'Sky's the limit: the rise of global travel retail' by Mathieu Jeannin

Shopping at the airport is a unique experience. Travellers usually have time on their hands before boarding. They’re more likely to be in the mood to browse, to treat themselves or splash out on a gift. Alternatively, they could be one of the savvy millions who wait to stock up on the brands they love with a tax-free discount.

According to recently released figures from the IWSC (August 2024), Global Travel Retail (GTR) footfall is back to its pre-pandemic level and its value to the alcohol sector is now higher than in 2019. Despite volumes being more sluggish due to careful consumer spending, they expect the channel to outperform all other alcohol markets in the run up to 2028, with value growth of +7% predicted.

This explains why, for spirits brands, GTR has become such a priority. In our latest ‘In Conversation With…’  article, International Beverage’s Paris-born Senior Sales Manager for Global Travel Retail, Mathieu Jeannin, shares his secrets for success in this booming channel.

I’ve spent my whole career in the drinks industry, working in sales for Bordeaux wines and French Cognacs amongst others, in both Europe and Asia. I joined International Beverage just after the pandemic to support markets in South Korea, Japan and Taiwan before heading to London for a role in the European GTR team – a job I relish given how much I love travel and how long I’ve spent in airports over the years!

This is a very special – and specialised – channel. Particularly so for Scotch whisky, which is a premium category with a huge international consumer base. I came into the role knowing that airports can be a powerful shop window to the world, with an opportunity to sample and immerse consumers in your brand. But to succeed and ensure your brands shine – and sell – in the channel, there are some important strategic insights and trends to be aware of.

It’s all about premium

Travellers want something different and exclusive in the airport, compared to the products they see on shelf during their weekly shop. They want more elevated expressions and to dip into the higher end of your portfolio. We bring a future-oriented strategy to GTR, led by new products, limited editions and premium or super-premium ranges. We have invested in transforming our GTR ranges to meet consumer needs - from Old Pulteney’s ‘Traveller’s Exclusives’ to the dedicated GTR range we’ll be introducing for our Speyside single malt, Speyburn, in 2025.

Build the volume opportunity

If GTR was a country, it would be the world’s most valuable one when it comes to Scotch whisky. That’s a powerful statistic, and a reminder of the huge potential for commercial wins in the channel. Single malt volume sales were up by +24% in 2023 (IWSR August 2024) and are forecast to sustain this growth. The channel presents brands with a captive market selling exclusive products, so price sensitivity is less of an issue. It’s also an enduring channel. People’s love of travel and airport shopping is going nowhere. As the cost-of-living crisis continues to bite in domestic markets, GTR is an increasingly important volume driver for many global spirits brands.

Tracking the new consumer

We make no assumptions about the GTR shopper. As an insights-driven business, we can see consumer behaviour and trends evolving – such as the emergence of younger shoppers in the GTR mix, who are making the most of budget travel but still want to spend on premium goods at the airport.  And they’re digital savvy, looking online before they travel to pre-plan purchases. A blended digital and in-airport approach to marketing and activations is crucial – as is keeping track of future trends and tastes of consumers in this space!

Right product, right place

There are huge regional variations to factor into any successful GTR strategy. Europe is a mature market, and the big hubs such as London, Paris and Amsterdam are growing more slowly than their counterparts in Asia (GTR sales in APAC were +46% in value during 2023, IWSC August 2024).  This is where the big opportunities lie in terms of volume and long-term growth – with Chinese tax-free super-hub Hainan attracting an incredible 90 million consumers each year. We continue to invest in both regions, but always with one simple rule at the core: right product, right place. I’s a granular, long-term strategy for success, driven by the profile and needs of each airport – whether that’s Balblair leading our activations in Hong Kong or Caorunn taking centre stage in its home market in Scotland.

Experience is everything

2024 has marked some of our company’s biggest marketing investments to date in the GTR channel. We now have full time brand ambassadors at several major travel hubs to deliver all important ‘liquid on lips’. Combined with a memorable brand experience – such as our stunning Old Pulteney tasting bars which have been transporting people to the brand’s Highland home at Paris Charles de Gaulle and Heathrow – we’ve delivered impressive results.

Partnership working

After airlines, duty free shopping is the biggest revenue driver for airports over any other - including hotels and restaurants. Airports want brands to invest and succeed, and they are ready and willing to support ambitious ideas and activations. As with so many aspects of our industry, strong long-term partnerships are the key to success.