CHAMPAGNE CONTINUES to perform well in travel retail, despite worldwide sales stagnating and exports within Europe slowing measured against those shipped to countries outside the EU. The latest IWSR figures show growth in the sparkling wine category as a whole of 4.4% in terms of volume (2017 vs 2016) to 1.6m cases and 7.2% in terms of value to US$710.2m.
Within the wider sparkling wine category, while champagne accounts for only 52.6% of the volume, up 2.6% on 2016, it still commands the lion’s share of value with an 80.1% slice worth US$568.87m, up 6.2% on 2016. Other sparkling wines are growing quicker in both volume, up 6.5% and value up 11.5%, but this is a sector where champagne still has that extra cachet and revenue from sales is four times the US$141.33m all other sparklers take.
In line with predicted future growth in sparkling wine consumption in many major domestic markets, IWSR expects champagne volume to rise by 1.8% between 2017 and 2022 and value to rise by 4.1% in the same period. The 10m bottles sold put travel retail as a whole in fifth place above Belgium, Australia and Italy, export markets number five, six and seven respectively, in 2017.
And travel retail is not just about the volume sold. As Olivier De La Giraudière, who looks after this channel for Lanson, succinctly puts it: “This is a market you have to be in when you want to be considered as an international brand. It’s about visibility, it’s a benchmark for your international standing.”
A sector whose entire raison d’être used to be about buying at an advantageous price to the domestic market, has come a long way over the past decade. “It’s constantly reinventing itself in terms of the merchandising, customer experience and product offer,” says Myriam Renard, global duty free director who has looked after travel retail at Vranken Pommery Monopole for the past 16 years. “It has survived geopolitical upheaval, a major retailer shake-up because of numerous mergers and acquisitions, plus radical change in the travel market itself.
“Brands have had to rapidly adapt and be creative and, most importantly, innovative, to meet retailers’ and customers’ demands,” says Renard. “Gift boxes, limited editions and novelties are a must, with dynamic merchandising key to catching the traveller’s attention, while seasonal promotional offers are essential to generate sales.”
The main challenge for the operators is to convert the airport shopper into a buyer. The passenger decision-making has to be fast here and activations to generate faster impulse buying are not just welcomed, but demanded by the operators, as they deliver sales,” says Renard. Enhanced security at airports has considerably reduced the time consumers have to browse and shop.
“For the launch of Pommery Cuvée Royal Blue Sky, because not all passengers are familiar with the consumption of champagne on ice, we worked with dedicated hostesses, offering tastings at point of sales and explanations about the concept itself. This new cuvée is without a doubt our big success story of 2017 and the first half of 2018,” says Renard. At Cannes this year it will be releasing a new Blanc de Blancs cuvée in the upmarket Apanage range, plus Louis Pommery sparkling wines from California and England.
