Duty free shops sell ethnic India theme

NEW DELHI: Theme India is the new mantra of duty free shops at Indian Airports. It's no longer phoren whisky, branded products or the luxe tags which are seeking shelf space. In fact, it is the 'Made in India' label, which is ringing bells at the cashbox. Items such as Indian beedi, tea and country liquour is the new fad among those splurging at duty free shops. So, out goes Blue label, Louis Vuitton and in comes desi brands such as Khwaja beedi, and Old Monk (Rum).

"Duty free shops have finally woken up to the concept of destination products and destination shopping. And, this is why they're lining up more ethnic products on their shelf," says an Alpha Future spokesperson. Alpha Future, a JV between UK-based Alpha Airport Group and Kishore Biyani promoted Future Group of India, has on display ethnic brands such as Sancha Tea, at its Delhi Airport outlet.

According to experts, after the formation of European Union, the concept of duty-free shopping has undergone a tremendous change in the West. "It's more about cashing in on the local flavour. Also, those visiting a foreign destination will like to take a souvenir to mark their journey, and if you can do it at the airport nothing can be more convenient," explains Arvind Singhal, chairman, Technopak Advisors, a leading retail consultancy firm.

A Delhi International Airport Limited (DIAL) official, reveals that the last six months has seen the sales of the desi items jump by around 10%. "Tea has been by far the fastest selling Indian item. Especially, packed elegantly in ethnic designs & motifs, it is a hot pick among the tourists, particularly Chinese and Japanese," the official said.

Seeing the huge demand, duty free shops are now planning to add more destination products such as incense sticks, packed sweets, local whiskey and vodka brands to their current portfolio. "We've recently introduced Indian wines (Sula) and the response has been good. Later, we may also add T-Shirts with Indian motifs like 'OM & 'Ganesh'," affirms the Alpha future official.

As per rough estimates, the duty free industry in India is pegged at around Rs 300 crore. According to an ACNielsen study, shopping at duty free shops is more impulse driven than planned and hence they have a high conversion ratio of visitor to shopper. Indians are among the highest spenders at duty free shops with an average spend of $ 440. However, players in the business feel that to do justice to destination products, they would need to dedicate a much larger shop area, which unfortunately is not possible right now.

Alpha Future Group is currently undertaking a huge retail expansion over two phases to more than double the existing space at Delhi International Airport. In 2006, ITDC generated $13.6m in sales. And Alpha Future is hopeful of beating this target.