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How Travel Retail Can Crack Duty Free

March 28, 2022
Author: Jasmine Waters

Airport travel is officially back up and running. While it’s been out for the count, a lot has changed in the way travellers are interacting with their inevitable waiting time. The days of a captive audience whiling away time in luxury duty free are long gone, and now the travel retail experience must adapt to fit the new prevalent traveller. What’s been happening in our terminals, and how can fashion retail adjust to changing travel?

What has changed?

While nomadic crowds are back on the rise, the type of traveller most likely to grace a terminal building is far from the same. The old-fashioned duty-free shops of fragrance and luxury fashion are still there but are now needing to compete with new websites and apps. Lifestyle is looking to take over waiting space, with airports choosing to offer things to do rather than things to buy. This largely reflects a distinct change in exactly who is travelling. In general terms, passengers through London Heathrow alone have decreased by 76% since before the pandemic, with total retail spend taking a €14 billion loss.

Does traditional duty free still work?

The two passenger demographics most likely to spend—long-haul flyers from Asia and business workers—are almost nowhere to be seen. An airport is much more likely to be taken up by younger travellers looking for quick, cheap getaways. If the average long-haul passenger from Asia spends $100 on duty free fashion, a mid-haul European traveller will spend $1. It’s this shift in financial dynamics that fashion labels now need to become accustomed to.

So, how can brands win back their travel sales? It’s inevitable that as more passengers return, sales will increase—and travel retail has the capacity to be able to adapt extremely quickly. Airports can no longer resist the changes made in the outside world, as they can no longer rely on the advantage of having a captive audience. Like many other retail outlets, travel retail now looks to provide a bigger experience. Its level of instant fulfilment is a tool many other stores would envy, but it now needs to be paired to the new ways of consumer engagement. While some airports are reconsidering what they sell entirely, others are looking to experiment with exhibition and concept space. Whatever the final strategy, brands operating inside the retail vacuum must fully embrace 2022 culture to survive.

Image source: https://www.pexels.com/@naimbic

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