By: Vinny O. Polis • email: email@example.com
Hands up if you can recall the last time you actually bought a bottle of wine in a Duty Free store? I’m not talking about the free glass of champagne you sipped the last time you flew Business class, or the glass of Chablis that you drank in the business lounge the other week. Think back to the moment when you spent your hard-earned cash on a bottle, which you then carried home with you.
You can’t? Well I am sure you are not alone. The truth is that wine has always played second fiddle to spirits in Duty Free for both customers and retailers. The widespread perception that savings on Duty Free wine are not large enough to overcome the convenience of carrying it home is one of the top reasons why spirits overshadow wines in our business. Over two and a half times more spirits than wine are sold in Travel Retail each year – a reverse of the global market situation where wine continues to outsell spirits!
Yet I would argue that wine – especially fine and sparkling varieties – has enormous potential to grow in Travel Retail.
A well curated and merchandised wine offer can deliver good profitability, attractive gifting options and a much-needed sense of place – particularly in Travel Retail locations with a strong regional wine industry. For wine to take off, however, the following needs to happen:-
Wine must be a value game
Global wine volumes have been static in recent years. The gains have been in value, and this is where the Travel Retail business must play to uncork the category’s potential. Discounting labels that are easily available in the domestic market is a zero-sum game. Instead, extensive sampling opportunities, knowledgeable sales assistants, eye-catching merchandising and attractive packaging must be used to persuade travellers to trade up.
Invest in staff training…
Wines are far more complex to sell and handle than spirits, and operators have to invest significant sums in staff training to see better returns. Given the difficulties of curating in-store wine to appeal to multiple nationalities and securing adequate supplies of fine wines, there needs to be more expertise on the buying side, too. How many retailers have dedicated wine buyers?
… or call in an expert
If you want a job doing well, call in an expert. Dubai Airport’s fine wine and spirits retailer, Le Clos, has won a string of retail awards in recent years and broken record after record for selling collectible fine wines. The company’s excellent relations with the world’s top vineyards, its multi-lingual buying team and attentive, personalised customer service are simply unmatched anywhere in Travel Retail.
There is no reason why a specialist wine retailer like Le Clos couldn’t succeed at other major airport hubs – either as a standalone store or as an in-house retail partner for a multi-category Duty Free retailer.
Recruit new consumers to wine
Are wine producers doing enough to excite millennials to the world of wine in the same engaging way as craft spirit and beer producers? I have my doubts, but Travel Retail is the ideal place to engage with them through exciting, interactive promotions where the emphasis is on fun, story-telling and education.
Of course, there are Duty Free retailers doing an excellent job of selling wine to travellers. Heinemann excels at showcasing Australia’s finest wines at Sydney Airport and German wines at Frankfurt; DFS Group impresses with its high-end Bordeaux, Burgundies and iconic New World labels at Singapore Changi; while at Paris CDG, LS Travel Retail and joint venture partner Aeroports de Paris, have also raised the bar significantly when it comes to retailing fine wines.
The trouble is these beacons of excellence are undermined by a mediocre treatment of wine at many smaller, medium-sized airports. I am convinced wine can grow and can offer so much more in Duty Free. Yet the industry must take a collective leap of faith and believe that the category can deliver more before this will happen.