June 21 2024  |  Associations

On location: Day two at ASUTIL 2024 in Bogotá

By Laura Shirk in Bogotá, Colombia

Business and economic outlook and the future of travel retail: Andean region

Day two of the conference opened with back-to-back presentations about the Andean region. Featuring economist and Vice President at Marcoview Carlos Melconian, the first presentation examined the current realities of conducting business in the region and how economic factors including world leadership, government policies and inflation, in addition to political uncertainties, impact the purchasing power of consumers. Melconian said while there is an agenda in terms of peace, migration and climate, there is a lack of motivation among leaders to push trade. He stated, “We must find the recipe for how we can grow.”

Melconian also provided a general economic outlook per country for Brazil, Uruguay, Chile, Colombia, Peru and Argentina.

The second applied directly to the travel retail industry in the region; described as currently experiencing a new wave of developments. From the evolution of new travel hubs like Bogotà and Panama City to the changing demographics of travelers, the session took a more detailed look at the Andean region.

Sustainable horizons: navigating Latin America’s journey towards eco-conscious travel retail

“Sustainable Horizons: Navigating Latin America’s Journey Towards eco-conscious Travel Retail” shone a light on the channel’s food and confectionery category. Seeing increasing pressure and consumer demands in line with health, indulgence and sustainability, companies are required to navigate, adapt and prioritize ethical practices – quickly and effectively – in order to thrive.

Delegates heard from Tamara Spada, Global Key Account Manager at Nestlé International Travel Retail (NITR) and Alejandro Sanabria Amortegui, Sustainability Manager at El Dorado Airport on topics including regulatory updates, compliance challenges, market expansion strategies and future growth opportunities in travel retail. The two agreed on the “latest definition” of ESG which incorporates environmental, social and economic factors.

As a global leader in sustainability, Spada shared NITR’s wealth of knowledge and experience on the topic. She said the key is providing credibility and proof points. The company has pledged by 2025 that all packaging will be reusable or recyclable.

The session was moderated by Camillo Rossotto, Chief Public Affairs & ESG Officer at Avolta.

Thriving in uncertainty

In conversation with José Luis Donagaray, the final session of the conference “Thriving in Uncertainty” featured celebrated author, cardiologist and rugby player Dr. Roberto Canessa, who is also a survivor of the 1972 Andes plan crash. Described as a testament to the remarkable power of the human spirit to overcome obstacles, Canessa’s inspiring story of survival is one of strength, resilience and perspective, as well as privilege. Speaking about an appreciation for life and how to face fear, his message can be applied directly to the world of business. “Our destiny is based on our decisions,” he said.

Andean region: Expansion and partnerships

Moderated by Dermot Davitt, the second panel featured industry leaders Ignacio Lasa, Vice President of Motta Internacional, Gian Botteri, Senior Vice President and Head of the Cruise Division Avolta, and Cyril Letocart, CEO of Lagardère Travel Retail Peru.

Ignacio Lasa opened with an overview of Motta Internacional's expansion, noting their strong presence in six cities with over 50 duty-free stores and plans for further growth. He highlighted the streamlined immigration processes at Bogota airport and stressed the importance of shared risks between retailers and airports. While Gen Z is a critical focus, Lasa emphasized that Gen X remains Motta’s largest consumer segment, valuing personal interaction in stores.

Gian Botteri from Avolta discussed their strategic partnership with Norwegian Cruise Line, emphasizing the need for engaging multi-generational travelers through daily brand activations. He addressed the challenges of high staff turnover and the necessity for continuous training. Botteri also stressed the "cruise trinity" of brands, retailers, and cruise lines, advocating for long-term contracts to enhance revenue and spending.

Cyril Letocart from Lagardère Travel Retail Peru announced the upcoming opening of Lima Airport’s new terminal in December, designed as a central marketplace feature. He noted a significant +25% trend in their duty-free business, driven by tourists from Peru, Chile, and Brazil, despite Argentina's high inflation. Letocart urged suppliers to expedite furniture production to meet the new terminal’s needs.

Consumer trends

Peter Mohn, CEO of m1nd-set, presented the latest data on consumer behavior in Latin America, focusing on the preferences and habits of travelers. He identified the top five airports in the region for 2024: Cancun, Panama City, Mexico City, São Paulo, and Bogota. US nationals were highlighted as the leading group in international travel.

Mohn emphasized that while Gen Z has a lower footfall in stores, they exhibit the highest spending per purchase, averaging US$135. He pointed out that 30% of LATAM travelers engage in pre-travel touchpoints, compared to 41% globally, influenced mainly by internet research and advertising. Moreover, 74% of travelers make their final purchase decisions in-store, with significant influence from price comparisons and staff interactions. However, LATAM buyers are less likely to be influenced by staff compared to global averages, indicating room for improvement in customer engagement strategies.

Mohn highlighted the importance of effectively engaging Gen Z to maintain their interest in duty-free shopping, stressing the critical role of experiential retail and accurate price perception.

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