As the world recovers from the ramifications of COVID-19 and the recession caused thereof, consumers have been bitten by the travel bug to go all out and make the most of their newfound freedom to jet set and shop like there’s no tomorrow.
The global airport retail market which was valued at US $ 20.1 billion in 2021, owing to lockdowns and travel restrictions, is expected to more than double to US $ 41.6 billion by 2027, as has been revealed by data shared from Research and Market.
The growth of the airport retail market is largely driven by rise in air traffic, expansion of airport infrastructure, and high customer demands for luxurious products. Apart from assisting in providing convenience to people travelling by delivering a variety of merchandise, airport travel retailing also aids in generating brand awareness and hence, airport retailing is finding extensive application in airports across the globe.
With countries dropping their entry restrictions and rules, a boost in airport retail and tax free shopping is eminent! Furthermore, the inclination of people towards unique and exotic holiday experiences, spike in disposable incomes and related expenditure, and rise in the need and interest of people to spend more money on shopping, coupled with changes in lifestyle, rise in tourism promotion, increase in accessibility of transport facilities are contributing towards the growth of the airport retailing market.
We highlight the key trends shaping the space and how to attract consumers to boost business. Read on to discover!
Airport Retail Market Trends
The current boom in the travel and tourism industry can best be attributed to the rise in post-pandemic leisure travel. This, coupled with a significant increase in the time spent by customers at airports owing to early reporting and check-in times for security and operational concerns, has positively influenced the demand for airport retailing worldwide.
Since retail stores at airports are duty-free and hence exempted from payment of local or national taxes, travellers are motivated to purchase available products at a relatively cheaper price resulting in higher levels of sales.
In addition to this, brands are customising their product offering at airports to better cater to a wide range of customers from various regions and tastes, while also improving the overall shopping experience of travellers. All of these factors combined are fuelling a favourable market outlook.
Asia-Pacific millionaires now control more wealth than their peers in North America. In terms of future spending options, travel has been recognised as the top priority with greater focus on unique luxury experiences and adventure activities. These factors increase the number of travellers, which directly impacts the sales at airport retail shops, thereby augmenting the growth of the airport retailing market – Allied Market Research ‘Airport Retailing Market’ report
To achieve the same, brands are investing in extensive research activities to collect data related to location, flight schedules, and the number of passengers travelling on the flight. These activities assist brands in keeping check of warehouses, adopting price skimming strategies, and conducting promotional activities to meet the preferences of the customer base.
Additionally, the rising trend of bringing back souvenirs while travelling is positively impacting the market.
A report by Allied Market Research confirms that leading vendors in the airport retailing market are continuing to focus their efforts on providing passengers with a first-rate shopping experience.
Market leaders are channelling their efforts on acquiring critical travel data from various airports in order to assess passenger attitudes and behaviour and identify high-spending consumer groups arriving at various airports and curate their offering accordingly.
Integrating omnichannel shopping experiences
The growing focus on heightening consumer convenience and their shopping experience is encouraging airport retail vendors to provide goods delivery services.
For example, airport retailers at Frankfurt Airport provide home delivery services to passengers who purchase goods through the airport’s online shopping platform.
By incorporating similar online purchasing options, airport retail brands are able to provide greater convenience to customers by offering multiple product delivery options.
Due to the increasing growth of the e-commerce industry, market players continue to face challenges in increasing consumer footfall in airports at uncertain and less-discovered tourist destinations.
Keeping this in mind, brands are focusing on spotting unique end-user requirements in order to increase sales at less common airports.
Article source: Allied Market Research ‘Airport Retailing Market’ report; Research and Markets Airport Retailing Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2022-2027