Mumbai Airport ‘budget shop’ plan

By Doug Newhouse |

The DFS Group and Flemingo International renewed joint venture at Mumbai International Airport T2 is considering introducing a ‘budget’ shop for lower spending passengers.

 

This follows research by the joint venture operators that ‘some people are quite daunted by this massive retail offer of what looks to be only premium brands’, according to Paul Topping, Board Director at Flemingo International.

 

Addressing a Flemingo press conference at the TFWA Cannes show which was also attended by DFS CEO Philippe Schaus last month, Topping said the JV is now considering converting one of its three shops to this new budget format.

 

 

The Johnnie Walker Shop operated by DFS and Flemingo at Mumbai Airport.

 

 

“We’ve got around 10m passengers and out of those 10m we’ve got a massive number – over 3.5m – who I would call budget customers. So when they come through this beautiful shop that really is – as I say – an exciting shop, I’m sure we’re missing so many.”

 

Topping said the priority in the new terminal is obviously to maximise the penetration and especially considering that this was woefully low at around 6% in the old airport terminal. The new walk through and walk past shops are now a huge improvement, so penetration improvement should be much easier in future, he said.

 

He said the partnership now operates some 50,000sq ft under the new contract which began last February, with the majority of space located in departures where there are three shops. He described the first as ‘beautiful’ with amazing lighting and ‘beautifully styled’ so that ‘everyone has to walk through it’.

 

 

The beauty area at Mumbai Airport.

 

 

All passengers also have to walk past the second shop and 85% of passengers also have the opportunity to shop at the third. The arrivals and departures shop offers are now around 95% finished, he said.

 

DFS has done ‘a fantastic job’ in responding to some of dynamic sales trends that are emerging in this new more enticing sales environment, said Topping, who said that confectionery was just one category where growth of 93% was recorded in just one month. But there are also some very serious old problems that have dogged the Indian duty free and travel retail market over the years.

 

These mainly emanate around government and state legislation [not always the same in India-Ed]. For example, at one point new confectionery labelling laws left the JV with only two confectionery brands on the shelves, while the liquor section was also temporarily ‘decimated’ because the operation couldn’t physically get the stock to the airport.

 

 

The DFS-conceived Indian Gourmet Shop which is apparently performing extremely well for the joint venture.

 

 

The level of ‘testing’ on perfume was yet another problem which emerged and Topping said this carried on for much longer than the joint venture had anticipated.

 

Considering all of this he said it was hardly surprising that the World Bank rates India the 57th most difficult country in which to do business.

 

Nevertheless, concluding this part of his presentation, Topping said the Cannes TFWA show was the first real opportunity that the joint venture company has had to impart a flavour of where the Mumbai Airport business is today.

 

 

The DFS Flemingo-run duty free arrivals shop at Mumbai Airport Terminal 2.

 

 

Having said that, he emphasised that the partners still have a lot of work to do and particularly in the area of understanding the consumer and researching how to better define the overall offer.

 

TOP IMAGE: Flemingo International’s management at the TFWA Cannes press conference (LtoR): Paul Topping, Board Director; Atul Ahuja, CEO; Carlo Bernasconi, Independent Director and Simon Forde, Group COO.

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