Chairman of the Kingfisher Airlines and United Spirits Ltd. which also imports and produces wine, was speaking at the Tax Free World Association (TFWA) opening conference on the first day of the association's World Exhibition in Cannes.
He also believes there should be more luxury brands and fashion goods in Indian duty-free shops. "Brands such as Louis Vuitton are doing extremely well and most premium brands are selling well despite the economic meltdown, as those who have the money are continuing to spend," he said with an air of optimism.
With new airports in Bangalore and Hyderabad and the revamp of Delhi and Mumbai airports set to be completed by 2010, "travel retailers operating in India need to put more effort into marketing themselves. Just showing their presence is not enough," said Mallya,
Mallya, who believes the Scotch whisky industry must be more innovative to succeed in travel-retail, said many airlines are still targeting India despite the economic downturn. "Transatlantic traffic may be down, but the Indian opportunity is still strong. Travel-retail in general is extremely underrated in India and must be taken more seriously."
Unfortunately, the wine sales has not picked up in the duty free shops due to a lack of variety, unattractive prices and still not-too-proper storage temperatures. There are no special promotions for the sale of the scanty stocks that are displayed.
At present, 2-liters of wine or spirits are allowed duty-free into India. The customs officials are generally more liberal in allowing 3-6 bottles of wine if they are convinced it is for personal use only.
Earlier, the Association President Erik Juul-Mortensen kicked off this year's edition of the TFWA World Exhibition opening conference with a realistic but optimistic appraisal of the travel-retail industry in light of the global economic downturn. He said it is the future that will present a challenge for the duty-free business.
Rising fuel prices and lack of spending power have resulted in a fall in passenger traffic that could mean a loss in duty-free sales of nearly $ 1 billion, according to a report. He added that the industry needs to compensate for that effect through an increase in average sales and penetration values. He also said that at present 70% of travellers believe has nothing to offer to them. |