A new café concept for Oreo at Qatar’s Hamad International Airport, and the first travel retail pop-up store from Switzerland’s Lindt based on a vast research project, at London Heathrow Airport, mark new strategies from the global brands as they both aim to build out the confectionery category in travel retail.
Oreo owner Mondelez International
Meanwhile, Lindt & Sprüngli whose 2022 sales hit 4.97 billion Swiss francs ($5.43 billion) up by 10.8%, has amassed huge amounts of consumer data over the past year. The first tangible results of more than 100,000 interviews materialized as a travel retail pop-up with a live chocolate chef at Dufry’s store in Terminal 4 at London Heathrow in April, with several more planned.
In both cases, premiumizing the brands is central to the retail strategies. The Oreo Café at Hamad International sits in good company, joining the Fendi Café, also a first for the fashion brand in an airport. The move, within the gateway’s indoor tropical garden, is conspicuous and deliberately so; the unit has Oreo’s distinct blue, white, and black aesthetic.
Mondelez world travel retail managing director, Jaya Singh, told Forbes.com: “Visibility is clearly key to attracting footfall and we’re delighted with how prominent the location is. This is a historic moment for Mondelez in travel retail. It has always been our mission to bring exclusive experiences to the channel, to drive differentiation in interest of conversion.
“Oreo Café has been years in the making; we knew we had to be strategic with how, when and where we presented the concept. We teamed up with Hamad International and Qatar Duty Free (the airport’s retailer) knowing that the FIFA World Cup would be taking place. We believed it would give the café the best exposure.”
Oreo milkshakes on top
Since then the airside retail unit, which seats 30 people, has continued to attract visitors, tempted by a sweet and savory menu priced from 16-65 Qatari Riyals ($4.40-18). The bestseller is the Oreo 115g Mini Canister but, by far the most popular on-site option is milkshakes, with coffee and food following closely behind.
“Our bestselling vanilla Oreo milkshake makes up one third of all sales,” said Singh, who added that to keep the sales performance up, the café has a selection of ready-to-go items, which make up 10% of all transactions.
Lindt’s pop-up at London Heathrow is a more targeted promotion that uses multiple data points built up and refined as a matrix from over 100,000 interviews. These have enabled the brand to identify various “consumption moments” and distill these down into five key demand drivers: a treat (something quick and easy); indulgence (offering an escape); recharge (a practical bite to combat hunger, low-energy, or boredom); connection (something to share); and delight (a gifting option).
Peter Zehnder, head of Lindt Global Travel Retail, told Forbes.com: “The beauty of the demand landscapes we’ve identified allows us to tailor retail and product concepts for different locations in the travel retail channel.”
In the case of London Heathrow, the promotion was geared to to the ‘delight’ pillar, based on UK preferences for chocolate. Zehnder said: “In the study, we found that British shoppers are specifically looking for gifting options so we are reviving the ritual of gifting at Heathrow. It will also help to up-trade the category.” The pop-up had a focus on one of Lindt’s bestseller lines, Lindor, with freshly-made truffle balls being prepared by a master chocolatier for passengers to try.
Tailored roll-outs from Lindt
This first physical—and scalable—pilot is set to be deployed in other airports with potentially six large-scale retail promotions launching this year, plus 100 other smaller stagings in travel retail. “We will look at specific nationalities and products and decide on the pillars that will be used elsewhere,” added Zehnder.
For Mondelez, which generated group sales of $31.5 billion in 2022 (up 9.7%), a scale up for Oreo Cafés in airports will have to be more considered due to the large investment involved. For the time being, Hamad International remains a strong location. As travel continues to increase worldwide, the brand can make the most of passenger traffic spikes when Qatar hosts the Formula One Grand Prix in October, the MotoGP in November, and the Asian Cup in January 2024.
Singh said: “Ultimately, we are open to expanding this concept into other airports but we would have to assess opportunities based on a range of parameters including location, quality of space and passenger demographics. Who knows, another Oreo Café may be on the cards.”
Both confectionery giants are committed to expanding the profile of confectionery in travel retail either by entering the F&B arena—one of the fastest growing spaces within travel retail—or through passengers trading up. According to Lindt, confectionery already has the best purchase rate (the percentage of buyers among all passengers) at 10%, well ahead of categories like alcohol and skincare. Lindt’s travel retail division also grew by triple digits last year at 109% and it will be keen to keep that momentum going using its new data-led promotions.