Airports are certainly not solely geared toward handling passengers and baggage. The non-aviation business-including shopping, dining, parking, and advertising-is consistently expanding as a vital supply of revenues.
Non-aviation business describes everything at ShoppingAirports not directly associated with air travel, like retail trade, catering, parking, and advertising. Airports have recognized the ability to boost both revenues and profits through the help of the non-aviation sector and, as a result, have significantly expanded areas focused on retailers and restaurants. Even airports not initially designed or constructed with retail areas in your mind have since were able to create a retail presence. For instance, Frankfurt Airport now has 570 square meters of non-aviation area per 1 million passengers, while London Heathrow has 1,050 square meters per 1 million passengers. Both airports intend to expand a lot more
European airports are expanding non-aviation space
The expansion into non-aviation is associated with more diverse retail concepts, specifically in fashion, well-ness, and beauty. In the fashion sector, premium and luxury formats have already been supplemented through the mainstream segment-illustrated from the Accessorize store in Munich and Zara in Barcelona. Wellness and beauty outlets are normally found at numerous airports and work particularly well at individuals with a lot of transfer passengers. The Be Relax wellness brand, to mention one, is represented at nine airports in Europe. Beauty items are now purchased in mono-brand shops in addition to duty-free stores.
The chances to establish a presence within these financial markets are definitely attractive for retailers, brand manufacturers, and caterers. Before jumping in, you should know which business models work best in which situations. Airport retailing is not like high-street retailing. Not merely has the amount of non-aviation areas risen-airports’ expectations regarding the professionalism and individuality of shops can also be growing. This applies to both retail trade and catering outlets. These outlines some main expectations for airport retailers and restaurateurs:
Provide clear and efficient routing. Until recently, by far the most commonly used form of routing for duty-free walk through shops was meandering, allowing passengers simply to walk through as wide a variety of merchandise as is possible. Now, however, shop layouts provide clear and functionally efficient routing that ensures optimal orientation with less time delay. This creates a more relaxed environment for stressed passengers, using the added benefit of increasing their willingness to get products. An example is definitely the shop layout planned by Gebr. Heinemann for Berlin Brandenburg Airport.
Airports are frequently criticized for their interchangeable retail formats, so they will always be looking for high quality brands to add to their retail mix-brands which can be either not even represented at other airports or that underpin the airport’s unique profile. To get unique concepts, some airports are willing to take certain risks; for instance, Singapore’s Changi Airport developed a young fashion and accessories concept along with students from Singapore Polytechnic. When airports plan new developments and extensions, they explicitly earmark about 20 percent of the retail mix for regional best performers. This implies you will find great opportunities for retailers that are not yet within an airport.
Airport locations are doubly valuable for brand manufacturers since they promise profits and offer a prominent location that supports the brand. Successful models might include independently operated shops and concessions allocated to retailers, which often could be the traditional duty-free companies. Luxury brands, like Armani, choose different operator models phitjq different locations.
However, merely using a strong brand and an effective business in high-street retailing does not guarantee success. The travel retail segment features its own business models and challenges and needs a certain type of management. Consider, as an example, the issue in developing retail techniques to attract the a large number of different passengers streaming through airports every single day. While customer flow is predictable (aligned with flight schedules), managing this type of large and diverse customer segment depends on matching specific concepts and merchandise offers with the terminal, destinations, and quantity of low-cost airlines. Additionally, while floor plans tend to be more compact and you can easily get an introduction to the competitive environment, distribution and logistics are definitely more complicated and costlier.