Trends in airport retailDecember 5, 2017
Marnix (Max) Groot
Manager Business DevelopmentIATA Consulting
Key projects:• Beijing Capital Airport• Seoul Incheon Airport• Shenzhen Bao’an Airport• Tokyo Narita Airport
Johan Schölvinck
ConsultantNon-Aviation BusinessIATA Consulting
Key projects:• Istanbul New Airport• Amsterdam Airport Schiphol• Moscow Domodedovo Airport• Taiwan Taoyuan Airport
Trends in Airport RetailDecember 5, 2017 Consumer
trends
Global spend per head evolution
CAGR 2005-16 2005-10 2010-16
Pax +5.2% +4.1% +6.1%
Sales +8.5% +10.6% +6.8%
SPH +3.1% +6.2% +0.6%
Source: Dufry, ACI, Generation Research
DUTY-FREE
Shifting behavior
In China
LUXURY BRANDS
remain in top demand
AFFORDABLE PRODUCTS are essential
POP-UP stores
CHINESE travelersShare of total retail e-commerce sales, worldwide
Source: Forrester Research
Retail operator trends
Operator-driven trendsEntertainment
Celebrities
Seductive layouts
Memorable experiences
Airport retail…
sunset?
• Non-aviation revenues are falling
• Security checks are increasing
• Duplication of shops
• Frequent travelers spend less
Airport retail…
sunrise?
• Over 3bn people in the middle class
• 140m/year increase of middle class
• 90% of this growth is in Asia
US $60B IN GROSS SALES
- Integration
- Joint ventures
- Abundant threats
RISK REDUCTION
ECONOMIES OF SCALE
DUTY-FREE
Trends in airport F&B
Operator-driven trendsCelebrity chefs
Pop-up restaurants
Knowing customer behavior
Food trucks
Operator-driven trends
Draw attention away from price Duty-free retailers moving into F&B
Consumer-driven trendsControl
Affordability
Low-cost airlines: More F&B
Experiences and trueness
Logistics trends
Tablet ordering
App ordering
Supply management
Waste management
Layout trends
More F&B
space
Vending
machines
Mixed with
retail
Food carts
Innovative passenger
services
Premium services
Fast-Track
Premium
lounges
Personal
shopper
Exclusive
parking
Service innovations
100% Digital
advertising
Valet
parking
Limousine
service
Trolleys with
wayfinding
Copenhagenisthefirst100%digitaladver singairport
Airline-Airport cooperation
B.A.R.T.A. Five players, new revenue, PAX data
The future
of airport
retail?
Brand worlds
Tech giants
Electronics
Sports
Charity
The Future
of Airport
Retail?
DO’s
and
DON’Ts
The AMS example
Retail mixed
with F&B
Genuine
market squares
Icon
features
Sense of
place
The bottom line
21% of revenues
create 47% of
operating result (2016)
The wrong exampleLondon
Luton
Chengdu,
China
München,
Germany
Pyongyang,
North Korea
Do’s and Don’ts
RETAIL
• Address the digital
consumer
• Combine luxury brands
with affordable products
• Increase your commercial
space
• Develop the right
partnership/contract
• Be a very active manager
• When you can measure it,
you can improve it
• Develop an airport
shopping brand
FOOD & BEVERAGE
• Make it the new rock star:
it is a magnet
• Mix grab and go, food
courts and full-service
restaurants
• Don’t put it on a
mezzanine
• Try food trucks and other
experiences
• Develop combined
Retail/F&B concepts
PASSENGER SERVICES
• Map the customer journey
• Serve every passenger
segment
• Exaggerate your sense of
place
• There’s a market for every
premium service
• Learn from the world’s
best
• Airports are in the
hospitality business