MAY 2014 TFWA AP ISSUE • VOL 24, NO 1
TfWA ap 2014
Moving into MTB p.
8
Opportunities abound in Oman p.
12
DDF: A jewel in the desert p.
18
Q&A with Diageo’s John Kelly p.
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Letter from the Editor
Gulf-Africa Duty Free & Travel Retailing (ISSN 0954-0592) is published four times a year (Spring, Fall and Winter) by Global Marketing Company Ltd., 26 Pearl Street, Mississuaga, Ontario L5M 1X2 Canada. It is distributed to duty free operators and distributors in the following countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, UAE, Yemen, Algeria, Azerbaijan, Benin, Cameroon, Cape Verde, Djibouti, Egypt, Ethiopia, Gabon, Ghana, Guinea, Iran, Ivory Coast, Jordan, Kenya, Lebanon, Madagascar, Malawi, Mali, Mauritius, Morocco, Mozambique, Niger, Nigeria, Namibia, Pakistan, Reunion, Senegal, Seychelles, South Africa, Sudan, Syria, Tanzania, Togo, Tunisia, Turkey, Turkmenistan, Uzbekistan and Zaire, as well as to duty free suppliers worldwide.
Desert storm – opportunities abound in the Gulf
I
f, like us, you’ve stepped straight off the plane and into the conference, you’ll be bracing yourself for a busy week ahead. With high profile keynote speakers, useful workshops, stylish networking opportunities and a brand new exhibition floor bringing the show’s total floor space to 8,400 square meters any jetlag you may be experiencing will pale into insignificance as you eye the opportunities for boosting your business. Patrick Bouchard, TFWA Vice-President Commercial is aiming to “raise the bar” again when it comes to the number and quality of stands, visitors and conference delegates at the show. It comes as no surprise considering sales in the region continue to grow faster than anywhere else in the world. Indeed, Asia Pacific is now the leading region in the industry after Europe. In this special issue, produced especially to coincide with the TFWA Asia Pacific Exhibition and Conference 2014, you will find fresh insight into the world of travel retail, with a focus on another dynamic region – the Middle East and North Africa. Inside, you’ll find the latest news and views on everything from major airport developments to eye-catching supplier promotions. We’ve spoken to Mohammed Al Bulooki, Chief Operations Officer, Abu Dhabi Airports about the vision for the Midfield Terminal Building and the high level of interest from suppliers and operators in developing this unique ‘blank canvas’. As Al Bulooki revealed to us, ADAC will be awarding space to the most “innovative brands” in order to pave the way for a thoroughly modern shopping experience. Fittingly for the time of year, Al Bulooki says he looks to Singapore Changi Airport and Hong Kong International Airport as examples of best practice: “I have huge respect for what they are doing. As landlords, they are doing a fantastic job at creating a great retail and food and beverage environment,” he told us. Also inside, find out about Al Musbah Group’s two new duty free shops that are set to open at King Khalid International Airport (KKIA) in Riyadh, Saudi Arabia in the next few months. We have the latest on Qatar’s Hamad International Airport, which is now edging towards completion, as well as the new brands available at Iraq Duty Free. For those of you with an interest in Oman, read our interview with Samer Nabhani, General Manager of Commercial Operations, Oman Airports Management Company, who reveals that OMAC is receiving up to 15 responses a week to operate concessions at new airports in Muscat and Salalah. We hope you enjoy this issue. Kind regards, Hibah Noor Editor-in-Chief www.dutyfreemagazine.ca
Subscriptions: $200 for one year, $300 for two years and $400 for three years. 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. May 2014, Vol. 24, No.1. Printed in Canada. All rights reserved. Nothing may be reprinted in whole or in part without written permission from the publisher. © 2014 Global Marketing Company Ltd.
Gulf-Africa Duty Free & Travel Retailing 26 Pearl Street Mississauga, Ontario L5M 1X2 Canada Tel: 1 905 821 3344; Fax: 1 905 821 2777 www.dutyfreemagazine.ca Publisher Aijaz Khan aijaz@globalmarketingcom.ca editorial department Editor-in-chief Hibah Noor hibah@dutyfreemagazine.ca Editor Wendy Morley wendy@dutyfreemagazine.ca associate Editor Ryan White ryan@globalmarketingcom.ca Art Director Jessica Hearn jessica@dutyfreemagazine.ca Layout & Design Sarit Scheer sarit.scheer@gmail.com Contributors Faye Bartle Advertising sales Advertising & sales executive Jacqueline Hammil jacqueline@dutyfreemagazine.ca Senior Regional Manager Neelma Hasan nhassan@globalmarketingcom.ca Circulation & Subscription Manager Deepa J deepa@globalmarketingcom.ca
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May 2014 • Vol 24, No 1
22 Ushering in the new Iraq Duty Free
Dolce & Gabbana, Gucci and Levi’s among the exciting new additions to Iraq Duty Free as the operator targets 30% growth in sales
Contents 6
Hamad International Airport
Qatar’s HIA nears completion
Mid-2014 will include 40,000-square-metres of retail and food and beverage services
8 10
Abu Dhabi Airport Company
Moving into MTB
Innovative concepts needed to transform 28,000 square metres of space at ADAC’s Midfield Terminal Building
RAK Airport/Air Arabia
RAK Airport and Air Arabia capitalize on Expo effect
scent of success 24 The in Abu Dhabi
Abu Dhabi International Airport
Abu Dhabi International Airport and DFS Group team up to host exclusive fragrance gala
holds competitive 26 Diageo edge in the Gulf Diageo: John Kelly
Expansion of the airline and duty free industries helps fuel double-digit growth for Diageo at Dubai and Abu Dhabi airports
30 Global offerings liquor report
The Gulf region is attracting a world of travelers, and they’re buying
36 The year of the horse Philip Morris
Philip Morris celebrated Chinese New Year with a Year of the Horse Marlboro package exclusive to Qatar Duty Free
Teaming up with the low cost carrier will help make the northern emirate more accessible to visitors
12
Oman Airports Management Company
Opportunities abound in Oman
Up to 15 responses per week to operate concessions at new airports in Muscat and Salalah
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Al Musbah Group
Saudi Duty Free opening soon at KKIA in Riyadh
The two new shops by Al Musbah Group will span 2,040 square metres in total
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Dubai Duty Free
20
Kuwait Duty Free
A jewel in the desert
Dubai Duty Free shines more and more brightly
Showing strength in Kuwait
That-Es Salasil/Aldeasa driving business with promotions and pre-awareness strategy
36
Hamad International Airport
QATAR’S HIA
nears completion Mid-2014 will include 40,000-square-metres of retail and food and beverage services by FAYE BARTLE
Q
atar’s eagerly anticipated Hamad International Airport (HIA) is edging towards completion with revised opening dates soon to be revealed. “The opening of Hamad International Airport is scheduled in the middle of this year, but no date has been set up until now,” says His Excellency Abdulaziz Al Noaimi, Chairman of the NDIA Steering Committee. “Intensive coordination meetings are being held by the Airport Steering Committee within the framework of monitoring the completion of works in Qatar Airways lounges and there is ongoing coordination with the Airport Operators and stakeholders to be fully ready for the opening. In light of all the previously mentioned, we will soon be able to set a final date of the opening of the world class aviation hub.” Initially scheduled for completion in 2009, the US$15.5 billion hub experienced a number of delays as the project evolved over time. Indeed, HIA is considered one of the most elaborate greenfield airport projects in the world. Spanning 22 square kilometres (around a third of the size of the city of Doha), it will be able to accommodate 24 annual million passengers once open, increasing to up to 50 million by 2015. Its dual runway system comprises a 4,850metre eastern runway and a 4,250-metre
western runway situated two kilometers apart that are able to handle 100 aircraft every hour. All phases of construction are now being tackled together in order to help speed up the completion. As Al Noaimi confirms to Gulf-Africa Duty Free: “HIA will be larger and have greater capacity on its opening day than initially envisioned. Due to increased transit growth in Qatar and the region in the past few years, these modifications were necessary to deliver an airport with a capacity of 30 million on opening day. The third phase was intended for a 2015 start but we preferred to accelerate the process and integrate the first three construction phases to complete the project in a shortened time.” Once opened, the hub will play a pivotal role in driving tourism to the Gulf state. “HIA will keep up with the upcoming international events to be organized in Qatar in the coming years. Due to its absorptive capacity reaching 50 million passengers, HIA will manage to support the requirements of the journey of growth and prosperity led by the state of Qatar to reflect the modern international standards thanks to its state-of-the-art facilities,” says Al Noaimi. “This will enable the airport to meet the rapidly growing number of passengers heading towards the state of Qatar in the near future, in parallel with the plans of
Hamad International Airport passenger terminal
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
His Excellency Abdulaziz Al Noaimi, Chairman, NDIA Steering Committee
Qatar Airways plan to expand the network of its world destinations and increase its fleet of aircrafts with a view to connect Doha with various world cities.” There will be up to 40,000-square-metres of retail and food and beverage services available at the hub. As of yet, however, no further details have been released about how the shopping experience is likely to shape up. Watch this space for updates.
Hamad International Airport Departures Hall
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Abu Dhabi Airport Company
Moving into Innovative concepts needed to transform 28,000-square-metres of space at ADAC’s Midfield Terminal Building
A
bu Dhabi Airports has started issuing request for proposals for retail and food and beverage outlets in its Midfield Terminal Building (MTB). Following a number of visits from high profile operators and brands, the owner/operator is hoping to lure top quality bidders from around the world to submit plans for innovative concepts that will help define the airport’s forward thinking approach to retail. Mohammed Al Bulooki, Chief Operations Officer, Abu Dhabi Airports tells Gulf-Africa Duty Free: “We are looking to devote 40% of the current available space to food and beverage and the remaining 60% to retail. Within this, we would like to attract more upscale food and beverage outlets alongside high end luxury retailers.” With a total of 28,000-square-metres of space available, comprising 18,000-square-metres of retail and 10,000-square-metres for food and beverage outlets, a big part of the attraction is the opportunity for partners to build and brand their chosen space from a blank canvas – not to mention exposure to more than 40 million annual passengers forecasted to pass through the broader Midfield Terminal Complex when it reaches capacity. “The space will be awarded to the most innovative brands because there is no other airport in the world offering this type of structure. Of course, brands sell products, but if a bidder comes up with a very innovative concept for a huge 300 to 400-square-
An artist’s impression of an aerial perspective of ADAC’s Midfield Terminal Building
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
MTB by
FAYE BARTLE
Mohammed Al Bulooki, COO, Abu Dhabi Airports Company
metre flagship space then they will win. We don’t want to miss an opportunity to partner with any brand that has a well thought out and innovative offering.” In terms of what Abu Dhabi Airports is looking for, it’s not just about being at the cutting edge. “Being state-of-the-art can have an adverse effect on sales if you implement something that hasn’t been tried and tested before, for instance,” says Al Bulooki. “Perhaps we take a vintage approach, which would complement a very modern airport. Certainly, we don’t want to limit ourselves by being too futuristic.” The successful bidders will work with international consultants to optimize the allocated space and tailor it to suit their own bespoke designs. TVS is handling the design along with Mark Riches and David Griffiths who are both part of an advisory board to Abu Dhabi Airports. In addition, KPS is tasked with looking after the architecture. “The vision is to create an environment that reduces stress for the passengers, as traveling can be very stressful exercise. We are looking for ideas to enhance their experience through the terminal,” says Al Bulooki. “Out of the 40 million annual passengers expected to pass through the airport, we are targeting 38 million as shoppers. We understand this is quite an ambitious target and we will work hard towards achieving it.” The key to success, says Al Bulooki, is to create a shopping ‘experience’ rather than just providing shops. “This is a key component that will go into our discussions with prospective tenants. The challenge is how to always be in fashion, on trend and exciting – how not
to be a boring airport – and there are lots of ways of doing that.” Abu Dhabi Airports is hoping to do away with as many rules and regulations as possible that would limit the creative freedom of the tenants and to be as flexible as possible as a landlord to allow them to aspire to achieve a similar impact to high street retailers. “Due to the amount of space on the high street, it allows for large, beautiful displays and events,” says Al Bulooki. “We would like to be able to achieve something similar, especially over Eid and other special occasions there could be more activities on offer. This is one idea that I am personally very keen on. We need to catch up with what the high street is doing and be better than them at it.” When it comes to inspiration, Al Bulooki looks to Paris Charles de Gaulle Airport, Singapore Changi Airport and Hong Kong International Airport as examples of best practice. “I have huge respect for what they are doing. As landlords, they are doing a fantastic job at creating a great retail and food and beverage environment.” A stand out feature of MTB will be the traditional Abu Dhabi souk concept. “It is a huge opportunity for us to create a first class retail offering with a local touch that provides a glimpse into our rich culture and tradition. I am deeply involved in this as it is a huge asset owned by the government and we have a very big responsibility to deliver it successfully.” Bidders will be given four to five months to respond and by the end of 2014 Al Bulooki expects around 80% of the RFPs to be out. “We will be keeping the plans closely under wraps until the opening date – July 17, 2017. This is when we will officially unveil the finished result which we will hope to wow the world with.”
An artist’s impression of MTB at night. Within the next few years, 20 million people are expected to use Abu Dhabi International Airport as their origin, destination or transit point for international and domestic journeys
The Midfield Terminal Complex (MTC) will provide a full terminal building, passenger and cargo facilities, and duty-free shops and restaurants for a total capacity of 27 to 40 million people a year
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RAK Airport/Air Arabia
RAK Airport and Air Arabia capitalize on Expo effect Teaming up with the low cost carrier will help make the northern emirate more accessible to visitors by
FAYE BARTLE
The Air Arabia fleet at dusk
Strong growth for regional airlines is expected in the years leading up to Dubai’s Expo 2020
T
he Department of Civil Aviation, Ras Al Khaimah (RAK) signed a strategic partnership with lowcost carrier Air Arabia in February. The move marks the airline’s new role as the emirate’s designated carrier, operating services from Ras Al Khaimah International Airport. Adel Ali, Group CEO, Air Arabia says: “Work is still in progress to finalize the exact operational details but we see many opportunities to work together for the benefit of both Ras Al Khaimah and Air Arabia. We look forward to sharing further operations details with our customers and shareholders in due course.” Commenting on how new routes will evolve, Ali adds: “Connecting Ras Al Khaimah to several destinations in the region, this collaboration will significantly increase the number of destinations accessible to residents of Ras Al Khaimah and neighboring northern emirates, while mak-
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Air Arabia is now Ras Al Khaimah’s designated carrier
ing this part of the UAE even more accessible to overseas visitors. Our focus now is on finalising operational details such as the number of flights we will operate and the destinations we will serve.” With Dubai gearing up for Expo 2020 and increased tourism promoting many travelers to look for more affordable routes into the UAE, the partnership further strengthens Air Arabia’s proposition. Ali says: “The Dubai successful bid to host Expo 2020 is an achievement that further acknowledges UAE’s standing as a global aviation and tourism hub. This well deserved win will encourage millions more innovators and experts to travel to the UAE and surrounding region. Allied to increased optimism and anticipation for an uptick in business and leisure travel, the fundamentals are in place to deliver a period of strong growth for the region’s airlines in the years leading up to the Expo.”
Gulf-africa Duty Free & Travel Retailing TFap may 2014
Adel Ali, Group CEO, Air Arabia
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Oman Airports Management Company
OPPORTUNITIES
ABOUND
IN OMAN
by
FAYE BARTLE
Up to 15 responses per week to operate concessions at new airports in Muscat and Salalah
Oman Airports Management Company is targeting a mixture of trusted favourites and local brands for balance at Muscat International Airport (arsist’s impression pictures) and Salalah Airport
O
man Airports Management Company (OAMC) issued Requests for Proposals (RFPs) to operate concessions at the new Muscat International Airport and Salalah Airport in January and so far the response has been “overwhelming”, according to Samer Nabhani, General Manager of Commercial Operations. “The RFP pre-release workshop that we conducted had a full house and we were extremely pleased to see the participation of the cream of the crop of the duty free, retail and food and beverage industry.”
OAMC is receiving around 10 to 15 queries per week, on average, regarding opportunities at the upcoming airports. When it comes to the type of shopping experience the company is hoping to build within the 2,000-square-metre space that’s available, Nabhani and his team is striving for a careful and considered balance of tenants. “We are well aware of the fact that, in addition to allocating the right amount of space, it is critical for airports to achieve the right concession mix to optimize sales, revenue and customer service,” he says. “Our tenancy consultants have carried out significant research and recommended
Over 70% of the construction work at the new Muscat International Airport is finished
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
strategies based on the highest sales per enplanement data for structuring of concessions at the new airports. You can expect the concessions to be structured differently since they will be structured based on facts and tangible data and information. “Ultimately, the vision would be to achieve destination airport status by delivering a quality airport travel and retail experience that meets international standards.” Trusted favorites as well as brands that bring a local flavor will help to elevate the offer. “We are geared up for positioning Muscat and Salalah international airports as a
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Oman Airports Management Company prime shopping destination for travelers,” says Nabhani. “Our goal is to have the best complementary brands and store designs to ensure a ‘wow’ shopping experience. Potential partners will be challenged to come up with concepts that complement the growing number of consumer preferred brands and create a sense of place with local favorites. Trusted brands and local flavors are important to our customers and we are planning to add more passenger driven concepts to our retail and restaurant offerings.” Also within the 1,600-square-metres of space available for food and beverage operators we can expect to see inventive concepts to suit all tastes. “Having the right mix of retail and dining outlets will be critical, given that the passengers in the new pier will range from business and holiday travelers of all ages to fly-in, fly-out workers,” says Nabhani. “During our prerelease workshop we made it clear to the retailers and food service operators that we do not want to see cookie cutter outlets and encouraged them to go and break the rules and come up with some innovative concepts. Particularly for food and beverage, our aim is to ensure that each and every
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passenger passing through the airports has the luxury of choice and value for money. We will house a wide selection of dining establishments offering a diverse range of cuisines and dining concepts to suit every passenger from big brands in cafés, lounges, fast food restaurants, quick bites and food courts to fine dine restaurants.” Travel retail undoubtedly provides a valuable revenue stream for the company. “Non-aeronautical revenues have become increasingly important for airports, as the growth of non-aviation revenues enables airports to generate funds for investment in infrastructure and development,” says Nabhani. “Retail activities enable the airports to remain profitable and competitive. Plus, it represents a major addressable opportunity as more people are travelling, they are traveling more often and they have more money to spend when they do. Over the last five to ten years, airports have been successful in driving sharp increases in non-aeronautical revenue and the indications are that there remains further growth potential in both retail and commercial activities. With a new commercially focused approach, OAMC would also be in a position to replicate this growth.”
Gulf-africa Duty Free & Travel Retailing TFap may 2014
The first official announcements regarding commercial tenants will be made in the forth quarter of 2014 for Salalah and the fourth quarter of 2015 for Muscat. Looking at the development of the airports in general, 85% of the work at Salalah Airport has been completed and it is expected to be operational this year, according to a recent statement by Dr Mohammed bin Nasser al Zaabi, CEO of the Public Authority for Civil Aviation. Once complete, the southern hub will be able to handle one million passengers a year. Oman’s Minister of Transport and Communications, His Excellency Dr Ahmed bin Mohammed bin Salim al Futaisi, has revealed to a local newspaper that over 70% of the construction work at the new Muscat International Airport is finished. Much of the headway has been made on works for Main Contract 1 (MC1), which represents that main civil works for the airport, as well as Main Contract 2 (MC2), the new control tower and data centre. Construction work for the passenger terminal building referred to as Main Contract 3 (MC3), however, still has some way to go. Once completed, the new Muscat International Airport will have capacity to handle 12 million annual passengers with future plans set to boost capacity to 24, 36 and 48 annual passengers as needed. Both the new airports will be able to accommodate A380s.
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Al Musbah Group
Saudi Duty Free opening soon at
KKIA in Riyadh
The two new shops by Al Musbah Group will span 2,040-square-metres in total by FAYE BARTLE
S
audi Arabia’s Al Musbah Group together with World Duty Free (WDF) is set to open two new shops at King Khalid International Airport (KKIA) in Riyadh, Saudi Arabia. Located in Terminal 1 (which is used for international flights) and Terminal 2 (serving international flights by Air France, Saudia and NAS Air) respectively, the shops span 1,020-square-metres each. The construction of the new outlets is almost complete and they are set to open in two to three months’ time, according to Irshad A. Cader, Executive Director, Al Musbah Group. “The shops have been designed by Indesign – travel retail experts based in Spain in consultation with the technical team of WDF,” he says. “In addition, WDF led the technical team that designed the shop floor in line with the latest trends. As such, we believe the shops will make a huge impact in the region.” Both of the walk-through concept stores are being fitted out to cater to the unique passenger profile of the airport, with 13 product categories available including cosmetics, tobacco, food and confectionery, watches and accessories, toys, electronics, mobile phones and gold. “The categories are well marked so that when passengers walk through the store it
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is easy for them to differentiate between product types. In addition, there is clever lighting for good visibility – all in all they are first-class examples of duty free stores.” The upper and upper middle segment passengers passing through the airport are expected to have a higher than average spend per head and Al Musbah Group/WDF is pulling out all the stops to make sure they are enticed to browse and buy. “The shops will have a special area called Thinking Saudia, which is dedicated to local food such as dates, nuts and souvenirs,” says Cader. “This area will have Arabic style furniture and a decorated palm tree for an authentic ambience.” A range of celebratory offers and promotions will be available to coincide with the openings, with a variety of leading brands participating. “All major brands in every category will be present – some are fully signed up and others are in final negotiations,” says Cader. “We will also be running a ‘spend and enter a prize draw’ promotion.” Al Musbah Group launched the first ever duty free airport shop in the Kingdom at Jeddah’s King Abdulaziz International Airport in April 2013 in partnership with World Duty Free Group. Its debut offering is located in the South Terminal. The group also has a second shop located in the North Terminal.
Gulf-africa Duty Free & Travel Retailing TFap may 2014
“All major brands in every category will be present – some are fully signed up and others are in final negotiations. We will also be running a ‘spend and enter a prize draw’ promotion.” IRSHAD A. CADER, EXECUTIVE DIRECTOR, AL MUSBAH GROUP
Saudi Duty Free is yet to release any artist’s impressions of the two new shops
They sell as good as they taste
Mars ITR is a leading player in the confectionery category. We combine insights, vision and global strength with powerful brands to create fantastic in-store opportunities. Contact your local account manager and see what we can accomplish together!
Visit Mars International Travel Retail at booth 523
® M&M’s and the M&M’s Characters are registered trademarks. © Mars 2014.
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Gold is one of DDF’s top-selling categories
Dubai Duty Free
a jewel in the
desert Dubai Duty Free shines more and more brightly by wendy morley
S
tarted in 1983 and owned by the government of Dubai, Dubai Duty Free (DDF) has grown to become indisputably one of the most major retail operations in the duty free world. DDF was the single largest duty free retailer in the world in 2013, with sales in excess of US$1.8 billion. According to DDF’s well-known and charismatic Executive Vice Chairman Colm McLoughlin, 2014 may be headed toward higher sales than the record-breaking 2013. “Dubai Duty Free’s sales figures for the first quarter show a 10% increase overall to US$479.5 million,” McLoughlin says. “We have had a very good start to the year and are very much on track for our sales forecast of US$1.92 billion. Terminal 3 continues to be the biggest in terms of accumulative sales and accounts for 62% of our total turnover. Our top-ten selling categories have not changed since last year, but what is very evident is the fact that there has been a good solid return in the ‘luxury’ categories.” Indeed, DDF’s sales in Terminal 3 rose by 11% over the same period in 2013, and sales in Terminal 2, with its recent expansion, increased by 23%. While the top 10 list of categories may not have changed, some categories had large increases in sales in the first quarter of 2014 compared to 2013. The largest increase, percentage-wise, was Handbags and Small Leather, which rose 62% to US$6.9 million. The Cosmetics category, too, showed a large double-digit increase of 30%, reaching sales of US$38.7 million. Perfume, which is the 18
number-one category, managed to distance itself even further, with increases of 16%, to US$78.5 million.
Countries of origin The regions that account for 75% of the store’s sales include Europe, the Far East, the Middle East and the Sub-Continent, with Chinese and Indians the highest number as single nationalities, according to McLoughlin. The large number of Asian travelers, and Chinese in particular, is driving the trend for high-end luxury goods. “Chinese passengers currently make up 4% of total traffic at Dubai International and yet they account for 12% of our sales,” he says. Dubai Duty Free has responded to this growth trend by recruiting over 570 Chinese staff. The retail operation also has promotions geared specifically toward the Chinese consumer, especially around Chinese New Year. DDF has increased its signage in Mandarin, plus they accept Chinese currency and the Union pay card, the biggest card in China. That being said, McLoughlin explains, they do not cater solely to people from any one country. They want to make sure all passenger needs are catered to, “whether that’s Nido powdered milk, of which we sell over 956 tonnes [1054 tons] per year, or bars of gold purchased as an investment. We try to meet all demands.”
ensure promotions are always taking place that will add to the customer’s enjoyment in addition to adding value for money. Recently, DDF featured Calvin Klein’s Scratch & Win Promotion to win a HarleyDavidson motorbike. The draw was part of a Calvin Klein and Harley-Davidson promotion that ran in November and December 2013. Other prizes given away during the promotion period included an iPhone 5, an iPad and iPod Nanos. Any customer who had purchased
Promotions Dubai Duty Free is famous for its large number of promotions. McLoughlin says the purchasing team constantly works with suppliers to
Gulf-africa Duty Free & Travel Retailing TFap may 2014
Colm McLoughlin, charismatic Executive Vice Chairman
The number-one category, perfume sales increased 16%, while cosmetics sales increased 30%
Calvin Klein perfumes across all Dubai Duty Free retail areas at Dubai International Airport had a chance to win the prizes. Another recent promotion by British American Tobacco International (BAT) and Dubai Duty Free was a lucky draw held in December and January in Dubai International Airport. The Dunhill winner was awarded with an exclusive trip to London for two, while Vogue offered a trip for two to Paris. Other prizes included shopping vouchers and exclusive travel bags. Customers who had purchased two cartons of Vogue or two cartons of Dunhill during the contest time were given a free entry into the draw.
E-commerce Dubai Duty Free is expanding in a whole new way. It has just launching its online shopping portal. DDF customers will have the opportunity to browse through the company’s catalog of selected products with the option to pre-order online. Once a customer has preordered an item, that item will be available at the airport for pickup and payment at the time of travel, enabling people who have little time at the airport to still shop duty free.
Expansion
confines of Dubai International. With the opening of Al Maktoum International in October 2013, Dubai Duty Free has a further 2,500-square-meter retail area. Dubai Duty Free also opened a small border shop in Hatta in 2012. While it does not compare to the Dubai International operation, it is doing well. McLoughlin and the rest of DDF are looking forward to the next expansion phase, the opening of Concourse D. Dubai Duty Free will operate around 7,000 square meters of retail space in the concourse, “mainly located around a central atrium, which will be very nice,” says McLoughlin. Dubai Duty Free retail operation now covers 26,000 square meters in Dubai International Airport, and he confirms that the long-term retail space allocation for duty free is 64,000 square meters. A government edict states that Dubai Duty Free will operate all of it, and so the company is not
Dubai Duty Free does not rest on its laurels. The company is constantly looking at ways to enhance their retail offer, whether that is by reviewing their product listings and ensuring they have what their customers want or by improving fixtures. The airport last year expanded and upgraded its Terminal 2 (T2). That afforded DDF the opportunity to extend their product range and boost sales in that terminal. The last phase of that development will be the opening of a new shop in T2 Arrivals, which will boost sales further from the 8.3% of DDF’s revenue that the terminal currently provides. For further anticipated revenue, Concourse D will open in 2015. This concourse will cater to all airlines other than Emirates, and will increase Dubai International Airport’s passenger capacity to 90 million. The company is also expanding outside the DDF shopping complex, Al Maktoum International
slowing down any time soon.
Jumeirah Creekside Hotel Branching out, DDF has opened a hotel, the Jumeirah Creekside Hotel, which is managed by the Jumeirah Group. The spacious hotel has a unique art theme, with over 400 pieces of art. The company opened the hotel because it also owns the Dubai Aviation Club, the Tennis Stadium and Irish Village, to which the hotel is adjoined. But this does not mean DDF is entering the hotel industry. “We thought it would be good to have our own facility on site and that it would be a perfect place to host and entertain our visitors, such as golf and tennis players and Finest Surprise winners. That kindled the idea at the beginning. There are no plans to open any more hotels,” says McLoughlin. c
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Kuwait Duty Free
SHOWING STRENGTH by
That-Es Salasil/Aldeasa driving business with promotions and pre-awareness strategy
in Kuwait
February in Kuwait is a peak time for sales
“During the campaign we had 15% discount on a wide range of products for the whole month of February and we had prices lowered on several categories such as electronics, foods, PEDRO CASTRO, perfumery and some INTERNATIONAL OPERATIONS DIRECTOR, THAT-ES SALASIL/ALDEASA high-end watches.” 20
Gulf-africa Duty Free & Travel Retailing TFap may 2014
FAYE BARTLE
W
hile the duty free concession at Kuwait Airport is currently up for tender with seven parties pre-qualifying, including five of the world’s top 12 travel retailers, the incumbent operator That-Es Salasil/Aldeasa (World Duty Free Group) is pulling out all the stops to show its retailing expertise. The Aldeasa partnership with That-Es Salasil, which has been running the Kuwait Airport duty free concession since early 2006, ran a successful promotion in February to coincide with Kuwait’s National and Liberation Days. “Hala February is one of the major events in the country,” says Pedro Castro, International Operations Director. “During this month, Kuwait is known for its moderate weather so people love to take advantage to travel due to the long holiday that lasts for a week.” World Duty Free Group celebrated the festive period by offering discounts on various products and dressing the shop with attractive displays themes around the holidays. “In comparison to months like January or March, February is a great period for sales in Kuwait despite the fact that the month only has 28/29 days,” says Castro. “During the campaign we had 15% discount on a wide range of products for the whole month of February and we had prices lowered on several categories such as electronics, foods, perfumery and some high-end watches.”
Kuwait Duty Free’s Hala February promotion
Currently, cigarettes and luxury are the operator’s strongest categories overall, while some confectionery novelties have also provided a boost for business. Insight into consumer shopping trends is providing fuel for honing the strategy going forward. “We have a dedicated team of specialists who are exceptionally knowledgeable in destination targeting, which helps to ensure our stores contain product that reflect the wants and needs of passengers,” says Castro. “They work closely with our commercial and store operation teams to develop appropriate strategies inside and outside the stores, in terminals and outside the airport to specifically target different markets. This insight allows us to effectively implement pre-travel communication, in store multi-language signage, bilingual sales associates and product assortment that appeals to different tastes.
Cigarettes and luxury are the operator’s strongest categories overall
“As well as offering year round value on travel exclusive products and premium and popular brands, our in-store expertise and skillful staff also help to educate customers in finding the right product for them. Having the latest products at exceptionally affordable prices makes our retail proposition even more enticing. At the core of this is the innovative and engaging experience available when shopping with us at the airport – from interacting with brands with tastings, to the digital modernizations available. Our in-store theatre provides unparalleled and experiential shopping, which encourages excitement and customer loyalty.” To maximize sales, the focus is very much on drawing on the strength of ‘trinity’ partnerships in order to bring the best launches, promotions and exclusive products to market. Good customer service is also crucial to the strategy and
key in keeping the travel retail proposition unique. “Part of our pre-awareness strategy is to educate and excite customers regarding our products, helping to increase awareness of our value proposition,” says Castro. “We want to generate pre-awareness among travellers of what is available in our World Duty Free stores that you cannot find on the high street. This includes our extensive product offering, our travel retail exclusives, our exceptional savings, our expertise and services so that passengers pre-plan their shopping for when they fly to make the most of the affordable luxury. We want to do this while positioning us as the destination for shopping, particularly within the beauty category. Our limitations come from the lack of space due to the passenger growth in the last years, despite the strong support of Kuwait DGAC to minimize the effects.”
Iraq Duty Free
Iraq Duty Free has allocated ninesquare-metres of space in its departures shops for animation concepts
The perfume category is showing the best performance across all of Iraq Duty Free’s airport stores
USHERING in the NEW Dolce & Gabbana, Gucci and Levi’s among the exciting new additions to Iraq Duty Free as the operator targets 30% growth in sales FAYE BARTLE
I by
raq Duty Free is set to entice shoppers by welcoming a variety of new suppliers to its Baghdad International Airport stores in April. Among the new additions are Dolce & Gabbana and Gucci perfumes, which have been targeted due to high passenger demand for the brands, according to Nabil Mohsin, Director Business Development, Iraq Duty Free. Two Levi’s shop-in-shops in the departures area spanning 12-square-metres each will also be unveiled. “The demand for Levi’s apparel has come from Iranian passengers, as the brand is not available on the high street in Iran,” explains Mohsin. The move further strengthens the proposition at the airport store, where fragrances and cosmetics remain a special focus. “The perfume category is showing the best performance across all our duty free airport stores,” says Mohsin. “Iraqis love fragrances and have a big passion for
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perfume. A fragrance is, by far, the most popular request for a gift among the Iraqi people. However, delicatessen items are also doing very well. The best selling brands in our portfolio include Dior, Hermès, Paco Rabanne, Carolina Herrera and Calvin Klein along with Abu Afif, Kit Kat, Lindt, Godiva and Cadbury in the delicatessen category.” When it comes to consumer trends, there is an opportunity to capitalize on a growing preference for higher end make-up and skincare items. “Until recently, women were only looking to purchase L’Oréal but now they are interested in Dior cosmetics as well as Estée Lauder and YSL,” says Mohsin. Iraq Duty Free is targeting 30% growth in sales on 2013 figures (which amounted to US$4,365,345) with a strategy that incorporates a series of renovations and upgrades. “Our shops in the Babylon terminal at Baghdad International Airport were renovated last year and the departure shop in the Nineveh terminal will be finally be completed on April 1 ahead of the grand opening on May 1.” By incorporating new bands and categories – optical readers and mass cosmetic products – the 21-square-metres of expanded space (a 30% increase) at Baghdad International Airport’s arrivals duty free shops is expected to boost sales by 50%.
Gulf-africa Duty Free & Travel Retailing TFap may 2014
“We have also allocated nine-squaremetres of space at the entrance of the departure shops in Baghdad airport for animation concepts,” reveals Mohsin. “The booth will be changed every month and first up is a Miss Dior animation that will be installed from May 1 to 30.” With Iraqi Airways set to receive six new planes from Boeing by the end of 2014, Iraq Duty Free will no doubt reap the benefits of increased traffic to the destination.
Nabil Mohsin, Director Business Development, Iraq Duty Free
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Abu Dhabi International Airport
The scent of success in
Abu
Dhabi
Abu Dhabi International Airport and DFS Group team up to host exclusive fragrance gala by
T
ravelers with a penchant for perfume will find new inspiration at Abu Dhabi International Airport’s Terminal 1 in June. The airport is teaming up with DFS Group to host the Masters of Fragrance exhibition, which will showcase 26 distinctive fragrances from 22 prestigious brands such as Dior, Guerlain, Amouage, Bulgari, Salvatore Ferragamo and more. Indeed, the display will boast some of the most coveted and celebrated creations in the world. The promotion is especially fitting for the emirate, which boasts a heritage steeped in rich and exotic perfumes. Combining Arabian perfumery with modern expressions of scent, the gala event will be unveiled at an invitation-only event at Manarat Al Saadiyat gallery in the city on April 10 before being transferred to the airport where it will remain until June 12. “Masters of Fragrances is sure to become one of the most exciting events in the fragrance world. Clients will experience a collection of bespoke and never-beforeseen offerings from the foremost fragrance houses and meet the esteemed leaders in the industry,” said Philippe Schaus, Chairman and CEO, DFS Group. “Through Masters of Fragrances DFS has created a truly unique and sophisticated shopping experience for the global traveler.
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FAYE BARTLE
Philippe Schaus, Chairman & CEO, DFS Group
We enjoy a long-standing relationship with DFS and are very excited to offer to our distinguished clientele the curated and bespoke selections of Masters of Fragrances,” adds Mohammad Al Bulooki, Chief Commercial Officer, Abu Dhabi Airports. Three experts have been invited as special guests to share their unique perspectives on the art of fragrance. The high profile personalities include Michael Edwards, author of Fragrances of the World and an award-winning global authority on fragrance who will conduct scent workshops for the gala attendees to develop their nose. Dubai-based lifestyle Editor and blogger Tala Samman will also be on hand as will Antwerp-based international florist Mark Colle who will be creating an original installation at the gala event. “This finely curated collection of exquisite fragrances must be seen – and experienced –to be believed. We are delighted to partner with Abu Dhabi International Airport to premiere Masters of Fragrances to our valued customers and are sure this discerning group will love the best the fragrance world has to offer,” says Eléonore de Boysson, Executive Vice President, DFS Group, Europe and Middle East. The event marks the beginning of the DFS 2014 Maters Series of global events, which include Masters of Wines and Spirits in Singapore and Masters of Time in Macau.
Gulf-africa Duty Free & Travel Retailing TFap may 2014
FRAGRANCE MAISONS AND ARTISAN BOUTIQUES THAT WILL PRESENT FRAGRANCES AT THE EVENT INCLUDE: Ajmal Amouage Armani Privé Bond No. 9 Bottega Veneta Bvlgari Dior Estée Lauder Fendi Giorgio Armani Givenchy Guerlain Lancôme Loewe Penhaligon’s of London Roberto Cavalli Salvatore Ferragamo The Different Company Thierry Mugler Viktor & Rolf Xerjoff Yves Saint Laurent
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John Kelly, General Manager, Gulf Region, for Diageo
Diageo: John Kelly
DIAGEO HOLDS
COMPETITIVE EDGE
IN THE GULF Expansion of the airline and duty free industries helps fuel double-digit growth for Diageo at Dubai and Abu Dhabi airports by wendy morley
G
ulf-Africa Duty Free recently sat down with John Kelly, General Manager, Gulf Region, for Diageo. Kelly discussed the practices that help keep Diageo, and especially Johnnie Walker, the numberone brand in the Gulf region. GADF: Could you tell me the brands you focus on for the Gulf region? JK: Whiskey is the number-one category in this region. Johnnie Walker is the category leader, and is our focus. The Johnnie Walker
Diageo is seeing sustained growth with Cîroc in duty free
range is so exciting and diverse and touches on so many price points, from Johnnie Walker Red Label at US$21 right up to The John Walker at US$3,500. Our focus for Johnnie Walker is around three pillars: innovation, differentiation and premiumization. Within innovation we’ve recently launched the Johnnie Walker Explorers’ Club Collection, which really delivers on differentiation for travel retail. You cannot buy this collection outside of travel retail. Again, it’s offered at different price points, so it also premiumizes. The Spice Road is US$45, The Gold Route is US$69 and The Royal Route is US$159. At the Trinity Conference in Abu Dhabi we discussed the need for suppliers to differentiate for Travel Retail. Johnnie Walker Explorers’ Club Collection really delivers on that. GADF: A customer who’s buying the US$45 bottle might think maybe he’ll pick up the US $69 bottle and then say, hold on I actually want all three. JK: We’d love for them to do that. There is also another way they can sample. We will have a little 3 x 20 cL pack, the Johnnie Walker Explorers’ Club Collection, in a nice leather case. The price point will be around US$80. So in addition to picking up one of the leader bottles or perhaps all three, they can have a little sampler. GADF: Are you doing any tastings? JK: We don’t do sampling typically within Gulf duty free. What we have are samples of the ingredients or aromas you get with The Spice Road or The Royal Route. We’ve got coconut, Sultana and different spices which shoppers can lift and smell. So while we don’t actually sample a product, we can take the opportunity for some interaction with the customer – smelling, touching, tasting. And then it’s up to them to decide which one they’ll buy.
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
GADF: In terms of innovation, that extends to the permanent visibility accessories. I remember seeing a display from Explorers’ Club and it extended to a solution for the entire Johnnie Walker range. How successful have you been in implementing that in the Gulf region? JK: Well, we have been successful. If I take John Walker & Sons Odyssey as an example, we have pioneered a fantastic display within the alcohol category. John Walker & Sons Odyssey is a US$1,000 bottle of whiskey. It is definitely for the high-net-worth client. You can’t just display it alone on a shelf. We had glass cabinets created, which gives great visibility to our brand. That also gives us the opportunity to also display our other Johnnie Walker products. We are investing significantly to refurbish our visibility in duty free. As duty free expands we’re constantly working with customers to
Diageo had glass cabinets created to display this very high-end product
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Diageo: John Kelly Johnnie Walker Explorers’ Club Collection The Royal Route is the jewel in the crown of the Trade Route Series
Ketel One is the vodka of choice for top bartenders
travel retail, that’s true. We are seeing sustained growth in the Cîroc brand at duty free, so we’re looking at increased visibility and shelf space for the brand. A couple of years ago that idea wouldn’t have been on the radar for me or for the duty free stores. But we invested in the domestic market, and now we look at that and it’s translating into duty free sales, particularly in arrivals.
make sure the Johnnie Walker range is the focal point in the alcohol category. When we’re looking at space in the new concourse, we’re looking for the right areas for Johnnie Walker to be within the store, so customers can actively see and recognize that yes, Johnnie Walker is the biggest player. GADF: Can you talk a little about other niche brands that are popular here? JK: Whiskey is by far the biggest category but we have other key brands and important categories. For example Baileys is an important brand for us. Recently we’ve launched the Baileys Chocolat Luxe, and it’s been very successful. Another exciting category is the ultrapremium vodka. We have been very successful in the Dubai on-trade with the Cîroc brand and we are also investing behind Cîroc in travel retail. GADF: Domestic market usually informs duty free, so are you seeing that here? JK: In this example domestic has influenced 28
GADF: What about Ketel One in this part of the world? JK: Ketel One is a key brand within our vodka strategy, which has three pillars: Smirnoff is our mainstream brand. It leads and we innovate regularly. For example Smirnoff Gold was very successful in our last fiscal year. Cîroc plays a key role in the higher energy occasions. It’s now popular in Dubai and equally popular in travel retail. Ketel One is the third pillar in our vodka strategy. In the domestic market Ketel One is really the bartender’s vodka of choice in high-end restaurants, for signature cocktails. Every year a class “A” leading Dubai bartender participates in Diageo’s World Class global competition, where signature cocktails always include Ketel One. Ketel One has a strong place in duty free also because people connect it with the fine-dining experience they get in Dubai. So from a vodka point of view, our brands are really well laid out for different occasions, different profiles and different price points. Diageo Vodka is the second biggest category both in Gulf domestic and travel retail. GADF: Generally, how has the Gulf region performed over the past year?
Gulf-africa Duty Free & Travel Retailing TFap may 2014
JK: We’re delighted. It’s a growing region that presents many opportunities. Emirates, Etihad and Qatar airlines all announced major purchase plans in the last Dubai Air Show. Passenger numbers are growing and terminals are expanding accordingly. Diageo performance is very strong – strong double-digit growth in all categories. In Diageo we also pride ourselves on our competitive edge. In addition to growing the alcohol category we want to win within the category. We are happy with the current performance versus the competition. We innovate ahead of the competition, achieving year-onyear double-digit growth and seeing market share gains as we help to grow in the category. To conclude, I’ve been here for three years now. I am enjoying life from both personal and business perspectives. It is an exciting place to live and work. Now, with the recent announcement of the Expo 2020 being held in Dubai, the market will be more dynamic and definitely an even more exciting place. I am very sure that Diageo will continue to be a leading player within the beverage alcohol market. c
Smirnoff Gold was very successful in the last fiscal year
Liquor Report by wendy morley
Global
offerings The Gulf region is attracting a world of travelers, and they’re buying
I
n recent years throughout the world some regions have developed and some have contracted, but there is one region that almost every company seems to be targeting, and that is the Gulf. A combination of factors makes this region especially appealing. It is popular for tourists and business travelers from all over the world, and its passenger numbers are rapidly growing. The region is known for its shopping, so travelers go prepared to buy. And the local population too has a history of supporting exclusive, higher-ticket, better-quality items, which means travel retail makes perfect sense.
The premium aged tequila 99,000 Horas is perfect for drinking neat or on ice
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Amarula Gold’s striking duty free promotion
Unique products and promotions mean sales in duty free Fraternity Spirits has had massive expansion in travel retail throughout the past couple of years, with recent new listings in duty free shops throughout many parts of the world including India and Nepal. Their flagship brand Tequila Corralejo shows continued strong growth in Dubai, Sri Lanka and Bangalore, where it has been supported with gift-with-purchase initiatives in addition to promotional activities and other focused marketing. The company’s El Ron Prohibido Habanero, meanwhile, has been an outrageous success. The company’s World Export CEO, Raffaele Berardi, says in 25 years of experience he has never seen a product with this kind of interest or sales. That is no doubt in part because in addition to its smooth, sweet unique taste, this artisanal rum has everything needed to become a success – intrigue, a great story, great design and promotion, and more than a hint of the forbidden. This rum, with its theatrical promotion, will be on display at TFWA Asia Pacific along with another of the company’s exclusive premium products, 99,000 Horas, named for the length of time it takes to bring to market. This special commemorativeedition tequila is presented in a rounded, carafe-style bottle after being aged in single Kentucky oak barrels for 18 months and then double distilled in the traditional Corralejo Charente method, using copper and column stills. This premium tequila is perfect for drinking neat or on ice, but is also delicious in cocktails. Berardi confirms that, while listings are currently being firmed up in Asia, “at TFWA
Gulf-africa Duty Free & Travel Retailing TFap may 2014
Mix Amarula Gold with ginger ale or sparkling apple juice
Asia Pacific Exhibition & Conference we are looking forward to follow-up meetings with customers from Africa, The Middle East and South East Asia for both duty free and domestic listings.”
Key markets showing well Amarula Gold, the company’s first launch in 25 years, has been available in select markets since early March. Given that the company’s original cream liqueur has performed very strongly around the world, as the number-one selling cream liqueur in key areas, the success it’s seen has not been a complete surprise. Robyn Bradshaw, the company’s duty-free marketing spokesperson, says: “We anticipated high traveler interest, given Amarula’s strong standing in the global duty-free channel, where it is the 36th biggest spirit brand, according to IWSR data. The response from both male and
female shoppers has been affirming.” Helena Melis, spokesperson for Big Five Duty Free, the travel retail concessionaire at OR Tambo, Johannesburg, confirms the positive sales trends. “The new product is a welcome addition to the brand. It also offers wider choice to shoppers. Our sales to date have more than exceeded expectations.” Currently duty-f ree shoppers in South Africa, Dubai and Brazil are able to taste and purchase Amarula Gold, and they have been doing so in droves. Shoppers are met by gorgeously clad promoters within striking promotional displays, where they can sample the new liqueur and receive information on the new product via neck tags, wobblers and freestanding units. Brochures and consumer and trade training AVs are part of the extensive merchandising for the new product. The international duty-free launch will continue across several European, African and Australian cities over the coming months. Amarula Gold will be launched in key dutypaid markets globally from September.
Diageo’s most expensive single malt Diageo recently released only to travel retail its most expensive whisky ever released, Brora 40 Year Old. Distilled in 1972, this single malt is considered the most brilliant of the now-closed Brora distillery’s highly peated bottlings. Steve White, Global Marketing Director of Diageo Global Travel Retail & Middle East, said: “We are confident that the supreme quality and rare nature of this whisky will delight and excite single malt collectors and aficionados who will want to add a bottle of this
prestigious whisky to their prized collection.” Brora 40 Year Old was previously available for preorder only. It is now available at selected World of Whiskies and World Duty Free Group stores. Only 160 bottles of this distillation have been produced, and the packaging reflects not only this exclusivity, but also the whisky’s history, heritage and credentials as a true luxury item. The beautiful wooden case, skillfully handcrafted by the Queen’s cabinet makers at N.E.J Stevenson Ltd, is an interpretation of the closed Brora distillery. The whisky’s decanter is made of exquisite crystal. It bears the emblem of the Scottish wildcat, which is not only the symbol on the crest of the distiller’s founder, the Duke of Sutherland, but also the legendary guardian of the distillery. The unique crystal stopper is clearly etched with the number “40,” signifying the whisky’s age, and the decanter has an engraved copper neck with the distillation year, 1972.
The carafe and glasses are made of Venetian glass and the egg is covered in colored enamel
Nothing says luxury like Lagoda’s Fabergéstyle eggs Relatively new to travel retail, Lagoda Group’s vodka has been available in duty free in Australia since December 2013, but the word “vodka” doesn’t begin to describe what the customer encounters. Ladoga Group’s Imperial Collection is unmistakable luxury. The super-
The decorative elements are of 24-karat gold
The beautiful wooden case is an interpretation of the closed Brora distillery
premium brand, which is packaged in Fabergestyle egg cases, is the pride of Lagoda Group. The carafe and glasses are made of Venetian glass. All decorative elements are covered in
24-karat gold. The eagle surmounting the egg, a symbol of Julius Caesar, was designed by a master in Florence who worked for over 30 years in the Vatican by Pope’s invitation. This unique product incorporates painstaking work done by hand. The surface of the egg is covered with colored enamel resembling precious stones. Enamel protects the surface and gives the product special elegance. The results in Australian duty free convinced Lagoda to move into other markets. The company first brought their Imperial Collection to a large domestic retailer in Abu Dhabi, and as domestic markets normally inform duty free, Lagoda Group is currently negotiating with several duty free companies in the Gulf region. Because of the product’s exclusivity and luxurious packaging, the company expects significant sales in this region despite the high retail price of over US$1,000. Lagoda also sees great potential in Africa for its premium and super-premium brands, and is currently seeking a distributor in this region. c
www.dutyfreemagazine.ca Gulf-africa Duty Free & Travel Retailing
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Smirnoff White’s innovative bottle is reminiscent of crystals
Liquor News A pioneering travel retail exclusive Diageo recently announced the worldwide launch in July 2014 of its new travel retail exclusive, the innovative new super-premium vodka, Smirnoff White. This new expression has been freeze-filtered at -6°C and then passed through charcoal filters, giving it an exceptionally smooth flavor. Its bottle reflects this unique process, with a design reminiscent of crystals formed in pure arctic ice. According to Diageo, Smirnoff White is inspired by the innovative nature and inventive spirit of Vladimir Smirnoff and his quest for perfection. Neither the nationalisation of his successful vodka business nor a revolution made him waiver in his commitment to innovation. He rebuilt his business founded on pioneering principles which, today, have inspired the brand and the creation of Smirnoff White. Matthieu Comard, Vice President Diageo Global Travel and Middle East (GTME), Western, says: “Global travelers deserve unique and bespoke options to augment their journeys and define them as travellers. Smirnoff White does just that. Building on the innovative principles of Vladimir Smirnoff, it sets a new benchmark in the quality standard of super-premium vodka and will create a new center of gravity for Smirnoff in travel retail. The launch of Smirnoff White will raise the bar in the white spirits category in terms of the product, its presentation and the scale and quality of activation.” Diageo has seen enormous success with its travel-retail exclusive Explorers’ Club Collection, and with the announcement of this new travel-retail exclusive product, is underlining its commitment to its focus on premiumization and differentiation. The launch of Smirnoff White will be Diageo’s largest vodka launch to date. “Smirnoff White is an innovation that demonstrates our relentless focus on differentiation and premiumisation,” says Steve White, global marketing director of Diageo global travel and Middle East. “It is a major investment by Diageo in the white spirits category and will be supported by bold executions at scale across key travel retail locations globally.” Bold displays and high-impact activations will announce its arrival in July 2014 at prime travel-retail locations around the world.
Rugged Islay Island is the inspiration for Bowmore’s new line Exclusive to travel retail, Morrison Bowmore has just launched a new series of Bowmore single malt whiskies. The range, which is being sold exclusively in select airports, will carry three expressions, Black Rock, Gold Reef and White Sands, named for the rugged natural elements of Islay, known as Scotland’s Whisky Island. Black Rock has been matured in sherry casks and carries a 40% ABV. It is considered the heart of the range. A dark amber whisky, Black Rock is peaty and smoky, with notes of honey, dates, leather and citrus on the nose and chocolate, citrus, honey and spices on the palate. Gold Reef, matured predominately in bourbon casks, carries a 43% ABV. Its color of golden honey hints at its refreshing and satisfyingly smooth flavor. On the nose Gold Reef is distinctly fruity, with hints of honey salt and cinnamon. On the palate it has strong citrus notes along with peat, coconut and vanilla. White Sands is the only member of this series that carries an age statement. Matured for 17 years in bourbon casks, this whisky has a color of warm antique gold, and carries a 43% ABV. White Sands is an incredibly smooth and warm whisky, with a light smoky peat flavor complemented with notes of malt, toffee, citrus and ripe pineapple. David Wilson, Global Sales and Marketing Director at Morrison Bowmore, says: “We are delighted to present this new range of luxurious single malts, exclusively to travel retail and duty free.” The “premium and highly giftable” range is targeted to whisky connoisseurs and collectors. The new series will replace Bowmore’s current travel retail lineup. Black Rock is the heart of Bowmore’s new line
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
Effervescent ideas
Brunello Prêt-à-Porter comes in a fashionable, vintageinspired faux leather box
Bottega is launching new sparkling wines in travel retail this spring. Il Vino dell’Amore Petalo Manzoni Moscato Rosé is an exclusive, rare, sweet sparkling rosé obtained by crossing Moscato and Raboso vines. This grape produces an elegant sparkling wine that is fresh and fragrant, with low alcohol content, a lovely color and a pleasantly sweet taste. Other wines that Bottega is highlighting in Singapore include Brunello Prêt-à-Porter, cased in a fashionable, vintage-inspired faux leather box, and Bottega Diamond, a sparkling white Pinot Noir obtained from grapes using the exclusive long-Charmat method. Its bottle is embellished with small brilliant crystals spelling the name “Bottega.”
“Jaan” means “life” or “love” in Hindi and Urdu
Bottega Diamond’s bottle is embellished with small brilliant crystals spelling the name “Bottega.”
Becoming truly global has been growing. JAAN has increased its domestic footprint throughout its home country, into the US and the UK, but the big news is in travel retail. Travelers want a unique, quality product, and JAAN delivers. This liqueur has been arriving at points all over the world, having been brought by travelers to Canada, and it has been creating buzz wherever it lands. Currently, Dhanjal is looking towards what he considers this product’s natural market: Asia, Africa and the Gulf. “We’ve seen a huge spike in interest all over the world, and we’ve been contacted by many people who want to bring JAAN into these regions,” he says. “We’re confident that this product will be well received in all parts of the globe.” Travel retail is a big focus for him, and he is currently looking for the right distributor in these areas. Expanding the product’s reach is not his only focus. This year or next, Dhanjal will be launching two new product extensions, JAAN Whiskey and JAAN Vodka, which will have the spice and aromatics but cut down on the sweetness. “In the initial focus group,” he says, “the response was very positive.” www.dutyfreemagazine.ca Gulf-africa Duty Free & Travel Retailing 33
A unique and distinctive product of today’s blending of global cultures, JAAN is a delicious liqueur that blends global flavors. The basis of the liqueur’s taste is sweet paan, a preparation commonly chewed as a digestif throughout India, Pakistan and other parts of Southeast Asia. Various ingredients, including fruits and spices, are wrapped in a betel leaf, and the mixture is slowly chewed. JAAN takes this traditional exotic eastern flavor and adds some western flair with vanilla, citrus and maple syrup. This east-meets-west result is appropriate, since the product hails from Toronto, one of the most multicultural cities in the world, and the product’s creator and company owner, Raj Dhanjal, is a Canadian of Indian descent. This product is not just unique and cosmopolitan, it is also award winning. JAAN has won many accolades, including a platinum medal at the 2014 World Spirits Competition awards in Geneva, and gold medals at the 2014 Monde Selection in Brussels, the Catavinum World Wine & Spirits Competition in Spain and the 2013 Beverly Hills International Spirits Competition. In travel retail, JAAN was presented at the FDFA trade show in Canada and got a lot of attention. This attention
Philip Morris
Marlboro’s exclusive Chinese New Year package featured a stylized horse design
the year of the horse Philip Morris celebrated Chinese New Year with a Year of the Horse Marlboro package exclusive to Qatar Duty Free by wendy morley
I
n 2013 Philip Morris International Duty Free launched a limited-edition Marlboro Chinese New Year product. They followed up that successful launch in 2014 with a limited-edition Year of the Horse product available exclusively in Doha International Airport. The number of Chinese international travelers has increased substantially in recent years, and at Doha Airport in Qatar, the number of Chinese legal-age smokers has been rising dramatically.
Marlboro’s high-impact display featured bold red and another compelling horse design
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The package design of a stylized horse was available either in gold on a white package, or in silver on a red package. The silver-on- red package had a strong Chinese New Year association, since red is the traditional color, but the gold-on-white package also had a luxurious feel. Qatar Duty Free created a dedicated Chinese New Year area to mark the occasion in Doha Airport. Striking Marlboro store displays using a great deal of traditional red were the center of attention. One display featured writing in Chinese characters and another featured gold lettering in English, with another compelling horse design. With these displays, Marlboro was positioned in Qatar Duty Free as the ideal purchase for legalage smokers looking for a mix of innovation, exclusivity, and a clear differentiation to products available in their domestic markets. Philip Morris celebrated Chinese New Year while offering a
Gulf-africa Duty Free & Travel Retailing TFap may 2014
unique, relevant and pleasing gift option to capitalize on the gifting season and on the Chinese tradition of gift giving. The launch was timed to coincide with the European and American gift-giving times of Christmas and New Year, inviting higher spending from that market as well. c Marlboro’s displays target the Chinese legal-age-smoker
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Tobacco News
AVO “88” The number on this new exciting tobacco creation represents both the 88th birthday of the brand’s namesake, Avo Uvezian, and the number of keys on a piano to suggest, as the company says, “the success of his musical cigar creations.” This cigar commemorates his two passions – for music and for his cigars – and celebrates his successes in both areas. The Avo “88” limited edition is complex and sophisticated. The flavor progression begins with nutty, sweet and woody notes. These are followed by flavors of dark coffee and pepper. The aroma and taste of this cigar call to mind the passion and warmth conveyed by Mr. Uvezian himself. The cigar comes in the Belicoso format, and is made of a blend of five Dominican tobaccos and a Yamasa wrapper. The elegant cigar box brings to mind a spectacular, glossy black grand piano. Sixteen cigars are nestled inside, wrapped in parchment paper printed with piano keys. The AVO “88” Limited Edition will soon be available worldwide. Production is limited to 8,888 boxes.
The limited-edition AVO “88” comes in a playful cigar box that brings to mind a glossy black grand piano
Like smoking the real thing Recently launched Blac Label electronic cigarettes have been hailed as the most realistic e-cigarettes on the market after two years of research and development. The company’s products look and feel like actual cigarettes, with enhanced mouth feel and a filter almost identical in weight. The market for e-cigarettes has exploded recently, with major cigarette companies jumping on board. Worldwide sales have been estimated at US$2.5 billion in 2013, and that number is expected to quadruple in the next few years. Many current and former smokers are choosing to “vape,” as using e-cigarettes is known because they work by creating a nicotine vapor Blac Label has a complete line of that the user inhales, much as he/she would traditional and flavored e-cigarettes inhale smoke from a cigarette. Tawil confirms that travel retail is a huge aspect of their expansion plans, Blac Label fully intends to capitalize on this growing market, with a huge new marketing campaign launching in the and they are in discussion with major airport retailers in the Gulf and other coming months. Lifestyle, luxury, iconic images and celebrity endorsement regions. “We know that busy travelers are always looking for tech products have been integrated into the campaign, which will utilize a rolling-thunder as well as products that are improving their life and of those around them,” approach with a combination of guerrilla and experiential marketing. Harry he states. “When customers shop for combustible cigarette products in a Tawil, President of Blac Label, promises “impact and effectiveness of the duty free store they should be offered an alternative, and we hope to be the highest order. With an organic media supported by presence at high profile alternative customers choose more than any other.” Blac Label e-cigarettes are available in Classic Tobacco, Bold Tobacco, events and a social media blitz, Blac Label has committed a cost-effective Light Tobacco, Vanilla and Menthol flavors. but impactful campaign.”
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
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Tobacco News
A Master Blender creates a tailored product The Master Blender in a tobacco house selects each tobacco leaf for its unique characteristics, depending on its variety, grade and country of origin. He selects and combines the raw ingredients seeking to create the optimal taste of a unique cigarette. Stefan Dukmedjiev, Master Blender at King’s Tobacco’s state-of-the-art international facility in Plovdiv, Bulgaria, was challenged to create a blend he could be so proud of that he would inscribe his name on every pack. The result is King Onyx. After selecting the finest grades of Virginia, Oriental and Burley tobaccos, Dukmedjiev combined them in precise percentages to achieve the taste he sought. He then cut the blend very finely and extended the length of the cigarette. The finer cut is to harmonize the flavors and the extended length helps create more smoothness. King Onyx is presented in a London-designed package with a velvety-soft varnish to hint at the smoothness of the smoking experience within.
Onyx’s London-designed package has a velvety-soft finish
Onyx’s London-designed package has a velvety-soft finish
Great cigars don’t need to shout The Davidoff name is synonymous with subtlety, sophistication and a discerning palate. Davidoff Classics were made for individuals who know that a great cigar will only reveal its depths of flavor to those who will truly appreciate them. They are, and always have been, created with passion and dedication. Davidoff recently began selling three of their timeless classics together under the banner: “great cigars don’t need to shout.” These Davidoff Classics are the choice for the true cigar connoisseur who demands a unique mix of subtlety and sophistication. Included in this collection are Davidoff “No. 2,” Davidoff “2000” and Davidoff Special “R.” Davidoff “No. 2,” launched in 1968, is woody and earthy. With a complex but harmonious blend, floral aromas and a refined, smooth aftertaste, this cigar was the cigar of choice for Zino Davidoff
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Gulf-africa Duty Free & Travel Retailing TFap may 2014
himself, and was one of the first to wear Davidoff ’s white band. Davidoff “2000,” the company’s first Corona and the best-selling cigar around the world, defined a generation. It contains notes of coffee and pepper, with a creamy aftertaste. Davidoff Special “R” contains three unconventional tobacco leaves within its wide ring gauge, giving rise to pronounced spicy flavors and a creamy aftertaste. Its tobacco is from Dominican Republic, its wrapper from Ecuador. The relaunch of the Davidoff Timeless Classics under the banner “great cigars don’t need to shout” will be sustained by the global Davidoff brand campaign “Viva Subtlety – Viva Sophistication.” Davidoff ’s extraordinary Timeless Classics are now available together in select locations in travel retail and select tobacconists worldwide.
Three timeless classics from Davidoff, available together
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Years of Challenges Ans de DĂŠfis
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