The Moodie Blog in India: Day 2 – How commercial aspirations came true in Cochin

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Martin Moodie
Martin Moodie is the Founder & Chairman of The Moodie Report.

Cochin Duty Free may just be one of the most under-rated success stories in the global travel retail business.

And Cochin International Airport (pictured above) surely deserves more exposure too for its impressive championing of the Sense of Place concept and its unrelenting commitment to corporate social responsibility.

Those are just some of our impressions after The Moodie Report’s first visit to the Kerala gateway over the past two days. Cochin International Airport was the first greenfield airport in India built under the Public-Private-Partnership (PPP) model – a concept that has mushroomed since Cochin International opened for business in June 1999.

Today I met with senior executives from Cochin International Airport Limited (CIAL) as well as its duty free management partner Alpha Kreol.

The sense of partnership is readily apparent – here is an Indian airport company that was well ahead of its time in putting such an emphasis on duty free (and commercial revenues in general).

Today duty free generates an impressive 30% of the airport’s gross revenues – driven by an average transaction spend of US$40, claimed to be the highest in any Indian duty free shop.

The airport management’s understanding of the importance of duty free is underlined by the extensive use of space outside the shops to promote the various offers and promotional campaigns (see below).

Even the space outside the terminal is well used to highlight shopping promotions within. The picture below shows me checking out the Shopping ‘Car’nival promotion that is running during the Onam festival celebrations.

This is a highly proactive approach to retailing. Promotions, like the one for Chivas Regal below, really make a difference to both penetration and average spend, says Alpha Kreol.

Cochin International is India’s fourth-largest in international passenger terms, most of them bound for, or returning from, work in the Middle East. That’s why, as explained in an earlier Blog, the Arrivals business (below) is so important here (over 90% of the mix).

Commercial success is one thing – social values are another. CIAL is dedicated to serving the people of Cochin and Kerala. “Cochin Airport is of the people, by the people and for the people,” says a proud Airport Director A.C.K Nair. The state government is a shareholder as are, collectively, the airport users.

We’ll bring you the full, fascinating story of Cochin International Airport and Alpha Kreol in the next issue of The Moodie Report Digital Print Edition, out in September and dedicated to the travel retail markets of Turkey, Russia, India and China.

It will make timely reading. With so many question marks being posed about the recent price of entry into Indian duty free, as well as numerous disputes between concessionnaires and airport companies, Cochin International Airport is a testament to the power of true partnership in making commercial aspirations come true.

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