Con Constandis is calling the shots as MD of Pernod Ricard Asia Travel Retail
The industry veteran sees near limitless potential for growth as Asia’s expanding middle class travels more.
When offered the chance to move to China in 2009, Con Constandis was initially caught in two minds. The proposed high-profile role as China managing director for drinks company Pernod Ricard clearly held challenges and attractions.
Most notably, there was the chance to develop some of the sector’s best-known brands in potentially the world’s largest market, along with the opportunity to apply the lessons of close to 30 years in the business in a variety of functions, divisions and countries.
He was concerned, though, that the language barrier might hamper efforts to use that know-how. And, clearly, simple cultural differences could confound the best-intentioned attempts to introduce new products, marketing initiatives and ideas about management.
“In China, at the start, it was extremely intimidating,” says Constandis, who was transferring from the position of president and CEO of group company Corby Distilleries in his native Canada. “I had to stand strong with an air of confidence that said I could lead the organisation and the business and did not need to know all the details. But a lot of it was nerve-wracking.”
To get off on the right foot, he saw it made sense to concentrate on two areas: the general direction of the organisation and the capability of staff to support the broader business agenda. After that, there would be time to put in place new operating and reporting practices and any other internal disciplines deemed necessary.
“A market like China has millions of opportunities and people want to align them all,” Constandis says. “We were going down that path, but I saw we had to narrow the focus, have a portfolio with the right balance, and pick channels which represented the future.”
This is something that was straightforward in principle, but made harder by the pressure to perform, emphasised by the impact of the global downturn on group results elsewhere and a series of more fundamental worries.
“I came into an environment where I couldn’t use what had been my greatest assets: communication and knowledge of the business,” says Constandis, who studied commerce and accountancy in Montreal before joining Seagram Spirits & Wine in 1983 in a financial role. “I couldn’t talk directly to customers, government officials, or 90 per cent of the organisation – that was the first curveball.
“But the flip side was that it forced me to develop other latent skills. My leadership style had to change by trusting others, insisting on the company’s ethics and value systems, and using my instincts – otherwise I would have paralysed the whole organisation.”
As the 1,000-plus team began to cross a number of performance thresholds, a more audacious goal emerged: becoming the biggest-selling country within the group. That was well in sight when annual revenue hit €1 billion, at which point Constandis was, in effect, asked to repeat the trick in his current role as Hong Kong-based managing director of Pernod Ricard Asia Travel Retail, which he took up last year.
The task now is to build sales at duty free and other outlets principally serving the region’s airports, cruise lines and ferry routes. The sector has its own dynamics and challenges, but also a near limitless potential for growth as Asia’s expanding middle class travels more. Not surprisingly, Constandis arrived with a fairly clear plan of action.
“Start by assuming you don’t know as much as you think and by asking where we want to go. Then you can put the pieces in place,” he says. “I am now a firm believer in learning through experience and subjecting yourself to situations where you don’t have all the answers.”
He admits that, in his latest role, a lot of the countries are still very new to him. But, even so, he doesn’t take briefings from his team, preferring instead to go out and meet customers, ask questions, see the reactions, and figure it out from there.
“I know the basics, but want to see the rest for myself, in order to keep learning and keep moving the agenda,” he says, noting the importance of directing company energies towards external issues. “Anything which bogs that down – internal meetings, paperwork – I don’t like. We must be entrepreneurial and innovative enough to make decisions and, obviously, need to be out there with customers fighting for business.”
Besides doing that profitably while increasing market share and sales value, his declared priority is to shape and solidify the organisation and ensure it survives him. As a leader, this means giving a relatively young team the abilities not just to contend with the normal weekly pressures of achieving performance targets and numbers, but also the all-round acumen to anticipate emerging trends and respond creatively.
“If you go through an airport, it is a luxury-brand environment, but the challenge in finding the right level of engagement for different customers is huge.” Constandis says. “That engagement has to be creative enough to catch the attention and interest of the consumer in a very short window and deliver a clear message about price and quality without being intrusive.”
DISTILLING THE MARKET
Con Constandis flags up five significant factors affecting the Asia travel retail business
Increasing volume “With growth of 7 to 8 per cent a year, passenger traffic in Asia is outpacing the rest of the world as more people travel to more places. Infrastructure development means there are now first-rate facilities in countries like China, Vietnam and Cambodia.”
More players “There is competition at all levels, with retailers and airport authorities looking to grab a bigger slice of the travel-related market.”
Broader demographics “The consumer profile is changing from mainly high-net-worth individuals to the emerging middle class. This next wave of roughly 600 million travellers in Asia has money to spend at airports and transfer hubs.”
Strong economies “Newly affluent people from China and India – and more women –increasingly represent the sector’s buying public.”
Focus on differentiation “In an environment where shoppers may have 15 minutes at most, the pressure is on to offer something familiar, but also something unique, which makes the buying and ‘gifting’ more exciting. This is done with limited editions for duty free areas and special offers not available in domestic markets, to give a brand reference but a different value equation.”