ETRC launches EU Index

Gavin Lipsith

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The European Travel Retail Council's first index of the regional trade points to poor trading over the past two years

The first edition of the European Travel Retail Council's (ETRC) index of EU duty-free and travel-retail sales has revealed a disappointing performance in the region for the past two years, with total sales growth consistently behind the increase in passenger traffic. The index, launched today at the TFWA World Exhibition, shows that liquor and tobacco are the worst performing product categories, with beauty the only category close to matching passenger growth.

The index shows trend data accounting for approximately 80% of the business within the EU, and breaks down the data by product category—tobacco, liquor, beauty, confectionery and other—comparing sales progress against passenger growth. The first edition compares full year trends for 2004 and 2003, the first quarter of 2005 against the same period in 2004, the second quarter of 2005 against the same period last year and the second quarter of the year against the first in 2005.

ETRC secretary general Keith Spinks told RavenFox.com: "The results are slightly disappointing, although expected to a certain extent. We knew that the dramatic increases in passenger traffic were driven mainly by intra-regional, low-cost carriers, and it looks as though those passengers are not spending as much at airport stores. However, it is encouraging that beauty and confectionery in particular are still performing relatively well."

The index also suggests that the situation is improving slowly. The comparison between the first and second quarters of 2005 reveals a slightly improved performance in the second quarter, with the trend on all product categories pointing up, although still not matching traffic growth.

ETRC's Fulvio Fassone told RavenFox.com that the council hopes to be able to make enhancements to the index after gauging its reception by the trade. "We hope to be able to define some harder parameters in later editions to make the index even more useful for the trade," he said. "[Travel-retail analyst] Generation worked on the raw data, and we hope to be able to compare Europe's trends with those of other world areas soon, as well as splitting travel-retail from duty-free sales."

For the full results and a detailed analysis, see DFNI November 15, out next week.