Digital has become the ultimate disruptive influence for all forms of retail today.
But, despite much discussion of the topic, questions abound over whether travel retail has kept pace with the changing nature and potential of this constantly developing medium.
Today, every store or promotional campaign promotes a ‘digital first’ approach or claims to be using the latest in digital technology to enhance or streamline the shoppers experience. However, in some places this does not extend beyond the use of digital screens or a social media campaign, and the industry is being accused of taking a ‘spraying and praying’ approach to the implementation of digital.
Large digital screens just scratch the surface of digital’s potential
TRACE Ltd Founder and Managing Director, Vimal Kumar Rai, explains: ”The industry is not moving beyond digital advertising. I don’t see them doing much else in terms of digital. There’s a whole spectrum of things they should be doing, but they are not.”
NEW TOOLS, OLD IDEAS
Digital has an almost limitless potential to engage and inspire both existing and potential shoppers around the world, but much of its use in today’s TR market reflects a print and analogue mentality. The aim is to put products in front of as many customers as possible and get as many people as possible to share it. Used correctly, digital is a medium which allows brands and retailers to engage and inspire shoppers.
Dufry’s ‘Next Generation’ store at Heathrow Airport
Rai, whose past experience includes working as Vice President of Media Solutions at Global Eagle, says: ”Sometimes it is difficult to know where to start. Digital is a tool. It’s how you use the platform that matters.
”Everyone is getting on board with the shiny new things, the apps and the websites, but no one is trying to leverage digital organically
in a way that puts the brand out in front of the customers.”
In the domestic market, brands like Nike and Honest Bee in Singapore are doing it well.
The Nike House of Innovation 000 in New York features the Nike Speed Shop, which is stocked with items the local community wants based on data sourced from the local area. Shoppers can also pick up items from the shelves and buy them using the Nike app without queuing for check out.
The Nike House of Innovation 000 shows the potential of digital
Honest Bee in Singapore features QR code entry, cashless checkouts and robot collection points.
Dufry, the world’s biggest travel retailer, has put its own focus on in-store digital upgrades. The ‘Next Generation’ outlets, unveiled at high profile locations such as Heathrow, Zurich and Buenos Aires, showcase in-store digital installations to provide a ‘highly personalised’ experience.
”One of the key advantages of travel retail is that, by definition, our customers come to us. Unlike the high street, we do not need to attract customers to our locations – they are there to travel,” explained Dufry CEO Julian Diaz, reflecting on the company’s 2018 performance. ”Digital initiatives contribute for an enhanced experience and facilitate our communication with the customer.”
The company’s Forum by Dufry app offers influencer recommendations, loyalty programmes and space for brands to showcase and interact. Diaz explains: ”It (connects) all of our digital dots and adds emotion and experience with content provided by brands, bloggers and influencers, highlighting the attractiveness of the travel retail channel.”
Inside Dufry’s ‘Next Generation’ World Duty Free store at Heathrow
SPEAKING TO YOUR SHOPPERS, NOT ALL SHOPPERS
Such developments are a vital step for travel retail keeping up with the digital revolution. But Rai believes the travel retail community has much more to do to keep pace with its domestic and online cohorts.
”(The people doing best) are the guys who are trying to understand the consumer who is engaging with your brand,” Rai reflects. ”The problem in Travel Retail today is we are spraying and praying.”
He continues: ”Using a snazzy digital screen to get people in the store is a numbers game, rather than using customer demographics. At least we should be targeting the right demographics.
”Digital allows us to be so much closer to the customer than traditional advertising does, but that’s not being leveraged.”
Mondelez has openly discussed its focus on digital to capture shoppers attention. Recent activations, such as the Toblerone personalisation activation with Heinemann’s Unifree Duty Free in Istanbul, or last summer’s digital football game at Stansted Airport, show the company moving beyond the traditional constraints of tick-box digital outreach.
The new Toblerone 4D Photo Box at Istanbul Airport
”Digital engagement has become fundamental to the way Mondelez World Travel Retail approaches the travel retail business,” enthuses Mondelez World Travel Retail Head of Category Planning, Ivo Knuesel. ”The travel retail offer no longer commands a monopoly of attention from travellers and requires a whole new approach to engage them.”
Strategy and Design Consultant Gregory Odia agrees. He believes too much of the use of digital today is broadly aiming to attract youth, but not in a way that actually engages with young consumers.
”The question we need to ask, across all brands, is have we stepped up with the times?”, he asks. ”Have you kept pace with how your customer demographic has changed and how to engage with them in the best way possible?”
As the potential of digital continues to grow, Travel Retail must be willing to step beyond its tried and tested methods to embrace the medium’s full potential – or simply risk being left behind by those who will.