Northstar

PEOPLE www.travelweeklyweb.com Chat with … How has the travel retail industry been affected by the recent economic fl ux? The tougher economic climate in some parts of the world has led the industry to focus on providing the best possible value and experience for the consumer. People have to think twice before launching a new product. The economic climate has also led to an even closer collaboration between retailers and manufacturers to drive customer footfall into the stores and to increase potential basket size through specific programs. The P&G Prestige Travel Retail (TR) business has grown share through the fi nancial crisis, and we are optimistic about future trends. Another trend we have observed is that with the travel retail industry growing at a rapid pace, passenger count has increased broadly. We are now seeing the fastest growth in Asia, followed by the US, Latin America and the Middle East, with Europe remaining the biggest market. Airports are also investing in bigger and better shopping environments, and we expect over 130 new airports to be built in India and China in the next 10 years. What are the changes in consump- tion patterns of the modern savvy traveller? One key change we have observed is the demand for super premium collections. While in the past, the Asian consumer might have been a conservative spender, now, the Asian consumer also enjoys the aspirational appeal of prestige products and does not mind paying a premium price for luxury goods and accessories as consumers become savvier and appreciate the quality of the product. Brand lines like SK-II's LXP range and Dolce & Gabanna's Velvet Collection address this consumer need. For the beauty industry, we have seen the emergence of the global customer – especially in travel retail (the world shops in the store). Global brands will leverage their advantage to win in this emerging channel. We also see the changing face in terms of footprint of global travellers www.travelweeklyweb.com Carla Liuni, regional director, Prestige Asia Pacifi c The travel retail industry has evolved through economic changes and the ever-growing travellers' preferences. We speak to Carla Liuni on the challenges that the industry has faced and how travel companies can contribute towards its robust growth. – more travellers from Asia and Latin America. And they are buying fragrances as an affordable luxury. We recognise that Asia is the new hotspot for prestige consumption as well as the dominant skincare market for both men and women. In skincare, we have P&G Prestige skincare, fronted by established prestige skincare leader, SK-II, which is consistently experiencing double digit growth and has continued to remain young and fre sh with consumers after over 30 years. Luxury travel seems to be making waves through purposeful platforms such as via green tourism or exotic destinations paying respect to their ecosystems through programmes that encourage visitors to partici- pate in being socially responsible. What are your thoughts on this and how does P&G contribute towards such causes? We are convinced that sustainability has a role to play in the luxury beauty industry and we are committed to innovate to create a more sustainable world. We want to delight the fragrance consumers with sustainable innovations, and we have plans in place on improving the environmental profile of our Prestige operations. What are travellers looking for in the travel retail category? Within TR, we have done extensive consumer and market research to uncover that 60 per cent of purchases done by travellers are for gifts, but the offers are often unique to the channel. For example if you are shopping for a holiday gift in the domestic market, bigger could be better. We all want the large gift wrapped box to present to a loved one. In travel retail, size matters when you have to carry it on an airplane, and are possibly even connecting flights with airport security to navigate. As such, the channel often provides unique gifting solutions often with a travel theme whether it's a makeup travel bag or an assortment of miniature fragrances of travel-sized purse sprays. The key behind our leadership in the Prestige category is that we continue to focus our efforts when and where it makes most sense according to consumer needs and desires. This is in line with our strategies of fewer and better and sustaining classics. We also continue to delight consumers in-store with a meaningful shopping experience that underlines the magic of the fragrance category. What about airport shopping environment – can you name a few that provide the best shopping experience? Airports are investing in bigger and better shopping environments, from beauty to fashion, accessories, and of course spirits and confectionery. With a myriad of stronger branding and navigational tools, simpler assortment and through testing new shopping experiences with our customers, we have created a more engaging shopping environment to please our consumers and shoppers. This success comes on the back of our strategic customer partnership model that has become the benchmark in the Prestige category, driving overall growth across the category, our customers and for P&G – through this we are dedicated to continually step change the benchmark for the category. Again, one of the measures we have taken in this space is to introduce travel retail specifi c merchandising which places our consumer at the heart of the shopping experience. To read part two of our interview with Carla Liuni, visit: www.travelweeklyweb.com 05 JUNE 2012 | TRAVELWEEKLY ASIA ■ | 7

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