domestic markets due to the price and margin structure. If you only have so much to sell and the demand is close to outpacing supply, it is natural to supply markets and channels that not only give the best profitability, but also the most premium and strategic visibility for the brand. This is what is happening for Rémy Martin and Louis XIII. ADF: What are the end effects, then, of this strategic stance? FVA: This is translating into less volumes available overall in travel retail in the Americas and Rémy Cointreau getting out of some less strategic channels while applying a value strategy in line with the group’s objective. To execute this strategy successfully, we will also need to continue to reinforce our brand differentiation and superiority based on the execution of our core brand idea: “Rémy Martin: the Heart of Cognac.” We will keep the investment high in the key channels, airports and retail locations that we have identified as strategic. ADF: This all may sound a bit scary to operators. Do you have anything you’d like to say to them? FVA: With a rich history of success in building brands, operators should all be confident in Rémy Cointreau Global Travel Retail’s ability to execute our value strategy during 2012-2013 by continuing to make Rémy Martin and Louis XIII two of the most c The rare and prestigious Louis XIII; Rémy desired brands in their universe. Cointreau is taking steps to ensure that there are no future shortages through a strategic brand building initiative

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Aging Spirits

The age difference BY

ANDREW BROOKS

Finesse, finish, process, materials… the age of a fine spirit is a lot more than just a matter of years

ge in a spirit is something akin to the age of a person. To some extent it’s a matter of how you define age—and age and maturity are not synonymous. By regulation, the age of a spirit is the age of the youngest liquid that goes into making it. But many factors can affect the final product, and the makers of aged spirits ring every change and variation they can on the materials and processes they use to make their products distinct. “The actual age is less important than the process itself, but the longer the spirit is left in the cask to take in the flavors and characteristics of the wood, the fuller the taste and the better the quality of the spirit—or so the theory goes,” says Rob Bruce, Whyte & Mackay’s Head of Global PR. “The reality is that people’s tastes are changing and so is the industry, and it’s now less about age and more about the finesse, the finish and the quality of the casks used—not the time the whisky sits in the cask.” Maturation, on the other hand, is less about age, Bruce says, and has more to do with the final finesse and infusion of a whisky into selected casks. “It’s where the spirit is stored for additional time in specially selected casks to impart unique flavor characteristics,” he says, “so less about the age and more about the finish.” All of Whyte & Mackay’s whisky products have aged and non-aged variants, Bruce says, but he notes that the industry as a whole is moving away from aged statements. At Whyte & Mackay the process begins when the Master Blender selects each cask to be used in the aging process across all brands, paying attention to the quality of the wood and the flavors it will impart. He

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

then manages the spirit’s progress through the required span of years to make sure there is consistency in the liquid, or to create new finesses depending on what the spirit demands. The brand’s flagship Whyte & MacKay whisky, Bruce says, is aged longer than any of its competitors through a unique triple maturation process. “This gives the smoothest possible taste,” he says. “We do that because we believe in going further than the rest to get that sublime quality and taste.” Whyte & Mackay’s 30YO expression has twice been recognized as the best blend in the world. It, Jura 16YO and The Dalmore 18YO are The Dalmore Cigar the company’s best sellers in travel retail. Malt Reserve, newly released, is aged in 30 Camus Cognac relies on long aging in year old Oloroso Sherry seasoned oak casks that are light in tanbutts, American White Oak and premier cru nins, says Marketing Director Pascale Cabernet Sauvignon wine barriques Dubos. For some of the brand’s products, such as XO Elégance and Extra Elégance, long aging in cool, damp cellars helps to develop an outstandingly round flavor, Dubos says. “The aging process develops aromas, body, structure, roundness and length over time.” For Camus the market differentiator is the company’s family tradition, with fifth-generation Cyril Camus now running the company. The company boasts a wide range of distinctive products, including the Elégance range, the rare vintage cognacs of the Camus Rarissimes range and a super premium lineup of Cuvée cognacs. “Coming as a limited edition, each is the result of the perfect marriage of a few rare age-guaranteed eaux-de-vie,” Dubos says. Cuvée is presented in a Baccarat crystal decanter (each is numbered)

Whyte & Mackay’s Dalmore on display in Singapore

The Glenrothes single malt: a duty free stalwart for BBR

The superpremium Cuvée Cognac range from Camus

designed by well known French sculptor Serge Mansau. “‘Age’ only tells you how long it’s been in the cask,” says Michael Harrison, Sales Development Director of Berry Bros & Rudd Spirits Ltd. (BBR). “‘Maturity’ implies development within the cask. The interaction between wood and spirit is the single most important part following distillation.” For non-smoky whiskies, between 60-70% of the eventual flavor is derived from the interaction between wood and spirit, Harrison says. “Age means nothing without good active wood and, since no two casks ever mature in exactly the same way, cask selection is also crucial and implied in the word ‘maturity’.” Berry Bros & Rudd matures its whiskies in casks made of American and Spanish oak. Between 20% and 45% of all casks used in every expression are prepared with sherry from new wood, and cost at least three times as much as equivalent sized ex-Bourbon casks—which account for 98% of all casks used in the Scotch Whisky industry, Harrison says. “Maturation in the right casks rounds the edges, removes the harshness and most importantly adds new flavors,” he says. These processes are called subtraction (i.e. of the less desirable elements, which are absorbed by the wood), addition (where the flavors of the wood infiltrate the spirit) and interaction—where the flavors of the wood mix with the flavors of the spirit to create new flavors. “Interaction is the most complex and least discovered part of the maturation process,” Harrison says. BBR does not produce in mass volumes. The company doesn’t own a single malt distillery but instead owns a single malt brand, The Glenrothes. BBR also specializes in fine spirits, including London No. 3 Dry Gin (“the key to the ultimate dry martini”), The King’s Ginger Liqueur, Berry’s Own Selection of Whiskies and other brown spirits. “We continue to strive to build a reputation for long-term and consistent quality which, as a private company, we’re more able to do than the competitors,” Harrison says. “We shall continue to grow our brands on the basis of the ‘steak’ and not the ‘sizzle.’” BBR had a record year in 2010/11. 2012 is looking tougher, Harrison

says, “but while consumers are drinking less they are drinking better.” The single malt category continues to grow, and eastern markets will outperform western ones, he says. “Loss of volume in the soft markets in Europe will be more than replaced by developing markets, and duty free will undoubtedly become more important to us as BBR products become more widely distributed and better known.” Duty free collectively is the single most important market for BBR’s The Glenrothes Speyside single malt whisky brand, accounting for about 20% of sales. In total, The Glenrothes sells over 50,000 cases, while No. 3 London Dry Gin has reached 8,000 cases since its launch 18 months ago. The company has a small presence in Americas duty free through World Equity Brand Builders (WEBB) in Miami, but based on strong growth in Asian and European travel retail, it will be moving to ramp up its presence in this hemisphere, Harrison says. The company will be at the WEBB stand at IAADFS, showcasing the Glenrothes travel retail range as well as London No. 3 Dry Gin. The travel retail market is an important one for Whyte & Mackay, Bruce says. Jura has grown by 48% and The Dalmore by 55% in travel retail in the last 12 months. “Travel retail offers a fantastic shop window for our premium and luxury brands in an up-market setting,” Bruce says. “This is great for affluent consumers who travel regularly, spend a lot of time in airports and therefore take a little time over their purchases.” Whyte & Mackay has focused on Asia and Europe over the last few years, but recently opened its own US operation. Once it’s up and running Americas duty free will become a bigger focus, Bruce says. “Camus Cognac is present in Americas duty free,” says Dubos. “Duty free is a core channel for our cognacs—it’s a market where we can do some great merchandising and consumer education.” Camus will be present at IAADFS, showing off the Elégance line along with all of Camus’ cognac ranges and some other premium brands that it owns or distributes, including Berneroy premium Calvados, Moutai prec mium Chinese Spirit, wines and more. www.dutyfreemagazine.ca THE AMERICAS DUTY FREE & TRAVEL RETAILING

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In-flight Spirits Report

In high spirits BY

ANDREW BROOKS

Some of the industry’s biggest players tell Americas Duty Free that in-flight sales are challenging, but a great opportunity if approached properly

Drambuie 15: a travel retail product that enables the brand to fit into different in-flight sales classes

Patrón XO Cafe coffee liqueur: Patrón’s fastest growing seller, in flight and on the ground

s anyone who flies can readily understand, lack of space is probably the biggest hurdle faced by liquor companies looking to sell their products on airliners, whether via pouring or bottle purchase. In fact, the cramped conditions tend to generate a series of cascading effects, says Zachary Sulkes, Regional Manager, Bacardi Travel Retail Americas. “The lack of space on board has an immediate impact on the volume of sales as there are usually only one or two bottles aboard of any one SKU, so sales are limited,” Sulkes says. “The other knock-on effect of the lack of space is the value this places on listings in the catalog and program, which are very desirable. For example, there are only approximately 10 to 12 liquor SKUs in any in-flight program, so getting one, two or three of these slots will impact significantly on sales. Fortunately, the strength of our brands and our partnerships with the concessionaires help us to overcome this issue and obtain great listings." There’s a plus side too, however: product differentiation. “Differentiating the product is actually easier,” Sulkes says. “A rare benefit of the lack of space on board a plane is that there are fewer SKUs than you find in a traditional retail environment.” The market has been performing well, and relatively consistent with airline capacity, Sulkes says. The customer profile is also fairly consistent. “Travelers are seeking out global brands that they trust to deliver premium quality and value for money and that’s exactly what our portfolio delivers.” In-flight sales have proven to be fairly resilient during the recession, says Drambuie’s Assistant Regional Manager Siobhan Rodwell, thanks to the ability to give the customer a concentrated three-pronged dose of product exposure through sampling, pouring and in-flight sales. The presence of Drambuie and the newly released premium aged Scotch whisky liqueur Drambuie 15 in virtually all major international airports drives awareness higher too, in addition to broadening the market footprint to cover a broader range of price points. Drambuie has benefited from a recent up-rating of food and beverage service on British Airways that meshes nicely with the launch of Drambuie 15. The Drambuie liqueur has always been present in all three classes aboard BA, but now Drambuie 15 is replacing Drambuie in Business Class and First Class, with Drambuie remaining in Economy. Drambuie 15 started out only available via pouring, but has just started in in-flight sales as well. Drambuie and Drambuie 15 have also launched on Virgin Pre-order through Tourvest, along with Drambuie’s Royal Legacy of 1745, an upscale malt whisky liqueur that won the Drinks International Travel Retail Award for Best Travel Retail Drinks Launch at TFWA Cannes in October 2009 (which Drambuie 15 won the following year with its 2010 launch). Needless to say, Royal Legacy is an especially good fit in First Class. “The main challenge with in-flight is working with concessionaires and airlines to make sure we’re competitive on price and products versus the airports,” Rodwell says. This is where Drambuie 15 fits really well—it’s basically a travel retail product, although it is being launched in domestic markets too.” Services like web-based ordering, home delivery and especially pre-ordering have been working very well. A UK-based dedicated Drambuie brand ambassador is available for cabin crew information days to provide brand education.

Market makers Onboard carriers, Patrón Spirits sells primarily Patrón Silver, Patrón Añejo and Patrón XO Cafe coffee liqueur. The latter is the brand’s fastest growing seller, both in the air and on the ground. Overall, in-flight sales amount to about 7% of the duty free total, says Joe Arellano, Patrón Spirits VP for Latin America and Duty Free. He notes that it’s a market that Patrón has a good hold on. Virtually no tequila was sold in flight until Patrón entered the market a few years ago, he says. “There are still very few tequilas available in flight other than Patrón, so in essence we created the tequila category for in-flight retail.” 198

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Bombay Sapphire: Bacardi’s brand strength is key to getting in-flight listings

In-flight sales have grown well, Arellano says, from no listings a couple of years ago to current listings on 14 airlines. More are in store for later this year, including confirmation for Patrón Añejo Tequila with Hong Kong Airlines and Hong Kong Express. Patrón XO Cafe has several current airline listings, including South African Airlines, and the brand will appear on Virgin Atlantic in April. Monte Wilson, Brown-Forman’s Director, Americas Duty Free and Global Key Accounts, says that the in-flight channel offers an excellent opportunity to showcase brands to a captive audience that reflects the ideal demographic to grow Brown-Forman’s brands internationally. “Most of these consumers have the opportunity to purchase duty free in the airport stores before departure, and in some cases upon arrival, but in-flight gives them and our brand a second chance to meet. It’s a duty free store at an altitude of 30,000 feet!” One of the main challenges for in-flight sales as Wilson sees it is to offer a product with three important criteria: It must be unique, it has to be a premium product, and it must turn quickly. “Due to the limited space on the cart, and with over 100 to 150 other items being offered in the catalog, it can be quite competitive to say the least. This is why we believe that training and education are so important to our success in all channels, especially in-flight.” Brown-Forman’s leading in-flight seller is Jack Daniel’s Tennessee Whiskey, but the portfolio also includes Finlandia Vodka, Southern Comfort, Gentleman Jack, Woodford Reserve, Casa Herradura Tequilas and Chambord Liqueur, among others. Brown-Forman has held staff training sessions, coordinated by its in-flight partner DFASS, to educate flight attendants about the product range and ensure they can communicate product features to passengers. Staff incentive trips to the Jack Daniel’s distillery in Lynchburg, TN and 500-mile awards to consumers when they purchased a bottle of Woodford Reserve on Delta have also proven to be successful, Wilson adds.

A souvenir value As mentioned, Brown-Forman’s in-flight partners include DFASS, which sells Jack Daniel’s Tennessee Whiskey on Air Canada, Singapore Airlines, US Air, American, Aero Sur, Avianca, Continental, Delta and others. Wilson says Jack Daniel’s is a “cart stopper” because many passengers want to pick up the “Old No.7” brand to take home with them as a piece of Americana. DFASS has performed sterling service in introducing new brands onboard for Brown-Forman, Wilson says, including Woodford Reserve Bourbon, introduced a year ago, and more recently, Jack Daniel’s Silver Select Single Barrel, which is a duty free exclusive. Patrón also sees the crew as an important part of the equation: “The flight crew can be a great brand ambassador for us during a flight so we do want to get the Patrón story across to them as best we can,” says Arellano. “Many airlines and concessionaires have functions for the crew scheduled in key cities where the crew can come to see all of the products sold in the catalog and learn more about the brands. We provide brand information and sampling to the crew members attending so that they learn additional information about the brand and feel a connection to Patrón.” Sulkes says that catalog advertising and promotions such as multi-bottle offers are top sales drivers for Bacardi. But meeting with and educating the flight attendants who do the selling is also valuable, Sulkes says. “Once or twice a year, each airline has roadshows when they’re about to kick off a new in-flight program. This is a valuable opportunity for us to have oneto-one interaction with the flight attendants and give them brief trainings on the excellent features and benefits of our portfolio of brands.” In-flight sales may be able to weather economic storms a little bit better, Rodwell says, but in Drambuie’s case, it has proven helpful to have a product at every price point, from Economy to First Class. “2012 is looking quite positive,” she says. “The Americas is a very strong market for Drambuie—our top market domestically, in fact. There’s great brand awareness c there, and of course that helps with travel retail and in-flight too.”

Jack Daniel’s Old No. 7: an in-flight “cart stopper”

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

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World Brands International

Choco Noir is a pinot noir based chocolate wine with 14% alcohol by volume; the brand has won numerous awards for taste and packaging

Channel changers

World Brands International BY ANDREW BROOKS builds its name in Americas travel retail

“O

ur entire portfolio is technically available for travel retail, but in terms of travel retail and duty free we’re focusing heavily on a few products right now,” says Karlo Reyes, Vice President, Operations, World Brands International LLC (WBI). The products he refers to have recently joined the WBI portfolio. WBI was recently granted exclusive representation of Snyder’s-Lance Inc. for the duty free and cruise line market. At the moment, the WBI team is focusing on the Snyder’s “Dips” series to introduce the brand into these markets. The series features Milk and White Chocolate Dips, Chocolate Peanut Butter Sandwich Dips and Bite Size Chocolate Nibbler Dips. All feature Hershey’s Milk Chocolate (with Hershey’s White Crème for the White Chocolate Dips). WBI is also concentrating on the introduction of Choco Noir into the duty free and cruise line markets. Produced by wine-based cocktail specialist Premium Blend, Choco Noir is a pinot noir based chocolate wine, with 14% alcohol by volume. Choco Noir was a Gold Medal Winner at the San Diego International Wine Competition in 2011, a Double Bronze Medal Winner (for taste and packaging design) at the Los Angeles International Wine & Spirits Competition and achieved a “Good – Recommended” 82 rating at the 2011 Ultimate Wine Challenge. In addition to Choco Noir, WBI is also concentrating on Premium Blend’s “Wild Cocktails” line of ready-to-drink wine-based cocktails. Packed in six-bottle cases of 1.5-liter PET bottles, Wild Cocktails flavors include Piña Colada, Strawberry Daiquiri, Margarita, Mojito, Hurricane and Long Island Iced Tea. Other brands in the WBI portfolio include Ruskova Vodka, Dosal Tobacco, Sal Y Sol nuts, snacks and sweets. “The company is unique

200

due to its range of products, from spirits and tobacco to quality snack food items,” Reyes says. “What sets us apart from the rest is our ability to attain brands in different product categories and be able to consistently introduce those brands into our pipeline, creating a consistent demand for those products.” WBI is experiencing good growth and has recently been most heavily involved in travel retail in Spain, Brazil, Japan, the Dominican Republic, Chile and Mexico. The company’s performance is definitely buoyed by overall market health: wines and spirits sales volumes in travel retail rose by 10.4% in 2010 to reach 25.4 million cases that year, which is the highest level since 1999. Spirits volumes grew by 13.5% while wine sales increased by 3.7%. The Americas, Africa, Middle East and AsiaPacific regions all recorded double-digit rises in travel retail wines and spirits sales in 2010, while growth in Europe was slower at 5.9%. WBI bases its marketing strategy on market research, followed up by test marketing, tasting events in stores and private venues, publicity campaigns, the distribution of targeted marketing collateral and consumer incentives and premiums. Sponsorships and special events are also a big part of the mix, and local consumer advertising is undertaken if it’s seen to be appropriate based on the market potential of the brand involved and within the budget allowances of WBI and the brandowner. Recently the company has increasingly adopted social media as a marketing tool, launching viral direct communication campaigns via Twitter and facebook. These address specific market segments according to the demographic targeted for the specific brand. WBI has a broad range of operator relationships, and is targeting or has negotiated with major duty free operators in the Americas and elsewhere such as Duty Free Americas, Dufry, Motta Internacional, Aldeasa, DFS Galleria and Grupo Wisa. In conjunction with their longstanding industry contacts, WBI is targeting or has negotiated with no fewer than 17 cruise lines, including Blount Small Ship Cruises (formerly American Canadian Caribbean Line), American Cruise Lines, Carnival Cruise Lines, Celebrity Cruises, Clipper, Cunard Cruises, Holland America Line and Royal Caribbean International. At present, Reyes says, further negotiations are underway in Latin America and the Caribbean. c The Snyder’s-Lance Pretzel Dips series: Hershey’s White Crème and Milk Chocolate

The Snyder’s-Lance Pretzel Dips series: Hershey’s Milk Chocolate THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Ruskova vodka is another popular brand in World Brand International’s strong portfolio

AFTER A GOOD MEAL

the natural herbal digestive

worldwide after a good meal since 1846 Find us at the Haleybrooke stand 207 â&#x20AC;&#x201C; IAADFS 2012 www.underberg.com

Made in Germany

Bacardi Global Travel Retail

150 years

of excellence

The Bacardi activation at Miami Airport

Bacardi celebrates a momentous occasion in style with a new limited edition release and activations at key airports in the Americas BY RYAN WHITE

acardi Global Travel Retail is commemorating the 150th anniversary of Bacardí, the world's favorite and most awarded rum, with a year-long programme of special events. The celebrations are beginning in style with airport spectaculars and the launch of a US$2,000 limited-edition decanter of rare Bacardí rum. Bacardi was founded in Santiago de Cuba on February 4, 1862, when Don Facundo Bacardí Massó purchased the small distillery where he would create a revolutionary new rum. He introduced techniques never before used in rum-making to create Bacardí Rum, the world’s first smooth, light-bodied spirit. For 150 years, the secret art of blending Bacardí Rum has been handed down from one Maestro de Ron (Master Blender) to another, ensuring that its flavor profile and premium quality are as exceptional today as they were when it was first blended in 1862. From its earliest years, the smooth, light-bodied spirit was an inspiration for cocktail pioneers, changing cocktail culture forever and bringing people together at legendary Bacardí parties.

Celebrating 150 years of legendary parties In San Juan and Miami, travelers will enjoy the most extraordinary airport spectaculars ever created by Bacardi Global Travel Retail. At San Juan’s Luis Muñoz Marín International Airport in Puerto Rico, giant 3D 10-foot-tall Bacardí bats have taken up residence on the airport concourse for the month of February. The iconic Bacardí bats are decorated with photography and advertisements celebrating the brand’s rich heritage as well as contemporary imagery to reflect how Bacardí is still bringing people together today through legendary parties and great-tasting cocktails. Puerto Rico is home to the largest premium rum distillery in the world. In Miami International Airport, the North Terminal rotunda is filled with the spirit of Bacardí as imagery of 150 years of legendary Bacardí parties is on display. Travelers to San Juan and Miami will be served a refreshing authentic Bacardí Mojito, one of the many classic cocktails inspired by Bacardí Rum, to toast the 150th anniversary and enjoy while they take in the exhibitions. And in both airports, Bacardí maintains its high profile from the concourse through to retail outlets where the latest digital merchandising units, equipped with hologram technology and tablets displaying the Bacardí Mix Master cocktail app, will ensure maximum in-store visibility.

Celebrating 150 years of craftsmanship Taking center stage as part of the 150th anniversary showcase in both San Juan and Miami and at other select airports around the world will be an extremely rare and very exclusive vintage rum. To honor 150 years of Bacardi rum-making expertise and craftsmanship, eight 202

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Maestros de Ron, all Bacardí family members, have combined their extraordinary talents to create a very special, limited-edition Bacardí rum: Ron Bacardí de Maestros de Ron, Vintage, MMXII. A blend of the finest rums laid to rest in oak barrels over the last 20 years and finished in 60-year old Cognac barrels, the vintage blend is presented in a hand-blown 500ml crystal decanter housed in a leather case and retails for US$2,000. The truly limited decanters are available to purchase at premium retail establishments around the world and select international airports. “Ever since Don Facundo Bacardí Massó revolutionized the world of spirits with the creation of BACARDÍ Rum in 1862, Bacardí has been bringing people together to enjoy the very best cocktails at legendary parties,” said Vinay Golikeri, Bacardi Global Travel Retail Marketing Director. “In 2012 we will be celebrating 150 years of legendary parties with a year-long series of exciting Bacardí programmes that will engage consumers and drive footfall throughout global travel retail. It’s the perfect way to celebrate the 150th birthday of a c remarkable company and a revolutionary rum.” Ron Bacardí de Maestros de Ron, Vintage, MMXII is a blend of the finest rums laid to rest in oak barrels over the last 20 years and finished in 60-year old Cognac barrels

www.fireballwhisky.com PLEASE DRINK FIREBALL RESPONSIBLY BEBA FIREBALL CON RESPONSABILIDAD Please visit us at IAADFS at the Stansfeld Scott Stand #201 and Chase International Stand #1111

WHISKY WITH NATURAL CINNAMON FLAVOR, 33% ALC/VOL (66 PROOF), IMPORTED FROM CANADA BY SAZERAC CO., FRANKFORT, KY

Liquor News (from left) Flavio Andreatta, in charge of the Cayman Islands for Giowine; Giovanni Cardullo, founder; and Ricardo March, Sales and Marketing Director

Giowine brings new vintages,

stronger Caribbean presence to IAADFS

It’s been a year since Italian wine distributor Giowine opened a new office in the Cayman Islands to strengthen its service to Caribbean customers. The opening reflects “The Italian link to the Americas,” which is Giowine’s new slogan. “Having an Italian representative in the area, we have a better and faster reaction to market needs, and we can also better understand

trends,” says Giowine’s Sales and Marketing Director Ricardo March. In the Caribbean, Giowine serves duty free operators, cruise lines and distributors such as Cayman Distributors, AMCO and others. The market is still on the soft side, March says, but an upward trend is visible. The company’s South American portfolio is performing especially well thanks to

good pricing and lower transportation costs; Spanish and Italian wines aren’t far behind. IAADFS attendees will be able to check out new offerings such as Masi’s new Corbec, Batasiolo’s new Moscato Rose dolce, Planeta’s Cerasuolo di Vittoria Classico “Dorili” and Fantinel’s introduction of Cuvee Prestige Brut at booth 1101.

Patrón introduces duty free exclusive packaging Patrón has announced that exclusive to travel retail customers, Patrón tequilas and Patrón XO Cafe bottles will soon be available packaged in a limited edition collectable tin. “We’ve long recognized that duty free is a unique retail channel, and those who shop in duty free stores are looking for distinctive luxury goods, gift ideas and items immediately useful while traveling,” says John McDonnell, COO at Patrón Spirits International. “Our new tin package fits perfectly in travel retail as it’s an exclusive offering not available in domestic markets, a great gift item and also convenient for keeping together souvenirs.” The keepsake tin The keepsake tin features a removable lid that when closed exactly resembles features a removable lid that when closed the Patrón box that has quickly become such an icon in the ultra-premium spirits exactly resembles category. The tin will be available across the Patrón portfolio (Patrón Silver, Patrón the iconic Patrón box Reposado and Patrón Añejo), as well as for Patrón XO Cafe coffee liqueur. “In addition to providing a key commercial channel with an exclusive offering, we also hope to gain new consumers who have yet to try our high-quality, ultra-premium spirits, while providing loyal Patrón consumers with something new, better and special,” adds Jason Nussbaum, Patrón Spirits Director of International Marketing. Patrón products are now available in about 130 airports worldwide, and in more than 700 total duty free outlets. Patrón Spirits International posted a 49% increase in total global travel retail sales in 2011 and the company’s total international business was up 45%.

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

American Caribbean Gateway is the official travel retail distributor for General Cigar products in the U.S. and Latin America.

SURGEON GENERAL WARNING: Tobacco Smoke Increases The Risk Of Lung Cancer And Heart Disease, Even In Nonsmokers. ÂŠ2012 General Cigar Co., Inc.

For inquiries please contact Marc Panara: Tel: (954) 524-9097 Email: marc@usaacg.com

Liquor News

Jack Daniel’s launches new Master Distiller Collection at IAADFS

Master Distiller Jeff Arnett will be available at IAADFS to discuss Jack Daniel’s Master Distiller’s Collection

Brown-Forman Travel Retail will unveil the long-awaited Jack Daniel’s Master Distiller’s Collection at the 2012 IAADFS Show in Orlando in March. The new collection is designed to honor Jack Daniel and the six other master distillers who have crafted Old No.7 since the iconic whiskey’s 1866 inception in Lynchburg, TN. The Master Distiller Collection will initially be a Travel Retail exclusive. “This will be a terrific addition to the Jack Daniel’s Travel Retail family in that it pays tribute to the invaluable role that the Jack Daniel’s master distillers have played in perpetuating the quality, essence and appeal of what Jack created some 140 years ago,” explained Jim Perry, Managing Director, Brown-Forman Travel Retail. Each year a different Jack Daniel master distiller will be honored, beginning with Jack himself and ending with current master distiller Jeff Arnett. The collection will come in a distinctive gift box bearing the likeness of the master distiller being honored and each bottle will be sequentially numbered on the back label . Master Distiller Jeff Arnett will be available at IAADFS to discuss the series and the history of the distinguished group to which he belongs as well as answer whiskeyrelated questions.

A. de Fussigny Cognac Orbis Aged World launches Vintage Collection Whisky makes appearance at IAADFS with World of Patria

A. de Fussigny Cognac has announced the launch of four rare and exclusive vintage Cognacs as part of the A. de Fussigny Vintage Collection. The new release is attractively presented in a luxurious, uniquely designed orange lacquered wood box and is available in limited and small quantities. Four vintages have been released: 1969, 1970, 1975 and 1988. These exceptional "eaux de vies" are carefully and personally selected by the A. de Fussigny Master Blender for their rarity, quality, elegance and outstanding aromatic concentration. The company notes that these Vintages have already secured duty free listing with key duty free operators. 1988, one of the offerings from A. de Fussigny’s new Vintage Collection

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THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Orbis is the first ever world blend of finest aged whiskeys from five great whiskey nations—Scotland, Ireland, the US, Canada & Japan. The brand was launched at last year’s TFWA WE in Cannes and Janet Murphy, Marketing Director at St. James Distillery Ltd., tells Americas Duty The whiskies that make up Orbis— many of which are 15 or 16 years Free that to date the response to the old—are married together to create a balanced blend unique liquid has been very good. “For the moment we’re still focusing on rolling the brand out to a wider audience,” she says. “It really is unlike anything else available and is a perfect fit for travel retail.” The whiskies that make up Orbis—many of which are 15 or 16 years old—are married together to create a balanced blend. Orbis is released in small batches and each bottle is individually numbered. Attendees to this year’s IAADFS exhibition in Orlando can learn more about Orbis by visiting distribution partner World of Patria’s booth number 1300.

Liquor News

The innovative World of Beer display is part of a series of global initiatives to mark Heineken’s involvement as an international partner in the travel retail industry

Heineken brings World of Beer display to Barão Duty Free shop in Rivera, Uruguay Heineken Western Europe Export & Global Duty Free recently rolled out its successful World of Beer display in Latin America. The newest duty free operator to feature the interactive display is Barão Duty Free shop in Rivera, Uruguay in cooperation with Kraudal Trading. The fixture was installed in early February and reports from Heineken indicate that the response has already been very positive. This innovative display is part of a series of global initiatives to mark Heineken’s involvement as an international partner in the travel retail industry. The shelving configuration of the World of Beer display enables retailers to customize their offer according to the shopper profile, bringing great flexibility in terms of SKU's and giving a premium look and feel to the beer aisle. The unit is available in multiple formats,

from a stand-alone aisle to a full wall fixture. “Shopper research has shown the increasing desire for more variety in beer in travel retail,” says Carlos Candeias, Heineken’s Global Account Manager Americas. “As Heineken aims to be the leading brewer, concepts such as ‘World of Beer’ add value to the shopper’s experience by creating an engaging in-store destination and encouraging trial and purchase.” Heineken offers a wide range of brands, including the premium international brand Heineken; Italy’s number one lager brand Birra Moretti; Spain’s leading lager Cruzcampo; Czech origin Krusovice Imperial and Cerné; internationally known brands like Desperados, Murphy’s, Newcastle Brown Ale, Affligem and Sol; and regional and ethnic brands like Lapin Kulta and Sagres.

WEBB continues to see strong growth in the Americas “We’ve had a very good year,” says Andy Consuegra, Founder and Managing Partner of Miami-based marketing and distribution company World Equity Brand Builders (WEBB). “It looks like 2011 was in line with the previous year’s growth of 69%—and it’s a combination of organic growth of existing brands and adding new brands to the portfolio.” 2012 looks set to achieve a similar benchmark, Consuegra says, based on the same strong organic growth as occurred in 2011. For WEBB, whose core business lies in the Caribbean market, the performance says as much about the vitality of the region’s duty free market as anything else. The Edrington Group’s line is especially strong in domestic Caribbean markets, although in some countries the brand’s duty free sales are significant. Famous Grouse and The Macallan are doing well and Flor de Cana is strong in the high-end rum category. As always, Armand de Brignac occupies a unique niche among super-premium champagnes, and Consuegra expects it to end the year as one of WEBB’s top brands. “Our brands are putting us where we are today,” Consuegra says. Armand de Brignac, rated top champagne in the world—the “rockstar” of its category

Appleton Estate 21 Year Old gets a new look Appleton Estate 21 Year Old Jamaica Rum has received a package upgrade in keeping with its luxury positioning. The expression’s signature royal blue color cues have been retained in the canister, the neck and foot labels and the cartouche, but the new decanter now has a painted label in keeping with the luxury profile of the brand. “This is an evolutionary upgrade which underpins Appleton Estate 21 Year Old Jamaica Rum’s luxury credentials,” says Managing Director Paul Henriques. “It is now presented in a proprietary decanter, the design of which was inspired by the Appleton Estate signature bottle that has been a hallmark of the brand since it was launched, and it is finished with a cork closure. We are thrilled with the new presentation, which we feel is a better reflection of the very special and rare Appleton Estate 21 Year Old Jamaica Rum.” 208

The new label highlights unique aspects of Appleton Estate’s manufacturing process and unique qualities. Furthermore, Appleton Estate’s 260-plus year history and heritage is showcased on the neck label, which features the brand’s iconic artist’s impression of the Appleton Estate scene. The 21 years minimum aging is again highlighted on the cartouche. Appleton Estate 21 Year Old Jamaica Rum is a once a year limited release that will be sold on an allocation basis and each bottle will be numbered on the foot label. Each bottle of Appleton Estate 21 Year Old Jamaica Rum comes with a certificate of aging.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

Appleton Estate 21 Year Old Jamaica Rum is a once a year limited release that will be sold on an allocation basis and each bottle will be numbered on the foot label

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Liquor News

MONARQ highlights

portfolio growth, Americas footprint at IAADFS

MONARQ Group has announced a new agreement with Miami-based Alebrand Spirits Company to manage, distribute and market Atlantico Rum in Latin American and the Caribbean markets plus US duty free as of February 1, 2012. Atlantico is currently the fastest growing ultra premium rum in the US. Up to this point, MONARQ’s portfolio was still in search of the right rum brand. Robert de Monchy, MONARQ’s Managing Director and owner, says that the company will officially introduce the new addition at the 2012 IAADFS exhibition (booth 1037). The year 2011 was an excellent year, comments de Monchy. Business continued to grow in the high double digits, both top and bottom line, and the trend is expected to continue through 2012. Also, at the beginning of this year MONARQ announced the hiring of Marte Salazar and Janelle Lee Loy, who will cover Latin America and the Eastern Caribbean, based out of Mexico and Trinidad, respectively.

Enrique Iglesias is a partner in Atlantico Rum, the product at the center of MONARQ’s latest distribution deal

“We’re in advanced talks with two new companies about very exciting brands in categories that we haven’t really covered yet,” de Monchy adds. “We’re targeting IAADFS 2012 to introduce at least one of them, and we’ve extended our booth for the show this year.”

Savary Argentina Torres heads into 2012 on the strength readies for new listings of TFWA WE releases buoyed by strength of Violaine Creuzé, International Travel Retail Manager at Torres, tells Americas Duty Free that 2011 was a good year for the company, especially considering strong releases announced during the 2011 TFWA WE in Cannes. Added to an already strong portfolio was the Hemispherio range of wines, which includes Cabernet Sauvignon and Sauvignon Blanc varietals; the Santa Digna range of fairtrade wines, which includes a Sparkling Rosé; Jean Leon Chardonnay and Merlot varietals; a red made with Syrah for the Natureo range; and Verdeo, an offering made with 100% verdejo. In addition to the above, Gran Coronas is selling well in duty free, says Creuzé, and is a focus for the company this year. Another recent listing is a Sangre de Toro bag-in-box Rosé, which was launched in Nordic countries. Creuzé tells us that the response to these products has been very positive. Overall, Torres carries some 50 brands sold in 140 countries around the world. The company’s primary presence in Spain is obvious, but Torres also has vineyards in Chile and California, both of them prime breeding grounds for global wine success stories. Gran Coronas is selling well in duty free and will be a priority for Torres this year

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LATAM economy

For Savary Argentina, the strength of the emerging Latin American economy has been a boon. With more disposable income and oftentimes an existent knowledge of New World wines, consumers from Mexico, Peru, Colombia and especially Brazil have become an important target group. “It is well known that the growth rate of the emerging economies is overcoming the developed countries,” the company tells Americas Duty Free. “This trend will keep on creating new middle class individuals that will start to travel around a lot more and adopt new habits. Of course, with any luck one of those habits will be an appreciation for fine wine. While details are still under wraps, Savary tells us that this year will see the introduction of a selection of no less than five world wines in several travel retail shops in US, Mexican and Caribbean airports. “There are plenty of opportunities—both in North America and in Latin America—available for us,” the company concluded.

Finca los Nobles and Saint Felician, just two of the many wines in Savary’s extension portfolio

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Liquor News

Beam Global brings a stable of well respected brands to IAADFS Americas Duty Free recently spoke with José Aponte, Director US & Caribbean Duty Free for Beam Global Spirits & Wine, Inc., about this year’s IAADFS show in Orlando. Aponte told us that attendees can expect to find a number of interesting recently released products at the Beam stand (#323). Taking bourbon innovation into “devilish” territory, Beam unleashed Devil’s Cut in 2011—a new, premium bourbon that is created using a proprietary process that extracts the liquid trapped inside the wood of the bourbon barrel. Also last year, Courvoisier continued to revolutionize the Cognac category with the launch of Courvoisier Rosé, a first of its kind blend of Cognac and premium French red wine grapes. In terms of white spirits, Beam launched Pucker Flavored Vodka in May 2011 to further expand its presence in the dynamic flavored vodka category. Of course, other favorites such as Knob Creek, Red Stag and Maker’s Mark, in addition to newer brands Cruzan rum and Effen vodka, will also be on hand at the Duty Free Show of the Americas. “The stories behind the individual brands and how and where they are made are unique, but they all share the same exceptional characteristics of quality, authenticity and craftsmanship,” Aponte told us. “We invite attendees to learn more Jim Beam Devil’s Cut, one of the about our award-winning portfolio of brands by more recent releases from Beam Global Spirits & Wine, Inc. visiting our stand at this year’s IAADFS show.”

Barton & Guestier takes the guessing out of wine and food pairings Barton & Guestier USA, importer of Barton & Guestier (B&G) wines, is ready for a busy 2012 hot on the heels of the launch of B&G wines in duty free in November 2011. B&G wines have been listed in all of Duty Free Americas’ stores at the major border points and airports in the US, as well as in the Port of San Juan Puerto Rico with SMT. Displayed on elegant black and gold wine racks and showcased in their “Kool” bags, sales of the wines have increased significantly, reports Hubert Surville of B&G. At the same time, Barton & Guestier USA also introduced “Les Charmes de Magnol Medoc,” an intense wine from the prestigious Chateau Magnol made from selected plots with limited yields and blended with two famous Bordeaux grapes: Cabernet Sauvignon and Merlot. For 2012 Surville tells us that the company is looking to make wine more accessible for consumers in the Americas: “We’re releasing a new range made specifically to take the guessing out of wine and food pairings,” he explains. “With names like ‘Chops & Burgers,’ ‘Chicken & Turkey’ and ‘Cheese & Crackers,’ we’re making wine fun for the consumer and taking some of the intimidation out of enjoying wine.” Attendees to this year’s IAADFS show can visit B&G to learn more about new developments at booth 1200 With names like “Chops & Burgers” and “Chicken & Turkey,” Barton & Guestier USA is taking some of the intimidation out of enjoying wine

Demerara makes progress in Canada as El Dorado rum continues to win top accolades Komal Samaroo, Vice President of International Marketing at Demerara Distillers Ltd., tells us that 2011 was a fantastic year for the company. Listings in retail outlets increased by 10% and in volume terms sales grew by over 15%. He attributes the company’s success to the quality of El Dorado rum and the fact that more and more consumers “are discovering the pleasure of sipping rums.” Also helping sales is the fact that last year IntraBrands was appointed Demerara’s duty free broker in Ontario, and “significant progress” has already been made at Ottawa and Montreal airports and most Canadian border shops, Samaroo tells us. Product introductions are scheduled for spring of this year. On the back of numerous product and gift pack launches such as 6YO DeLuxe Silver, El Dorado Spiced Rum and the three-bottle Connoisseur's

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Choice mini-pack, Demerara will this year continue to work on penetrating the duty free market with novel gifting ideas. Also high on Demerara’s list of priorities is making sure that word is spread far and wide about the supreme quality of El Dorado rum. El Dorado was extremely successful at last year’s International Wines and Spirits Competition in London. For the second year in a row Demerara Distillers Ltd. was named Distiller of the Year for the Americas and the Caribbean, also winning the Spirits Producers Trophy for the region. In addition, El Dorado 15YO was the Trophy Winner for the coveted Best Rum Award, and El Dorado 12 and 8YO rums won Gold Medal and Best in Class, respectively. “This is a reaffirmation of the quality of the El Dorado portfolio of rums,” Samaroo says.

THE AMERICAS DUTY FREE & TRAVEL RETAILING MARCH/APRIL 2012

At last year’s International Wines and Spirits Competition El Dorado 15YO was the Trophy Winner for the coveted Best Rum Award

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Timeless Time brand cigarettes appeal to price-conscious consumers who still want a quality product

KT&G

Opportunities abound Given increasing numbers of traveling Koreans in the US, KT&G sees a place for its brands in airport stores across the country

mericas Duty Free recently had the pleasure of sitting down with Jihyun Choi, Overseas Brand Department Manager at KT&G, to discuss new developments with the company as it prepares to exhibit at this year’s IAADFS show in Orlando. Choi told us that while the economic boom in Asia has brought about many opportunities for Western companies in the region, KT&G is benefitting from an increase in South Korean travelers visiting the Americas. “We have been selling our top brands ESSE and Raison via airport duty free shops in New York and Philadelphia with International Shoppes, and we are planning to present our products in Washington DC airports this year,” Choi explains. Since its introduction, the ESSE brand has grown rapidly in terms of both sales volume and brand awareness. To date, ESSE has been introduced in more than 40 countries and has become a serious player in the super slim cigarette subcategory. KT&G says that ESSE is meant to appeal to young, trendy 20-somethings who are “confident in expressing themselves, have modern sensibilities and possess a desire to be unique and stylish.” “As the share of female smokers rises and the wellness trend spreads across the globe, the super slim, low-tar cigarette market is

growing,” Choi tells us. “ESSE is at the center of the trend as a leading brand and its popularity has been growing continuously among users in the global market.” Also highly popular among the young generation in South Korea is the Raison brand of king size cigarettes. Choi tells us that the cat on the package symbolizes outside-thebox thinking and a willingness to experiment. Raison cigarettes contain a dual charcoal filter and offer a smooth herbal flavor. Largely because of its strong stable of brands, KT&G saw growth across the board in 2011. “The demand for ESSE super slim cigarettes is clearly visible,” says Choi. Given last year’s successes in New York and Philadelphia, Choi sees further opportunities in airports that cater to large numbers of Korean travelers. “We are specifically targeting Korean nationals who are traveling from the USA to Korea,” she explains. “In addition, there are many Koreans who live in America or visit there regularly, and our brands ESSE and Raison appeal to that demographic.” In the domestic market in the US, KT&G has been selling its Carnival brand since 2000 and recently released the Timeless Time brand in May of last year. Choi says the cigarettes target consumers who are seeking very competitive pricing in addition to quality. For 2012, KT&G plans on focusing on

RYAN WHITE

expanding its reach in the Americas by leveraging the many good relationships it currently has with operators. Additionally, the company is concentrating on increasing standout where its brands are currently listed by introducing showcases and other point of sale materials. Choi tells Americas Duty Free that the company’s commitment to attending the IAADFS exhibition is part of a larger plan to attend more trade shows this year as a means of networking with possible future partners. Finally, KT&G is watching Los Angeles International Airport (LAX) closely to see what comes of the duty free tenders currently on the table there. More than 2,200 square meters of duty free space will be added to the Tom Bradley International Terminal. This includes a 1,300square-meter main shop and three island areas set aside for boutiques, as well as a row of inline shops totaling 400 square meters. Korea-based operator Lotte Duty Free has put in a bid for the hotly contested contract, and Choi tells us that if the company wins the tender, travelers to LAX may soon see KT&G’s products available for sale there. “If Lotte Duty Free’s bid is accepted, we would look to showcase our products in Los Angeles with a focus on ESSE.” To be sure, though, KT&G won’t be twiddling its thumbs as it waits for news from Los Angeles. “Given the high number of traveling Koreans these days we see great opportunities right across the Americas,” concludes Choi. c

Since its introduction, the ESSE brand has grown rapidly in terms of both sales volume and brand awareness; to date, ESSE has been introduced in more than 40 countries

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CONTACT: IAN SMART, Director Business Development TEL: +44 (0) 8700 339 866 @: sales@protege-international.com www.protege-international.com

After Hours is a registered trademark. Made under the authority of the trade mark proprietor. ÂŠ FenderTobacco Inc 2004 - 2012.

Cigar Report

The big smoke

The cigar market caters to discriminating tastes, with travelers being a key demographic BY ANDREW BROOKS

“

ur travel retail business was up 100% in 2011, and we’re projecting the same growth rate this year,” says David Salmon, Vice President of Brand Development for Ted’s Cigars. The company specializes in premium, handmade seasoned cigars and is the largest company of its kind in the US. The company has some seven brands, including cigars seasoned with Maker’s Mark Kentucky Bourbon, Grand Marnier and Forty Creek Canadian Whisky. Other products include the non-branded Rhum and HOPZ lines of seasoned cigars, and the eponymous nonseasoned Ted’s Cigars. Travel retail accounts for about a quarter of total business, but this proportion too is growing. Ted’s has travel retail distribution in Canada and the US and is working on developing a European presence. “We’re probably in about 90% of the Canadian travel retail market,” says Salmon. The company is listed in Canadian airports in Montreal, Ottawa, Toronto, Edmonton and Winnipeg with Aldeasa, Nuance and DFS. Ted’s has footholds in a couple of US airports as well through DF Americas. It’s now building its US presence based on its positive experiences in Canada and Singapore. “We only entered travel retail two years

ago, and we’re very happy with the performance of the brand,” says Salmon. The company will be at IAADFS exhibiting with Chase International. The rum and hops seasoned cigars, named Rhum and Hopz, will be of special interest as they are relatively recent additions to the line, having been added last spring and summer. “HOPZ has been one of our most successful launches,” Salmon says. “We use centennial hops and we have fans of microbreweries in mind. The cigars have the aroma of hops and give a really unique smoke.” The Rhum series is seasoned using super-premium rum. Furthermore, the non-seasoned Ted’s brand has its share of fans, recently winning an 89 rating from Cigar Aficionado. Last summer Ted’s Cigars launched new three-packs into market testing— they have yet to enter general distribution. The packs offer an approximate 10% discount off the US$12.95 retail price, according to Salmon. Ted’s sells all its cigars in glass tubes, which provide extra protection against damage and preserve the cigar in its original condition for years. “You can take one out of its tube five or 10 years after you bought it, and it will give you as good a smoke as it would have if you smoked it on the same day you bought it,” says Salmon.

On the slim side

A full-size cigar is a full-size smoking experience. Location is important and you don’t want to feel rushed or pressured. That’s why there will always be a market for cigar lovers, and especially traveling cigar lovers, who want to be able to enjoy their favorite pastime even when there isn’t a lot of time and not much choice when it comes to location. This explains the continuing popularity of the cigarillo—the slim alternative to the full-size cigar—in the travel retail market. With an eye on the segment, J. Cortès has released two box sets of its Sumatra and Dominican wrapper cigarillos, exclusively for travel retail. Each set contains five packs, each containing 10 cigarillos. The new sets were first unveiled at TFWA WE in Cannes last year, and will also figure prominently in the J. Cortès presentation at IAADFS this year, says Export Manager Emmanuel Ghesquière. “We’ve had a strong presence at duty free trade shows in recent years and to continue getting attention in this market, we developed a travel retail exclusive presentation,” Ghesquière

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“This is a good feature for travel retail—it increases giftability and self-consumption because if you don’t have a travel humidor the cigar still stays pristine.” As always, Cuban cigar maker Habanos S.A. has a commanding presence in the market. The company is making increasing international inroads since Altadis purchased 50% of Habanos in 2000 (Altadis was bought by Imperial Tobacco eight years later), notably with openings of “Casa del Habano” franchise outlets abroad. Habanos recently launched the The beer-themed packaging for HOPZ, Ted’s Cigars’ hops-seasoned product

told Americas Duty Free recently. “Innovation is extremely important, especially in this market. Travelers around the world can expect more innovative duty free-specific products from J. Cortès in 2012.” The new box sets have already attracted interest from operators in the Middle East, Ghesquière says, and hopes are high that operators in the Americas will have the same warm response to the box sets. The new cigarillo box sets from J. Cortès, exclusive to travel retail

The 14th annual Habanos Festival in Cuba, billed as the largest international gathering of fine cigar enthusiasts, took place from February 27 to March 2

first Gran Reserva of Montecristo, which the company says is probably its most popular brand, in the Montecristo No. 2 vitola—“the most emblematic of the brand.” The product has been issued in a limited run of 5,000 numbered 15-cigar boxes, all with leaves that have been aged for at least five years. The Habanos signature Cohiba Behike line was launched in 2010 and won the Gold Medal for product quality at the 29th Havana International Fair. The cigar is made in very limited quantities in three vitolas with specially selected leaves, including “Medio Tiempo,” which comes from the top two leaves of sungrown plants. Habanos says that these deliver “exceptional character and taste.” This year saw the staging of the 14th annual Habanos Festival in Cuba, billed as the largest international gathering of fine cigar enthusiasts. This year’s event, which also marked the 520th anniversary of the European discovery of tobacco in Cuba, highlighted two major brands produced by Habanos S.A.: Cohiba and Romeo y Julieta. The event hosted attendees from 60 countries who got an exclusive preview of the new vitolas Habanos is launching this year. The event incorporates seminars, tastings, master classes in cigar rolling, the new Habanos blind tasting and the Habanosommelier contest General Cigar Co. Inc. manufactures and markets a broad range of best-selling products, handcrafted in their factories in the Dominican Republic, Honduras and Nicaragua. The company is the US market leader, and also exports to 62 countries around the world. “In travel retail, we focus on three brands— Macanudo, CAO and Don Tomas—which are handcrafted in the Dominican Republic, Nicaragua and Honduras respectively,” says Cameron Shaw, Director of Sales and Marketing for General Cigar International. “For the US

travel retail market, we also feature Dominican-made brands such as Cohiba, La Gloria Cubana and Partagas, and from Honduras we feature Hoyo de Monterrey and Punch.” Travel retail is becoming a bigger part of General Cigar’s business, Shaw says, and the company is working to expand distribution. General Cigar hired American Caribbean Gateway (ACG) last November as its exclusive travel retail agent throughout the US, Caribbean and Latin America, and believes that this alliance provides the best opportunity to reach aggressive growth targets and expand the reach of its brands. Through ACG’s work, General Cigar’s US travel retail business grew by 8% last year. “Our aim is to offer the trade exciting and profitable products and promotions which can be customized to meet the specific needs of our partners,” Shaw says. “We will focus on highlighting innovative new concepts in packaging and portability during the show this year.” For the 2012 Duty Free Show of the Americas, CAO La Traviata has introduced the popular “Luminoso” frontmark in a new Maduro version. Following in the footsteps of the highly successful Ecuadoran-wrapped CAO La Traviata Luminoso, the new Maduro version features a Connecticut Broadleaf wrapper to lend a touch of sweetness to the critically acclaimed blend. At 4.5” x 50, the new Rothschild will be available for an SRP of US$5.10 per cigar, or US$153 for a 30-count box.

Furthermore, Macanudo is adding two new large-ring frontmarks to its lineup: Macanudo Café Gigante and Macanudo Maduro Gigante made their retail debut late last week. Created in response to consumer demand for large-ring offerings, both the Macanudo Café and Macanudo Maduro Gigante cigars measure 6” x 60. Each will be packed in a 20-count box and sold for an SRP per cigar of US$7.99 or US$159.80 c per box.

CAO and Macanudo fans will be able to see new products from the brands this year: Macanudo Café Gigante and Maduro Gigante, and CAO La Traviata Luminoso Maduro

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

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Tobacco News JTI rides the travel retail wave For JTI, a member of the Japan Tobacco Group of Companies, the top sellers in travel retail are Winston, Mild Seven and Camel. Winston is the second leading brand worldwide, Mild Seven is the top selling charcoal filter cigarette and Camel is an iconic American brand. “Travel retail and duty free is around one percent of JTI’s total sales volume, however it is extremely important as it gives the company the opportunity to follow its consumers when they travel and offer them the same brands they are used to,” the company says. In Latin America, the travel retail business is growing well for the company, showing a double-digit increase in financial results year over year last October compared with the same month in 2010. For 2012, JTI will launch an extension to the Camel line for travel retail—Camel Black & White. JTI says Black & White “is a genuine American Blend cigarette made with a selection of the best tobaccos and has been crafted to deliver an exceptionally smooth taste.” The packages have a modernist black, white and silver design. The range will be rolled out in Mexico, Argentina and the Dominican Republic in the second quarter.

JTI will showcase Winston XSense super slims at IAADFS

For US travel retail, JTI will introduce Sobranie Superslims, made with the Less Smoke Smell technology. The product will be available in Black, White and Pink versions. All new travel retail products will be highlighted at IAADFS, including Winston XSense, a new Winston entry in a king size super slims cigarette with a charcoal filter. JTI will also present the 2012 Winston Limited Edition Pack, which will be launched by year’s end in Mexico, Argentina and the Dominican Republic.

Imperial refines its offer Imperial Tobacco’s duty free team is based around the world in Hamburg, Athens, Fort Lauderdale and Hong Kong (recently relocated from Singapore). Global and local brands are sold though in flight, on ferries and cruise lines, in airports and at border locations. The company’s global strategic brand Davidoff is sold in more than 120 countries. “We focus on special editions as travelling is special,” says Dr. Jennifer Thanscheidt, Imperial’s Corporate Affairs Manager – Global Duty Free. “Duty free is a market where ‘home’ products meet ‘global’ products. It’s unique.” She says the major challenge is that there isn’t a single cluster that fits the “traveler” or “tourist” designation. But, she adds, there are global trends like the increasing speed of traveling and “hopping.” Notable special editions for Imperial in duty free include the Davidoff Book Edition and the Chinese New Year edition, which was created to celebrate the Year of the Dragon in 2012 and was unveiled at Cannes. Thanscheidt is keeping the company’s IAADFS plans under wraps for now, but she did say that Imperial was looking forward to springing some surprises. In Americas duty free, the increase in Chinese travelers to the US is driving growth for Davidoff and contributing to the overall positive trend for Imperial’s duty free performance in that country. Moreover, the company is completing a reorganization on the duty free side, and the expansion of the supply chain and marketing teams has undoubtedly also had a positive impact, as has the inauguration of a global Corporate Affairs portfolio.

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Imperial’s special Davidoff edition for 2012, Year of the Dragon

For further information: www.imperial-tobacco.com

SMOKERS DIE YOUNGER. SOURCE: EU DIRECTIVE (2001/37/EC)

Tobacco News The new Panter duty free packs are available in Arome, Sprint, Dessert, Blue and Small varieties

Royal Agio Cigars Introduces new Panter travel retail packs Agio Cigars is known for having a wide range of cigars on the market, from small cigars and cigarillos to the traditional corona, each with a distinctive character, taste and smoking experience. Perhaps best known for being the company behind the successful international cigar brands Mehari’s, Panter and Balmoral, Agio Cigars recently restyled the Panter travel retail packaging. Agio Cigars says that its designers succeeded in developing new packs “that fit the times and simultaneously reinforce the Panter image.” Agio Cigars says that the restyling of the duty free packs was the result of a recent redesign the domestic packaging of Panter. The new packs are available in Arome, Sprint, Dessert, Blue and Small varieties. Agio Cigars is one of the leading cigar producers in the world. The company has almost 2,150 employees and produced over 800 million cigars last year. In the Netherlands, Agio Cigars is currently the only independent, globally active family company that produces cigars. Agio Cigars has production facilities in Belgium, Sri Lanka and the Dominican Republic. Apart from its own sales organizations, Agio Cigars has intensive trade relations in more than 100 countries throughout the world.

Vapor Corp promotes

a smokeless alternative Publicly traded Vapor Corp (Ticker VPCO) sells electronic cigarettes, which are essentially a personal vaporizing device without the flame, tar, ash or second-hand smoke associated with traditional cigarettes, ideal for smokers trying to quit or seeking an alternative. Vapor Corp differentiates itself by taking a hard line on product quality and price competitiveness, says Adam Frija, Director of Business Development. Vapor Corp’s leading brands include Krave, Smoke 51, Green Puffer and VaporX—the latter a newly introduced zero-nicotine line available in a variety of flavors. The company markets starter kits for budget-conscious consumers, and its products come in disposable and rechargeable options. Rechargeables come with pre-filled cartridges, with refills available in a range of flavors and nicotine levels. Frija says that Vapor Corp has found a range of promotions to be effective. These include door and window clings, logo change dishes, purchase promotions and a range of marketing items made available to retailers and display units with promotional video. “Now is the time to be visible and get placement of our products with distributors, brokers and retailers,” says Frija. “Electronic cigarettes have already begun picking up market share lost by Big Tobacco and it is only projected to increase.” As e-cigarettes proliferate in the market, more and more awareness is created, which in turn feeds that proliferation, resulting in a snowball effect where sales and distribution expand at an increasing rate. Vapor Corp. has benefitted, with Smoke51, Krave and VaporX in particular, grabbing major market share, Frija says. Vapor Corp’s Krave e-cigarette brand is gaining market share

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Swiss cigar maker smashes records in 2011 Villiger’s best sellers in travel retail are the Premium No. 7 20- and 5cigar packs. The brand is number one in travel retail and duty free markets, as well as domestic, says Lydia Garcia, Area Export Manager. Other top performers are the Premium Vanilla Filter and the Villiger Export Square 25- and 5-packs, the most popular cigar in Switzerland, Villiger’s home base. New to travel retail is the Villiger Mini in three flavors: vanilla, Sumatra and espresso, available in tins of 10 cigarillos without filter. These will be prominently displayed at IAADFS. “Our duty free customers in the Americas are always open to new products and feel attracted by our interesting range and wide selection of superb tobacco compositions,” Garcia says. “In 2011 we had an overall growth of 12% compared to 2010.” In January, Villiger reported record results for the past year. The company's total sales of cigars and smoking tobacco rose by 22% to CHF220 million (US$240 million). Cigar sales increased by 30% to more than 1.3 billion units. “We have not quite reached our

Two of Villiger’s bestsellers in travel retail, the Export 25-pack and the Premium No. 7 20-pack

targets yet, but we are certainly on course to sell more than 1.5 billion cigars in 2012, despite the social and political pressure on manufacturers,” said Villiger Managing Director Peter Witzke.

British American Tobacco

win-win-win situation

British American Tobacco’s focus on meeting needs results in a strong portfolio of brands for operators and most importantly a wide selection for consumers BY RYAN WHITE

ncreasing market share is no doubt high on any supplier’s list of objectives, but more often than not getting results depends on how well one manages any number of different factors. For Carlos Felipe dos Santos Rocha, British American Tobacco’s Global Travel Retail Marketing Manager for the Americas, understanding consumers, the duty free channel specifically and the importance of cooperation with operators and airport authorities represents the key to increasing the value of the company’s brands in travel retail. Rocha calls 2011 a “vintage year” for British American Tobacco in the Americas. The company secured record value share in travel retail at airports that it defines as strategically important, increased volumes by 12% and grew its global flagship brands by a respectable 28%. “These results could not have been achieved if we didn’t have the full support of our key strategic partners,” Rocha explains. “In order to bring relevant consumer experiences, we hired and trained brand ambassadors in all key airport locations and supported operators by ensuring the category is well represented to consumers.”

consumers has been fantastic. We managed to grow sales by 48%— one of the highest rates across all of the company’s businesses.” More innovative product releases are on the table for 2012, and British American Tobacco continues to be heavily involved in maintaining dialogues with business partners and consumers in order to keep a thumb on the pulse of the industry. “We’re on track for another great year,” Rocha says simply. Following last year’s capsules success, the company will further expand its capsules portfolio by introducing the new spearmint flavor and the boost concept. The innovation boosts a menthol cigarette from a fresh to an even fresher taste in on click. “In terms of the senses, menthol and spearmint are actually quite different flavors when you compare them,” Rocha says of the new spearmint-flavored cigarettes. “It’s a way to offer more variety for consumers. It’s very important to us to build equity and differentiation in the market.” British American Tobacco will also continue to roll out its innovative modular furniture, designed specifically with operators’ spatial needs in mind. Rocha says that last year’s test runs were very well received and a robust calendar of tactical activations will be planned in conjunction with the rollout.

“It’s really about continuing to drive consumer experiences and sales in the channel.” Carlos Felipe dos Santos Rocha, Global Travel Retail Marketing Manager for the Americas, British American Tobacco Rocha makes a point of giving credit where credit is due, noting The company also tested new modular furniture in selected airports; put a big push on technology with touch screen panels designed the strong contributions of the entire Americas team, headed by to keep travelers abreast of latest brand introductions; enhanced the Rafael Bello. Rocha also points out the work of managers Marcos Novis portfolio development and invested in research aimed at identifying and Hector Chavez in developing relationships with customers, as well shopper and customer tendencies and needs in order to customize offers. as manager Hugo Fuentes for his supply chain work. “It’s really about continuing to drive consumer experiences and sales Of course, big product launches were also a part of the equation last year. British American Tobacco introduced Lucky Strike Click & Roll, in the channel,” Rocha concludes. “To do this you need innovative prodKent Convertibles and Dunhill Switch amongst others. The products allow ucts that meet consumers’ needs and great relationships with both operconsumers to experience two different smoking experiences in a single ators and shoppers. It is a sustainable model that clearly results in bencigarette. Composed of an innovative filter that contains a menthol fla- efits for all three parties.” c vor capsule, the cigarette flavor essentially switches from non-menthol to a mentholated experience when a consumer chooses to click the filter. Also released in 2011 was the Dunhill Blends platform, consisting of three new products—Master Blend, Swiss Blend and Blonde Blend—made without any tobacco additives. Dunhill Blends feature the exclusive Reloc technology, which reseals the pack and preserves the tobacco’s freshness. With an offering like Dunhill Blends, says Rocha, having dedicated brand ambassadors in store gives the company a huge advantage: “In selected duty free stores consumers can experience a guided walkthrough of the prodDunhill Switch, Kent Convertibles and Lucky Strike Click & Roll allow consumers to experience two different smoking experiences in a single cigarette ucts,” he explains. “The reaction from 222

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All of the styles, none of the damage. Satin•Hair Boutique

Braun GmbH, Dept. IAM-DF, Frankfurter Straße 145, D-61476 Kronberg, Germany, Tel.: +49 6173 30 2221, E-mail: mellin.k@pg.com, www.braun.com/global

New & Notable LIQUOR

CONFECTIONERY

Fireball Whiskey

Chupa Chups Destination Tin

Company: Stansfeld Scott Description: A cinnamon flavored whiskey liqueur that is 33% ABV (66 proof), offering “a sweet taste of heaven mixed with fiery cinnamon flavors” Booth: 201

Company: Perfetti van Melle Global Travel Retail Description: This souvenir gift tin with various travel related images contains 16 different flavored lollipops, suitable as a souvenir or gift Booth: 1105, Cypress Ballroom

Wave Whipped Cream Vodka Company: Stansfeld Scott Description: Wave Vodka features a bold look and an array of flavors, including whipped cream, pink lemonade, cherry, blue raspberry and grape Booth: 201

TOBACCO & LIGHTERS

Glenfiddich Age of Discovery Bourbon Cask Reserve Company: William Grant & Sons Description: Matured for 19 years in American oak casks previously used to mellow fine bourbon whiskey, Age of Discovery Bourbon Cask Reserve is a new addition by Glenfiddich that will create a unique taste and aroma Booth: 100

Zippo Windproof Lighter

Mickey Finn Apple Infused Whiskey

Company: Zippo Manufacturing Company Description: Each Zippo windproof lighter is designed with distinctive bottom stamp revealing date of manufacture and authenticity. Zippo offers many lighter finishes including a variety of engraving and imprinting options Booth: 2307

Company: Haleybrooke International Description: A light golden whiskey liquor, with a subtle touch of Irish whiskey, infused with green and red apples. Booth: 207

Davidoff Puro d'Oro Eminentes Company: Oettinger Davidoff Group Description: The new Toro format is a largesized cigar where the dominant combination of Dominican tobaccos delivers a strong, aromatic blend with hints of coffee and spices

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Nestlé Swiss Carres Company: Nestlé International Travel Retail Description: Nestlé Swiss Carres contains chunky ingredients such as pineapple and pepper, almonds and orange, cashew nuts and cranberries. Each ingredient is topped with a solid piece of Swiss chocolate. Two variants are available—milk and dark—both available in 160g premium boxes Booth: 1123

Muppets and Star Wars Assortment from PEZ Candy Inc. Company: ALFA Brands Inc, Duty Free Exclusive Agent Description: Star Wars reverts back to classic packaging while unveiling two new characters dispensers: Darth Maul and Yoda. The New Muppets Assortment will include Miss Piggy, Kermit the Frog and Animal Booth: 530

Mentos Gum Fruity Fresh Red Company: Perfetti van Melle Global Travel Retail Description: A duo pack of Mentos three layers in a combination of strawberry, green apple and raspberry flavors. Designed to deliver longer lasting flavor intensity and freshness through the textured gel middle layer Booth: 1105, Cypress Ballroom

WATCHES Timberland Charleston Watch Company: Scorpio Distributors Description: The Charleston Gents quartz watch sports Timberland’s rugged design and has a brushed stainless steel case with black IPB bezel and tan leather strap. The white dial includes a calendar with black minute track, PNP numerals and white luminous hands and indices. The watch is water resistant up to 10ATM Booth: 1031

Aviator World Cities Watch Company: Scorpio Distributors Description: The new gents Aviator world time pilot watch has a solid stainless steel case and black dial with luminous hands and calendar. The watch also has a rotating inner world time bezel, integrated black leather strap and is water resistant up to 10ATM Booth: 1031

ACCESSORIES Sportina Company: Bric’s Description: Sportina is the original bag designed by Bric’s for convenience, functionality and style. Adjusted with pressure studs, Sportina can be used as a hand, shoulder, or cross-body bag and the inside pocket works as a utility case or a mini-shoulder bag

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The Last Word

Getting away from it all

Laurie Karson, Executive Director of FDFA, on a weekend getaway in Montreal in 2012

Executives in the duty free industry are some of the most well traveled businesspeople in the world, but when they’re not working where do they go to get away from it all? espite the social aspect of the travel retail industry and the generally jovial ambiance at trade shows, everyone needs a vacation from time to time. Americas Duty Free asks some well known industry executives where they like to go c to get away from it all.

José Chao, President of Horizon International, at Ha-Long Bay, Vietnam in 2011—from the looks of the sign he’s famous outside the duty free industry as well

Patricia and Jean-Jacques Bona of Essence Corp. at Lake of Lugano, Switzerland in 2011

Kenneth Chapman, Business Development Manager at Stansfeld Scott, meets his favorite artist Beenie Man in Antigua

Barry Geoghegan, Founder of Barry Global Innovations, in Hong Kong in 2011

Jim Perry, Managing Director of Brown-Forman Travel Retail, in Pebble Beach in 2010

Amy Hildreth, Operations Manager at ALFA Brands, hanging out with family, Tigger and Winnie the Pooh at Disney World in 2011

Hubert Surville, COO of Barton & Guestier North America, enjoying the weather in the Bahamas

Giles Marks, Maui Jim’s Travel Retail Director, with James Kfouri (left) from Paton’s in Cairo, Egypt in 2010

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Success in ITR comes in many colours.

As one of the leading confectionery players in ITR, you’ll find Mars’ brands at almost every travel location across the world. Focusing on the key purchase motivations our stunning product portfolio, containing the nr. 1 and nr. 2 brands M&M’s and Snickers, is backed by creative merchandising driving the purchase decision. Our combination of insight, category vision and global strength enables us to optimize the effectiveness of our unmatched portfolio of global favourites. Finally, we continue to develop exciting new concepts. For example, we now have all Wrigley products fully integrated into our ITR program, creating even more opportunities to drive your business.