Editor’s introduction: Michael Guenoun* is Managing Director Travel Retail Asia for Cartier, one of the world’s most powerful luxury brands. In common with many of his peers in the luxury sector, Guenoun is having to reevaluate the changing face of travel retail in the face of key external and industry influences. In this opinion piece for The Moodie Davitt Report, Guenoun calls for a move away from the transactional and into the experiential.
Today, we are navigating within an uncertain geopolitical and currency context with an unprecedented accumulation of negative factors, including Chinese government anti-corruption measures; milder GDP growth in China; and strong currency volatilities just to name a few.
Those are the perennial challenges that always affect markets in unpredictable ways. However, many of today’s challenges represent trends that will only grow stronger tomorrow, and stronger still in the coming years.
It is clear that in the coming years, people will travel more and more as it will be easier, cheaper and faster to travel. And also because they will have more time to travel. In short, they will WORK less and TRAVEL more!
But, will they still buy luxury goods when they travel?
Global shoppers are placing more and more value on experiences rather than possessions. The desire of global shoppers for indulgence, exclusivity, sophistication, and status symbols will not vanish in the coming years. However, we believe that the offer in travel retail must change from a transaction to a real experience beyond the acquisition of products.
Digital services “not enough”
We see today, many opportunities in travel retail with the introduction of digital services, but it won’t be enough.
It will be essential to develop further “retail-tainment” to create a “destination” that the global shopper must visit during their journey.
Retail-tainment will enable us to provide to the global shoppers a broad range of experiences and products that amount to a lifestyle, featuring local culture, art, food, design of the retail space and other factors – all designed to influence global shoppers to visit, experience and then shop.
Travel retail represents a unique opportunity for the development of luxury brands. However, there is a strong necessity for it to be different compared to any traditional distribution channel. A cheaper price is no longer enough to attract global shoppers; the major focus must be to create a differentiation, an emotion, a real experience – something that neither digital nor traditional channels can provide.
Finally, brands must develop and reinforce a travel retail offer in a way that both commemorates and is the symbol of the journey of those global shoppers.
To achieve this, increasing impulse buying through creating emotion will be essential. Obviously, some elements will take more time than others to develop and to be adapted. However, we at Cartier are taking all those new elements seriously in developing our travel retail strategy. That applies both internally and also with our partners in offering our clients a unique opportunity for entertainment while travelling and shopping. Offering a memorable ‘souvenir’, not only through purchase but also through experience is our priority.
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*Footnote 2: Michael Guenoun will explore the theme of this article further when he joins a powerful speakers’ line-up at the 2016 Trinity Forum in Mumbai on 12-14 September. He will participate in a hard-hitting concluding panel discussion entitled ‘Telling it straight – how does the future look for our industry?’ that will feature the challenging views of a broad array of Trinity perspectives.
