40,000SQM RETAIL SPACE AT DXB AND DWC

Dubai 2020 | TOURISM | VIP INTERVIEW

TBY talks to Colm McLoughlin, Executive Vice Chairman & CEO of Dubai Duty Free (DDF), on promoting Dubai, payment systems, and expectations for Expo 2020.

As the effective welcome and farewell committee to nearly every visitor to Dubai, how do you manage this task, and how does your approach align with Dubai's brand?

From the beginning, DDF has always had the dual mission of promoting the Dubai brand and the DDF brand. We are delighted to have established our brand identity from the early days, and DDF is now synonymous with quality, choice, service, ambiance, and value. We currently operate a total of over 40,000sqm of retail space at Dubai International Airport and Al Maktoum International Airport and employ over 6,100 staff, who are the best trained staff in the world, serving 89 million passengers in 2018. We have been, and continue to be, committed to investing in a wide-reaching marketing campaign that is aimed ultimately at “Turning Flyers into Buyers." In 2018, as the operation celebrated its 35th anniversary, 2.5% of its turnover was dedicated to its marketing campaign. And over the past year, DDF has continued to invest in a communication strategy that covers event management, sports sponsorship, industry sponsorship, advertising, public relations, media relations, promotions, and community projects that give DDF and Dubai the exposure that will put us on the map.

How is DDF looking to expand collaborations beyond the airport, and what does innovation look like for DDF?

While the successful running of the shop floor is our major focus, we also promote Dubai to a global audience and, along with many other entities, aim to retain Dubai's reputation as a leading business, leisure, and sporting capital. In terms of sports sponsorship, one of the highlights was the DDF Tennis Championships, which has been running for 27 years and is owned and organized by DDF. 2019's tournament saw Roger Federer claim his eighth Dubai title and 100th Association of Tennis Professionals singles career title, which resulted in massive worldwide coverage. Media analysis show that the two-week tournament generated an estimated USD1.3 billion worth of TV exposure for Dubai, of which USD445 million is for the DDF brand alone. We also support international horseracing events and paid two visits this year to Newbury Racecourse in the UK in April and September, as well as Ascot for the DDF Shergar Cup in August. June also saw the 12th DDF Irish Derby, which was held at the newly renovated Curragh Racecourse in Ireland. Also in Ireland, we attended the fifth DDF Irish Open at Lahinch Golf Club in County Clare.

How does DDF continuously surpass expectations to create meaningful retail experiences, and how do you anticipate retail to evolve in Dubai?

As the leading retail experience in Dubai, we have consistently looked at ways to improve our retail offerings to an increasingly diverse passenger mix. We have collaborated more with our suppliers and partners to ensure we deliver the right products at the right prices in the right location. This combined with a series of strategic promotions, both in the physical stores and online, has seen an increase in sales in core categories. Also, with the increased presence of e-commerce, our customers value individual service and staff with in-depth product knowledge who are able to make recommendations based on their requirements and communicate with them in their language. This is especially important for younger travelers who expect convenience and an individual experience. This includes an expectation to offer a fast and convenient check out experience, and we now offer a wide choice of payment options including Apple Pay, Samsung Pay, and AliPay. As our customers are constantly connected and thus comparing prices and product availability, we are conscious of offering great value and a wide selection of merchandise and relevant brands. DDF also launched a major digital marketing initiative in June as part of its 'Road to USD3 billion' vision. This initiative will see us invest in both people and technology to increase digital reach and improve our customer engagement and service, connecting with the airports' nearly 90 million passengers in a more effective and personalized way.

With a 25-million-person surge expected due to Expo 2020, how is DDF gearing up for the unprecedented event?

We are all excited about Expo 2020 and the site will truly be a fantastic event. Such figures of inbound travelers provide us with a fantastic opportunity to reach a global audience, and we are working with Expo on merchandising opportunities as well as other areas. We will have an Irish Village at Expo 2020, and that will be close to the Ireland Pavilion, so we can expect some collaboration there.

Looking beyond 2020, what are your strategic priorities for growth in a dynamic sector?

With the number of international travelers forecast to reach 1.8 billion by 2030, we are well placed as an industry to benefit. It is predicted that retailers will increasingly engage with customers online, for example via video content and augmented reality, perhaps as a preliminary way of visiting a physical store. However, we need to stay ahead of retail trends, engage with these travelers, particularly millennial ones, and ensure we have the right products at the right prices for an increasingly sophisticated shopper. From a sales point of view, Chinese passengers continue to be number one for us, accounting for almost 18% of sales. This is followed by India and Saudi Arabia, with a 13% and 7% sales contribution, respectively. There are 16 flights a day out of Dubai airport to cities in China, and providing that traffic continues, sales will continue to grow. The rising growth of millennials is influencing our communication as well as the range of products we carry. We have become more social media-savvy. E-commerce has been a game changer that we embraced several years ago. Now, we are investing greatly in redefining the online offer and introducing a number of marketing systems whereby we can interact much more with our customers before they travel and while they are in the airport. Our investment in digital technology over the past year will result in greater engagement with our customers, and we are looking forward to building on that in the year ahead.