Travellers want a holistic experience, insists Dufry

By Trb Editor |

Xavier Rossinyol, CEO, Dufry Group.

Speaking to TRBusiness for the Global Industry Survey 2023, Dufry Group’s Xavier Rossinyol has been encouraged by quickening demand for convenience, duty paid and duty free assortments aligned to the speed of the passenger traffic recovery.

The Chief Executive Officer of Dufry – which stands poised to complete its transformation into a powerful new travel retail and travel F&B entity after the takeover of Autogrill – maintains that a holistic customer experience lies at the heart of its Destination 2027 strategy. However, he cautions that awareness is required to adapt to evolving consumer needs and behaviours.

How would you assess the travel retail industry in 2022?

Throughout 2022 we saw an impressive recovery of travel. The propensity and willingness of customers to travel was confirmed in all geographies as soon as restrictions were eased or lifted. On top of an increased demand, customers have been spending above average, a phenomenon which continued throughout the whole year.

The speed of the acceleration has, in some areas, led to airport disruptions manifested as capacity constraints with respect to ground handling of passengers, mainly caused by recruitment challenges in some locations. The close collaboration of concession partners, suppliers and retail operators has continued to be key in providing our customers with a seamless travel experience. We strongly advocate for a continuation of this, as well as the willingness to find new shopping formats and contractual frameworks.

How do you anticipate inflation and the risk of global recession affecting your business and the consumer appetite to spend in the travel retail channel in 2023?

As the macroeconomic environment remains volatile, it is still very difficult to assess any potential impact. Unlike in previous scenarios, we currently have several factors such as recession, inflation and political issues influencing each other and thus reducing visibility and predictability. Looking at customer behaviour in 2022, the impact of these issues so far has been minimal. The close collaboration of concession partners, suppliers and retail operators has continued to be key in providing our customers with a seamless travel experience.

How has the shift in passenger demographics, as a result of the pandemic/travel restrictions, affected your product portfolio and growth plans?

In 2022, we have conducted comprehensive customer and market research, received industry expert feedback and analysed social media posts with the support of artificial intelligence (AI). This shows that new customer profiles have emerged and we have identified three of them, which we will cater for with the implementation of our new strategy Destination 2027. However, we also need to be aware that new profiles will continue to evolve and we need to keep adapting to changing needs and behaviours.

Dufry will be seeking to defend its presence at Aena-operated airport locations as the Spanish airports duty free tender heats up. The travel retailer’s existing concession agreement expires on 31 October 2023.

What we have also seen during the recovery is that – influenced by the speed of recovery – demand has first resumed within convenience and duty paid assortments. With a slight delay, as soon as international and intercontinental routes were opened, duty free products have recovered fast as well and the traditional mix of duty paid and duty free products, including the weighting of the single categories, has been restored.

Moreover, the importance of sustainable, health and wellbeing products have continued to gain in acceptance, while overall experiences, novelties and attractive promotions have confirmed their importance.

Stagnant conversion rates continue to pose a challenge for DF&TR. How should the industry be addressing this in a post-pandemic environment?

Travellers want a holistic experience along their whole journey. The art and key success factor to drive conversion is to create relevant offers for travellers and make them available how, when and where they want it. Meaning to connect both our physical shops – and the unique advantage of the captive audience – with as many online touchpoints as possible to engage with the customer during their whole trip.

The second element is to attract their attention with hybrid offers, combining or inventing new and flexible store formats and assortments. For example, our new Mind, Body & Soul shop-in-shop concept providing a health and well-being assortment, with a variety of products which can be regionally adapted. Or, combining a speciality food souvenir shop with a tasting bar allowing customers to rest, enjoy an F&B experience and buy the tasted products without going to another store.

Dufry refurbished store at Mexico City T2.

In our new Destination 2027 strategy, we put customer centricity as our main focus to develop this holistic experience and relevance. This includes to permanently identify new trends, develop the respective assortments in cooperation with our brand partners, and present the offer in new and experience-oriented shop formats.

READ MORE: TRBusiness Global Industry Survey in the TRBusiness January 2023 e-zine.

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