Duty-free in Singapore's Changi airport, which was voted world's best airport in 2023 at the World ... [+]
With the post-pandemic travel boom ongoing, travel retail is set to surpass $117 billion in global sales by 2030, growing at nearly +10% annually from 2022. To meet rising traffic and enhance traveler experiences, airports are investing in their infrastructure, opening up a realm of opportunities for brands to expand their travel retail footprint. Increasingly, international airports are welcoming luxury brands as a way to elevate the overall airport experience and boost their appeal, contributing to a shift towards a more premium travel retail offering.
European Airports Bet High On Luxury Brands
Schipol Airport in Amsterdam - the fourth largest airport in Europe - is upgrading its Lounge 2, designing a new layout and rethinking the traveler experience altogether. At the heart of this enhancement is the dedication to luxury travel retail and premium food providers in order to elevate drastically the airport journey. This marks a transformation that can be witnessed across a range of international airports, which are benefiting from increased funding to rethink the airport offering and cater to travelers wishing to benefit from a pleasant airport experience before their flight.
“The renovation of Lounge 2 is part of a larger plan to make Schiphol attractive to passengers again: tastier and more sustainable food and beverages, great shops with an appealing range and an environment that emphasises Schiphol's standing as a home base for world travellers,” shared Arthur Reijnhart, executive director of Schiphol Commercial in a press release. “We're also improving our range of offerings in the luxury segment, with the first big step being the arrival of top brands Louis Vuitton and BVLGARI in Lounge 2. We'll be creating space for this renewed range in phases, and the opening of BVLGARI is a significant milestone.”
Schipol Airport is not the first to lead this increased focused on luxury travel retail: both Rome and Paris airports are gearing up their luxury retail offering following the examples set by airports in Dubai and Asia mainly. Indeed, as Isabelle Fourmentin, CEO of JCDecaux Airport Paris (a joint-venture between advertising JCDecaux and Paris Aéroport) explained for Luxury-Insights.com, luxury brands are the perfect fit for enhanced infrastructure and premium airport experiences. “The trend started in the main Asian hubs such as Shanghai or Singapore, along with the mega-airport at Dubai. European airports have since followed suit, with the major revamp of the Paris airports since 2005. Thanks to a gradual renewal of the infrastructure there, luxury brands now have more spacious stores, often with a highly desirable ceiling height – giving them plenty of room for inspiration.”
This has led Rome airport’s retail strategy to focus on luxury offerings, not just to elevate the airport experience, but also to go after a lucrative segment of the market. Gianluca Littarru, Rome airport’s general manager, shared in an article for Kering: “we particularly need luxury retail, which is one of the key drivers of growth in the retail business – combining a brand narrative and experience with the significant price advantages of the Duty-Free area.” He also added that “the spend per passenger for flights to China is five times that of other long-haul destinations”, explaining why many airports develop these high-end duty-free stores for passengers flying outside Europe.
Digitalization And Experiences Are Key To High-End Travel Retail
Thanks to a continuous improvement in infrastructure, luxury brands will have more of a playing field to engage with their audience in airports, both thanks to digital outlets and interactive shopping experiences. Brand activations are being reimagined to target affluent travelers and reinforce brands’ luxury credentials with beautiful displays and bespoke customer service, even outside retail stores. LVMH-owned brand Bulgari’s Rome airport footprint is a good example of this. The brand unveiled a new fragrance counter at the end of 2023. “In Bulgari’s new corners, travelers can indulge in a first-hand fragrance journey. To enhance the shopping experience, Bulgari’s highly trained advisors offer specialized services like custom gift-wrapping—a personal touch of Roman allure. Additionally, pop-up events, such as fragrance-flacon engraving and complimentary fashion illustrations, enrich the transportive ambiance of the spaces,” said the brand in a statement.
In addition to these type of visual and engaging brand interactions, highly digitalized marketing activations are helping deliver a premium feel to airport experiences. Luxury brand are investing in delivering innovative and desirable content displayed on screens, a tool that airports leverage heavily given the certain visibility generated by limited space and certain passenger traffic. Large screens help elevate the passenger experience, but digital experiences are expected to go further to meet expectations of luxury shoppers even within airports.
Last year, Hong Kong airport launched its digital luxury platform, allowing travellers to access a concierge service and make pre-flight purchases. Orders placed can be delivered to the gate or at the customer’s home thanks to free local and global delivery, a service that demonstrates how airports have the potential to become shopping destinations just like standalone luxury boutiques.
As Asian airports lead in luxury and digital experiences, other global airports are expected to follow suit, further expanding their luxury retail footprint and transforming airports into premium shopping destinations, giving brands a serious retail channel to dive into.
