Treading a path to sustainable recovery in travel retail

Does this become more difficult in the COVID-19 era and beyond?

In the times that we live in, does living and breathing sustainability values become more challenging however? As a channel embedded in the wider travel economy, one whose future is anything but certain, it’s not easy to look away from short-term goals. Mélanie Guilldou says: “The crisis certainly hasn’t eased progress towards sustainability. Many of us have been busy managing the short-term impact of the global pandemic, and the increased use of disposables and protective equipment has hampered efforts to reduce waste. We have also found that CSR is not always as high on landlords’ agendas as it should have been.”

For Lagardère Travel Retail, despite the crisis a focus on CSR remains “critical,” she notes. “Sustainability is at the top of consumers’ expectations and only companies which can demonstrate their commitment and progress towards building a more sustainable future will secure long-term success.” Building on the theme, Jennifer Cords says that acting responsibly in times of crisis is more important than ever. “The exchange with our business partners and suppliers as well as the commitment of our colleagues around the globe have encouraged us to continue our journey towards more responsibility in the travel industry.” ARI’s findings reinforce this view, with an emphasis on sustainability having “accelerated” through the pandemic. Nuno Amaral says: “Consumers want it now more than ever before [82% consider sustainability when making a purchase; source Pi Insights 2020]. The challenge is to balance the current turbulent trading environment with customer expectations, both now and in the future. “In my role as Chief Operations & Business Development Officer, coupled with Executive sponsor of Sustainability, I am accountable for both the delivery of the business results and of our sustainability strategy. I am 100% focused on and committed to leading the team to achieve this balance and drive the sustainability agenda across our estate at speed.”

How does travel retail bring together profit and purpose?

On this question, travel retailers we spoke to are emphatic – you can be ‘green’ and still make money. And with consumers today demanding that you show your credentials as a responsible corporate citizen, investments in sustainability are no longer ‘nice to haves’ but ‘must haves’. Nuno Amaral says: “Sustainability is fast becoming almost a ‘hygiene’ factor. Notwithstanding the fact that it might come as an additional cost to the business in some areas, there will be a time in the future when the industry no longer challenges this investment. Other industries are more advanced than travel retail in this space and they have realised that their stakeholders, whether customers, shareholders or partners, demand a focus on sustainability to remain relevant in the future. “Creating a ‘conscious shopping’ experience is a major component of our customer value proposition and is a strategic priority for ARI. Airports and customers have high demands for a ‘greener’ retail operation. We must not lose sight of the fact that we operate in a competitive B2B environment and that sustainability is becoming a major focus for airports. We need to be able to increase our sales and deliver sustainable profits. We believe our sustainability strategy will achieve both in the long term.”

Mélanie Guilldou: “It’s better to excel where you can make the greatest difference than be average everywhere”

Mélanie Guilldou says the balance is possible: showing one’s green credentials – through the product offer or by reducing waste or energy – can make it more appealing to shoppers and boost the bottom line, she insists. “Sometimes it can be more difficult, and significant investment is required to deliver longer term sustainability (and profitability) gains. To avoid a detrimental impact on the industry economics, the environmental and economic benefits must be carefully assessed and balanced, and priorities must be defined. It’s always better to excel where you can make the greatest difference than be average everywhere.” For Gebr Heinemann, aligning the four Ps – people, planet, profit and purpose – is the overriding goal. That means measures that contribute to company and industry performance mirroring those that offer a safe, healthy future for people and the environment. Jennifer Cords says: “Some examples that bring together profit and purpose: Saving natural resources in retail design, packaging and our offices saves environmental resources but it also saves money. Sustainable products create awareness for the topic among customers and are so sought-after that they can gain up to +50% more revenue. Investments and partnerships in sustainability are focusing on the long term.” Kevin Chiang concludes with a message that should resonate across the industry. “A sustainable enterprise should not only seek profit; how you spend your money is equally as important as how you generate it,” he says. “The process of pursuing sustainability is actually the same direction as helping society develop towards goodness, delivering kindness through action.” *See next page for examples of how these retailers are putting principles into profitable action.