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Retailers in the ₹2,000-crore duty free retail segment are getting ready to go online through the click and collect model with their ‘value’ pricing across categories such as liquor, tobacco, beauty and fashion.
At the moment, FDI regulations do not permit any of these players to engage directly with consumers except when they are flying with legitimate tickets and boarding passes.
However, duty free companies like DFS and the Nuance Group have been trying to facilitate purchases through pre-booked orders made through the net before reaching the airport, which can be collected by passengers before boarding their flight.
“We are doing a template in Singapore whereby passengers can pre-order their airport purchases online and the same concept will soon get launched in India where price is going to be the prime driver. Our rates are 50 per cent cheaper than downtown prices for categories like liquor and even beauty brands would be about 15-30 per cent less than the usual prices,’’ says Manishi Sanwal, Managing Director, DFS India.
The Hong Kong-based DFS operates categories such as liquor, food and tobacco and occupies 55,000 sq ft at the new T2 airport in Mumbai. Convenience
Even the Nuance Group, which operates the duty free airport in Bangalore, is trying to capture the captive audience of passengers at the airport.
“We want to give more value and convenience and have a click & collect model. But more than competing with attractive prices with e-commerce players, our competition will be from other international airports,” said Anirban Chowdhury, Country Head Nuance Group.
“Almost 80 per cent of our products will be 10 to 30 per cent cheaper than duty free shops in Europe. Our global sourcing agreements with international brands for the Indian market give us clear pricing advantage compared to other markets.”
Local flavourConsidering Indian duty free retailers compete primarily with other duty free airports across the world, having Indian specific products and variants of the international brands are expected to draw more consumers.
For instance, DFS launched an ‘aam panna’ flavoured vodka under the Absolut brand and even a corn flavour Toblerone chocolate specifically for the India market.
According to consulting firm CAPA (Centre for Aviation), in India, liquor leads the duty free category accounting for 63 per cent sales compared with 17 per cent globally.
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