LATIN AMERICA. The first day of the annual ASUTIL duty free conference – held for the first time in Panama – was notable for a fine speech by InterBaires CEO Nicolás Posse.
Some 258 delegates listened to the address, themed “˜Passenger Service – A New Challenge to Travel Retail’. Posse’s presentation focused on recreating enjoyment for passengers at airports.
“We need to think about how we can return the pleasure to the flying experience, which has been lost,” he said. “We need to see things from a passenger’s point of view – not our point of view.”
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A warm local welcome to the first day’s lunch sponsored by Motta Internacional |
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(Left) Lunch is served by Motta Internacional; (Right) Travel Retail Business correspondent John Gallagher co-moderated the conference with The Moodie Report Founder and Publisher Martin Moodie | |
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The opening day of ASUTIL 2008 saw strong contributions from Interbaires CEO Nicolás Posse (left) on improving the customer experience and World Duty Free Director of Trade Relations Sarah Branquinho on the LAGs issue | |
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(Left) Tocumen International Airport Commercial Manager Erick Goldoni underlined the Panamanian gateway’s renewed commercial revenues emphasis; (Right) London Supply’s Paco Heredia in relaxed, anecdotal mood | |
Calling for more emphasis on exclusive products and other new and innovative experiences, Posse said the importance of good consumer feedback was critical. “No advertising we do can have the strength of word of mouth,” he noted.
“How do we motivate the passenger?” he asked. “How do we make them want to go to the airport?”
One answer was developing stronger loyalty programmes, as InterBaires has. Posse said the average transaction value through this programme was US$314 compared with a customer-wide average of US$70.
With a completely new airport due to open at Ezeiza in 2011 – doubling the number of stores – Posse said much thought was going into creating added or new services “which add value to our passengers and make them want to go to the airport early”.
“THE CRISIS HAS CROSSED THE OCEAN”
The day had begun with a welcome from ASUTIL President (and Aldeasa International Operations Director) Daniel Montero, who spoke of the healthy state of the Latin American duty free market.
“After a few dry years, today we can say we are at a good stage,” he said. “If we compare sales numbers with our European friends [where the market has been soft in a number of countries -Ed] they are completely unrelated. Here we are talking two-digit growth. The crisis has crossed the ocean to Europe.”
ASUTIL Secretary-General José Luis Donagaray was also in positive mood. ASUTIL retailer members surveyed over their first-half performance had reported an overall +43.1% rise in sales year-on-year, he said, peaking at +76% with one retailer and reaching +25.3% even in the lowest case. In comparison, passenger growth averaged +10.4%. Average transaction value was up +25.4% across all categories.
Perfumes & cosmetics sales rose by an average +46.4% in the period. “The region continues to show dynamic growth,” Donagaray said.
Other key categories posted strong rises too during the first half. Liquor was up +35.3% across outlets operated by the various respondents; tobacco gained +16.6% and foodstuffs rose +36.1%. Electronics surged ahead by +76.9%.
“PASSENGER CONFUSION CONTINUES”
The industry’s ongoing problems with the liquids, aerosols and gels (LAGs) issue were debated by IAADFS Executive Director Michael Payne, World Duty Free Director of Trade Relations Sarah Branquinho and Donagaray.
Payne did not mince his words about the continuing impact of the restrictions on LAGs purchases for transit passengers, and confiscations from those who were buying duty free when they were not permitted to carry it. “Passenger confusion continues,” he said. “Customer confidence in airport duty free has eroded.”
He continued: “The airport duty free industry could face a loss of credibility and harmonised global standards remain elusive. Thousands of bottles continue to be confiscated and many are duty free [liquor] bottles at price-points above US$50.”
Work continues in the US towards a technological solution to identifying liquid explosives but neither Payne nor Branquinho held out any short-term hopes of a breakthrough.
Branquinho talked of European Travel Retail Council (ETRC) hopes that more countries would eventually apply for and get recognition from the European Commission that their aviation security measures met EU standards – thus clearing the way for LAGs to be sold to passengers transiting through EU airports. So far only Singapore and Croatia have gained that approval.
Ten other countries were in negotiations though, she said, and, importantly, she was hopeful of quarter four progress with the US and Canada (for EU-bound traffic only) as well as Israel.
Donagaray called for a renewed commitment by the trade to overcoming the problem. “In one way or another we have to demolish this barrier,” he said.
Other presentations included a typically effusive, anecdotal address by London Supply Commercial Manager Francisco (Paco) Heredia themed “˜All that glitters is not gold’, which analysed buying attitudes among duty free consumers; and a strong insight into the ambitious expansion – and increasing importance of commercial revenues – at Tocumen International Airport, by Commercial Manager Erick Goldoni.
The conference concludes tomorrow.
The conference is being co-moderated by The Moodie Report Publisher Martin Moodie and The Travel Retail Business Spain and Latin America Correspondent John Gallagher.
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ASUTIL 2008 gets into full swing in Panama – 04/09/08
