The Challenge

Tower Strategy Group's client, a multinational Consumer Products player, had a long-standing presence within the global duty free channel. And though it had achieved a respectable position within that rapidly growing market, it believed opportunities existed to further accelerate growth. However, the client had key questions relative to what changes in focus, investment and structure were required to tap into that potential.

The Solution

Tower Strategy Group partnered with the C-suite and a cross-functional team of global commercial executives to:

• Develop a consolidated picture of the focus, investment levels and structure of the client's existing duty free play

• Identify which sub-channels are available in duty free and the profit pools inherent in each

• Map global consumer flow, trends and needs across those channels to evaluate fit with client’s portfolio

• Establish, as a result, clear guidance on which specific channels client should focus on going forward (e.g., airports vs. cruise ships vs. border shops)

• For the highest priority channels, define specific sources of strength and weakness and the steps necessary to occupy more shelf space and improve product velocity within the channel

• Reprioritize which regions and countries to focus on globally, mapping portfolio back to the nature of the consumer and channel opportunity across them

• Define tangible steps needed to close client’s performance gap within the channel (e.g., Travel-Retail, specific innovation)

• Restructure client’s existing channel management organization, adding core missing capabilities and migrating to a structure better able to manage global customers

• Reset client’s P&L for the coming 5 year period to not only set clear expectations on performance but to also allow for governance and accountability

Impact

Our plan helped the client transform its global travel retail operations. Delivering a 5-year $120MM increase in channel revenue and $50MM increase in profitability. In addition, we streamlined the client’s organizational structure by consolidating disparate, regional operations into a unified channel. One more fully equipped to do battle with its largest competitors.