DFS Group’s immediate set of priorities include delivering the next phase of growth for all partners, expanding its global presence and pursuing consumer relations in an uncompromising way, according to Chairman and CEO Philippe Schaus.

This will also involve developing stronger partnerships with industry, while moving towards a fully-digitised retail model, with ‘powerful’ new marketing capabilities, he says.

Speaking at the TFAP conference session ‘Navigating through change’ in a keynote last Monday, Schaus told the packed audience that profoundly changing consumer behaviour has developed well beyond any impact from the fight against corruption in China – considering the economic and political upheaval throughout the world today.

He suggested that the Chinese anti-corruption drive has even led to a new ‘modesty’ in Chinese consumer behaviour, alongside some other positive effects for travel. However, all of this comes at the same time that new forms of retail competition with airport and downtown travel retail have emerged – particularly digital devices with the ability to analyse and deliver comparative prices instantaneously to consumers on the move.

Philippe Schaus confirmed that DFS is constructing a new store ‘in France’, although he didn’t want to be drawn on the details.

GOOD REASON FOR OPTIMISM

With the underlying growth that the industry has enjoyed for several years now seemingly giving way to ’stagnation’ Schaus added that there is still good reason for optimism, as he pointed to huge progress in airports, wider product assortments and longer dwell times all contributing positively in more recent years.

However, changing consumer behaviour, aspirations and expectations need to be understood, such as greater individualisation and the differing emotional drivers at play, with the future dependent on how the industry responds to these developments.

Providing a sense of place for customers can also create a destination with its own values, said Schaus, who pointed to DFS’ new Siem Reap store as an example with its architecture and mix of locally-produced products and artistry and how this blends in with the global product assortment.

He also referenced the company’s first (well documented) store set to open in Italy later this year with its blend of retail and authentic tourist experiences, as well as the airport shopping experience featuring the iconic duplex wine and spirits shop at Changi Airport Terminal 3.

ACCESSIBLE & LUXURY BALANCE

Even much smaller retail offers elsewhere can still offer a good value proposition, said Schaus, who said this has to be beyond mere discounting. He added that striking a balance between accessible and luxury products is key today and especially considering that people now buy luxury for different reasons to those that motivated them five years ago.

Retailers will need to harness digital technology to smooth the customer experience, along with making transactions much easier and with mobile cash tills within stores in future. At the same time they will need to work much more closely with those that can influence shopping behaviour.

Good personal relationships will also need to be built with travellers in airport and downtown shop locations, while linking with services and tourism, such as exclusive events in airports and others like DFS’ Master of Wines and Spirits, which attracts between 400 to 500 customers each year who want to discover products they can’t find anywhere else.

Philippe Schaus talking with John Rimmer.

Schaus says it is all about engaging the customer across the entire journey from the moment they begin to plan their trip. He added that this is why DFS created its ‘MustPack’ campaign which is all about the products customers need to buy for your trip – a theme that runs right through DFS’ retail process.

Besides ‘digitising the travel retail eco-system’, he said the whole process is about the relationships between the different actors in travel retail, with innovation and creativity counting for 20% and execution 80%. This can also be strengthened by unique offers to consumers, as he referenced recent exclusive tie ups between DFS, Cartier watches and Michael Kors.

Schaus then took some questions from TFWA Conference Director John Rimmer. Within this brief session he described how DFS’ stores have evolved from his perception of them (when he was at Louis Vuitton), as stores with big corridors. DFS has now become a true retailer, said Schaus, as the retailer has moved into marketing and digital in a big way.

After taking a number of other questions, Schaus also confirmed that DFS is now looking at a second European location opening ‘in France’ which he said is ‘under construction’, although he didn’t want to be drawn into this subject any further.