Even in a market hard-hit by the pandemic, distiller Whyte & Mackay has continued to focus heavily on opportunities in travel retail, led by the offshore duty free market in Hainan, and more recently in the fast-recovering European business.
After a troubled 2020, travel retail sales leapt by over +60% last year, more strongly than the brand owner had initially anticipated. That momentum has remained into 2022, aided by a combination of the offshore channel (despite some slowdown in China travel due to Covid-19) and a boom in leisure travel in Europe since late Q1 this year.
Reflecting on recent performance, Travel Retail Director Richard Trimby says: “Hainan has turned out to be an insatiable market for The Dalmore. We have had to allocate stock on The Dalmore across all markets even though many Asian airports remained shut and had no demand.
“The offshore duty free business has been booming and we see that continuing. We will watch with interest what happens once the Chinese traveller goes abroad but we expect that Hainan will still generate demand, albeit with a different type of shopper. It will remain a destination for short trips and may, therefore, take share from traditional duty free locations elsewhere in Asia. Hainan will probably not grow at the same rate as in the past, but it will remain very important.”
The surging demand from Chinese shoppers was a key reason behind the choice of China Duty Free Group (CDFG) as a launch partner for the company’s most ambitious travel retail omnichannel campaign and activation last October. It celebrated the ‘once-in-a-lifetime’ single malt collection The Dalmore Decades as well as the then recently launched Ensemble Collection and other rare and aged expressions.
The activation took pride of place at the CDFG-run Sanya International Duty Free Shopping Complex, and was mirrored by a wide-reaching media campaign, leveraging the power and reach of the retailer’s client base. The Dalmore Decades omnichannel campaign generated a remarkable 86 million impressions in that month alone.
Trimby says: “CDFG in Hainan offered us access to millions of visitors who then took away what they learned about The Dalmore, and brought that appreciation home. It shows just what a great place to build brands travel retail is.
“In Hainan we are looking at how we invest on the ground with BAs and merchandisers. We are careful on where we focus. We cannot supply everybody; we work well with CDFG, Lagardère/HTDF and Shenzhen Duty Free in Mission Hills. The demand is so strong that we have to be selective. With The Dalmore it’s about growing value not volume.”
Head of Marketing Global Travel Retail & Emerging Markets Clarisse Daniels says: “In Hainan we managed to capture the consumer on their path to purchase which was significant, creating connections along the journey in the media that influenced them.”
She adds: “Everything we do on The Dalmore is about making the consumer feel exceptional while interacting with the brand. Whether it’s the enjoyment of our rare and scarce single malt, made by our whisky making team which has a ‘relentless pursuit of excellence’ motto, or when interacting with consumers online or in store, we want each encounter to create positive emotional connections. This is key for a luxury single malt brand like The Dalmore.”
Satisfying demand for The Dalmore remains a challenge given the limited quantities of the best-selling single malt, but there are clear priorities and a mid-term plan to help drive the business even under those conditions.
Trimby says: “We can only grow so fast on volume, and the demand is incredibly strong in both domestic and duty free. We are looking to meet the ever increasing demand for high value malt in our duty free channel by increasing our focus towards the prestige offering of The Dalmore. This demand for high end The Dalmore is happening across the globe, not just in Asia and despite the lack of Chinese travellers.
“Like others we have had to raise prices this year partly due to cost issues but also to calm the demand. The Ensemble Collection which we launched two years ago has been such a success it has now expanded to Asia and has also been one of the levers to satisfy the appetite for The Dalmore.
Travel retail will also benefit from several forthcoming line extensions of the brand.
In 2022, the company will launch a new 18 Year Old edition of The Dalmore. Daniels says: “With the current demand far greater than the availability, we had to find a better way to quench the thirst for our precious 18 Year Old single malt. A rarer and better version of the current 18 Year Old, it will bear a vintage release date and will continue to be distinguished by a 100% finish in Rare Matusalem Oloroso Sherry Casks, exclusive to The Dalmore. The difference will be maturation for up to four years in mainly first-fill Matusalem, whereas the previous version was finished for up to two years.” The RSP will be US$350 for a 70cl bottle.
The Dalmore will also introduce a new travel retail-exclusive 20 Year Old, set to become the pinnacle of The Dalmore Principal Collection.
This new annual release is strictly limited to 5,000 bottles in 2022 and available to purchase in select travel retail locations worldwide.
It is the pinnacle of the Principal Collection but also the “epitome of whisky-making artistry” the company claims. It is 100% finished in the rarest 30 Year Old Matusalem oloroso sherry casks exclusive to The Dalmore; the extra years of maturation give a higher strength of 43.8% and create rarities of flavour.
Beyond The Dalmore, Whyte & Mackay can now claim a portfolio role in the channel, in a way it did not before. Complementing The Dalmore are Jura and Tamnavulin, now respectively single malts number one and two in UK domestic, with vast potential in travel retail, says Trimby.
“We repositioned Jura during the pandemic and are seeing the impact as people come back. Last year we outsold 2019 on Jura with some customers, mostly off-airport. And as travel comes back we expect Jura to outperform 2019 this year overall.”
The most recent extension, launched on 1 April, is a limited-edition collection from Jura, the Islanders’ Expressions Collection No. 1. The travel retail-exclusive single malt was inspired by the creativity of the artistic community in the island of Jura. Islanders’ Expressions will be available for a limited time and in small quantities at key travel retail locations.
Islanders’ Expressions captures the power of and is inspired by a community of innovators and artisans and kicks off with storytelling jeweller Amy Dunnachie aka Amy Finds, to bring to life a new addition to its whisky family. A Jura native, she forages objects from around the islands shores and landscape to reimagine new treasures, each telling their own story.
“Jura is all about supporting the community on the island. We partner with local artists and use rugged repurposed materials to reflect its distinctive personality. For the Heathrow launch we combined that with digital, doing some geo-targeted media investment alongside impactful HPPs, with an element of personalisation by using an engraving machine in the store. It takes a different approach and appeals to shoppers seeking new flavours driven by craft and quality cues,” Trimby explains.
“People want limited editions and exclusives and this ticks all the boxes. We are now rolling the expression out to Europe and the rest of the world.”
Tamnavulin is also progressing well, targeting consumers that aspire to shift from blends to malts. Building on its status as the number two malt in the UK – having launched in 2019 – the company has introduced two channel-exclusive SKUs, with the latest an Oloroso addition in late 2021.
Fettercairn is another rising star in the Whyte & Mackay malt portfolio, with its own processes and a trove of aged stocks. Relaunched in 2018, the range now includes travel retail-exclusives and limited editions across the ultra-premium and prestige sectors.
Trimby says: “It has now gone across Dufry, Heinemann, Dubai Duty Free and more customers are seeing the potential across the portfolio. It was designed as a niche brand, not mass market, and we decide who we work with, region by region. It is for those whisky connoisseurs looking for hidden gems.”
For the rest of 2022 and into 2023, Trimby says that the travel retail division will remain nimble and agile as it plans its pipeline of new products, with some big announcements to come soon, including at Cannes in October.
“Innovation is one thing; another is to get the excitement going at execution. One thing we are clearer about now is how we communicate. We want to be seen as a leader for our digital campaigns. Decades did that very well across GTR as a whole and with CDFG in particular and Ensemble has done that very well too.”
It’s a platform on which the brand owner aims to build as it reinforces its commitment to travel retail, something Trimby says did not waver amid the near shutdown of business.
“We never pulled back from our commitment. We always had a tight team and didn’t see the need for major transformation. We never thought the business would not come back but recognised that we had to do some things differently. So, we used the time to ensure we built our digital capability led by Clarisse.
“But we also redefined the role of travel retail, not just as a commercial opportunity but also in terms of the brand-building opportunity. And we have shown that we can do things at a scale and reach that you cannot do in domestic markets. The campaign with CDFG is an example.
“In travel retail we connect with as many consumers as we can to get them to understand the brand. Travel retail is a perfect environment as we can execute well, it’s a luxury location and we have great access to digital communication which we didn’t have two years ago. It’s a great place to build brands and that has been reinforced for us.”
*This article first appeared in The Moodie Davitt eZine; click here to access.