Editor’s introduction: Suzy Smith* took over the top job at Edrington Global Travel Retail in December, assuming control of a business that is a vital showcase for the premium spirits company, as well as being a critical sales driver.
Underscoring the channel’s importance, the division has embarked on plans to open a series of boutiques across key travel retail markets, following the previous opening of a standalone store at Taoyuan International (with Ever Rich Duty Free Shop) in 2016. In this interview, Smith outlines the thinking behind the project, noting that it builds on the brand’s premiumisation drive and allows it to engage better with travelling consumers. Details of the locations and partnerships will be announced shortly.
The Moodie Davitt Report: What is the strategy behind your new boutique programme?
Edrington Global Travel Retail Managing Director Suzy Smith: The boutique programme is part of our long-term aim to build The Macallan’s luxury credentials. By creating our own standalone retail environments, we will be able to offer an experience which embodies the brand and enables a deeper level of engagement with our target consumers.
We’ve made our ambitions clear for our leadership role in the travel retail channel, our luxury positioning and our aim to drive value through premiumisation. The boutique programme underscores our commitment to delivering on this vision.
Why is this such a major step for The Macallan in travel retail?
It speaks volumes for our confidence in both the brand and the travel retail channel. The Macallan has been on a clear upward trajectory over the last decade and that has accelerated over the last few years. The investment in The Macallan Estate with the opening of our new distillery and the launch of our ‘Make The Call’ campaign, in particular, have highlighted the scope of our vision and the significant level of investment we are making in the brand.
What is the target audience?
Over the last few years we have made significant investments in consumer insight, which has allowed us to identify globally an audience of widely travelled individuals who seek out travel retail as a channel to engage with luxury brands.
This profile offers clear, natural synergies with our boutique strategy. Of course, within this pool of consumers there will be differing levels of category adoption and brand awareness; our goal is to ensure that whether a traveller is new to the brand or a life-long advocate, The Macallan Boutique has something for them.
How will the boutique design come to life?
The Macallan Boutique design is a bespoke concept – bringing to life The Macallan brand values at that moment of consumer connection. It draws heavily from the passion, vision and beauty of The Macallan Estate by using architecture, aesthetics and materials, as well as certain immersive features that are distinct to the new distillery and the surrounding estate.
Some of the features – the roof and ceiling structure of the distillery, for example – are iconic visual references, mirrored between what you see in Scotland and the boutiques. The design also features quite a few subtle references to the estate and the distillery from the colours, materials and finishes used throughout, to the prestige product display that heroes our rare and prestige range.
In terms of creating a compelling and immersive environment, we are confident the boutiques will represent best-in-class and underline our leadership ambitions in travel retail.
What kind of digital and experiential features will the boutiques offer?
I don’t want to give away too much, but we have aimed to integrate digital experiences that enhance, not replace, the human touch and which are central to the whole consumer journey in the boutiques. Service is at the heart of our approach, creating a bespoke experience that gives our consumers an opportunity to see and sample rare expressions of The Macallan brand.
Will there be any tailoring of the boutiques by location?
The boutique concept offers a direct link to The Macallan Estate and therefore locations will be more standardised than tailored. However, we know that a Sense of Place is an important trend in travel retail and as such you will likely see each evolve as we progress through the programme.
How will this contribute to The Macallan’s premiumisation and luxury focus?
This is all about elevating The Macallan brand by delivering a true luxury retail experience. The design and delivery of our new distillery within The Macallan Estate generated a lot of ideas about what this luxury experience means – whether that’s in terms of retail, partnerships or design. Our boutiques capture a lot of these ideas, and we think they will be powerful beacons for the brand’s luxury credentials.
We will offer rare and prestige bottlings, including The Macallan Boutique Collection, a range exclusive to and sold only in our boutiques, our distillery and our online shop. This is an important element in our overall premiumisation strategy. We want to offer the broadest possible range of The Macallan, ensuring that what’s available in the boutiques offers much more choice and rarity and is differentiated from what is offered on-shelf in the main duty free stores.
What are the criteria you have used to identify boutique locations?
Our boutiques will be the ultimate expression of the brand after The Macallan Estate. The quality of the space available is important; this includes size, adjacencies to other luxury retail and location in relation to passenger flow. Other key criteria are the strength of partnership with both the retailer and the airport – sharing common values and goals is vital in driving success.
We also need to consider our consumer profile; international hub airports typically offer the right kind of passenger mix for luxury retail. This is fundamentally an extremely selective strategy – very much a quality over quantity approach.
Will this concept also be rolled out in domestic markets?
Our goal is to take the lead on this programme while integrating with domestic. Ultimately, most of our consumers will engage with the brand both domestically and in travel retail, so we want to ensure a coherent, integrated experience across channels and markets.
What does a good partnership look like when you consider how and where you roll-out the programme?
Openness, ambition and alignment are key. We’re very clear about the value and differentiation we believe our boutiques can deliver – not only for the airport and the retailer but ultimately the consumer. Where our partners can really amplify this and maximise potential is with their own knowledge of the consumers at a given location, their luxury credentials and a willingness to share information.
What are the KPIs for success: sales, visibility, profitability?
There is a long-term vision for The Macallan brand, and an understanding of the role these boutiques can play in the realisation of that vision – whether that’s through consumer recruitment or building the brand equity. So, we’re aware that this isn’t simply a sales exercise and that success cannot be judged on profitability alone. Equally, there are underlying commercial realities we have to consider as we measure the success.
What are your long-term aspirations for the programme?
We’ll be opening a handful of boutiques in 2019 but looking beyond these we’ve already identified further locations that could offer opportunities to expand the programme in 2020 and beyond.
Obviously the nature of travel retail, which involves highly competitive tender processes and sometimes fierce competition for space, does provide challenges but we are confident we have the right concept and strong enough partnerships in place to build a lasting legacy in travel retail.
The boutique programme is part of our long-term aim to build The Macallan’s luxury credentials. I think we’ve built a reputation in travel retail as an innovator and a leader in single malt, but I believe this programme pushes us beyond the spirits category and positions The Macallan alongside some of the world’s most iconic luxury brands.
*Suzy Smith was named as Managing Director of Edrington Global Travel Retail in late 2018, moving from the position of Marketing Director for the company’s Regional Power Brands business. There she promoted brands such as The Famous Grouse, Brugal rum and Cutty Sark. Her previous experience included spells with Diageo and GlaxoSmithKline in local and global marketing roles across multiple brands.