Issue 46 | March 2023
From a Store to a Story
)
From a store to a story. That was the statement used during the presentation of the corporate strategy for the next 5 years – Destination 2027. A statement that encapsulates not just Dufry´s future, but a strategy focused on delivering a whole ‘travel experience revolution’. A big change for both our combined new company, and probably for the industry.
Much has happened since that presentation which came a few months after the announcement of the business combination with Autogrill. And although there is still quite a long way to go, today is a good time to put all the pieces in order and start to see how this great project is taking shape.
Changing customer habits
Generation Y (those born between 1980-2000) and Generation Z (born in year 2000 onwards) are ageing. And if these consumer groups represented around 40% of our target customers in 2019, in 2025 – that is two years from now – they will take over 70% of the pie. This new mix of consumers comes along with new and different preferences and ways of behaving that clash with the traditional retailing approach.
On one hand, there is a clear shift towards experiences over products. Take the Apple stores as a reference. You can buy the same device online, or at any other store. So why do people still queue to get into the stores? For the experience! This is what makes the difference.
There is another battery of elements, among which the digital experience – before, during and after the sale – also has a clear influence on the way customers behave. While both digital and experiential connects with Gen Z and Y, the truth is that these elements are relevant for all generations, to a greater or lesser extent.
)
Complementary offering
Dufry is the house of thousands of different brands. In many cases, we are the access point to products not available in our customers' home markets and offer an unparalleled showcase for brands in general. Needless to say therefore, that some of our stores in certain airports are chosen by the most powerful brands in the industry for their global launches, due to the international visibility they obtain.
Food & Beverage is a complementary offer that brings value to the combined Group’s offering. Bearing in mind that passengers start their trip digitally before they get to the airport and before arriving at their final destination, by now also offering F&B services we have an additional opportunity to engage with them.
)
Moreover, and taking that experiential approach to the business, F&B and Retail are the perfect marriage and bring together many cross-sell and up-sell opportunities. For example, our customers will be able to enjoy a great glass of wine and then take a bottle of that same wine they just enjoyed back home with them. Or what about rewarding a VIP customer after a great sale with a voucher to enjoy a snack – or a glass of champagne – in the bar next door!
These are just a couple of examples of the broad variety of opportunities that this combination brings to our commercial offering. Discover more about this in the interview with Fernando Pérez-Peña in this issue.
Our journey so far
The 3rd of February, when the company announced the successful closing of the business combination with Autogrill, was a very important milestone in this journey. Probably the most important one. After this announcement, we immediately started to work together as a strong team. That same day we made a very significant step change, both in terms of capabilities (as described above) and dimension – with around 60,000 employees, our new combined Group will address 2.3 billion passengers in more than 75 countries, in approximately 5,500 outlets across more than 1,200 airports, motorways, railway stations, cruise ships and many other locations.
The next development was the announcement of the high-level organizational structure, responsible for navigating this new combined entity – and for which you can find all the details in the dedicated articles in this issue.
)
What´s coming next
Internally, the integration team (Integration Management Office IMO) has started to work along several functional work-streams and focus on the integration during the next few months, with the aim of aligning the processes, seeking opportunities and driving innovation, by combining best practices, skills, know-how and expertise of both Dufry and Autogrill.
The outcome of the integration process involves taking the best of the new organization and shaping it into the future operating model and detailed organization. Communication in the various phases will be crucial and there is a strong commitment from top management to keep everyone closely updated on the developments.
From a corporate and legal standpoint, the company will launch a Mandatory Tender Offer (MTO) as required by Italian law to acquire the remaining 49.7% of the shares of Autogrill. We expect to close the MTO in the second quarter this year. The final step is to delist Autogrill from the Milan stock exchange.
