With the August holiday season upon us, the time feels right to talk about Travel Retail Design. I’ve been involved in travel retail design for over twenty years now working in airports across the globe – from Europe to the Middle East, Australia and New Zealand. I don’t know whether it’s the excitement of air travel itself that attracts me to the travel retail and duty free sector or the continuous need to innovate. Whatever it is, I just love it!
Much to the amusement of my colleagues here at Innovare, I still treasure my very first POPAI award (from back in 2003) for Famous Grouse Whiskey. And then there was that adorable Milka Cow…surely you’ve come across her – complete with cowbell…simply irresistible to small children!
Of course, airport retail has moved on significantly since those days. Airports and travel retailers have learnt that presenting ubiquitous brands and boutiques in the same formats all over the world just doesn’t work commercially any more. You only have to look at The Moodie Davitt’s newly published The World’s Top 25 Travel Retailers to see the shape of the sector today.
Airports have become destinations in their own right, competing with each other in the same way that today’s premium department stores and shopping malls do. They now aim to attract the best luxury brands, high-end food and beverage offers, as well as seasonal pop-ups and events that combine to deliver a fresh, unique and memorable retail experience for air passengers. And what’s more, a recent report by M1nd-set reveals that when airport architecture, environments and merchandise are infused with a Sense of Place, they generate a much stronger positive emotional connection with their passengers – the perfect frame of mind for shopping!
Air travel is still a high-ticket item and a special occasion for many passengers. And whilst air passengers provide retailers with a captive audience, there is a need to wow and woo this audience more than ever before. Why should they shop in airports when the duty free advantage of preferential pricing continues to be eroded and they can easily price check and buy items on-line.
The secret lies in customer-focussed experiences – knowing your customers and giving them what they want…and more. Rachel Bulford, Gatwick’s Head of Retail since October 2016 clearly understands the importance of this for her diverse footfall. Customer satisfaction has reached an all-time high due to Gatwick’s carefully curated mix of retail and catering brands. But importantly Rachel Bulford understands the need to “keep evolving our business according to consumer trends”.
London Heathrow Airport has proved how their retail redevelopment of both T4 and T5 is paying off. They recently posted half-year results for 2017, which shows a retail revenue increase of +11.8%. This was due to a number of factors – including an increase in passenger traffic – but significantly airside shops saw +23% rise in revenue while F&B also had strong growth of +18.2%.
All over the world airports, retailers and their brands are finding new and innovative ways to persuade air passengers to shop. And among their many challenges is the need to harness the opportunities of omni-channel retail. This recent interview in Airport Business magazine shows how Heathrow’s retail boss is taking a fresh look at their digitial services.
Market research analysts Technavio predict that the global duty-free retailing market will continue to grow +8% up to 2021. So that is good news for all of us involved in this sector, provided we continue to listen to what consumers want and invest in innovation.