C1 - Internal use

1. Challenge:

In September 2012, I joined the Solar PV division of a company I work for. Although  the division had been booming with the overwhelming increase of travel globally, especially in Asia;  the industry itself had been stagnating. The consumer experience hadn’t really caught up with  innovations we see in retail around the world/bridge between online-offline services/ digitalization  and so on. In other words, for an industry that is booming & generating such important sales, and  benefiting from immense amounts of traffic – travel retail was not really up to speed.

In our group, there had certainly been talks and plans to gradually rethink our model/find digital  opportunities. For example – it is bizarre that the travel division works in silo, as opposed to hand in  hand with local markets – since after all, we share the same customers. We thought there must be a  way to create better synergy, capture the customer early in their journey before they hop on a plane  or keep them consistently engaged/aware of key travel offers. However, 2 key challenges that we  have not been able to crack are:

➢ Offsetting the sales dependence we have on key passengers (i.e. by recruiting a new one

that we can call XYZ for the purpose of this exercise – that actually makes up for the majority  of the traffic in the airports we are present in, but does not step into duty free shops)

➢ Digitalizing the experience; leveraging mobile/online pre-purchasing services to increase

efficiency/adapt to limited dwell time, but also offset our dependence on retail sales. The  latter is actually a challenge because it requires collaboration from 3 parties: the Duty Free  retailer, the brand (us) and the airport. And it’s therefore very difficult to scale as the owners  of duty free & airports vary across the country.

Once the pandemic hit, the 2 challenges above needed to be addressed now more than ever. The  biggest thought we had was, ‘if only’ we had innovated earlier and built a model that is crisis-proof.  Nevertheless, it’s not too late, but this course helps find ways to crack the code and move things  forward. The main one I want to address today, is what needs to be done to get the passenger XYZ  into our shops – what are we missing. On top of it, this passenger is very digital savvy, so recruiting  them can only further our transformation.

2. Selection

The tool I selected for this challenge is the Story telling tool, because today there is plenty of  redundant research as to why passenger XYZ does not step into the duty free (expensive price  perception, prefers heading to a restaurant instead to spend their dwell time, doesn’t want to  carry extra things, doesn’t perceive the assortment/offer to be attractive).    The Story telling tool entails putting the human beings and their experience front and center &  listen. Listen to their journey thoroughly, and let them tell their story through images,  questions/answers, drawings to help uncover insights/unexpressed needs/patterns. By doing  so, we would be working with a different set of data than the one readily available to all the  competition.

3. Application:

We created 3 segments of the passenger XYZ and recruited 25 members for each:

Segment 1: Domestic Business Travelers  Segment 2: Domestic Travelers for Leisure (where more than 50% of their trips/year are domestic)

C1 - Internal use

Segment 3: International Travelers (where more than 50% of their trips/year are international)    To help kick-off the story telling process. We asked each segment to tell their stories via different  methods.    A) Questions: general travel-related pre & post-covid to get an initial pulse:    Pre Covid examples: What is the most exciting part of travelling/What do you dread most/Walk us through your path from the

time you enter airport to your flight/List reasons you stop at certain shops & why/What do you wish was different in your travelling  experience?/How do you typically feel when you travel

Post Covid: What is the first thing you want to do post-covid? / When do you plan to travel again / Who will you travel with /Do  you trust airports/airlines will make it safe? / Will you prepare differently if so how?

B) Drawing: Drawing their journey from the moment they wake up to when they reach their gate.

C) Deep-Dive round table talk: regarding how they prepare for travel from our industry’s  standpoint (we sell trendy/daily used consumer goods) – ranging from how they pack, steps they  take, what they bring etc

D) Ranking Exercise: we asked them to rank a variety of services in terms of convenience &  attractiveness.

I found the above methods to be very effective in extracting unique information.

4. Insight:

The main insight we gained from applying the tool is that these passengers don’t behave that  much differently when they are not travelling. The offer that typically appeals to them in our  particular industry was simply not available in travel retail & the service that comes with it  neither. They of course did not list that as a reason for not shopping in duty free right off the bat,  but as we doug in their journey and understood all the facets of it, it became evident that the  key element that drives their purchase outside airports was simply not available in airports, and  hence emerged an opportunity for us to adapt fast.

In understanding their journey thoroughly, we also uncovered new opportunities to catch them  before they decide to fly.

We are of course still at early stages, but the amount of insights we gathered by doing this  simple exercise outweighs in terms of richness any existing study we had on hand.

5. Approach:

I would apply the same tool actually if faced with a challenge that is particularly human based.  We saw that having this close interaction and various ways of conveying a message, really  does help uncover insights that the consumer would not have explicitly communicated.

I might consider however complementing this first exercise with a launch experiment, simulate  an environment that mimics a current Duty Free and test some changes/tweaks we have in  mind to see how they respond to them. We might then run a pilot in 1 airport location to validate  the winning ‘pretotype’.

