Duty Free Wines and Spirits
Selling wines and spirits duty free is big business, accounting for the major chunk of our duty free spend.No wonder, then, that you’ll find ever more impressive liquor shops and displays and dynamic brand promotions at airports globally. There are a lot of brands competing for our money!
There really has never been a better time to buy wines and spirits at the airport. Travellers are spoilt for choice. At many international hub airports around the world the selection of premium spirits and fine wines has improved greatly in size and quality over the past decade. The shelves and aisles are groaning with single-malt whiskies, super-premium vodkas, vintage wines and XO Cognacs.
Away from the big hubs smaller regional airports are also doing a superb job of showcasing their local wines and spirits. Vintage port wines abound at Lisbon Portela airport, for instance, while hundreds of single malt whiskies can be found at Edinburgh international. Over in Eastern Europe vodka reigns supreme at Warsaw’s Frederic Chopin airport, while down Mexico way tequila is the star of the show at Guadalajara international.
Many of these local tipples are often exquisitely packaged, making them wonderful gifts for friends and family. Okay, we can all remember occasions when we have brought back a bottle of local wine from a vacation that tasted fantastic under the stars on a balmy night, but at home turned out to be gut-wrenchingly awful. But for every dud buy, there is a quirky local liqueur or wonderful native wine just waiting to be discovered.Along with cigarettes and fragrances liquor is one of the three traditional duty-free product categories. Indeed, it is still what many people first think of when they hear the word ‘duty-free’. Booze was there right at the birth of the modern duty-free industry. When Shannon airport in Ireland opened the world’s first duty-free shop in 1947, cut-price spirits, especially Irish whiskey, proved very popular with cold, weary transatlantic passengers, who had time on their hands to shop while their aircraft was being refuelled.
In the 1960s and 1970s wines and spirits accounted for over a third of the global duty-free shopping basket. However, over the years their share has fallen to around 17% as other product categories have gained in popularity, especially fragrances and cosmetics. The accent at many airports nowadays is now more on quality rather than high volumes with many specialist shops selling some of the world’s most expensive vintage wines and rare spirits.
For us lesser mortals without a small fortune in the bank, is duty-free booze a bargain? Well, that is a very tricky question to answer with a simple yes or no. It all depends on where you call “home”. For instance, for travellers from high-tax markets such as Brazil and India duty-free liquor offers huge savings on what can be bought back home. This is why arrivals duty-free shops in these two countries remain such big business.
The same is still true of many northern European countries such as Iceland and Sweden, where domestic taxation remains eye-wateringly high. Ferries and cruise ships criss-crossing the Baltic can still sell shed loads of duty-free wines and spirits to thirsty Scandinavians by stopping off en route at the tax-free Aland Islands, which belong to Finland, but are outside the reach of the country’s tax regime.
True duty-free shopping inside the European Union was axed in 1999 in a doomed effort to harmonise tax rates. No reason to get downhearted though. Many EU-based airport retailers still offer passengers wines and spirits at travel-retail prices, which can be up to 40% cheaper than domestic market levels. Also, look out for so-called multi-buy or combo-deals on key brands, which can also give travellers big savings.
In other markets such as the US, where taxes are lower, duty-free is often seen as a rip off by travel writers and shopping experts. These naysayers have a point. If there are savings to be had for these passengers, they are certainly small. This is especially so when it comes to big international brands, which are often sold on promotion at big domestic supermarket and liquor store chains.
Our advice would be to do a little homework before you buy. Many airport shops (but not all) have online price catalogues these days so that you can see how prices measure up. Just remember to keep in mind that the standard 1-litre size bottle commonly sold in duty-free and travel-retail shops is 40% larger than the 70cl bottles found in many domestic markets.
It may seem to be counter-intuitive, but price is not the main reason why many people duty-free liquor. In fact, recent research has shown comparatively few travellers can actually recall how much they spent on wines and spirits just a few minutes after they have left the shop! Other reasons such as finding a gift or just treating themselves are often more important motivations for travellers to buy than finding a bargain.
It is also worth remembering that the domestic availability of international spirits in some developing countries is still patchy. Counterfeit product is also rife in many of these regions, especially parts of Asia. Many travellers look to duty-free as being one of the few places where the genuine article can be bought with peace of mind.
One last point to make on this duty-free versus domestic market debate is that duty-free shops often sell exclusive products that can’t be found anywhere else. Sometimes we are just talking about gift packaging, but often the juice inside the bottle will completely different too, especially when it comes to Scotch whisky and Cognac.
When it comes to duty-free shopping preferences, blended Scotch whisky continues to top the sales rankings. Scotch has always been a favourite buy among business travellers, who continue to big duty-free shoppers. It is also a leading spirits category in many countries such as India, Brazil and South Korea, where duty-free sales are generally growing much quicker than in other parts of the world.
The likes of Johnnie Walker and Chivas Regal might be the biggest sellers, but other spirits are also gaining in popularity as the passenger mix at many airports broadens. Premium vodkas are on the rise, for instance, with brands such as Grey Goose, Belvedere and Russian Standard doing a roaring business. Champagne is also growing so fast that some famous houses can’t keep up with the demand.
Even spirits categories, which have traditionally had a low profile in duty-free such as rum and bourbon, are slowly gaining ground. Look out for the excellent Guatemalan rum brand Zacapa Centenario, for instance, which is winning fans the world over. Similarly, the fantastic Maker’s Mark bourbon with its unique red wax seal is appearing in more and more duty-free shops as each year passes.
Of course, taking liquids onto an aircraft has become a lot more complicated business in recent years. Since a UK-based terrorist plot to destroy transatlantic jetliners with liquid explosives was discovered in 2006 travellers the world over have all had to put any liquids they wanted to take onboard with them in containers of more than a 100ml. These containers are then placed in a sealed plastic bag.