Travel retail, particularly in airports, is currently a bright spot in the retail world. The latest report from research firm GlobalData reveals that spending in airports hit $38 billion globally in 2016 and is set to grow by 27% to $49 billion by 2021.
“Apart from the growing number of air travelers, increased security over recent years delivers a constantly changing captive audience for airside retailers, which claim 83% of all spending in airports,” says Maureen Hinton, group research director at Global Data Retail. “This audience has time to kill and, especially when on holiday, is in the mood to spend.”
This has given rise to the rapid development of retail space at airports as grateful retailers, who are seeing customers forsake high-street shops for online and leisure experiences, welcome the opportunity to get in front of willing customers again.
Spending in airports hit $38 billion globally in 2016 and is set to grow by 27% to $49 billion by 2021
“Airports appreciate the extra revenue and are willing to invest in creating a more inviting space for travelers. For example, in Singapore’s Changi airport you can catch a movie, browse new art, play games, pamper yourself in a spa, and entertain your kids—the airport equivalent of a modern shopping center,” Hinton adds.
Asia-Pacific airports generated the most spending in 2016, taking $14.8 billion through their tills. Chinese travelers were a particular boon to this market as they seized the opportunity to buy duty-free luxury goods.
Europe ranks second on spending, hitting $10.7 billion in 2016. Indeed, one benefit of the U.K.’s Brexit decision was the subsequent increase in tourists to the country, who were attracted by the low value of the pound.
Even the U.S., which according to GlobalData has traditionally offered a poor shopping experience at airports, is developing new retail spaces and offerings.