Nestlé International Travel Retail (NITR) is responding to the COVID-19 crisis by investing in travel channels beyond airports and in a programme of innovation that spans Nestlé food brands alongside its core confectionery lines.
In a media briefing this week, NITR previewed a series of product innovations that it said will help drive its recovery.
“No other business unit has been as badly hit as us,” commented NITR General Manager Stewart Dryburgh. “Last year, we started to increase focus on duty free zones and border stores. A lot of products sold in this area are within the day-to-day food category rather than impulse buying and confectionery. This has really offset some of the worst that has happened this year.”
“Our industry has always shown itself to be resilient over the long-term,” Dryburgh added. “Identifying the correct growth drivers to meet the needs of the post-COVID 19 travelling consumer are critical to moving forward and our innovations for 2021 reflect this – notably the economic effect that COVID-19 is having on disposable incomes.”
NITR’s recovery strategy reinforces its commitment to the category growth drivers it announced last year: deeper connections, better for you and elevated experiences. These drivers will boost consumer engagement through NITR’s SOUL framework: story, occasion, unique and local. [The wider strategy for the business was covered in detail in a special Moodie Davitt Spotlight eZine in late 2019; for access, click here.]
KitKat extends Senses line and enhances consumer engagement
KitKat — which has experienced accelerated growth in travel retail — is NITR’s core strategic brand for 2021.
Premium line KitKat Senses, which makes up 11% of the KitKat portfolio, is one of the most important product lines for next year.
NITR has extended the line with a new lower-priced travel retail-exclusive range called KitKat Senses Tablets. The tablets are available in three flavours: Caramel Crisp, Cookie Crumble and Hazelnut Crunch. It will launch on 1 March 2021.
Dryburgh explained, “KitKat Senses Tablets create a complete brand portfolio with products available to suit any occasion within the Elevated Experience and Deeper Connections need-states.”
The company is also enhancing online and offline engagement for the KitKat brand. In 2021, NITR will be relaunching the V.I.B Lounge concept, supported by new Free Standing Units and an enhanced digital and real-life KitKat Bus. The concept was initially launched as a Chinese New Year activation in Singapore Changi Airport Terminal 2, in partnership with Lagardère Travel Retail, early this year.
Smarties transitions to paper packaging
Following the launch of the sustainable Smarties Music Generator, Smarties is transitioning its entire confectionery range to recyclable paper packaging for 2021.
This includes replacing the plastic lid of the Smarties Giant Tube and Topper with a cardboard closing and swapping the cylindrical tube shape with a hexatube and paper sticker. The Smarties plastic bag and pouch will also shift to sturdy paper alternatives.
According to Dryburgh, this is only the beginning of NITR’s sustainability ambitions. In 2021, the company will also be rolling out recyclable packaging options for all Nestlé Mixes & Quality Street pouches and sharing bags. It aims to shift to 100% recyclable or reusable packaging by 2025.
Dryburgh said, “This move is a great example of Nestlé taking the lead in sustainability. We were the first confectionery brand to use 100% sustainable cocoa for KitKat. Now with Smarties, we are the first children’s global confectionery brand to move to paper across all formats.”
Nestlé Swiss right-sizes tablet range and relaunches Dark Blueberry
To address demand for a more self-indulgent tablet size, NITR is resizing the Nestlé Swiss range from 195g to 170g, while retaining the same nut and fruit ratio.
In travel retail, the Nestlé Swiss range will be supported with new merchandising and POS displays showcasing the Swiss lifestyle concept.
Nestlé Swiss is also relaunching the Dark Blueberry 170g tablet, which offers sustainably-sourced dark chocolate combined with blueberry, almonds and hazelnuts.
The Dark Blueberry tablet was originally launched last year but will be re-introduced to the market with a stronger product focus for 2021.
After Eight unveils a new size and travel retail-exclusive packaging
NITR has also launched a travel retail-exclusive London-themed packaging for After Eight. The 400g box pays homage to After Eight’s British heritage and is decorated with a striking design inspired by the London skyline.
According to Dryburgh, the exclusive packaging meets one of NITR’s category growth drivers — All Year Round Gifting. He said: “The luxury allure and sense of heritage around the After Eight brand is undeniable and we look forward to rolling out these new indulgent flavours in 2021. They are sure to appeal to travelling gift buyers who want an impressive gift item from a brand that they know, trust and love.”
In addition, NITR is also launching four limited-edition After Eight flavours: Strawberry, Dark, Irish Coffee and Orange into travel retail. To further drive engagement, After Eight is also launching an exclusive global activation with Heinemann this year.
Nescafé begins travel retail expansion
With passenger numbers severely depressed by the COVID-19 crisis, NITR is looking outside of confectionery for growth opportunities. “We have gone to great lengths to ensure that our 2021 innovations are relevant across all category growth drivers, taking into account the changing pattern of travel,” added Dryburgh. “Innovation, however, is not just about confectionery. The category also encompasses fine foods and to that end we continue to present opportunities from across our group’s portfolio.
“It is therefore with great pleasure that we announce the launch of Nescafé Gold into travel retail for 2021. Launched in 1938 Nescafé has grown to become a global icon, to the tune of 5,500 cups drunk every second. This makes it a natural for travelling consumers and our offer will include product for all buying levels: premium, standard and value.”
Nescafé experienced a +120% sales increase year-on-year in 2019, indicating a great demand for the coffee brand in the channel. For 2021, NITR is launching Nescafé Gold in airports where the brand is not readily available in the domestic market. For regions where passengers are already familiar with Nescafé Gold, NITR is launching Nescafé Artesano Santuario, which is made with intense Colombian arabica beans. It is also launching the full-flavoured Nescafé Red Pillar in border stores.
In addition, NITR is also introducing a super-premium range of infant products under the Illuma brand. The range was created specifically with the Chinese traveller in-mind and offers milk products that replicate breast-milk at the molecular level. It will be available in selected travel retail locations.
Building connections in the world of COVID-19
The global health crisis and its impact has also resulted in the streamlining of the NITR portfolio. Dryburgh said: “The reality is, we are cutting SKUs. It’s going to be a continuous exercise in understanding where the requirements are and the operational efficiencies in the business. We need to respond to the rationalisation in the industry. Buying teams have gotten smaller and that extends to the supply chain as well.”
As the travel retail landscape continues to transform, NITR Marketing Manager Tamara Spada highlighted the importance of building deeper connections with travellers in times of crisis. She said, “Moments like this give you a chance to understand the opportunities and challenges. KitKat is a powerful brand with a unique offering. The After Eight 400g is also a very strong product and an exciting format for a brand with a very loyal fan base. We want to know how we can meet consumer demands within the out-of-pocket context and make sure that we can excite both customers and retailers with our products.”
With safety and hygiene continuing to be a priority for travellers in the post-COVID-19 retail landscape, NITR is accelerating digital innovation and finding new ways to engage with customers outside of the airport environment.
Spada added,“COVID-19 has given us an opportunity to reassess how we are engaging with our consumers. If we understand that they are changing behaviours, it is up to us to adapt the ways we communicate as well. We cannot just focus on in-store and ignore the rest of the consumer journey, because that would really be a missed opportunity.”
Spada added, “The traditional model is to engage with customers after security and before boarding — which is a very tiny window. There is an opportunity to lengthen that significantly and we are trying to do this in a cost-efficient way that also delivers positive returns.”
“Were moving from sense of place to sense of space,” added Dryburgh. “Consumers now need that space to be comfortable. Traditionally, engagement begins as soon as they enter the store, and now we can’t do that. Sampling is really useful for customers who need to be introduced to a brand, but that isn’t possible in the current climate. In the short term, strong brands like ours have the advantage. When sampling is not available, customers will default to something they trust.”
Dryburgh concluded by reinforcing Nestlé’s commitment to the channel. “COVID-19 may be having a most dramatic impact on our industry, but we at Nestlé believe in the future of travel retail and our category, thanks to the passion for the experience and discovery that travel brings to each and every one of us.”
NITR goes for Gold at Moodie Davitt Virtual Travel Retail Expo NITR is a Gold Partner at the Moodie Davitt Virtual Travel Retail Expo (#Virtual Stand CF-G5). The unique 5-day live event, followed by a 30-day showcase, begins on 12 October, just after the conclusion of the Chinese Golden Week holidays. It features a star-studded series of events across the five days, including a Symposium, category workshops and a new consumer research initiative. Registration is free for buyers, exhibitors and preferred media partners (Click here to register). |
