Home to elevated tastes, India drives category growth in travel retail
At Delhi Duty Free the aim is to cater to the evolving tastes of all travelers by offering a mix of globally recognized premium brands and exceptional value options, ensuring a satisfying shopping experience for everyone
India is becoming an increasingly important market in global travel retail for all categories, and spirits is no exception. The country’s burgeoning economy and a growing middle class is creating a surge in international travel along with a taste for premium brands – both trends to the benefit of travel retail. Evolving consumer preferences are driving significant growth and innovation, making it a focal point for industry stakeholders worldwide.
In general, Indian travel retail spirits trends are in line with those in other parts of the world, with one of the most prominent being the shift towards premiumization. Consumers in India are increasingly driven by a desire for exclusive experiences. This trend is expected to continue, with an emphasis on personalized customer experiences and exclusive product offerings.
“We are observing a strong shift towards premiumization, where consumers are increasingly opting for high-end, luxury spirits,” says Ashish Chopra, CEO, Delhi Duty Free. “This trend is coupled with a growing interest in unique, limited-edition releases. We anticipate that this will continue in the coming year, with an emphasis on personalized customer experiences and exclusive product offerings.”
The broader growing consumer preference for authenticity and artisanal quality, along with a clear direction toward wellness and environmental impact, is also evident in Indian trends. “We’re seeing a growing interest in craft spirits and locally produced beverages,” says Lal Arakulath, CEO, Kreol Group. “Consumers are also becoming more health-conscious, leading to a rise in demand for low-alcohol and non-alcoholic spirits. In the coming year, we expect sustainability to be a key trend, with consumers preferring brands that prioritize eco-friendly practices.”
After years of inching its way up, tequila is finally seeing a growth explosion. “We observed significant growth in the sales of tequila, single malts and premium Scotch,” says Avishek Das, CEO, Ospree Duty Free. “Tequila has seen a surge in popularity, driven by an appreciation for high-quality variants. Single malts continue to grow, with more interest in unique, limited-edition releases. Premium Scotch remains a staple, with consumers increasingly seeking aged and rare expressions.”
Premiumization trend
The Indian market has shown a remarkable shift towards premiumization, with a clear shift toward high-quality, luxury spirits. Promotions and experiential activations are crucial partners in this trend, effectively highlighting the unique qualities and added value of premium products.
According to Chopra, younger consumers are leading this trend, showing a strong preference for innovative and premium offerings. He also sees a “notable” rise in the number of modern female travelers who are increasingly experimental and open to trying premium products. “Yes, Indians have enthusiastically embraced the trend of premiumization, reflecting a shift towards higher quality and luxury in their purchases,” he states.
Arakulath says the trend of premiumization is evident across various age groups and genders, with younger customers being drawn to innovative and trendy premium products, while older consumers often stick to established brands and personal favorites. “Indian consumers are willing to pay more for premium and super-premium spirits. Promotions play a crucial role in driving sales, especially during festive seasons,” he says. “Indians have certainly embraced the trend of premiumization, reflecting a growing preference for high-quality, exclusive products.”
Indian spirits on the rise
The sales of Indian spirits are on the rise, driven by both knowledgeable locals and foreign travelers seeking unique souvenirs. This trend reflects a growing appreciation for the quality and heritage of Indian brands and the desire to take home a piece of India’s rich spirit culture.
“Local customers are increasingly appreciating the quality and heritage of Indian brands, while foreign travelers enjoy taking home a piece of India’s rich spirit culture,” says Chopra. “This dual appeal has contributed to the overall growth in sales.”
He adds that duty free is thriving in India, with a wide selection of high-quality Indian spirits available. “This offers a unique opportunity for both local and international customers to explore and enjoy premium Indian brands, further enhancing the appeal of shopping at Delhi Duty Free,” Chopra says.
Arakulath points out Kreol Group has observed robust sales of Indian spirits, attributed to strong domestic demand. “We expect this trend to continue, driven by the growing class of people willing to spend on premium Indian spirits,” he says.
Das notes a significant and consistent rise in Indian spirits sales, highlighting a surge in interest in domestically produced beverages. This trend is fueled by a heightened sense of national pride and the increasing recognition of Indian whiskeys on both domestic and international stages. “Indian whiskeys have gained prominence both domestically and internationally, with brands like Indri, Rampur, Amrut, and Paul John receiving acclaim for their quality and craftsmanship,” Das says.
Looking ahead, he expects sales of Indian spirits to continue increasing, driven by several factors. The global trend towards authenticity and heritage in spirits consumption benefits Indian spirits, which often have rich histories and traditional production methods. Indian distillers continue to innovate and experiment with new flavors and styles, attracting a broader audience both domestically and internationally. “Overall, the future looks promising for Indian spirits, and we expect to see continued growth in sales as they gain recognition and appreciation on the global stage,” Das says. “The global trend towards authenticity and heritage in spirits consumption bodes well for Indian spirits, which often have rich histories and traditional production methods.”
While white spirits are growing – especially with younger consumers – brown spirits continue to be more popular in India, with single malts like Glenmorangie on the rise, with promotions such as this one are key
Indian brands
To effectively penetrate and capture the Indian market, spirits brands must prioritize understanding the diverse consumer preferences and regional nuances, according to Chopra. The Indian market’s complexity requires a tailored approach, and brands must seek strategic promotions and partnerships. “Investing in customer behavior studies and continuously adapting strategies to meet local tastes and preferences is crucial. Additionally, focusing on premiumization and offering superior promotions will help brands capture and retain a loyal customer base,” Chopra states.
Similarly, Arakulath highlights the need for brands to comprehend both varied customer preferences and the regulatory environment. “Brands looking to enter or capture more of the Indian market need to understand the diverse consumer preferences. They should also be aware of the regulatory environment and consider partnering with local distributors for better market penetration,” says Arakulath.
Prioritizing the diverse regulatory landscape and understanding regional preferences also top the list for Das, when discussing how brands can break into the market. “Effective promotions and strategic partnerships with travel retail stores like us can significantly enhance their market penetration and customer reach,” he adds.
Narrowing gaps
With the growth of aviation in India, the distinction between how Indian and foreign travelers shop at duty free stores is becoming increasingly subtle. Both groups now fall into the broader category of world travelers, influenced by global trends and preferences.
“While there are some differences in preferences, such as foreigners still favoring white spirits over brown and India being predominantly whisky-driven, we are also seeing global trends influencing Indian customers. There is a notable migration towards premium gins, tequilas, and other spirits,” Chopra says. “Our aim is to cater to the evolving tastes of all travelers by offering a mix of globally recognized premium brands and exceptional value options, ensuring a satisfying shopping experience for everyone.”
Unique opportunities
The travel retail and duty free channel in India presents a unique opportunity for spirits brands who want to reach a global audience. With the recovery of travel post-pandemic, there is an anticipated surge in demand within this channel. This resurgence is coupled with a trend towards exclusive travel retail offerings, adding an element of exclusivity that attracts consumers, according to Arakulath. “Speaking specifically about Indian craft spirits, they offer a unique alternative to international spirits and are certainly worth exploring for those interested in expanding their palate. Often incorporating local ingredients and traditional distillation methods, their flavors reflect India’s rich cultural heritage,” he says.
Das emphasizes the growing demand for unique and exclusive products in the travel retail channel. “India’s travel retail and duty free channel is evolving rapidly. Travelers are increasingly seeking unique and exclusive products, and we’re committed to meeting this demand by offering a diverse range of high-quality spirits,” he says. “Our focus on personalized experiences, exclusive partnerships and innovative digital engagement ensures that Ospree Duty Free remains at the forefront of this exciting market.”
Das is excited about recent events such as the Ardbeg launch. Held at Ospree Duty Free, this launch event featured a captivating mix of fun activities and entertainment, creating an unforgettable experience for the retailer’s guests. Attendees enjoyed interactive games and live performances, all designed to celebrate the unique character of Ardbeg. “It was a fantastic opportunity to engage with our customers and showcase the exceptional quality of Ardbeg spirits in a vibrant and festive atmosphere,” Das reports.
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