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Johnnie Walker Explorers’ Club: US$50 million in sales to date |
Diageo Global Travel & Middle East (GTME) is targeting double-digit category growth in spirits, with differentiation and innovation at its heart. The company is expanding the range of travel exclusives it is bringing to market, including Smirnoff White and a new expression in the Johnnie Walker Explorers’ Club Collection (see below).
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Matthieu Comard: “Travel retail offers incredible access to incredible shoppers” |
Speaking to media at the recent IAADFS Duty Free Show of the Americas in Orlando, Diageo GTME Vice President Western Matthieu Comard noted that the spirits category was growing at a faster rate than most others in travel retail, at +8-10% a year.
Comard said: “Travel retail offers incredible access to incredible shoppers, and this is an opportunity that doesn’t exist in other environments. We want to drive double-digit growth in the channel and we start from a position of strength as category leader globally and in the channel as well.
“We are investing in the acceleration of category growth now to the benefit of our partners and our brands. The strategy is driven by premiumisation, innovation and differentiation. And we want to be the partner that retailers call on in terms of luxury: the reserve segment, super-premium and above, is the fastest growing segment within Diageo.”
The Johnnie Walker Explorers’ Club Collection, the company’s major current activation in travel retail, underlines the values of luxury, innovation and differentiation, noted Comard.
Through the three expressions released so far – The Spice Road, The Gold Route and The Royal Route – Explorers’ Club has delivered over US$50 million in sales in travel retail, and the three references combined have already taken a 7% share of the market in blended Scotch, according to GTME.
“Explorers’ Club is our priority in the drive for differentiation,” said Comard. “We have activated hundreds of locations across airports, borders and cruise lines with more to follow. All our feedback suggests this strategy and the Trade Routes series has worked tremendously, and we’ll continue down that road.”
The next step in the roll-out of Explorers’ Club has begun, as a new variant, The Adventurer, begins shipping to market from this month. Priced at US$30, it will come in above Johnnie Walker Red in the brand portfolio. “It will be very much part of the Explorers’ Club Collection range, but is separate from the Trade Routes series,” said Comard. “It will target the opportunity we see in the emerging middle class and aspirational travellers in the channel. It’s an entry level variant to the Explorers’ Club series.”
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Louise Higgins: The group’s differentiation agenda turns now to vodka |
As reported, the other major travel exclusive launch for GTME is Smirnoff White, which is available from July. It is the company’s biggest vodka launch yet in travel retail, and part of its premiumisation drive in the channel.
“We are now turning our differentiation agenda to vodka, and Smirnoff in particular,” said Diageo GTME Marketing Director Western Louise Higgins.
“It’s the number one brand in vodka in travel retail, and there is room between Smirnoff, Ketel One and Ciroc. This helps to bridge that gap, but the key is to deliver something different, aspirational and stylish, and that leverages the Smirnoff brand name and quality stamp.”
The new expression is priced £21 or US$30. The product is said to be different because it is freeze filtered at -6°C and passed through modern charcoal filters for a smoother flavour, said Diageo.
Comard said: “Global travellers 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 centre 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.”
“It is a very smooth liquid and the packaging, which resembles arctic ice, is spectacular,” said Higgins. “There will be a global launch and campaign, playing on the quality of the liquid, the style of the bottle and the story of Vladimir Smirnoff. Smirnoff White will target young adult vodka drinkers, and there is a big opportunity with female consumers too, although it is not targeted specifically at women.
“We will use sampling extensively where possible to get the message of quality across, and to tell the story as we try to convert travellers into shoppers. And the plan is that it will remain as a travel retail exclusive. Our customers are very excited about it.”
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Targeting travellers: Smirnoff White (left) and Talisker Dark Storm are among the new product developments with a specific focus on travel retail | |
Diageo also has other new product development occurring in the channel. Talisker Dark Storm, another travel exclusive, is currently available in Europe before a wider release worldwide. As reported, it is said to be the smokiest whisky produced by the Isle of Skye distillery.
For Mortlach, there will be an 18yo and 25yo plus a Special Strength version for travel retail exclusively, each released this year, as the brand is relaunched. The bottles have been created using Victorian engineering design cues, part of a tribute to Mortlach Founder George Cowie.
“On malts, it’s becoming clear that we will focus on a number of key brands, notably Talisker, Singleton and Mortlach,” said Comard. “Singleton you could say has more of an Asian focus, Talisker more Europe and America-focused and Mortlach then at the super-premium level.”
Speaking more broadly about the Scotch business, a cornerstone of Diageo’s portfolio, Comard also said that the reliance on age statements was declining. “Feedback from consumers suggests that taste and not age is now the most important driver of purchasing decisions. We think age is less and less a factor and that will remain the case.”
Comard also commented on brands can better communicate differentiation to travellers. “Our use of “˜travel retail exclusive’ is really an industry language that does not always talk to the traveller,” he said. “The average traveller is only on a plane one or two times a year so we need to communicate the difference to them. The danger is that the message becomes too simple or becomes confusing. “˜Only in duty free’ is one way to talk about differentiation but in Europe many sales are not duty free so we have to be careful.”
On GTME’s recent performance (it released half-year results in February), Comard said: “Within Diageo we have five regions and within this, 21 business units. Of the 21, GTME is one of the top five, one of the fastest growing and also one of the most profitable.”
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Mortlach distillery: The malt whisky is being relaunched this year |
