Today, BoF can exclusively reveal that luxury travel retail company DFS is set to open an 8,000-square-metre retail complex near the world heritage site of Angkor Wat in Cambodia in 2016.
Luxury travel retailer DFS is set to enter Cambodia in 2016 with a 8,000-square-metre ‘T Galleria’ retail complex (the ‘T’ stands for traveller) to be housed in a building shared with the Angkor National Museum in the provincial capital of Siem Reap, gateway to the world heritage site Angkor Wat which accounted for almost 30 percent of the 4 million international visits to the country in 2013.
The new retail space will sell fashion and accessories, watches and jewellery and beauty from brands in DFS’s portfolio of over 700 brands including Chanel, Dolce & Gabbana, Louis Vuitton and Bottega Veneta, alongside a selection of locally crafted pieces.
“T Galleria by DFS Angkor will be a prime attraction for visitors, particularly in the hottest periods of the day. Visitors will be able to indulge their taste for renowned international luxury brands and local artisanship in pleasant surroundings that pay homage to local culture and design, reflecting the rich traditions of this unique destination,” said DFS chairman and CEO Philippe Schaus.
In recent years, travel retail has become a highly lucrative component of a successful luxury strategy, with growth outstripping that of the luxury market as a whole. “Travel retail has been growing at about 12 percent in the past few years. A similar growth is expected in the next two to three years, putting it at double the growth rate for the luxury goods market,” Luca Solca, head of luxury goods research at financial services firm Exane BNP Paribas, told BoF earlier this year.
DFS has kept a close watch on Cambodia, where the tourism industry increased contributions to the country’s overall GDP by 10.2 percent in 2014, according to the World Travel & Tourism Council. What’s more, in the first six months of the year, an increase in direct flights between Cambodia and China boosted visits between the countries by 20 percent.
“A significant number of Chinese, Japanese, Korean, Southeast Asian and Western visitors are already visiting each year and numbers are expected to grow further, especially from China,” added Schaus. “We expect the total number of visitors to Cambodia and to Siem Reap to double by 2020, according to sources including the Asian Development Bank.”
In September, DFS announced plans to enter Europe with a full restoration of Venice’s Fondaco dei Tedeschi, first built in 1228, which will house another T Galleria, also set to open in 2016. “It’s too early to announce any other plans for world heritage sites but we are keeping a close eye on every destination that our customers visit,” commented Schaus.
Majority-owned by LVMH’s Selective Retailing Division, DFS boasts a global network of over 420 locations on three continents and continues to operate a dual business model, comprised of duty-free stores at major airports and ‘Galleria’ stores located in global travel hubs, though over time the company’s strategy has shifted away from duty-free stores towards full-priced retail.