Focusing on a value proposition and innovation

Nodjame Fouad, VP marketing at Pernod Ricard Global Travel Retail, talked to Felicity Murray about the importance of the channel to the company and it's strategies for growth

Nodjame Fouad Pernod Ricard GTR

Travel Retail is a key strategic priority for Pernod Ricard and earlier this year the company strengthened its organisation by consolidating its Asia Pacific, EMEA and  Americas travel retail businesses into a single entity – Pernod Ricard Global Travel Retail, based in London.

"By consolidating our business into one global business allows us to really treat the channel, the travellers and our customers with much more of a global view because, at the end of the day, travellers are global," explains Nodjame. "It’s very much a strategic move for us to address a very strategic channel.  People are continuing to travel, and the growth rates are growing in terms of passengers. If you look at it historically, despite the  numerous potential interruptions to the business, it is a resilient channel that continues to grow year on year.

"At Pernod Ricard we fully believe in the strength of global travel retail and the future opportunity for travel retail. Our focus is on value creation. When you consider that three billion passengers travel annually on international trips, you can see that there’s a huge opportunity to build brand value, as well as profitable business growth. Therefore, we are an organisation that’s really focused on the value proposition from a brand standpoint, an experience standpoint, and a commercial standpoint. 

"We are putting a great deal of focus on understanding different traveller motivations and different shopper missions.  We look at what we call the ‘travel trail’, which is essentially your consumer journey - following your traveller from point ‘A’ to point ‘B’. This requires a lot of synchronisation with domestic markets in terms of being able to create a communication flow and a programme that targets a traveller from ‘A’ to ‘B’ and retargets them by communicatting to them a travel retail exclusive, a new offer, or something newly launched in the channel, which will drive them into the store. Therefore, a collaboration with our domestic markets is really, really important, especially as it relates to the digital opportunity and the digital realm. 

"The biggest opportunity and challenge we face is footfall - driving footfall into the store. We know that the number of travellers are growing but that doesn’t necessarily convert into the number of shoppers, or the spend per head, and that’s a strategic focus that must be addressed. This requires a number of things: firstly, a very strong partnership with the retailers and airport authorities, as well as domestic markets; secondly, it requires quite a bit of understanding in terms of how travellers use their mobile and how travellers leverage the entire digital realm. Digital acceleration for us is therefore key in terms of being able to drive footfall into the store because, at the end of the day, footfall will ultimately (hopefully) translate into conversion. So, if you are growing the pie, growing the opportunity, and growing the pool of shoppers you are ultimately (hopefully) also going to be able to address the conversion issue.

"We know travellers are looking for value, but value doesn’t necessarily mean dollars, it can also be the experience that you are giving them.  We have strengthened and we have built a retail excellence team that works very strongly together with our digital team to look at how we can create new experiences in store that add value to consumers by creating a little bit more disruption, fun, and engagement.

"A big part of our strategy is to recruit the next generation of travellers into duty free shoppers. This would secure the long-term viability of the channel. We are also focused on bringing a little bit more engagement - a little bit more disruption into our product propositions and into the way we bring our brands to life into the retail environment. But again, to really achieve that, it requires a lot of partnership with the retailers and airports.

"Innovation is really important for us in both travel retail exclusives and non-travel retail exclusives.

"There is a big element of impulse shopping in travel retail and if you are able to offer people something new and exciting that they haven’t seen before, such as a travel retail first, that is coming from a reference brand that they have an infinity to, this is a very strong proposition.

"Another key priority for us is gifting and, therefore, the packaging. We know that there is a huge, huge opportunity and a huge focus on gifting specifically as it relates to high value Scotch. In some parts of the world, almost one out of every two purchases of high value Scotch is a gift.

"It’s a very, very important part of our proposition to build up strong brands and give the travellers something new and exciting to try in travel retail. But the real challenge is making sure that we communicate those before people get to the store, because if you don’t do that they are not going to know that it’s there…"

15 November 2017