Motta Director Erasmo Orillac discusses news in Cuba, Trinidad & Tobago, Venezuela and more
- March 09 2017 07:15 AM
Motta Internacional, the leading operator in Central America, South America and the Caribbean, has a great many new developments happening, according to Erasmo Orillac, Director of the company and also Chairman of the Board at IAADFS. “We have a few projects going on in the duty free industry that are going to be a challenge,” he says. “Some are works in progress and some are in planning,” he says. Of particular note is the company’s negotiations in Cuba.
“Work in progress is Cuba,” says Orillac. “We are in the process of opening a duty free shop in Havana and three other smaller airports. It’s a very complex situation but things are moving along well and we are targeting the third quarter of 2017 to open. It’s very interesting and challenging.”
Cuba is just one of the recent developments for the busy operator. In Trinidad and Tobago, Motta Internacional recently won a bid for the duty free business and everything is ready to go. The firm expects to have a soft opening this month.
Along with its new locations, the company has also renewed some important concessions, including one in Venezuela. While this country has been going through some difficult times recently, Orillac is optimistic about this well-established operation. “It’s an interesting situation; we have been there for 15 years.” The renewal is for five years.
Motta Internacional has also renewed its contract in Bogotá, Colombia until 2027, where an additional 618 square meters of retail has been added in the new section of the airport, which will open in June or July. “We’re working on that as we speak. Our main store needed a facelift after some years, and we’re also reshuffling a bit within the store,” Orillac enthuses, adding: “We also won a contract for 10 years in Cali, a smaller airport in Colombia. It’s a brand new terminal and we are setting up shop there.”
Meanwhile, Tocumen Interntaional Airport is being renovated in Panama City, the company’s home turf. Orillac says the company will be bidding for two clothing boutiques in the new Terminal 2, which is currently being built. In addition, it will bid for a consumer electronics specialty monobrand shop.
Sales, average ticket and categories
Orillac reports that despite challenges in the industry, 2016 was better than 2015 – the company was up 15% overall. Orillac believes this double-digit result is due to working “very hard” on the training of its store managers and sales staff. “We’ve been able to succeed in increasing the average ticket per passenger by half a product,” he says.
The penetration rate depends on the dwell time people have in the airport, and some airports in Motta’s portfolio fare better in that regard than others. Tocumen is not the best airport for dwell time, notes Orillac, because the main carrier is Copa Airlines and the average connecting time is 56 minutes, which offers very little time for shopping. Here, penetration rate is up to 10%. Airports with higher dwell time see a higher penetration rate – up to 20% in Quito, Ecuador, for example.
Major changes in purchasing behavior
In recent years, Orillac has observed a major trend: Passengers are now very well informed on prices. Using their smartphones and taking advantage of the free Wi-Fi at the airport, they can check prices worldwide at a click. “The younger crowd, the millennials, they are so good at using cellphones for internet pricing, they know everything,” he says.
Another trend he notes is toward buying better products. “The new generation want to buy the very best; they want the latest product, the most fashionable product on the market. They know exactly which is the latest model. They are very smart shoppers and very well educated. They know what they want and if you don’t have it, they don’t buy it. They travel light, too. They like smaller products they can stick in their carry-on bag, and they have no suitcase.”
In response to the changes in customer behavior, Motta Internacional has shaken up its promotional tactics. The firm used to produce one booklet per month for promotions, but now it issues one booklet every 15 days, because “customers like to see new things.” The company’s website, www.attenza.net, is also doing well. Passengers can pre-order on the internet and pick up and pay at the airport. The company guarantees it will have their package waiting for them at the airport, where their payment is then processed. “That’s increasing every month, and when you look at the age of the shoppers, those 35 and younger make up 80-85% of pre-order sales. Passengers aged 35 and older buy physically [in the store].”
New listings are introduced all the time, says Orillac, but several products have been a hit in past two years. They include GoPro action cameras – a “fantastic” category, he says – and cellphones. Headphones are also popular – in ear, over ear, and especially noise reduction. Shoppers are opting for top brands like Bose, priced between US$250 and US$299.