The purchase penetration of food, including confectionery, has increased to 35% of duty free buyers in H1 2023, compared to 30% in 2017-Q1 2020, according to m1nd-set research.
The data also shows food as having the ‘fastest growing penetration in travel retail’.
What’s more, the category has one of the highest conversion rates among Generation Z at 42%, compared to tobacco (42%), beauty (36%), alcohol (35%) and souvenirs (30%).
The statistics come one year after Nestlé International Travel Retail (ITR) launched its vision to build food into the number one most purchased category in travel retail by grouping confectionery, global food brands and local food together into one ‘super’ food category and increase basket size through a stronger together approach.
Today, Nestlé ITR is seeing growth from both confectionery and non-confectionery, with additional sales being incremental, as desired.
“We are very happy to see that this incrementality is growing an adding value to the trinity and also for the shoppers,” Aura Sanchez, Marketing Manager, Nestlé ITR told TRBusiness.
“Although confectionery is still the beating heart of our business and that of our retailers, we saw that there are two opportunities to keep growing: coffee and vitamins, minerals, herbs, and supplements (VMHS).”
In this video interview, filmed on location at the TFWA World Exhibition in Cannes in October, Sanchez tells us more about how the vision has progressed, including the commercial intent being seen from retailers in opening up the space to a broader selection of products within the food category.
We hope you enjoy the video….
As referenced by Sanchez in our video interview, Nestlé ITR has recently introduced the premium TREX Nestlé Sustainably Sourced Cocoa range featuring tablets in four flavours and assorted chocolate chunks.
Produced through the Nestlé Cocoa Plan, with packaging that’s completely recyclable, the range helps fund the education of 156,000 children through Nestlé’s collaboration with Rain Forest Alliance.
Also in the sustainability realm, Nestlé is set to achieve 100% paper or recyclable packaging by 2024.
To better communicate its achievements in this area, the company has recently rolled out a travel retail specific multi-brand sustainability platform called Together We Grow.
It gives brands and retailers the chance to showcase their green credentials and is also a tool for engaging travellers throughout their journey.
“We don’t want to be a company that just promises future commitment,” said Sanchez. “We want to show the steps and the journey, and to have sustainability proof points with everything substantiated regarding what we are doing today, and the impact we are making in the world.”
Circling back to the opportunity that coffee and VMHS presents, Sanchez explained how the company is refining the messaging of Solgar to target the different need states of travelling consumers, chiefly covering immunity, wellbeing, beauty, energy, sleep and stress.
“Shoppers aren’t used to finding these products in travel retail so we are testing the places we are locating these solutions, and the idea is to really craft and frame the business plan to start expanding,” she said.
“So far I can tell you that the most relevant need states for the shopper are wellbeing and stress and sleep.”
More new products unveiled in Cannes include the Strawberry and Mint Limited Edition After Eight, and innovations in the Nescafé coffee portfolio.
KitKat sees new flavours in the Senses Collection, destination gift packs, an updated TREX assortment, and a new industry specific ‘Live Your Best Break’ communications platform.
Even more exciting is the proposed 25 sq m shop-in-shop for KitKat, of which there will be five, starting in 2024, with the locations currently under discussion.
“We want to put investment behind each one, which is why it they are limited, and there will be a whole ecosystem to amplify the shops,” said Sanchez.
Bringing all of its new launches and initiatives together is the launch of a future-focused Food Reimagined store design and layout created in partnership with Portland Design, to help “build the world of food”.
As described by Sanchez, this puts the requirements of the consumer at the core by “analysing need states and building different worlds based upon those need states”.
It’s something the company is starting to co-create with its partners now, in line with the next step of its category vision.
You can find out more in our upcoming November/December issue.