USA. The Nuance Group, in association with DFASS, today opened its flagship Airside 4 duty free and duty paid store at Orlando International Airport.
As reported, the alliance, bidding as The Nuance Group (Orlando) LLC with DBE partners, won the duty free/duty paid concession in January off long-term incumbent World Duty Free Group and three other rivals.
It opened its first store (Airside 1) a few weeks ago but today’s ribbon-cutting ceremony at Airside 4 marked the formal, full start-up of the operation. [Note: We’ll bring you more detailed pictorial coverage of the store later this week].
Executives from The Nuance Group/DFASS alliance and its DBE partners with Orlando International Airport senior management cut the ribbon at today’s big opening
After it secured the award, the partnership estimated it would generate sales of over US$200 million during the seven-year term, a bullish projection given 2010 and 2011 sales of US$14.7 million and US$15 million, respectively.
Greater Orlando Aviation Authority Executive Director Phillip N. Brown: “I think it’s an outstanding concept they have – the product selection, the merchandising, it’s all good”But The Nuance Group North America CEO Dick Rendek and DFASS Chairman and CEO Benny Klepach both insisted today that significant investment in the stores is paying instant dividends.
Rendek told The Moodie Report: “We have already doubled sales in Airside 1 and with Airside 4 we expect similar results as the store improvement is even bigger.
“We expected to do around US$23 million in our first full year of operations and we’re on pace to achieve that. It’s an airport that has a lot of great tax paid concessions so you have to make the duty free appealing from the concourse and I think we have achieved that. It’s a very enticing store.”
Klepach added: “It’s early days but we’re already seeing that our numbers are accurate so we’ll hit the figures that we were projecting, if not better.”
He continued: “We view Orlando as a major gateway and we’re very excited to have a presence here. We know what we’re getting into and we’re excited by the growth.”
Greater Orlando Aviation Authority Executive Director Phillip N. Brown told The Moodie Report: “We did very thorough and detailed analysis [of the duty free tender].
“One of the non-traditional concepts we have here is duty free and duty paid [combined] so we’re expecting that to create some additional revenue, which is one of our focuses. But we also want to have all the amenities for the travelling public and we think they [The Nuance Group Orlando] did a good job.
“Duty free is one of our top revenue generators,” he continued. “So we’re looking forward to great things from this group. I think it’s an outstanding concept they have, the product selection, the merchandising – it’s all good.”
Dressed to kill: An enhanced beauty offer, anchored around new brands MAC and Kiehl’s, is integral to the new retail propositionBrown explained that Orlando International Airport generates an unusually high 70% of turnover from non-aeronautical sources, making the duty free business particularly critical in terms of future revenue growth.
Encouragingly, he said the airport company is working hard to attract further international flights, with commercial services such as retail and food & beverage playing an important drawcard role.
While Airside 4 is mainly focused on British and other European passengers, Airside 1 benefits from that terminal’s booming Latin American traffic (Orlando is the number one location for Brazilians’ second homes and flights to the country are increasing fast).
Commenting on the design and layout of the store, The Nuance Group (Orlando) General Manager Andre Jones said: “It’s very different from the last design here. This design adds more character and colour and a real feel of newness.”
While the new Airside 4 store has the same square footage as its World Duty Free Group predecessor, the revamped outlet has been opened up completely to maximise flow, visibility and sight lines, Jones said.
“So we made sure the aisles were wide and that we gave a spacious feel, for example with the open ceiling. Smart Design, who are our designers, did a nice job with this. It’s basically the same square footage, however it seems more spacious. We opened it up so much more than it was before, and that makes a huge difference.
“The total layout is more supportive of maximizing the square footage that we have. It lends itself more to ease of passenger flow, so that they can come in, see everything in the store and then move on out.”
The Nuance Group Vice President Buying. Merchandising and Operations Andrew Rattner said: “We wanted to make the brands really strong and vibrant.
This iconic feature in the centre of an open ceiling design lends brightness and clarity“We wanted the customer to walk into this 5,000sq ft store and see everything. We also put MAC, which wasn’t here before, at the front of the store because it’s a big draw, especially for the Brits. Our experience from Las Vegas shows that they’re a big buyer of MAC cosmetics, so we put it at the front to really draw the traffic in.
“You can see that the design company, as in Las Vegas, drew on local elements with the colours of the store and the light colours of the ceiling to convey the feeling of Orlando.
“We’re really happy with it. It’s open and there’s a great view of everything. It turned out really well. With MAC and Kiehl’s, for example, we have got some really, really strong brands.”
The MAC boutique at the front of the Airside 4 store acts as a magnet to draw consumers in
Major beauty brands act as a powerful lure for the predominantly British and continental European passenger profile of the Airside 4 flagship store
Promotional activity, here for Bombay Sapphire, plays a key role in driving penetrationCOMMENT: Transformation and investment are the key words here. The duty free shops at Orlando International Airport are among the most well-known in the industry, thanks to the annual Duty Free Show of the Americas that takes place in the city. Delegates visiting the show next year are in for a surprise, for the offer (highly effective down the years but retail always moves on) has been radically and impressively transformed.
The key changes in Airside 4 are the opening up of the entrances, flow and centre of the store and the addition of big-name beauty brands. The passenger (and potential shopper) can see easily from the entrance to the back walls, allowing the big brand power on display (particularly accessories, fashion and beauty) to fulfil their drawcard potential.
It’s not perfect – confectionery is adequate; tobacco struggles with familiar regulatory display constraints; and liquor needs a bit more vibrancy (which it will get with the introduction of a themed American whiskey area) – but it is a big step forward. The beauty walls and MAC boutique are true drawcards and the ambience, open ceiling (together with its integrated iconic feature) and general design have combined to raise the slightly homely and conspicuously cluttered feel of the old store to a more sophisticated and consumer-friendly level.
As Dick Rendek says, the airport has done a superb job in creating a diverse, first-rate tax paid retail offer. Today, duty free has taken an important step forward in matching that standard.
(Above and below) More images from The Nuance Group Orlando’s new-look retail proposition
(Above and below) More celebratory shots of The Nuance Group/DFASS management and team at today’s opening
