The advent of a new era
The Hudson Group has long been an eminent force in North American travel-retail. As Nicki Saunders discovers, the company now has ambitions that reach far beyond its home market
The Hudson Group has become one of the most recognisable faces of North American travel-retail, with more than 550 newstands, bookstores, cafés and speciality retail shops in 69 airports and transport terminals.
Hudson News, the company’s flagship concept, is the only national newsstand brand in the country. So far, the company has not made any serious efforts to expand its brand outside North America.
In December, the Hudson Group signed a definitive agreement with global private equity firm and majority shareholder in Dufry, Advent International, making it the majority owner. With the muscle of Advent behind it, the Hudson Group has high hopes of bringing its newsstand concept to an international audience.
COO/executive vice president of Hudson Group and son of founder Mario DiDomizio, Joseph DiDomizio, has worked for the company for fifteen years. “We’re going to start exploring international opportunities now, which we weren’t really doing before,” DiDomizio tells Frontier.
“We were exploring more locally, like Canada and the Caribbean. Now we’re going to be looking in Europe, Asia and South America, and this investment will allow us to do that. Our major objective in this deal is growth, both inside and outside North America. With Advent, the sky’s the limit.”
The Hudson Group has built its name in providing core services to travellers, including its Euro Café food and drinks concept, and Hudson News newsstands and Hudson Booksellers bookstores, which offer snacks, reading material and convenience products.
In June 2006 Hudson also signed an agreement with US cable network CNN to run joint marketing initiatives. The partners have since developed a co-branded CNN/Hudson newsstand, which it is now rolling out in North America.
“Our strategy is to anchor a retail programme with our core convenience newsstands, then add in a wide variety of national and international retail brands, some of them proprietary, such as our Discovery stores, Christmas and Kitchen stores,” explains DiDomizio. “We marry these to strong local concepts to create a strong sense of place that airports crave.”
One example of this model can be found at Nashville International airport, where in February the company joined forces with US television channel CMT to open CMT Loot, a speciality store selling CDs, DVDs and memorabilia, with a focus on country music and Nashville-related themes.
In addition, Hudson has opened a flurry of themed and speciality stores at the airport, including Sunglass Hut and an ‘In Celebration of Golf/Life is Good’ combination store. “As we do elsewhere, we looked at the programme with an eye towards providing variety to the customer,” says DiDomizio. “Starting with core convenience newsstands and including exciting national and regional brands that customers want and need.”
It is a model that Hudson can see working elsewhere, adds DiDomizio. “We have evolved this concept in the US and Canada and would now like to shift that focus to other countries. This is our model and we intend on growing it in other countries.”
The group is looking to acquire large companies and strengthen its management. “That is where our company stands out,” says DiDomizio. “If we can leverage our management, like we did when we took over WHSmith, then we will be successful in achieving our growth goals.”
Back in the US, the Hudson Group is aware that it has some challenges to overcome in the current industry climate. Foremost on DiDomizio’s mind is airline consolidation. “Fewer flights result in fewer choices for travellers and less traffic passing through our stores,” says DiDomizio.
Predictably, tight security regulations in the US are also a problem for retailers in the region. For Hudson Group at least, it is not so much duty-free confiscations that are causing the biggest problems, but the tightening of security checks on its employees.
“In some airports the process is taking six to eight weeks just to get our new employees [the necessary] credentials,” DiDomizio laments. “The situation makes it more difficult than ever to hire great help. We have tried to counter this by offering prospective employees top salaries, benefits, training and employee recognition in order to keep them on the job.”
But the issues are not dampening Hudson’s spirit and the group is strictly focused on an agenda of expansion and growth. “We are very excited for this company as a whole and the future opportunities that are now open to us,” says DiDomizio. “With the backing of our new majority owners and their existing international presence, we see a whole new set of possibilities and are looking forward to pursuing them.”
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