Spiritual home
What’s for sure is that travel retail is the spiritual home of this over-sized, over- the-top form of packaging. And the sector is wholeheartedly loved by brand owners for its ability to show off their wares to hoards of bored, moneyed people.
At Pernod Ricard’s half-year get-together with journalists in London last September, future leader Alexandre Ricard summed up the sector’s importance: “If it were a country it would be our third or fourth largest country in the world from a profit point of view.” Laurent Lacassagne, newly installed chairman and chief executive of Chivas Brothers, also chipped in: “Travellers are open-minded consumers with time – things we don’t find too much in normal life.”
An explosion of travel among the Chinese – which, according to Diageo, is estimated to have been 85 million last year and growing at 15% – has changed everything. The Chinese penchant for gift-giving, especially around Mid-Autumn Festival and Chinese New Year, has had a profound effect on sales of Cognac and Scotch.
This is something Rémy Cointreau knows a little about. “In some locations gifting represents as much as 50% of purchases,” says the group’s Matthew Hodges, marketing and business development director, GTR. “There are so many reasons to buy a gift – to say thank you, to show respects, to convey affection, to simply surprise someone and very often simply because it is expected.
“Many of us are familiar with the feeling of not knowing what is suitable and are willing to pay a little more to overcome our sense of uncertainty. Travel retail provides the product range, the advice and the opportunity for travellers to make an appropriate gift choice.”
Since the group bought the Islay single malt Bruichladdich in September 2012, it has set about working on a five-bottle exclusive-to-travel retail collection, which launches this month at TFWA Cannes. “The range is highly distinctive, the belief in terroir is communicated on every bottle,” says Hodges. “The Organic Scottish Barley is packaged in an eye-catching aqua bottle inspired by the colour of the seas around Islay. It is simply a beautiful and unexpected colour for a category dominated by earthy tones.”
The gift-buying period
Back at Chivas Brothers’ Prestige Hall, it’s a busy period for whisky orders. With China’s Mid-Autumn Festival orders only recently dispatched, the confluence of Christmas and Chinese New Year orders create a bottle-neck, so to speak, in production. Fathers’ and Mothers’ Day, Valentine’s and the Spring Festival in South Korea mean there are more spikes throughout the year, but because travel is so widespread, gifts are in constant demand.
According to research from UK distributor First Drinks, gifting represents a “year-round opportunity to engage with consumers”. In many markets, the UK included, gift packaging is employed at all price points – from the luxury market to mid-market. “The majority of gifting purchases are valued at up to £20 – indeed the £15-£20 price point is key,” says Roy Summers, head of category management. “However, 40% of shoppers are happy to pay a lot more than that – above £50 – so gifting is an attractive proposition across all price points, not just the premium or super-premium end.”
