This article was originally published in Orient magazine, September 2019.
In this issue our Editor sat down with Edrington's Managing Director of Global Travel Retail, Suzy Smith, to discuss international expansion and their growth in the Travel Retail sector. We also dived deeper into Edrington's Giving More and alcohol responsibility initiatives.
The Travel Retail sector appears from our outside perspective to be an area of strong growth for Edrington and other companies in the sector. Coming from a marketing background yourself, how are you looking to differentiate Edrington’s products and drive the future of the sector?
Our global travel retail business accounts for an important part of Edrington’s total profits. The department headquarters are here in Singapore, but there are offices throughout the world servicing the sector. Travel retail is an unique environment, providing an opportunity to engage with consumers in a space where they have time and are actively looking to spend or find special products.
To this end, we launched Macallan airport boutiques this summer, first in Dubai and then at Heathrow. The concept is about step-changing the impression of Macallan to provide the full history and understanding of the brand, with unique high-end prestige products, some of which are unique to travel retail (the Boutique Collection) or limited global editions (the Prestige Collection). We invested in our distillery in the past five years on the Macallan Estate to provide a money-can’t-buy experience, and our boutiques are the next step in the process of bringing this to consumers. We are further investing in staff training by having the travel retail teams visit the distillery and understand the story and brand to fully portray this to our customers.
Typically in travel retail, you would pay premium costs for display areas within an airport, as well as positioning in mass retail outlets, so an investment of this nature is significant for a single brand.
Edrington clearly looks to international markets for growth, with a statement on the company website of 2/3 of employees being based overseas in wholly-owned or JV offices. With operations in Singapore, Hong Kong, Taiwan, Shanghai, Taiwan and Korea, where does the company see the next growth area likely to be in this part of the world?
We are seeing a lot of growth in emerging markets around Asia, with travel retail in the Asia Pacific region providing the highest growing market for passenger numbers. In this part of the world there is plenty of inter-region travel and an increasing level of affluence among consumers, making the region a real area of growth and focus for the future of Edrington.
The Robertson sisters and their Trust established Edrington in 1961 with a strong sense of philanthropy in the culture and values. Can you tell us a little about how this translates to today’s social responsibility within the company and back in Scotland?
The sisters setup The Robertson Trust to ensure that the family business maintained its independence with no shareholders, and to establish specific values for the future. To date, the Trust has donated more than £263 million to charitable causes in Scotland, and a further £10 million has been donated by the International Giving More fund since 2012, where 1% of pre-tax earnings are donated to a cause decided by each local office.
One of our key values is around Giving More. We recently formalised a policy whereby every year, every employee is given three days of Giving More leave to use for charitable giving. This could be participation in company activities or volunteering or fund-raising for a different cause which is special to the employee, the choice is theirs. The company then double-matches all monies raised.
This culture and expectation of philanthropy is established from day one of an employee’s journey with the company, and we have high levels of participation. Each office has a committee that agrees the office recipient of the 1% donation for that year, while employees can support other causes through their Giving More entitlement.
As with all companies in the alcohol sector, there is a difficult balance from a values and publicity perspective in the need for profit vs. drinking responsibly. How is Edrington working to support their customers in this?
We partner with a lot of organisations in this area and maintain an Edrington Marketing Code for sales, marketing, events, commercial and procurement employees to undertake and re-commit to every two years. Every year, we run an Alcohol Responsibility week with all employees around the globe to raise awareness and talk about the issues.
In Asia Pacific, we partner with the Asia Pacific International Wines & Spirits Alliance (APISWA) which works on programmes across SEA looking at alcohol responsibility and education. In the UK, we are a contributing partner to the Scotch Whisky Action Fund and work with Drinkaware, and in the US we are represented on the Board of the Foundation for Advancing Alcohol Responsibility (FAAR).
Through these partnerships, we aim to drive these responsibility messages and educate our employees. From a marketing perspective, there is a difficult balance between selling the products and advocating for responsible drinking, but trends can help with this as people start to look at drinking less but at a higher quality, where our premium products are positioned.
As a woman in a senior leadership role, how has your personal experience been across your career with finding mentors and support to achieve your goals, and where do you think the industry can improve for the next generations of female talent?
I have been lucky during my career to have great line managers and separately to this, mentors. For the future, we must look to support colleagues and the future generations of talent.
Diversity is important to the company and I have taken a personal interest in helping to drive these initiatives in Asia Pacific and am keen to learn from others. We must understand each locality’s culture and requirements before looking to implement processes as what works in one location may not be as effective in another.
Edrington’s vision is that we will give more by building the world’s leading portfolio of exceptional super premium spirits. Our strategy is to intensify our focus on becoming the world’s leading super premium brand builder. The Macallan is our central focus supported by Highland Park and The Glenrothes in the fast-growing Single Malt category and Naked in the Blended Malt category.
We have strategic partnerships with Tequila Partida and Wyoming Whiskey in the dynamic Tequila and American Whiskey categories. Our portfolio is completed with The Famous Grouse Blended Scotch Whisky, Brugal premium rum in the Dominican Republic and Snow Leopard vodka.
Edrington is headquartered in Scotland and employs over 3,200 people in its wholly owned and joint venture companies, with over 70% employed overseas. We own our route to market in 15 countries and distribute our brands to more than 100 countries around the world through joint ventures and third-party agreements. Our principal shareholder is The Robertson Trust, which has donated over £263m to charitable causes in Scotland since 1961. Our business model is underpinned by the Edrington values of giving, integrity, excellence and respect.