Eastern Europe under the spotlight in Kiev

Nicole Mezzasalma

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The Baltic and East European Conference focused on the main challenges faced by airports, retailers and suppliers in the region

Over 110 delegates from the travel-retail industry gathered in Kiev to attend the Baltic and East European Regional Conference 2007 on November 18-20. Nine presentations and panel discussions covered issues ranging from rapid growth in inbound tourism to the purchasing motivations of affluent Russian travellers.

Opening the event, UNWTO deputy chief market research Sandra Carvão and Travel Business Partnership director Nancy Cockerell addressed the rapid growth in international tourist arrivals in the region, with many Central and Eastern European nations registering double-digit rises in the number of inbound travellers, mainly due to the expansion of low-cost carriers. Carvão highlighted the high expenditure rates of Russian, Ukrainian and Hungarian passengers and said tourism is “still one of the most dynamic industries in the world” despite any security issues. Cockerell predicted that mature destinations such as Prague and Budapest would see saturation in demand, while new routes to countries such as Romania and Bulgaria would maintain the impressive growth rates in air travel.

Next, an interactive panel session analysed the importance of getting the retail mix right in Central and Eastern European airports. Chaired by Concession Planning International managing director worldwide Frank Grey, the panel included Moscow Sheremetyevo airport’s JSC terminal commercial director Vladimir Karykhalin, Dufry Eastern Europe deputy COO David Grady, SSP CEO Central & Eastern Europe Johann Weintzell and Prague airport executive director for non-aviation business and services Martha Guthová.

After a coffee break, Foley Cooke commercial director Michael Foley and Umdasch export manager and travel-retail director Michael Ripfl explored how store design and innovative merchandising initiatives can help travel retailers to maximise customer spend per square metre. Foley highlighted that operators in Central and Eastern Europe have the opportunity to do something different in the airports of the region and should not simply copy the designs seen in more mature European markets.

The Nuance Group executive vice-president strategy and business development Ivo Favotto followed by explaining what a retail operator such as Nuance is looking for in the emerging markets of Europe, using the group’s recently-won contract at Antalya airport in Turkey as a benchmark. He highlighted the importance of longer contracts in giving retailers confidence to invest in the airport, a point stressed several times during the event.

After lunch, Euopean Travel Retail Council secretary general Keith Spinks chaired a panel session on how the confusion over increased security measures on liquids, aerosols and gels and price positioning have affected travel and travel-retail in Eastern Europe. He was joined by Kievrianta general manager Garrett Coogan, Gebr Heinemann director Russia, Baltics, CIS and Mongolia Pierre Viarnaud, Riga International airport director of commercial department Arturs Saveljevs and Sofia International airport commercial director Vlad Gitsoaika

Closing the first day, Kavanagh Communications CEO Anne Kavanagh delivered a presentation explaining how airports and travel retailers can benefit from investing in good relationships with the national and local media, and how public relations can give better returns than advertising, citing case studies from clients such as BAA and Alpha Airports Group.

The second day of the conference opened on a high note, with Cadbury Schweppes International Travel Retail general manager Steve Brock sharing the supplier’s extensive market research experience and information on how Russian travellers spend their money and on what. He mentioned that women comprise nearly 40% of Russian passengers, well above the international average of 16%, and that Russians are now the ninth highest spenders in the world.

Brock’s presentation was followed by Inflight Service Europe general manager Travelshops-Euroshop Janusz Grabowski, who shared with the audience his company’s experience of being acquired by venture capitalist CapMan and how that affected its travel-retail business. He described how the company had to cater for two very different markets—Scandinavia and Eastern Europe—and discussed extensively the challenges of operating in the emerging markets of the East, such as bureaucracy, political tribulations and the different passenger profiles.

Finally, Comturist import manager Gabriela Grigoras described how the troubles surrounding the Romanian duty-free border business have led her company to seek refuge downtown. She explained how opening a big shopping centre in Bucharest was the solution chosen to lift Comturist’s profits after the forced closure of its border stores network last January.

Networking opportunities were plentiful thanks to the hospitality of Ukrainian vodka company Nemiroff, which hosted the opening cocktail and gala dinner; Aer Rianta International, owner of Kyiv Duty Free, which sponsored lunches on both days; and chocolate supplier Ferrero, which sponsored coffee breaks throughout the conference.

A full conference report will appear in DFNI December 15.