Introduction: “Coty’s pioneering spirit still guides us today. We want to keep this and extend it to other categories, not just fragrances.”
These words from Coty Senior Vice President Global Travel Retail Guilhem Souche encapsulate the company’s enduring founding philosophy and its ambitious vision for the future.
In this Q&A, Souche discusses Coty’s remarkable FY2024 performance, driven by nearly +21% revenue growth in travel retail – a key strategic channel for the company. He shares the beauty powerhouse’s evolving approach to pop-ups and activation in the sector, embracing digitalisation and the importance of the human touch.
He also reflects on Coty’s 120-year history while exploring how its legacy of innovation continues to shape its approach in modern beauty retail.
Travel retail played a starring role with revenue surging almost +21% for Coty in FY2024. What factors have led to this performance?
2024 has been a super exciting year. Not only is Coty celebrating its 120th anniversary, we also had very strong business growth driven by several factors.
The first is that we had growth in all categories due to a strong innovation plan, starting with fragrances. We had two avant-premières in travel retail this year: Burberry Goddess and Marc Jacobs Daisy Wild.
With the launch of Burberry Goddess we used the travel retail avant-premiere as a showcase both in terms of sales and brand elevation. We reached millions of people in less than one month and so we repeated that success with Marc Jacobs Daisy Wild in the spring.
Second, we had brands, including Kylie Cosmetics, entering the fragrance category for the first time.
Launching Kylie Jenner Cosmic showed that the brand has great potential in fragrances. This is very important in the context of recruiting customers because we know that younger travellers may not necessarily enter the duty-free shop unless they know that a brand they love is present. Kylie is one of those brands.
Third, we are continuing the premiumisation of all our brands and collections.
Chloé Atelier des Fleurs is doing extremely well, not only in Asia, but in the rest of the world. We are extending the collection, creating a great halo effect for the brand. It is the same for Burberry Signatures.
In terms of makeup, Gucci and Burberry are transforming into full couture brands. Before, we only sold one aspect of the proposition with fragrances, but now we are offering the wider universe with makeup too. For example, we had great success with Burberry Beyond Wear foundation; a product inspired by the brand’s signature gabardine Trench Protect Technology.
With the challenges in North Asia travel retail, how does Coty see its recovery prospects in the region? How do you see your Asia business evolving in the next few years?
We are quite balanced in terms of geographic footprint, which means we are less affected by what is happening in specific regions.
We expect the traffic in Asia to double in the next ten years and that a lot of the world’s key airports will be in the region. Our view is that, while there may be some short-term challenges in the region, mid- to long-term, investments will reap benefits in the future.
In fact, we want to extend our footprint in the region, elevate our brands in-store to really meet the demands of the beauty consumer there which are evolving at a fast pace. Today, we are gaining a qualitative presence across the major airports in Asia’s key countries.
As a predominantly fragrance player, how has Coty benefitted from the post-pandemic fragrance boom and how are you evolving your portfolio to better meet the diverse needs of fragrance consumers in travel retail?
Fragrances have been in strong demand in the post-pandemic years and we have certainly benefitted from that. We have also grown and diversified our portfolio to reach all spending levels from Adidas in Consumer Beauty to Gucci, Chloé and Burberry in Prestige.
We want to reach consumers in all regions and push all categories and in terms of innovation pipeline, 2024 has been amazing. In Q1, we had the avant-première of Gucci Gorgeous Flora Orchid, which delighted consumers at the highest traffic period of the summer, giving a boost to Gucci fragrances.
We launched Chloé Eau de Parfum Intense and Burberry Goddess Intense in the channel, which is important because Goddess has been a huge acceleration for Burberry and is still building the momentum. We have also launched a 30th-anniversary edition of CK ONE.
What factors have led to the fragrance category’s acceleration in recent years?
During COVID, people rediscovered fragrances as a moment of self-indulgence and a form of self-expression. For example, it used to be that florals were popular in Asia and ouds in the Middle East. Now this segmentation has changed a lot because people want to express their personalities.
There are also plenty of new consumers from countries such as India who are just entering the market. So, it is important to be present across the whole price ladder.
In 2022/2023 Coty invested in growing its skincare brands Lancaster, Orveda and Kylie Cosmetics. How is this skincare push playing out in the channel?
In travel retail, for the time being, our skincare push has been mainly focused on Lancaster. With Lancaster, we want to leverage our expertise on photoaging, photo repair and photo protection, while also consolidating our leadership in suncare.
It was also a good year for skincare for us. Lancaster is the number one prestige suncare brand in Europe and we are continuing its expansion.
You can now find Lancaster in Asia and the Americas and we are planning to launch in more and more countries, including Argentina which launched in September and has been going very well. We also brought the French Riviera to Sentosa with a dynamic summer campaign.
While we were just present with Lancaster skincare in Asia, we are extending that to Europe and the Americas. In terms of innovation, the big focus is Golden Lift, which launched in September and is now rolling out globally.
Cross-category animations create synergies with the fashion houses – not just with fragrances, but with couture fashion items and eyewear as well.
Blockbuster animations, including the avant-premières for Burberry Goddess, Marc Jacobs Daisy Wild and BOSS Bottled Triumph, have delivered great dividends for Coty. How do you see your pop-up strategy evolving in the future?
The BOSS Bottled Triumph Elixir campaign was a great collaboration with the fashion house because we built an offer not just in terms of products, but also in terms of retailtainment. That campaign elevated the brand experience and engaged consumers as it offered a tailor-made shopper experience in travel retail.
The timing couldn’t have been better. There were two big football competitions in the world at the time, so a lot of people were travelling for matches which meant that the campaign really resonated with these travellers. We also had big football names as our brand ambassadors.
In my view, to really capture the attention of travellers, we need to push this kind of activation in the channel further. Shopping is part of a holiday, and when you engage meaningfully with travellers, you go a lot further than just selling a product.
Another great example is Fly with Me 2.0, a multi-brand concept where we pushed the concept of travel even further. When we conceptualise a brand activation, we think about how we can make the brand suitable for the channel. With Fly with Me, the starting point was travel itself.
Fly with Me 2.0 featured gaming, product discovery and gifting, all centred around travel. It’s an adaptable concept with sense of place elements that we will keep on developing. Every year, we are going to make it bigger and better than the year before.
Going back to the 120th anniversary, how does it feel to be at the helm of Coty Travel Retail during this pivotal moment in the company’s history?
I think looking back brings us a lot of inspiration. Coty is famous for its fragrances and we recently celebrated Coty’s beginnings as an avant-garde perfume house in Paris with a three-day exhibition marking our history and heritage.
François Coty was a pioneer in product innovation, packaging, retail and marketing. He was the first to combine synthetic and natural notes and put them into a beautiful bottle.
You know that when François Coty wanted to sell his first scent, La Rose Jacqueminot, at the Grand Magasins du Louvre, he was refused. So, he dropped the bottle of the floor and suddenly all the department store’s customers wanted to purchase the fragrance.
Coty’s pioneering spirit still guides us today and we want to keep this and extend it to other categories, not just fragrances. It is really gratifying that many retailers are recognising that if they want innovation, speed and something exciting, we are among the first partners they think of.
That’s something we want to develop. We want to keep elevating our brands in ways that are relevant for travel retail and help bring more people into stores. Because as we know, while traffic is increasing, shopping time is not increasing. Conversion is decreasing because people can be distracted. It is our job to engage them to interact with our brands.
How exactly are you doing that?
Engaging, interactive and experiential activations are one way. When you engage with your customers in a meaningful way, you move from a transactional to an experiential relationship. Key to that is having consumer insights to better understand their needs, where they are going, what they are looking for and how to apply best practices in-store and evolve with their needs.
For example, there are many different nationalities in Southeast Asia. That means different needs and different inspirations and you need to understand each one.
We also have to pay huge tribute to our Beauty Advisors because they welcome customers from dozens of countries. For us, it is so important to work with our sales teams and ensure that they understand all sorts of customers and how best to engage with them.
After all, amid all of this embracing of digitalisation and technology, at the end of the day, it’s all about the human touch. Because travel retail is a people industry. ✈
A disruptive fragrance history The legend goes that when the manager of the Grands Magasins du Louvre refused to smell François Coty’s first-ever fragrance, La Rose Jacqueminot, he dropped a bottle on the floor. By doing so, he covered the air with the scent of sweet roses, capturing the attention of the department store’s luxury clientele who bought Coty’s entire inventory. While it is uncertain if the legend is true, it is a story fondly told within the company to underline the pioneering and indomitable spirit of Founder François Coty. Coty broke the perfumery rules of his era by designing accords more sophisticated than the floral or citrus ones available at the time. In 1905, Coty launched Ambre Antique, the first-ever Amber fragrance, followed by Chypre which contrasted bergamot with oakmoss and patchouli. These important fragrances formed the beginnings of the Amber and Chypre fragrance families that we know today. By using synthetic molecules and bases combining natural extracts with synthetic creations, he expanded the perfumer’s palette and magnified flowers and woods in his fragrances.  Since its founding, Coty has been focused on creating bottles that blend art with perfumery. Coty frequently said of a perfume: “It should be looked at as much as it is smelled; it is an object before it becomes a scent.” Luxury French glassmaker René Lalique produced all of Coty’s bottles from 1908 to 1920, until Coty decided to design and make his own. After running a small shop on Rue La Boétie, Coty opened a larger one in Neuilly in 1905. He then opened another at 23 Place Vendôme, which became the brand’s flagship and established the perfumer in the industry. He soon launched branches in London, Buenos Aires, New York and Moscow, and started the Suresnes plant so he could control every step of the manufacturing process.
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