Introduction: Travel retail distributor Duty Free Dynamics (DFD) has been behind the growth and expansion of popular brands and what it calls
“under-exploited brands” in travel retail through its extensive global distribution network.
Owned by E. Liberman Group, the company describes itself as an innovative developer of retail concepts throughout the channel.
From establishing its presence as a regional distribution service provider in Latin America and the Caribbean in 2015, the company has extended its footprint to North America and Europe, Middle East, and Africa, and soon to Asia Pacific. It has offices in Panama, Barcelona, Miami and Hong Kong.
DFD initially operated with just one brand (Guess) in one category (watches).
Today, its success is defined by the extensive and diverse portfolio of over 30 brands it represents across ten different categories, with plans to double its portfolio within the next two years. Among the big global names in its portfolio are Adidas, Guess, Gucci, Mont Blanc, Saint Lauren, Perfetti Van Melle and Lego. The most recent addition to its line-up is German writing instrument Lamy, demonstrating the company’s robust expansion strategy in the EMEA region.
With the recently appointed CEO Martín Mairal, the company is now focused on further globalising its operations and adapting to the fast-evolving travel retail landscape. Mairal underlines the increasing presence of disruption within the channel and the challenges and opportunities that come with it.
Since establishing the company in 2015, Duty Free Dynamics has made an outstanding reputation for expanding premium lifestyle brands in the channel. What is the key to your continued growth over the years?
Firstly, from the outset, we conceived a business model focused on non-core product categories with recognised lifestyle brands in segments such as watches, footwear, apparel, sunglasses, toys, writing instruments and electronics, among others. These had previously seen limited or poor representation within the channel. The inclusion of brands with significant growth potential within the channel and appeal to consumers has been instrumental in gaining the trust of our retail partners.
Secondly, we have maintained a close collaboration with our partner brands, allowing us to understand their needs and quickly adapt to market demands. Furthermore, our ability to identify emerging trends and market opportunities has given us a competitive edge.
Additionally, we have invested in technology and efficient systems to optimise our operations and improve logistics, enabling us to be agile and respond swiftly to market changes.
How you are planning to increase the added value that your company offers to your brand partners?
Thanks to the open communication we maintain with brands and retail partners, as well as the results achieved so far in the Americas, they have expressed their desire for us to provide services in other regions. That’s why we have decided to expand the territories in which we operate. As a result, we are currently focused on geographic expansion with DFD’s entry into EMEA this year. To accomplish this, we have expanded our commercial platform in Barcelona, and we are planning to expand into APAC in 2024/25.
DFD has been known for supporting the growth and expansion of both well-known and niche brands within its extensive global distribution network. How important is introducing newness to the travel retail offer?
Travellers seek unique and exciting experiences during their journeys, which are an integral part of the travel experience itself. This quest for novelty is especially relevant in travel retail, where passengers have the opportunity to discover and explore products that may not be available in their local markets.
Our excellent relationships with brands enable us to work closely with them to consolidate information and opportunities identified by both DFD and our retail operators for the creation of limited editions. We can see examples of this with the Zippo brand, where collections have been customised to reflect the characteristics of a region or released as limited editions.
Furthermore, our extensive portfolio and experience are crucial for our network of retail operators to trust and try out niche or lesser-known brands in the region. This gives these brands the opportunity to expand globally, increasing their brand awareness in those territories, and provides our retail partners with a distinctive portfolio and new growth opportunities.
It is important for us to maintain a balance between introducing emerging brands and established ones.
How do you plan to continue developing and expanding your brand line-up and what other categories are you targeting?
As you have seen, we have made several additions to our portfolio of globally recognised brands, such as Adidas in apparel and footwear and Lamy in the arts and writing instruments segment.
We have a dedicated department responsible for monitoring emerging trends and consumer preferences to identify brands that have the potential to thrive within the channel in major global markets, delivering higher returns to our retail operators. We bring these trends to life in these markets and others where they may not yet be well-known.
Subsequently, relationships are established with these brands, always with a focus on fostering long-term collaborations that are mutually beneficial. Our intention is to continue to invest in non-core traditional categories that are yielding excellent results.
Retail operators have observed how these categories attract consumers and enable them to increase cross-selling opportunities. Therefore, they are dedicating more and more shelf space in their stores to lifestyle products in categories like watches, sunglasses, apparel, footwear and accessories.
You have recently been appointed as the new CEO of DND. How does your leadership align with the company’s goals and vision and how would you further drive the company’s growth amid the continued recovery of the travel retail sector?
Under this initial stage of my leadership, Duty Free Dynamics is focused on three fundamental pillars. Firstly, working to further increase the added value that DFD offers to brands. This involves generating more business for them by reaching more territories and ensuring a consistent brand image and exceptional experience in all the territories where we operate.
Secondly, there is a focus on strengthening strategic alliances with our network of retail operators, providing them with logistical support through our global platform, as well as commercial and marketing support, and offering new business opportunities and partnerships.
Lastly, we are driving the expansion of Duty Free Dynamics by extending commercial platforms in Barcelona to serve the EMEA market and establishing teams in APAC in 2024/25 based directly on existing platforms in those regions.
Now that outbound travel has picked up and markets have reopened, what challenges and opportunities are you expecting in this post-pandemic recovery period? How do you plan to address these challenges and take advantage of new opportunities?
With the reopening of markets, competition in travel retail is intensifying. We are prepared to meet this challenge by differentiating our offerings, focusing on brand and product exclusivity, and providing exceptional service to our partners.
As for the opportunities we see in this recovery period, they include:
Increased interest in travel: Data predicts a recovery in both business trips and leisure travel, with a renewed focus on destinations that traditionally did not attract tourists, and we have already established a presence in these areas.
Geographic expansion: With markets reopening and our global expansion, we can now serve our network of retail partners worldwide, offering logistical and administrative advantages.
Personalised experience: In today’s globalised world, personalised experiences are more important than ever. We will work closely with our partners to develop customised limited editions tailored to different regions. Likewise, we will collaborate with retail operators on staff training, a key factor in ensuring a satisfying consumer experience. ✈
