NEWS/ANALYSIS
concepts, including at Nice Airport Terminal 1 and 2, helped to offset these challenges. Last month, Lagardère Travel
Unlock the full potential... “It’s about customer needs and
Retail inaugurated a new beauty concept for Parisian brand BuY Paris Duty Free at Paris Charles de Gaulle (CDG) Airport. Terminal 2E, Hall K is the first to unveil its upgraded look following a phased refurbishment process that began last year. Terminal 2E, Hall L is set to complete its renovations by next year, with projects at Paris-Orly junction and CDG T1 and T2 scheduled to complete in the future. “The first part of this massive
renovation is 2E [hall] K finishing this year, and this [renovation] will continue until 2021,” Fondeur reveals to TRBusiness.
Hybrid shop trials One interesting development is the company’s test trial of new walkthrough concepts for its Relay chain of convenience stores at certain regional Italian airports. “What I fully believe in, due to
the changing customer profile in Europe, is hybridisation of concepts especially in regional airports where customers expect a one-stop-shop where they can have everything from convenience to ultra-luxury in the same space,” Fondeur explains. “In travel retail, each platform
is different dependent on the infrastructure and customer profile, so we need to adapt the solution to each platform. However, we see a model emerging – which is one solution – to have hybrid stores.” It is too early to ruminate on how a model such as this could play out practically, but one idea could be a shop-in-shop guise featuring the Relay fascia within Aelia Duty Free’s global store branding, TRBusiness understands. “We see it as a big venue for
growth in the years to come,” Fondeur continues, in doing so emphasising that demand for these type of platforms are being led by the low-cost traffic boom in Europe. “We are testing walkthrough
convenience Relay’s,” he confirms. “Is it the right format? We need to monitor the results to be clear on the data.
APRIL 2018
how they are changing. The low- cost phenomenon is introducing a new type of customer to air travel, some with lower purchasing power and more interest in convenience or mass-market products.” Fondeur is understandably cautious in over indulging in the prospect of the model’s potential transition to larger European airport hubs in the immediate term, instead preferring to focus on its application in more regional markets. However, he stopped short of ruling it out altogether in future bid proposals. “We would need to think about
whether it suits the particular terminal, typology and passenger profile,” he replies. Away from Europe, Lagardère
Travel Retail made its first foray into Africa in September when it secured a 10-year contract to run a 1,000sq m duty free shop and a 100sq m Relay convenience unit at Blaise Diagne International Airport in Sénégal. The new shops opened in December as the airport, which cost $575m to build and handles 10m passengers from its base situated approximately 50km from capital Dakar. On the convenience side, the results have been ‘extremely positive’ since the shops opened their doors, but duty free has performed a little below initial expectations due to ‘operational issues’, notes Fondeur. Nonetheless, the future prognosis remains positive. “Once these operational issues
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are resolved, the potential is fully confirmed,” he maintains. “We see a higher potential in Dakar than what we initially thought. We are aware of the constraints of opening up a new platform in Africa and we need to learn how to solve that, but it is just a question of time.” When asked by TRBusiness whether
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the current operational ‘issues’ could have been foreseen and, accordingly, are rectifiable, Fondeur responds: “From a market point of view, I
think the most important thing is we have confirmed the potential.” Fondeur says he is confident that the firm will find the right solutions to make the supply chain more efficient, which will in turn allow it to leverage the platform’s full growth potential.
Duty free and fashion’s share of divisional revenue rose by seven percentage points in 2017 compared to the previous year. Source: Lagardère Group FY17 results.
TRBUSINESS 17
The BuY Paris Duty Free brand is undergoing a makeover at Paris Charles de Gaulle Airport.
“From a sales point of view, we have started 2018 very strongly. Our focus this year will be to maximise the current [retail] footprint, increase spend per pax and sales and win new, profitable contracts dependent on the opportunities.”
Ambroise Fondeur, Chief Business Officer, Lagardère Travel Retail
“We knew it would not be easy
operationally – it has taken a bit more time than what we initially suspected, but we opened in December, so it’s very new.”
Middle East traction Elsewhere, positive traction has been felt from its Middle Eastern
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