INDIA. Hyderabad Duty Free, a division of GMR Hospitality and Retail Limited, aims to become “the largest and most preferred duty free outlet in South India by 2022” as it prepares to mark ten years of business in 2020.
Hyderabad Duty Free was created in 2010 after GMR–Hyderabad International Airport Limited (GHIAL) opted to run its duty free operations at Rajiv Gandhi International Airport in-house, after The Nuance Group (India) exited the business in June that year.
Since then, according to GHIAL, Hyderabad Duty Free has seen sales climb by around +20% on average in recent years and by 4.4 times overall in the past eight years. The duty free operation spans 1,200sq m of space in arrivals and departures, with a broad range across liquor & tobacco, fragrances & cosmetics, confectionery, travel essentials and destination goods.
Space for duty free will be enhanced in line with the airport’s own expansion, with plans for additional promotional areas, augmented reality and experiential zones, plus new ranges.
Among the new brand entrants soon at Hyderabad Duty Free will be Dior, Versace and Tom Ford (fragrances); Revlon and MAC (cosmetics); Paul John (whisky); Anthon Berg, Guylian, Ricola, Ritter Sport, Storck and Haribo (confectionery); Smoor, Adyar Ananda Bhavan, Lal Sweets (destination goods); Oris and Gurkha (tobacco); and Bose and TRI (electronics).
Liquor is the best-selling category followed by confectionery, fragrances and tobacco. Hyderabad Duty Free highlighted the strong rise of destination merchandise, notably handcrafts from Telangana and Andhra Pradesh in the southern states of India. These, it said, carry appeal for visiting nationalities – after Indians, US and UK travellers purchase the most in the stores.
Hyderabad Duty Free said it has been tweaking its mix to adapt to new consumer preferences, based on extensive and regular research.
With spirits such a key category, the range has been extended to over 100 brands, and prices kept competitive so they are at least at par with rival airports, said Hyderabad Duty Free. A recent survey of Hyderabad-based travellers flying internationally found that many sought out value in higher price segments.
A spokesperson said: “This led to Hyderabad Duty Free modifying its product offerings and ramping up its premium positioning across all categories, specifically liquor. High value or premium liquor contributes 25% of sales in the category. This segment has grown at a rapid pace over the last three years (CAGR +70% in volume terms). Another survey highlighted that over 75% of customers believe that the price at Hyderabad Duty Free is better or at par compared to other duty free outlets within the country.”
Marketing initiatives have helped boost awareness of the offer. These include:
*Wallet payment/cash back services through alliances with banks, an improved website and ‘Shop & Collect’ feature in the stores.
*Local market affiliation: Hyderabad Duty Free promotes handcrafts from the Telangana and Andhra Pradesh regions, which range from Kondapalli toys to Nirmal paintings, Pochampally sarees to bidri and filigree to dokra items and Hyderabad pearls. The retailer also sources Araku coffee and spices from the region.
*Loyalty programme: The Club HDF Loyalty Programme is a multi-tiered loyalty scheme offering benefits and privileges for members. Each purchase automatically entitles members to earn points which can be redeemed for future purchases.
*Special offers: With a focus on international travellers from the south of India, HDF has launched a promotional platform – ‘Mana Hyderabad Mana Duty Free’ or ‘My Hyderabad, My Duty Free’. Passengers can avail of discounts from 5-15% on selected purchases in arrivals.
GMR-led Hyderabad International Airport handled about 3.9 million international passengers in FY2019.
