The boom in Travel Retail continues
Vincent Boinay
L’Oréal Travel Retail Managing Director
“As the Travel Retail market leader , L’Oréal is taking full advantage of the increase in air traffic through its portfolio of complementary brands adapted to meet the aspirations of all travellers, as well as its close ties with distributors and its teams on the ground. The Group’s brands continue to do particularly well with Asian consumers all over the world. With exceptional growth of 27.1% , L’Oréal exceeded 2 billion euros in sales on the Travel Retail market.”
The democratisation of travel
The Travel Retail market has benefited from important societal changes that have led to the democratisation of travel such as increased purchasing power of the middle classes, particularly in China , the development of low-cost airlines and a rising interest in travel among Millennials .
These phenomena have led to a significant rise in air traffic – up 6.7% in 2018 – and to considerable growth of airports and their sales areas, particularly in emerging markets. Several airports have even become showcases for their respective countries. The combination of these factors is attracting new consumers to the Travel Retail market. The number one category in Travel Retail is beauty, which accounts for 36.9% of the channel’s sales .
L’Oréal’s 6th Continent
-
55%
of Travel Retail sales are made in airports. The rest are accounted for by “downtown shops” – duty-free shops in city centres– as well as sales aboard aircraft and cruise ships .
Exceptional brands and teams
Bolstered by its 25 brands in the channel and its teams across three major Zones (Asia Pacific, Europe Middle East, and North and South America), L’Oréal has the brand portfolio and agility needed to meet the expectations of new consumers in a very competitive market. Thanks to the trust-based relationships developed with distributors over the last 40 years, the Group is able to maximise the potential of its brands in airports around the globe. Güven Dalgiç, Area Manager for Travel Retail, tells us more:
Güven Dalgiç
Area Manager in Travel Retail
Brand roll-out on the ground
L’Oréal Paris is attracting more and more Asian consumers with its affordable premium products, particularly in duty-free “downtown shops”, like those in Bangkok. The brand also rolled out a first-ever global travel retail campaign for Color Riche Shine across some of the biggest international airports like Paris and Singapore.
Meanwhile, Vichy showcased its star product, Minéral 89, through large-scale media advertising in major Asian airports. The campaign provided an occasion to celebrate the brand, which is present in 60 Travel Retail dermacenters alongside other brands from the Active Cosmetics Division.
0 / 0
Luxury brands continue to leave their mark on the channel and put their best foot forward in exceptional spaces. The Armani Box pop-up store continues its round-the-world tour of airports and “downtown shops”, recruiting new consumers for the beauty brand thanks to its distinctive identity and design including fine lines, and bright red hues. The striking results are a particular hit with Millennials , who are likely to share images via social networks and help events go viral.
While big, iconic brands like Lancôme – with its star product Génifique – Yves Saint Laurent, Kiehl’s and Giorgio Armani continue to spark consumer enthusiasm, upcoming brands that are paving the way to the future are also doing well. In 2018, men’s grooming brand House 99 was launched, while Atelier Cologne opened pop-up stores in Paris and Los Angeles.
-
30
Kérastase points of sale at end 2018
The future of Travel Retail
Travel Retail has clearly demonstrated its potential and L’Oréal has already outlined its plans for further growth.
The channel will continue to expand its digital presence to meet the demands of today’s ultra-connected consumers. L’Oréal Travel Retail provides personalised offers both on- and offline all throughout the traveller’s journey, as well as before and after. L’Oréal has most notably rolled out activation campaigns to attract travellers to shops, such as the Shu Uemura Shu Kiss initiative in Seoul, in partnership with distributor Lotte; or the Ralph Lauren Father’s Day campaign in Brazil, in cooperation with distributor Dufry.
-
12%
E-commerce represents 12% of L’Oréal Travel Retail sales
Secondly, the Group will maintain focus on its sustainable development initiatives, to which it has been committed for many years now through its “Sharing Beauty With All” programme . By ensuring the sustainable manufacture of products sold exclusively in airports, offsetting the carbon footprint generated by employee travel and recycling and reusing merchandising equipment, L’Oréal aims to make performance meaningful and become a leading player in this vital transformation of the Travel Retail channel.
Some key figures of 2018: 100% of CO2 emissions due to L’Oréal Travel Retail employee trips were offset by agro-forestry, reforestation and environmental conservation projects; 100% of cardboard used for products sold only in airports was certified FSC and PEFC; 90% of materials and furniture in the Tax Free World Exhibition was reused or recycled.
