Comment: APTRA President Sunil Tuli on shaping up for a new travel retail era

In this guest article, Asia Pacific Travel Retail Association (APTRA) President Sunil Tuli addresses the dynamics that will shape the hoped-for recovery in 2022, and assesses the organisation’s strategic pillars and priorities.

As the journey into 2022 begins, and we contend with the impacts of Omicron, we have entered another area of unexpected turbulence with no clear sightline on how far-reaching it may be, writes Sunil Tuli. Restrictions have been swiftly implemented that threaten recent bilateral travel arrangements. Inevitably we can expect more hesitancy in the short- to mid-term.

What is clear, however, is that the consensus across Asia Pacific countries has been shifting gradually towards long-term pragmatism in learning to live with Covid – as evidenced by an increasing number of governments recently adapting their strategies to balance health and economy together, rather than as competing interests.

Despite the Omicron curveball, long-term prospects for travel retail remain robust, driven by the pent-up demand for travel among many people and the economic imperative voiced by business leaders, industries and communities everywhere.

Most significantly for Asia Pacific is tourism – a vital lifeline industry that effectively feeds, educates and improves living standards for huge populations in emerging market economies. The tourism belt in Southeast Asia is desperate to welcome back overseas visitors to countries including Indonesia, Thailand, Vietnam. Cambodia, Taiwan and the Philippines. And, across the world, vacationers are eager to come, with two of the three most popular destination searches in 2021 being countries in Asia Pacific (data from Kuoni Travel).

The latest APTRA Advocacy Report for Q4 2021 outlines some of the work the association has been involved in; one industry positive is an enhanced duty free liquor allowance of 2.25 litres, effective from 1 January for international travellers in Indonesia; click to enlarge

Looking back on 2021, we witnessed the positive bounce in footfall and basket spend that comes when people are able to travel. The Hainan phenomenon continues at pace, sparking industry debate about the potential for other innovative duty free markets. Brands and retailers are increasingly working together on digital solutions that extend and expand the connection with shoppers.

There’s an increased focus on sustainability across all parts of the industry to meet shopper expectations and importantly to address and anticipate regulatory requirements, notably around product packaging. As we shape up for a new era of travel retail in 2022, APTRA is planning several initiatives to support and advise our members across evolving industry dynamics, including the launch of a sustainability drive, with more details coming soon.

Despite the ongoing repercussions of the pandemic, APTRA continues to attract new members. Illustrating the Trinity membership base APTRA represents, we are delighted to welcome Global Drinks Ltd, Perth Airport, Rituals and Western Sydney Airport. The latter is Australia’s newest airport with construction underway and on track to begin operations in 2026, bringing 28,000 jobs to the local economy.

APTRA priorities and the outlook for 2022 (below); click to enlarge. Source: APTRA.
As always, APTRA continues our advocacy mission – acting as the industry’s radar and intelligence on regional regulation. Although largely focused on tobacco, alcohol and confectionery, let us keep in mind that this advocacy protects the entire industry as we are all dependant on maintaining the vitality of these core duty free categories that drive the majority of industry footfall.

And, finally, a word on APTRA’s other strategic pillars. We are planning to restart our research programme as soon as it’s appropriate and we are working with our members to tailor suitable studies.

Networking is a vital characteristic of doing business in travel retail and, following the welcome return of key industry events in 2021 including The APTRA Exchange in September attended by over 80 travel retail executives, we are excited to be planning for the TFWA Asia Pacific show in Singapore in May 2022. This is a long-awaited opportunity for us all to reconnect and meet with APTRA members and other industry colleagues in person.

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