“Our main objective is to be ready to seize the opportunity from the travel surge that we expect to see from Q3 onwards.” So says Stoli Group Global Duty Free and Travel Retail Director Jean-Philippe Aucher as he ponders how recovery in the market might take shape.
Like many people in the business, he is cautious but optimistic about recovery prospects in 2021. He also underscores the crucial role that industry-uniting events such as the Summit of the Americas — A Virtual Experience, will play in this recovery.
Over recent years, Stoli Group — which started with flagship vodka brands Stoli and Elit — strategically expanded its portfolio to include rums, tequilas, mezcals and bourbons. Aucher and Stoli Group will be showcasing this diversified range at the all-digital summit, underlining its ambition to become a leader in the super-premium spirits category.
In this interview, The Moodie Davitt report (virtually) sits down with Aucher to discuss the importance of the Americas market as Stoli Group seeks out new and unexpected growth opportunities in the region. He also shares his positive outlook on travel’s Q3 return, outlines the trends that will influence that recovery, and comments on how the industry can work together to flourish in a changed world.
What is the major focus for Stoli Group at the Summit of the Americas – A Virtual Experience? What lines, launches or campaigns will you emphasise and showcase?
With the Summit of the Americas cancelled last year, it is important for us to show our commitment to the region at this virtual event. Stoli Group is a big player in the Americas – the US, Canada, Latin America and Caribbean are all key distribution markets for our growing portfolio of premium and super premium brands.
During the event, we will focus on our flagship vodka brands, Stoli and Elit, along with Kentucky Owl super premium bourbon and Louisiana produced Bayou Rum, plus other brands yet to be revealed. We are particularly pleased to announce that Elit Vodka has received Beverage Testing Institute’s (BTI) prestigious 2020 Best Vodka award. This achievement places Elit in an esteemed category as a nine-time winner.
What are your major targets by geography, channel or retailer type as you seek to tap into a recovering market?
Our main objective is to be ready to seize the opportunity from the travel surge that we expect to see from Q3 onwards. For us, all distribution channels and geographies within the Americas are important, but we see particularly strong prospects within the cruise-ship and border store markets. Geographically, our key focus markets are the US and Mexico, along with Canada and South America for the cross border business.
How do you view the continuing impact of COVID-19 on Americas travel retail and the wider industry?
Much of the region is still severely impacted by Covid-19 and while there is some domestic travel, it is generally very quiet. We are now seeing demand from Brazilian border stores which are beginning to open up again. The cruise business is also planning to open up again from April, which is great news. Overall, we think that business will start rebounding from the end of Q2 with a strong resurge in Q3.
Although we don’t expect figures to return to normal anytime soon, we do think recovery could be quicker than expected. People want to travel — whether via plane, car or ship — and all channels offer significant opportunities for the Stoli Group portfolio.
In the last few years, Stoli Group has been strategically expanding its portfolio to include so much more than just vodka brands. Could you tell us about this strategy and what goes into finding the right brands to partner with?
Stoli Group’s strategy is to become a key player in the super-premium spirits category. We have developed our portfolio with that in mind, with a focus on four major liquor pillars: rum, tequila/mezcal, bourbon and vodka.
The strength in our portfolio enables us to become a competitive force in many territories around the world and particularly within our core markets of the US and Mexico. We are also now represented in the gin category with Tulchan.
Our partners offer brands that bring quality, innovation and heritage to the portfolio, complementing and balancing the inherent DNA of Stoli and Elit. We’re not looking to acquire any more companies, but rather grow the beautiful brands within our portfolio through line and range extensions where it’s sensible to do so.
Rum, tequila/mezcal and bourbon are all categories where we see real potential for growth, not just in the Americas but worldwide. Mezcal, for example, is seeing very interesting growth in Middle Eastern and Asian markets where super premium brands such as our own Se Busca are competing against malts in the ‘sipping’ category.
In your opinion, what are the biggest wines and spirits trends that will influence Americas travel retail in the post-COVID-19 landscape?
I don’t see one key trend but rather a combination of various factors. These include ongoing premiumisation and up-trading, the increasing consumer demand for innovation and exclusivity, the expectation of sustainable sourcing and packaging by brand-owners, and the ever-rising expectation of unique digitally-enhanced shopping experiences.
This last point is really mandatory for retailers and suppliers now. We simply must engage with consumers at every step of their journey from the minute they begin to research a trip.
How do you think the channel can and should engage with travelling consumers to ensure a sustained recovery?
Today it is all about social commerce, particularly amongst GenZ and millennial consumers. They buy based on what they see on social media and are guided by reviews to make purchasing decisions. So, brand dialogue is everything. We must tap into that, link it to their travel plans and what is available in travel retail. That then needs to link into dynamic and engaging activations and promotions in-store, that can capture their attention and convert that into sales.
How would you like to see industry partnerships evolve as we enter a new era for travel and travel retail?
This last year has shown us that the three elements of the trinity can cooperate, share ideas and think collectively when necessary – and never has it been more necessary than during this pandemic. I do hope that we can continue to have a more transparent and fair cooperation moving forward.
Visitor registration for the Summit of the Americas (free to all travel retailers and airport companies) is open at the official event website, which is now live.
Contacts
To learn more about this opportunity, please download the 2021 Virtual Summit Information Briefing. For virtual stand reservations or media, please contact Irene Revilla at Irene@MoodieDavittReport.com.
For general questions about participation in the Virtual Summit, please contact Steven Antolick for further assistance.
