The Moodie Davitt Report brings you the latest instalment in our popular series Ten Easy Pieces*, in which we get up close and personal with leading travel retail personalities via ten snapshot questions.
In this edition, we chat to Travel Blue Executive Director Jonathan Smith, who has spent an impressive 30 years working in travel retail.
1. Where were you born and raised? And where do you consider ‘home’?
I was born in the Midlands and raised in Ruislip, Middlesex. I now consider ‘home’ in the south of England having spent most of my life there.
2. You’ve dedicated 30 years of your career to travel retail. Tell us about how you came to enter this channel all those years ago and what has made you stay.
“The whole idea of flying and travel, the environment and the captive audience, meant I found duty free much more exciting than the local market”
30 years ago I joined Alfred Dunhill as Sales Manager for UK domestic retail, responsible for department stores, jewellers, etc, plus a new retail channel ‘UK Duty Free’ (travel retail had not been created back then). The whole idea of flying and travel, the environment and the captive audience, meant I found duty free much more exciting than the local market. I was able to develop new brand identified shops and corners within Heathrow and Gatwick airports and within a year or so of joining Dunhill, I was experiencing international travel for the first time.
By the time I left I was responsible for almost all of global duty free for the jewellery division. My number one customer being DFS, the biggest single account, meant I travelled to Hawaii at least twice each year. Happy days! I’ve never looked back.
3. Can you describe the changes you’ve seen in the industry over the years – what are the highs and lows?
- The abolishment of duty free in the EU in 1999. Back then, many in the UK duty free industry were very nervous, afraid of what it would do to their business. This as we now know was a complete fallacy, business as usual!
- The international global retailer. Today, the top 20 global operators have the greater percentage of the global travel retail business. 30 years ago, it was much more fragmented; there were many, many retailer names across the globe and very few ‘international multiples’. Now, with Dufry and Lagardère buying more retailers, plus Lotte and Shilla etc, there are massive players across the world. That’s a major change.
- One of the current ‘lows’ in our industry and a major change is the power of the airport landlords. Over the last ten years, landlords have realised that they can charge higher rent, etc for the retail space they own, especially considering sealed bids, there is no transparency. As a consequence the retailers/concessions have to accept being charged higher and higher rent, minimum guarantees, etc. That has been a fundamental change. Global retailers need to have better margins to offset increased airport charges, but still have competitive consumer retail offers. Ultimately this falls on suppliers to increase retailers’ margins. There is no short term solution, but we have already seen changes in operators and airport landlords working together, for example Fraport and Gebr Heinemann struck a joint venture to manage travel retail at Frankfurt Airport. Hopefully this type of partnership is the way forward.
- The other low I would say are the various wars such as the Gulf Wars as well as SARS and terrorism – all incidents that stopped people travelling.
4. You started your own business, House of Brands, in 1997. What was it like being your own boss and what challenges did you face?
Very scary! From working for a corporate organisation with many departments, I had many different departments/colleagues that I could rely upon, and then, I had to rely on just me.
I represented brands that were not in travel retail and trying to gain distribution was a major challenge. I learnt that unless you own something (the brand or the product) then for as long as you represent the brand, that brand can be taken away from you at any time. So it’s a risk. Ownership of something is crucial.
5. Besides travel accessories, you’ve worked in luxury (at Alfred Dunhill and Aquascutum) and for lighter producing company Ronson. How did your time at those companies shape your career and what were the highlights?
Working at Alfred Dunhill was amazing. It was my first time entering into luxury and I couldn’t believe how expensive everything was – very high prices. For me, that was a great learning curve going into the luxury business from FMCG. Dunhill gave me a fantastic grounding in travel retail; there were lots of business, sales and marketing courses that I completed.
Travel retail in those days, especially in the UK, was a very small part of the business – it wasn’t so important. I could almost do whatever I liked within travel retail without too much difficulty so it was a great place to learn.
At Dunhill, international travel gave me a fantastic opportunity to work with different cultures in different countries. I then went on to Aquascutum and did exactly the same: set up their first brand identified shops in airports. Those were great career highlights.
I joined Clifford International (part of the Ronson Group) in 1997 working with Bruce McGuire who many people will know within the industry. I ran the duty free division of Ronson for a small PLC company. Exciting heady days!
6. You joined Travel Blue in March 2010. How has the company evolved in the seven years that you’ve been there and what has been your biggest achievement?
Working with Travel Blue has been the most amazing journey of my 30 years working in travel retail. When I first started, apart from Heinemann, one of our longest standing travel retail customers, we had very little business in global travel retail. Seven years on, we are the number one supplier of travel accessories to the travel retail industry – what a journey! It has been amazing; I remember getting our first global agreement with Dufry, that was major.
The biggest achievements… Convincing the travel retail industry that travel accessories is an evergreen category. Provided that people are travelling, it’s a guaranteed sale. Over time, we have not only convinced key customers but we have built a global distribution and along the way, many competitive companies have followed. Seven years ago, we had only one competitor and now there are a number of brands that have set up. If we hadn’t done what we had done and set the pace, they wouldn’t have been interested.
“Working with Travel Blue has been the most amazing journey of my 30 years working in travel retail”
7. Travel Blue is celebrating its 30th anniversary this year. Are there any special plans to mark the occasion? And what do you think the next 30 years hold for the company?
There is no special celebration to mark the anniversary. We have worked very hard to build this business, we are in a good position but we are well aware of how important it is for us maintain it. The growth over time has been phenomenal. We need to maintain this by staying one step ahead and continually bringing out new and innovative products.
On the question of the next 30 years, we have already started. At the Singapore show, we launched our own brand of reading glasses Z-ZOOM. It is in our plans to continue to develop wholly owned brand categories over the coming months and years and well into the future. There are already a couple of projects in the pipeline which we will launch very soon. So the next 30 years will hold very exciting and challenging opportunities for us as we continue to build on the Travel Blue brand along with other subsidiary brands of our own.
8. Where do you see yourself in five years’ time? Do you envisage a time when you are not globe-trotting and catching up with the travel retail community?
Exhausted! Haha. But healthy. I would still be here with Travel Blue. As for globe-trotting, I absolutely love it. Even when I retire I think I will still be travelling.
9. As a travel retail veteran, you must have visited some weird and wonderful places. Where do you most enjoy travelling to and why?
The most wonderful places I have visited most recently I would say are Cambodia and Vietnam – amazing countries. Certain countries in the Far East haven’t experienced the development and change that many other countries have. For me, the Far East is definitely the best region to travel to.
“We were stuck in traffic and the driver opened his window and placed a flashing light on the roof and started a very loud siren”
Also India. India was fascinating. The colours, the saris, the traffic, the smells (good and bad), everything.
When I was working for Aquascutum, I travelled to Moscow. I will never forget being in the back seat of a stretch limo and we were going downtown to look at some real estate for an Aquascutum shop. It was a hot, sweaty day, we were stuck in traffic and the driver opened his window and placed a flashing light on the roof and started a very loud siren. Suddenly the police are parting the traffic to let us through! It turns out my business colleague had close connections with the mayor of Moscow. It was very surreal.
10. Finally, what are your hobbies and interests outside of work?
Rugby and motorsports are my two favourites. And of course, travel. I love to travel.
*PREVIOUSLY FEATURED TEN EASY PIECES PERSONALITIES INCLUDE:
Meet Antony Kime, a travel retail flying Kiwi
Meet Essilor sunglasses specialist Francesco Leccisi
Meet Blue Chip Group Vice President Flora Lee
Meet ‘Mr Braun’, the ever-effervescent Klaus Mellin
Meet Karelia Tobacco Company ‘voice’ Joanna Kamarinopoulos
Meet Monzelez WTR marketing specialist Irina Tarabanko
Meet the underwater wine woman Irina Wiedemann
