Liqueurs report: Travel Retail

13 August, 2015

While trading conditions in key markets are far from ideal, leading liqueur brands are stepping up their focus on travel retail, as Joe Bates reports


IN VOLUME TERMS THE LIQUEUR CATEGORY HAS HAD A TORRID TIME IN TRAVEL RETAIL OF LATE. Overexposed to both European and North American markets, where passenger growth and retail spend have struggled since the great recession of 2008, the liqueurs sector has simultaneously failed to make a serious impact in fast-growth emerging markets such as Asia/Pacific. As a result, sales declined by almost 3% in 2013 to 2.18m cases, according to IWSR research. 

The category’s travails are exemplified by market leader Baileys, which still enjoys a dominant category share of more than 28%. Despite a series of flavoured line extensions and the roll out of the premium Baileys Chocolat Luxe, sales of Baileys in GTR slipped back a worrying 10% in 2013 to total 620,300 nine-litre cases, according to IWSR figures. 

Not every major liqueur is facing the uphill challenge of Baileys, however, and, while overall sales volumes for liqueurs in travel retail might not make for pretty reading, brand owners are slowly taking the travel retail sector more seriously. Indeed, the growing consumer interest worldwide in making cocktails at home and the increasing numbers of people from emerging markets such as China and Brazil travelling abroad have led to a number of liqueurs being launched exclusively for travel retail. 

A prime example of this trend is this year’s launch of Cointreau Blood Orange: the first travel retail exclusive flavour ever released by Cointreau. Priced at the same level as a standard 1-litre bottle of Cointreau, the new 70cl Cointreau Blood Orange is made from blood oranges grown on the island of Corsica, and described by La Maison Cointreau master distiller Bernadette Langlais as a “new expression” of the famous liqueur rather than a “new flavour”. 

Blood oranges are clearly the trendy flavour of 2015 as the red-fleshed citrus fruit is also the signature ingredient of another travel retail exclusive liqueur launched this year: Southern Comfort Blood Orange. Like Cointreau Blood Orange, Southern Comfort Blood Orange is the brand’s first line extension exclusive to travel retail. It went on sale with World Duty Free Group (WDFG) at its airport stores in the UK, Spain, Finland, Germany, the US and Canada in May for a three-month period before a wider roll out. 

And, while Baileys might be struggling, rival cream liqueur Distell-owned Amarula, the third best-selling liqueur in travel retail, is going from strength to strength, growing by more than 17% in 2013. Robyn Bradshaw, general manager duty free/travel retail, explains that this year the company has been jointly promoting both the flagship Amarula and the newly launched clear, higher-strength 30% abv Amarula Gold at key travel retail locations. 

“Made to be mixed, Amarula Gold offers a very different expression of the unique marula taste from the velvety cream option,” explains Bradshaw. 

“We have focused on tasting activations, where we know Amarula Cream responds well, but wherever possible have also included Amarula Gold to encourage shoppers to widen their brand repertoire. 

“We have been following this approach from São Paolo and Rio de Janeiro to Melbourne, Johannesburg, Bali, Moscow, Copenhagen and Milan and a range of other destinations, and are seeing very good growth.” 

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