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TWE focuses on travel retail's $1 billion growth opportunity in wine

Published:  29 October, 2014

Treasury Wine Estates has identified a $1 billion opportunity to grow wine sales in the global travel retail sector and has strengthened its travel retail sales team to capitalise on the potential growth.

Research conducted by TWE and market research firm Counter Intelligence Retail (CIR) shows a large under performance of wine as a category in travel retail compared to other sectors. The research included talking with over 2,000 wine shoppers in travel retail outlets in 15 airports from around the world, including London Heathrow.

Tom King, general manager at TWETom KingTom King, general manager of global travel retail at Treasury Wine Estates

"The purpose of the CIR research was to better understand purchase motivations of shoppers. The category is underdeveloped and there has been a lack of focus and investment from the supplier base," said Tom King ,TWE's general manager for travel global retail.

The findings confirm that there is clearly a missed opportunity for wine in the travel retail market.

"The research showed that while global sales of wine totalled 48% of overall alcohol sales in the domestic market- this figure was only 21% of overall alcohol sales in global travel retail," according to the TWE research.

Tom King, general manager of global travel retail at Treasury Wine Estates

However, Treasury has had its eye on the opportunities within the travel retail segment for some time now and has been quietly building up a dedicated sales team for the sector.

King said: "Since we established the dedicated global retail team at TWE 18 months ago, our core strategic focus has been to find a way to drive growth in the wine category."

In an exclusive with earlier this year at Prowein, King discussed Treasury Wine Estates goal of doubling the size of its retail business within five years. King was in negotiations focusing on wine growth in the travel retail sector back then. Treasury has since held discussions with all the major travel retailers including Nuance, World Duty Free, DFS, Dufry and Heinemann, about how it could partner with them and help to drive growth of wine in travel retail.

At Prowein King said: "We have had really positive feedback from all the major travel retail players as we want to help them grow the overall wine category and not just talk about our own brands."