BW Confidential - Issue #9 - March/April 2012 - (Page 70)

Travel retail credit: istock Americas: Brazilian travelers The region’s growth engine The rising wave of Brazilian travelers spells good news for beauty by Kevin Rozario T he US is flooded with visa applications from Brazilians, so much so that it plans to add further consular staffing, which has already doubled since 2005. Travelers from Brazil have been in the sights of the duty-free industry for many years. But ever since the 2008 financial downturn their profile has risen significantly— not just within the region, but for the Brazilian duty-free shopper profile Primarily driven by price savings compared with the same products in local market l High per-person spend is easily achieved on prestige beauty if the savings on offer are substantial l Shopping doubles as a leisure and entertainment activity; they travel to shop l Newly middle class are still not particularly brand aware and open to marketing and promotional influence l Existing middle class and the welltravelled tend to be more brand-conscious, and often brand-loyal l International luxury brands are in high demand across all socio-economic groups, partly due to their scarcity in the local market l global travel-retail market. Data compiled by The Economist Intelligence Unit for tax-refund company Global Blue on nearly 250 nationalities visiting London, found that the fastest-growing spenders were from Brazil, up 80%, followed by China, Malaysia and Thailand. The sales data put London first in Europe as a shopping destination. And when they shop, Brazilians spend a lot. A US Department of Commerce survey shows that Brazilian visitors spend almost $6,000 per trip, a +250% increase on 2003. Back in the US, Brazilian shoppers are now so prolific there has been talk of waiving the tourist visa requirement altogether. As well as helping domestic stores, such a move would be a boon for travel retailers. Beauty & Brazilian travelers Beauty is one of the most sought-after product categories when Brazilians travel and the consensus in the duty-free industry is that this trend is not a flash in the pan. Unlike previous booms in South America— which sometimes have been followed by sharp busts—this time there seems to be a more positive view that the growth spurt in Brazilian spending will be a basis for long- term development. At L’Oréal’s luxury goods division, travel retail brand director for cosmetics brands & YSL, Floriane Pampiglione says: “We are seeing very goods results in Latin America, especially with Armani Code Sport and we don’t feel there are risks or negatives here. In Brazil, in particular, we should see more and more travel as the middle class expands.” At Spain-based Puig, whose beauty brands include Carolina Herrera, Paco Rabanne and Prada, international marketing and customer development director Lyndea Dew, comments: “We have historical strength in Brazil. Right now we are seeing a shift to the middle class and when they travel they come with a long list of things to buy.” Also from Spain, Perfumes y Diseño area manager of South America Liliana Sobredo adds: “Brazilian consumers now represent around 40 to 50% of the duty-free buyers in Latin America. Today they have the most potential.” The company is seeing the Brazilian effect, particularly in Argentina. “[For us] Argentinian duty-free sales are our highest in South America. Brazilians have changed the sales performance across the whole region. Perfume Holding, whose March-April 2012 - N°9 - BW Confidential 70

Table of Contents for the Digital Edition of BW Confidential - Issue #9 - March/April 2012

Cover
Comment
Update - Brand & retail news recap
- Companies on the move
Take note - Market facts, figures & trends
Best of BW - Highlights from our e-publication
Launches - The latest in fragrance, skincare & make-up
Interview - HSN gm of beauty & merchandising strategy Betsy Olum
Insight: Make-up - Category overview
- Nails
- Retailing
- The latest trends
Wellness - Online marketing
- Spa case studies
Retail - Pos technologies
- Store concepts
Digital - Social media strategies
Market watch: Brazil fragrance - Country overview
- Fragrance industry roundtable
- Prestige fragrance retailing
Strategy spotlight - Case studies to inspire
Travel retail - Americas regional overview
- Brazilian travelers
- Interview: Nuance Group North America...... Andrew Rattner
Radar - Six up-and-coming beauty brands
Packaging - Electronics in beauty packs
- Latest innovations
Last word - Crépuscule ceo Christophe Lerouge & creative director Olivier Boré

BW Confidential - Issue #9 - March/April 2012