Ten years on, Cyprus Duty Free can confidently claim the success of its Kypriaka shop, where local goods are sold. The floor space has grown considerably, with more items being offered all the time
Reaching, engaging and delighting the customer is Aer Rianta’s modus operandi if not its motto. Toni McDonald, Retail & Marketing Manager, Cyprus Duty Free, says, "The customer is simply the focus of everything we do. At Cyprus Duty Free we have created a modern retail experience for customers that’s designed to connect with them across all touchpoints on their journey.”
For example, ARI has recently redesigned the retail space at Larnaca Airport to center on the customer journey and offer an authentic and engaging sense of place. “We’ve also recently made improvements to the store layout and product range in our Pafos store, so we are confident that once a customer enters our stores they are guaranteed a world-class shopping experience.”
But it’s about more than just a great shopping experience once travelers arrive at the airport. “We’re also prioritizing early engagement with customers to help drive awareness of our offering before they enter a store, and ultimately to enhance conversion,” says McDonald. “Digital and social media play a crucial role in our customer strategy as they facilitate engagement with customers before they enter or leave the island, while also enhancing their in-store experience.”
Toni McDonald, Retail & Marketing Manager, Cyprus Duty Free, says the customer continues to be at the heart of every decision
Hyperconnectivity
ARI greatly enhanced its digital space over the pandemic, something that had been already in the works, and it couldn’t have rolled out at a better time. digital transformation for the business has been two-fold – extending across both online and in-store.
“Hyperconnectivity is a core element of ARI’s Customer Value Proposition and over the last few years,” says McDonald. “We launched Cyprus Duty Free’s new ecommerce platform in 2022 and it has been performing well so far. We don’t expect online sales to account for a huge portion of our revenues and it’s still a relatively new concept in travel retail, but our ecommerce platform serves as an important awareness driver of our offering and provides customers with the ‘shop window’ preview that we don’t have versus high street stores.”
McDonald adds that a crucial aspect of building the company’s digital footprint has been its investment in content and influencer marketing for engagement with customers pre, during and post travel to help drive in-store conversion and brand recall. “Katerina, our Social Media & Digital Marketing Officer, has greatly enhanced our work in this space,” she says.
The store refurbishments at both Larnaca and Pafos Airports have included the introduction of digital on a significant scale, says McDonald. “Our Larnaca store alone has over 250 digital screens to facilitate better engagement with our customers and greater cut-through with our messaging.”
Additionally, and in line with the company’s sustainability strategy, increased digitization has allowed the retailer to cut back on the materials traditionally used for POS and in-store branding.
The Mirror Box is an innovative new digital immersive visual and aural experience designed to attract and engage Fashion & Accessories shoppers. Digital investment has enabled not only effective and engaging marketing, but also the ability to cut back on the materials traditionally used for POS and in-store branding
Digital news
McDonald says there is plenty of news under ARI’s digital banner. “Digital is a constantly changing environment and we are always exploring ways to engage with customers and enhance their journey with us – making it more interactive but also more convenient and shopping on their terms,” she says. “Through our ecommerce platform we offer online shopping with digital lockers for both ‘Click & Collect’ at Departures and ‘Shop & Collect’ in our Arrivals shops.”
Earlier this year the retailer introduced its very own futuristic sales assistant. “CandyBot is a 24/7 robot, serving confectionary at the Departure Gates,” says McDonald. “This unique concept offers something exciting and memorable for customers, as well as the always-on convenience."
Just recently, her team also launched two new interactive digital experiences. “The Selfie Experience, located at the entrance to the store, allows customers to take a selfie in a custom-build photobooth as a parting memento of their time in Cyprus. We also launched the Mirror Box – an innovative new digital installation designed to attract and engage Fashion & Accessories shoppers. It is an immersive visual and aural experience, complemented by a Fashion Garden inspired by local seasonal Cypriot flora. Already we’ve seen a hugely positive reaction from both customers and brands.”
The Selfie Experience, located at the entrance to the store, allows customers to take a selfie in a custom-build photobooth as a parting memento of their time in Cyprus
Growth and recovery
Unsurprisingly, 2020 was a difficult year for Cyprus Duty Free as international travel ground to a halt, but McDonald says they began to see strong growth as early as mid-summer 2021 as some of the COVID travel restrictions were relaxed.
“Thankfully from the beginning of Q2 2022 we saw compelling growth in passenger numbers, which reached just over 80% of the 2019 passenger totals that year, despite the loss of the bulk of Russian travelers due to the war in Ukraine,” she says. “The outlook for 2023 continues to be positive, with passenger numbers likely to hit close to 2019’s total passengers.”
While passenger numbers in 2022 reached just over 80% of 2019 totals, McDonald says a higher average spend (PAS) meant sales reached almost 91% of 2019. “This was a really strong performance and a positive sign that many of the decisions we made back in 2020 – along with the great support from both our operations in Ireland and Bahrain – bore fruit last year and continue to do so in 2023.”
As travel restrictions were lifted, a great hunger welled up for international travel, especially holiday destinations, says McDonald. “Cyprus has been positively impacted by this. Also, both the Cypriot Government and Hermes Airports deserve a lot of credit for bringing new and additional routes into Cyprus that did not exist three years ago. We are focused on enhancing our offering for both existing and new customers, ensuring that we are meeting the ever-evolving customer expectations with an exceptional range, true value, and an authentic experience – in short, delivering on the key pillars within ARI’s Customer Value Proposition. Our success in delivering this is reflected in our continuing sales growth in 2023 and this will to be key to our continued growth throughout this year and beyond.”
Cyprus Duty Free has seen customers return to purchasing fragrances, cosmetics and skincare, with double-digit growth in the category this year
Kypriaka and other categories
The key categories for Cyprus Duty Free are Perfume & Cosmetics, Confectionery, Liquor and Tobacco, says McDonald. “The offers in our shops are constantly evolving and changing, so new brands such as Le Labo will shortly launch in our stores. We noticed a significant return to customers buying Cosmetics and Skincare with strong double-digit growth year to date in 2023, and Fragrances are continuing to grow very well. The other key categories of Confectionery and Tobacco are performing very positively, with expected growth from Liquor throughout the year.
Cyprus Duty Free was ahead of the sense-of-place curve when it launched Kypriaka – which means “the best of Cyprus” — 10 years ago. “Kypriaka has been a great success since it was created, and it continues to go from strength to strength,” says McDonald. “Originally it occupied 80 square meters of space, however in the new build at Larnaca Airport this has been increased to 160 square meters – such is its importance to the business and to the overall customer experience at Cyprus Duty Free.
“We identified that customers were seeking a truly authentic experience with great Cypriot products that delivered the tastes and aromas of Cyprus. We have worked closely with a number of creative local vendors to develop a range of unique and exclusive products for Cyprus Duty Free that deliver truly original flavors of Cyprus. Some of these products include Ovis Whiskey, the first Cypriot whiskey launched in Cyprus. It is matured in Commandaria casks to give a sweet and distinctive experience. Last June we launched Chypre Perfume, inspired by the fact that over 3,000 years ago Cyprus had a thriving fragrance industry and distributed fragrance around the Mediterranean region.
“And in August of last year, we launched Yolanda’s chocolates, hand-made and painted confectionery with amazing flavors and a visual feast for the eyes. We intend to continue to further develop our exclusive range of Cypriot products, delivering great and authentic tastes and flavors of Cyprus that will leave abiding memories of this beautiful island.”
Challenges and initiatives
McDonald says that for Cyprus Duty Free, staffing has become one of the major challenges. COVID has affected people in a way that made them reconsider their priorities, such as the desire to spend more time with their families. As with ARI as a whole, Cyprus Duty Free considers the positive and respectful treatment of its staff as imperative. “Our people are our priority, and we make sure that we offer an environment where they feel supported, respected, and empowered in their roles. There are no easy answers to the issue of recruiting additional people, but we remain flexible and values-driven in our approach.”
McDonald says several exciting new initiatives are underway as part of Cyprus Duty Free’s retail strategy, with the shaping of ARI’s Customer Value Proposition. “We continue to keep our customers at the heart of everything that we do in our business, ensuring the very best brands at great value, with engaging and innovative retail experiences. We work closely with our many brand partners to improve the product offering, promotional events and create a true sense of place and occasion – including the introduction of both new brands and new technologies, while also bringing the element of fun, engagement and entertainment into our retail spaces.”
