TFWA Asia Pacific Hainan Edition
Digitalisation is transforming shopper habits. We asked consumer behaviour and retail expert Professor Gary Mortimer of Queensland University of Technology, a workshop speaker at the forthcoming TFWA Asia Pacific Hainan Special Edition (23 June online), about the consequences.
Gary Mortimer
Gary Mortimer

TFWA: Has Covid-19 changed the way brands and retailers approach digitalisation? If so, how?

Gary Mortimer: COVID-19 has accelerated online consumption. Consumers spent $861 billion online with U.S. retailers in 2020, up an incredible 44% year on year, so it is vital for retailers to ensure their ecommerce channels are operational and efficiently run. Digitalisation has not just encouraged retailers to invest in their online presence, it is now providing an opportunity to better engage with consumers. Virtual is the new norm. Zoom users increased from 10 million to over 200 million in 2020. Microsoft Teams added 12 million active users in just 7 days. This virtual environment presents great opportunities for duty free and travel retail to connect with its market, through VLOGs, video tips and digital narratives.

TFWA: With consumers increasingly shopping and interacting with brands online, what role should physical retail now play?

GM: Physical retail will never disappear, but it may look very different. While online provides efficiency, convenience and price transparency, it can’t convey the quietness of a pair of noise-cancelling headphones or the subtle flavours of a single malt whisky. There may be opportunities to blend the digital and instore experiences, i.e. sample instore, purchase via an online kiosk, then collect at your destination. Travelling consumers are naturally both excited and anxious, worried about missing flights, delays and COVID-19. The travel retail in-store experience must mitigate these anxieties through sound, lighting, sufficient space and respectful service.

TFWA: Has e-commerce rewritten the rulebook for retail or is it just another route to market?

GM: Duty free and travel retail should not consider e-commerce and physical retail as ‘either/or’ – but a combination that creates value for consumers. Today, consumers are more likely to research online first, looking for key brands, prices, service levels, warranties and locations, then head in-store. We refer to this as ‘web-rooming’. Travel retailers should expect better-informed travellers arriving at their stores, information in hand and ready to shop.

TFWA: How can brands and retailers best engage in-store with millennials used to shopping online?

GM: Millennials are well travelled, having worked for many years, saved and holidayed globally. They are risk-tolerant and happy to shop online with their credit cards. This group will be experiencing a pent-up desire to travel again. They will be looking to experience new, exclusive brands, and to reward themselves after almost two years at home.