In my last post, I mentioned that I would share some perspectives on Ancillary revenues. I am sure that the first thing that springs to mind are the things that airlines do like baggage fee’s, in-flight food and drink and if rumour were to be true – paying to go to the toilet on a certain low cost carrier! Thankfully, that last one has not appeared just yet.

Of course, as a travel retailer, breaking down each stage of the sale really isn’t possible unless the retailer wanted to offer a ‘shop and deliver’ service and charge a premium for delivery. For me, deconstructing travel retail requires a different perspective….

Creating a sense of place in store

As an industry, over the last couple of years there has been a real buzz around the term ‘sense of place’. Of course, this has largely been the domain of the airport and it has filtered into the retail offers too to a certain extent. The sense of place that I want to consider is the product.

A while ago, I was in a mainland European hub (so not in the UK) and I went to look at the Whisky section. I will not name the retailer or the airport because it would be unfair to do so as most retailers in the channel do this. On the shelf, sat between 2 regular priced Whiskies was a US$4.5k bottle of Scotch. My question is ..Is that really the right place for such a premium product?  Who was going to buy it, sat there, no positioning, no wow factor, no pizazz!

Now, if we consider a sense of place at a product level, this would really be a fish out of water.

Where does Ancillary Revenues come in?

Super Premium for me is about superior craftsmanship and sometimes you need to help the shopper see the product in context and presented in way that reflects its ‘premiumness’.

One such company that manages this is Linley. The picture on the left is a handmade bar box. “Trafalgar Bar Box in walnut with a starburst pattern in rosewood and an engravable sterling silver plaque. The box contains two Trafalgar Crystal Decanters, four Trafalgar Curved Whisky Tumblers, a Trafalgar Ashtray and four magnetic coasters.” Exquisite design and quality. It is made by www.davidlinley.com and will set you back £11,000. [note, this company designed the interior of 10 Flying Spur Bentley’s that were shipped to China].

So, imagine that $4.5k bottle of Whisky sat next to the Trafalgar Bar Box and setting the scene for the shopper. The Bar Box showcases quality and luxury but can also be SOLD!!

Another example is the humidor with the casing showing the Chinese flag. This is an excellent example of craftsmanship tailored to a market. The humidor is also David Linley and will set you back a mere £6,950. Click Here to go to their site. [incidentally, it is probably the same value as the VW Golf I drive! – ok, maybe the box is a little more expensive than my car…]

So, to summarise…

  • Display product appropriately
  • Create a sense of context for the shopper
  • Sell the ‘furniture’ that is the scene setting
  • Choose craftsmanship over mass product (items that can be sourced on the high street)

I hope this article has challenged your thinking. I have gone some way to deconstruct TR in terms of product and its environment – transforming the ‘scene’ into an opportunity to sell. Liquor companies have put armchairs, tables and even rugs into a store to create an ambience – why not sell it?

Some may argue that the likes of ‘Glassware’, ‘China’ etc may have been done before and it fails to make an impact or a suitable turnover. This I believe is different. You are using an international stage to showcase product that is super or even ultra premium. Everyday product that can be found in a department store is not likely to create interest. Bespoke, or short run limited edition products are more likely to and is more consistent with the travel retail ethos.

The future of ultra premium in travel retail I believe is true craftsmanship.

As ever, thank you for reading.

Kevin

p.s. Please note that I do not represent the company David Linley and I have no connection (commercial or otherwise) with them in any way.