SEVA invests in the future

I N V E ST I N G I N T H E FUTURE

With a hunger for growth in travel retail, SEVA Group continues to focus on its investment strategy by LAURA SHIRK

With the fundamental belief: we competitors. The difference: because of its Following the lead of Severino Pušić, can always make things better, hunger for growth, company culture and Founder of SEVA Group, the company SEVA Group applies this way life cycle stage, the distributor has continoffers a strong, positive and communityof thinking to grow at a faster rate, which ued to invest. Although it’s painful at the based outlook and culture. Taking this supports its ambitious growth plan to be moment, when it comes to investment, change of pace to review its processes among the Top 25 travel retailers within SEVA Group isn’t letting the pandemic and focus on new opportunities, partnerthe next five years. Committing to making stand in its way. Looking back, Roger ships, brands and markets, many of which the travel journey better for everyone and Jackson, Managing Director, Organico originated as a result of its investment operating across a number of industries, Solutions, part of SEVA Group, says the strategy, SEVA Group has encouraged an SEVA Group’s travel retail division has team will describe this as a reflection external and internal perspective. While been strongly impacted by COVID-19 – period, which helped to achieve its ambiits external perspective assists customers the same as its partners, supporters and tion more quickly. during this time of need through payment

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Offering a fresh approach and a strong return on investment, its marketing team is equipped with the right tools, skills and experience to deliver the best overall strategy from a distributor perspective

support and staff training, its internal perspective allows employees to seek further education and personal development, leading to greater productivity and delivery.

A step in the right direction Following in the steps of Dubai Duty Free (DDF), SEVA Group has adapted to new health and safety measures by implementing all local and global regulations. Naming DDF as setting the standard for winning back consumer confidence in the current environment, the company is practicing strong social distancing rules and hygiene protocols. Looking ahead, SEVA Group is prioritizing the health, safety and comfort of shoppers and providing in-store packs across its brand portfolio.

As Samsonite’s travel retail distributor in the Middle East & Africa, the group is learning more about and incorporating anti-bacterial technology into its upcoming plans – including gift with purchase. With such a small number of people traveling at this time, it’s difficult to analyze the situation and response, resulting in the releasing of conflicting data. Before understanding the wants and needs of consumers, the industry needs to regain a decent traveling base.

“Retailers, airlines, brands and distributors all need to work in partnership through social media and traditional press to re-enforce the shear extent of safety measures in place. Of course, the retail environment will continue to change. However, in many regards this will simply accelerate the journey that travel retail was already on – more digital focus, more click&collect, more disruptive and less complacent approach in attracting passengers to spend,” adds Jackson.

Projects and partnerships to come Although its original plan, marketing strategy and financial expectation for 2020 has been revised, SEVA Group and Organico Solutions (its trading name for the Middle East & Africa region) still expects to double its consumer base and introduce new brand partnerships this year. With an additional focus on digital platforms during lockdown, the team has shared its core values and strong brand distribution base with more customers and expanded its global footprint. Across the company, in regards to sales targets and performance, SEVA Group has declined by 75-80%. It’s believed that this statistic is unlikely to significantly change until the end of the year. However, in terms of establishing new brand partnerships and building new customer and retailer relationships, the team is thriving. Although approximately half of this planning was in the works pre-pandemic, COVID-19 has allowed individuals, companies and businesses time to reflect on their current practices and relationships and change partners. Referencing new projects and partnerships, Jackson notes the public will learn more in the coming weeks. Acknowledging that the group doesn’t have all of the answers to battle the pandemic, SEVA Group has increased its data and statistical analysis and teamed up with parties to improve digital content and warehousing logistics. Agility and service Primarily a real estatebased business, most of SEVA Group’s workforce is employed in this sector. However, brands, luxury and travel are personal passions of Pušić – all of which are related to the travel retail industry. A self-styled “boutique distributor”, the company offers quality customer service. Considering the strong experience of the members of its marketing team, the company promises a great return on investment for existing partners. From ensuring the right range is on display to selecting the best location within airport, store and shelf level, the team provides a service that is unique to travel retail at the moment.

“Significant experience in net revenue management, promotional effectiveness and shopper marketing is what sets apart our marketing team. In addition to our agility, we believe having the skills to understand the data as it unfolds and our relationships to make quick and effective changes will ensure that sales and investments are maximized. However, this isn’t new thinking for us. Our reputation for delivering in this area has attracted new brand partners and retailers that might have been looking for a fresh approach,” explains Jackson.

A need to succeed Taking on the leadership role of diamond sponsor of The Moodie Davitt Virtual Travel Retail Expo, which is set to take place October 12-16, SEVA Group aims to showcase its ability to be a top travel retailer and support the longevity of the concept.

“More than any other year, travel retail needs partners that are prepared to invest ahead of the curve. We want to show our absolute commitment to the long-term future of the industry that we love.

For us, 2020 is not the year to stop spending and this approach has been well received by all of our partners. In the long-term we know this loyalty, consistency and focus on sustainability will be what takes our group into the Top25 travel retailers,” concludes Jackson.

Seeing the blue light

FRATERNITY SPIRITS STAYS TRUE TO ITS CREATIVE DNA WITH THE INTRODUCTION OF NEW CORRALEJO TEQUILA LIQUEUR by JAS RYAT T he two main values that make up the DNA of Mexico-based Fraternity Spirits are creativity and innovation, according to Blue skies ahead Berardi, a duty free veteran of over 30 years, is no stranger to the challenges the global market presents. Unsurprisingly, he new promotional metaphor. “We attached our blue Corralejo light as a destiny, as a symbol that we can offset every chalRaffaele Berardi, Owner, Fraternity Spirits describes the ripple effects of Covid-19 as lenge in front of us, based on our values,” World. When faced with the adversities a very difficult and an atypical situation. explains Berardi. that Covid-19 has presented to the tequila “All the markets have shrunk among our Berardi’s optimism has led the commaker, the team’s focus turned to finding value chain, but at the same time we took pany to remain active in the ecommerce opportunities to create new products, add it as a special challenge,” he points out. arena as duty free and travel retail chanexcitement and value for its customers “We are always focusing on opportuninels have suffered with the lack of travel. and consumers during this unusual time. ties, like how we can create and add value Says Berardi: “Even though on-premise

“We are very happy to announce that within our products and for our partners, channels such as the physical retail stores we have been working on new SKUs in markets and consumers.” have been closed for several months and order to increase our selected portfolio The company has also created addithe category suffered a contraction, we range. Now we gladly announce our new tional opportunities through social media have seen that the category is still very Corralejo Tequila Liqueur. It´s ready for platforms, relevant media content, digital active trough digital efforts and purthe international market,” says Berardi. activities such as mixology capsules, and chases. People are still drinking at home,

The new Corralejo Tequila Liqueur is courses. and they are curious to go further in highly aromatic, featuring a silky grade learning things like pairings, new cockunctuous and aromatic high‐ grade Out of the blue tails, recipes, process, etc. Of course it´s tequila néctar obtained from the slow Fraternity Spirits has been working to not the same as it used to be, but at least distillation of 100% Blue Tequilana Weber support launches that can fit — or be we have seen more opportunities than agave, and the sweet and delicate mixture evolved — into new market needs. ‘SEEother industries that unfortunately have of secret ingredients, which rest in a stainING THE BLUE LIGHT’ is the brand’s been greatly affected.” less steel tank to enhance and permeate its natural flavours, cooked agave notes and aromas. “Seeing the blue light” is the brands new promotional metaphor that represents Fraternity Spirits ability to offset every challenge

The result is a high-grade agave nectar liqueurthat is ideal as a digestif, Margarita base, or to create different flavors and textures in cocktails. Corralejo Tequila Liqueur will play well into the narrative of the curious millennial, food lover and creative bartender.

The new liqueur is set for launch for the US market in Q3, followed by the European market two months later.

Reclaiming the throne

Clara Susset, m1nd-set Travel Retail Research Director, explains why restoring trust amongst travelers coupled with richer brand content may be the answer to a strong spirits recovery in travel retail by JAS RYAT

Susset emphasizes the importance for niche brands to stand out and share their stories to capture the attention of the consumer

The spirits category continues Susset feels there is room to revisit the offer an engaging in-store experience, to be a multifaceted one that experience for consumers in the spirits such as virtual reality, augmented reality, offers theater, innovation and category. Whereas tastings used to be a quick response codes and digital screens resilience to the landscape of very important part of their decisionexplaining the product’s history and duty free. Now, as Global Travel Retail making process when purchasing, executuniqueness; it won’t be possible to rely on (GTR) shifts gear into recovery mode, ing a traditional tasting would prove taste only,” she explains. the spirits category will be forced to difficult at this time. Brand awareness is a very important re-imagine its narrative in order to reach “Brands and retailers will have to work driver of choice for spirits products in consumers in new ways. together to come up with other ways to travel retail; therefore it is even more

Clara Susset, m1nd-set Travel Retail Research Director, feels a key element for strong recovery will be restoring the trust of the consumer. She says consumers essentially want to resume regular traveling, with the addition of increased safety and hygiene measures prior to engaging in any traditional interactions.

“Our research shows that testing of products and interaction with staff will be less appealing to spirits shoppers. Sixty-one percent will refrain from being in proximity with retail ambassadors and sales staff, while 49% will refrain from testing or trying out products in the duty free shops,” explains Susset.

imperative than ever for brands to create a compelling experience beyond taste.

Intent to purchase According to m1nd-set research, consumers post-Covid-19 will be more likely to pre-plan their spirits purchases, as with many other duty free categories. “Travelers will be less open to browsing if they have no mission, but will visit the store if they have a specific purchase in mind. Indeed, 90% of spirits shoppers expect they will plan their duty free shopping in the future,” says Susset.

Research shows that pre-Covid-19 only 16% of purchases in the spirits category were made purely on impulse, versus 21% of duty free purchases overall. This puts the category in a strong position, says Susset: “Looking ahead, we expect that impulse purchases will be the most

impacted, which is good news for the spirits category and could mean it will bounce back relatively quickly.”

Pushing all the right buttons The focus at the moment is recovery — how to trigger interest and increase conversion. It’s important to differentiate to the consumer what duty free has to offer and revisit the appeal value proposition of the channel. Susset highlights that retailers and brand owners must emphasize the reason why consumers shopped in duty free pre-Covid-19.

“I think duty free shopping will be affected the first couple of weeks [after reopening] and there is no way around that,” admits Susset. She notes that although the initial reaction of travelers is to be apprehensive about sampling products, they are still open to this type of

m1nd-set research shows the key aspects that would encourage conversion when purchasing alcohol

interaction if the necessary measures are in place. Consumers prefer to stay away from sales staff if they are not wearing face masks and are reluctant to touch products unless they are able to clean their hands. Compulsory face masks and gloves for the staff (48%), strict distance between staff and customers (45%) and disposable hand sanitizer for customers (42%) are all factors that will contribute to making the shopper feel more comfortable in duty free.

She continues, “It’s going to be very important to gain that trust again. Even though there are ways to get around tastings with the right brand activations, richer brand content refocusing on the brand history and its uniqueness — in the end consumers want to test what they are purchasing so we will have to find a way to offer that.”

FROM WASTE to taste

Late last year, Estonian spirits company Liviko launched a beverage that is not only a new flavor but also an entirely new creation. Juniper berry-based soft drink Re-crafted Crafter’s Junibeer, which is offered as a 0% ABV soft drink and also as a low-alcohol 3.2% ABV fermented drink, brings a brand-new taste to the ginger beer subcategory.

With its unique bitter taste and its provenance rooted in sustanability, this new drink embodies what today’s consumers are looking for in a low-alcohol or non-alcoholic drink option. “Re-crafted Crafter’s Junibeer is made for the consumer who is looking for unprecedented sensory adventure, and who values wellness and sustainability,” says Hanna Kaur, Beverage Architect, Liviko. “Junibeer is suitable for vegans, and as veganism is increasingly being adopted by a wide range of people, we see clear trend in marketing toward this growing target group. The young greener generation consider a product’s ecological footprint from design to production. Junibeer covers most of the needs of the new conscious consumer.”

Re-crafted Crafter’s Junibeer is the result of the company’s zero-waste production philosophy. Juniper berries once used in its handcrafted gin distillation are “recrafted” into an entirely different beverage. “Zero waste distillation can be interpreted in our single botanical distillation method. We distill each botanical separately to extract the maximum amount of characteristic flavour – more flavour compounds with less kW,” says Kaur.

Uncommon role Kaur’s position of Beverage Architect at the company is an especially unusual one, as it combines science, marketing and R&D. Kaur, who started at Liviko as a chemist 16 years ago, has held this role for three years. She looks at trends, tries to predict where they are going, creates a beverage that works with those trends, and then manages its marketing. “From the bottom of my heart I can say that it has been incredibly exciting time, time to adapt in this changing world with new consumption patterns. I have always been interested not just in the products I create, but as well to whom and for what purpose I`m creating them.” Kaur appreciates the unique position she is in to share her passion with the final consumer

Call of Nordic nature Kaur says she spends half her working day in the lab or looking for new flavours. “It’s very exciting to test various botanicals to find new sensory experiences,” she says. “Liviko has a superior laboratory that gives me as a beverage architect great opportunity to analyze all the crazy ideas I get for new products, whether recipe or technology. The Nordic environment is full of peculiar botanicals, and our taste culture has its roots deep down in the four seasons and untouched wilderness. For Beverage Architect Hanna Kaur, whose inspired creation Re-crafted Crafter’s Junibeer was nominated best beverage concept finalist in the WBIA in 2019, sustainability is as important as taste by JAS RYAT

Beverage Architect Hanna Kaur combines science, marketing and R&D to create a drink that aligns with today’s trends

My main experiments include researching Nordic botanicals and the distillation process that is the basis for gin production.”

Crafter’s gin is a modern handcrafted masterpiece from a 122-year-old factory. “Ours is a real boutique distillery, with our heritage, our traditions and our hightech lab. We do things the Estonian way – smart and with strong passion,” says Kaur.

Green future Kaur highlights Liviko’s commitment to sustainably as imperative. “Massive consumption in recent decades has reached a point where it can no longer continue. The new generation is growing with mindful thinking and environmentally conscious values. For brands it’s only rational to think seriously and take real actions in advance.”

Re-crafted Crafter`s Junibeer from Liviko is a Juniper berry-based soft drink that is a result the company’s zero-waste production philosophy