Travel Retail –Lancôme

Poonam TripathiTeam Gloss

Changing Market

Global Travellers

Increase in buying capacity

Women as shoppers & Influence by Opinion leaders

Travel retail

Rise in Air Travel

+20% increase in Chinese global shoppers Leisure shopping & Tax free

History of Lancome 1990-venture to Asian Market. Face lift of

Brand.Tresor

1960-1970

Lancome sold to Loreal

1950-1960 Launch of Magieand Tresor Fragrance

1942 Lancome School was

founded

1936

Lancome was found by Armand Petitjean

Travel Retail

Current market size 2.4 billion .10 year projected growth 100 billion

Market

Air Traffic is growing -5%

6 billion international flight -2013

Market expect to grow at 10%

Beauty Segment 30% total turn over

7.4% growth in 2013

L'Oreal is market leader

20% Market share

Travel Retail contribute to

-maximise exposure of traveller

-Increase customer loyalty

-Recruit new customer

Travel Retail consumers

-Global Shoppers

-Best Place to showcase brand

-Utilising the time at Airports

-Airports as big shopping malls

-Increase in Buying Capacity

Travel Retail

Market

Duty Free Shops at Dubai London Hong Kong Paris Singapore Istanbul Doha Frankfurt Seoul Bangkok Beijing

Market

Duty Free Shops at Dubai London Hong Kong Paris Singapore Istanbul Doha Frankfurt Seoul Bangkok Beijing

Passenger Traffic Total passengers enplaned and deplaned, passengers in transit counted

onceRank City (Airport) Passengers 2013

1 ATLANTA GA, US (ATL) 944,31,2242 BEIJING, CN (PEK) 837,12,3553 LONDON, GB (LHR) 723,68,0614 TOKYO, JP (HND) 689,06,5095 CHICAGO IL, US (ORD) 667,77,1616 LOS ANGELES CA, US (LAX) 666,67,6197 DUBAI, AE (DXB) 664,31,5338 PARIS, FR (CDG) 620,52,917

9 DALLAS/FORT WORTH TX, US (DFW) 604,70,50710 JAKARTA, ID (CGK) 601,37,34711 HONG KONG, HK (HKG) 595,88,08112 FRANKFURT, DE (FRA) 580,36,94813 SINGAPORE, SG (SIN) 537,26,08714 AMSTERDAM, NL (AMS) 525,69,20015 DENVER CO, US (DEN) 525,56,35916 GUANGZHOU, CN (CAN) 524,50,26217 BANGKOK, TH (BKK) 513,63,45118 ISTANBUL, TR (IST) 513,04,65419 NEW YORK NY, US (JFK) 504,23,765

20 KUALA LUMPUR, MY (KUL) 474,98,127

Airports are transiting from transit venues to luxury shopping hubs, duty free shops have become now new concept stores offering actual shopping experiences with wide variety of choices and offers.

Airport like Hong Kong or Seoul are up to 70% of revenues are of non aeronautical nature.

The highest contributor in travel retail are Chinese travellers followed by US & German Travellers.

According to Nielson report 90% of Chinese travellers buy luxury goods just before they travel.

L'Oreal & Estee Lauder are the close competitors who enjoy the maximum market share.

Celebration of festival at Airports ,border shops ,Down town according to respective nationality

Market

Lancome Brand

Lancome Symbols

Lotus - Skin Care

Cherub Make up

Rose Fragrance

Lancome Products

Heritage Products

Iconic Products

Lipstick-Lip over

Lancome Products

Skin Care- Visionnaire, Génifique, Absolue, Rénergie, Blanc expert, UV Expert

Lancome Products

make-up Hypnôse star, Hypnôse Doll Eyes, Hypnôse, L’Absolu Rouge, Rouge in Love, TeintMiracle, Teint Idole Ultra 24h; Lancome Products

fragrance:La vie estbelle, Trésor, Ô, Hypnôse.The Women TG : Women 40 yrs and Young womenMultiplying Products based upon Seasoned and markets trends specific launches.New products rollouts based upon skin tones, which account for various demographical Air travellers .

Brand value $6.3 BSource-forbes

Competition

Source-Promise consulting –French women Survey -2013

Competition

Source-L2 intelligence report ,2014

Perception of Scarcity, Principle creating a niche market for Lancome product along with its competition. Playing the same game. Jan 2014 189 products vs 41 products in April 2014 is creating a scarcity gap and hence buyers perceive it as a fast moving products and hence is always in high demand and sold on premium.

Consumers

Shopper Profile & Reasons for Buying

Lancome Consumers or Shoppers –

Travellers-Air , Cruise Down Town or Border Shops First Timers, Leisure trips, Business and Educational travellers Females Medium to high income groups Love with French products Asian –Chineese,Korean,Japanese etc. travellers Techno savvy Window shoppers Customers looking for gifts & buying for friends & Family.

Reasons for Buying Brand Loyalist Gifting-Family,friends,referal Impulsive buyer Status Quo Referred by Opinion leader Celebrity endorsement Followers Effect Advantage of range of product at different location utilise the gift voucher or points from the miles,pay back points

Lancome Digital strategy

Lancome Live chat feature is very popular as we can see the ROPO effect (Research online purchase offline)

Lancome strategy to have bloggers and V-loggers (Lancome’salliance with Michelle Phan –top viewed beauty tutorials on you tube as well as Lancome repost of fan’s content on his own channel are adding a clear digital staregy to drive traffic to its store.

Lancome Digital strategy

Lancome allowing its digital users to e-gift customisable cosmetics It helps in driving traffic & unique visitors to its e-commerce siteLancome has 6 million+ fan following on Facebook world wide which itself is a key driver on the digital front

SWOT Analysis

S

Strength Highly Reputed product Strong Brand Recall Value Market Leader Soothing and eye catching branding and

visual Strong foothold in Ecommerce & Digital

Media Celebrity Endorsement

Weakness

Target group 35+ years, inexperience in age group of 18-30

Limitation in Product Range Brand perceived as Women centric Men’s

product not given utmost impotancedespite men are frequent travellers

Opportunity Chinese & Indian Student traveller

highest spenders in US & EU Market Techno savvy youth can be reached with

low budget digital campaign Focus on Men Product Mobile wallet share & electronic buying

on increase Beauty industry in Travel retail is growing

Threat Intense competition Growth in other airport vis a vis Lancome

existing retail Short span of shopping time or Low transit

time Budget or low cost airline shifing to new

airport(youth using low budget airlines but with high wallet share & experimental)

Opportunities for Lancome

Opportunities for Lancome

Current Retail Strategy Data sampling & collection activity (Online & Offline Registrations)

Branding in Hop in and hop off buses –Mainly Tourist ,Brand recall value

Branding at departure after security check-in ,near duty free shops, arrivals after the immigration or Passport control for maximum eye balls .

In flight magazine double spacing for maximum attention. May be on the front or the back cover of the magazine. during the peak season with sampling

Alliances with Miles card or signature cards ,amex cards

Email -direct mailers.

pushing the brand ad with free wi-fi at airport.

mobile app

google adsense,key word marketing

Promotional push messages with local telco player for localisation approach.

Branding at downtown stores

A tailor made experience, customised by nationality, adapted by assortment ,multilingual material ,celebrations ,events

Adapted products assortment, Multilingual material,

Current Retail Strategy

Current Retail Strategy

Current Retail Strategy

Current Retail Strategy

Current Retail Strategy

Current Display of Retail stores & Merchandising

Podium

Perfumery Show window Head of Gondola

Display Trays

Current Display of Retail stores & Merchandising

Stocker Unit

Free Access Perfumery

Show Window Instut

Lancome Growth and way forward

Retail strategy•New pop up stores as well as existing stores brand experience enhancements with new out of box marketing promotions strategy

•Targeting Teenagers as well as male segments can drive enormous growth and brand push

•Targeting family package solutions can bring new revenues as well as top brand recall

•New digital campaigns and touch points including free sampling at the boarding points as well as landing and take off locations

•Creating new kiosk at the domestic airports can enhance additional footfalls in the international routes.

•The strategy to have a niche brand player with solutions for female life stages-Youth to elderly to be more focussed upon.

•Travel ties up with Online e ticketing sites and new alliance with airlines which have the highest passengers traffic should be planned