New Aims For Luxury In Airport Retail Inspire Green Re-Think on PaxEx - World Aviation Festival Blog
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New Aims For Luxury In Airport Retail Inspire Green Re-Think on PaxEx

retail airport shopping

New Aims For Luxury In Airport Retail Inspire Green Re-Think on PaxEx

The latest report from airport retail analysts at m1nd-set is an eye-opener in terms of what it suggests about retail preferences of today’s travellers and because airports and airlines alike can take note of these mega-trends in designing the onboard/terminal product and the passenger experience.

 

Luxury Returns

First, let’s dig into luxury. The luxury traveller is by far outshining non-luxury travellers in terms of footfall at retailers (54% vs 38%), purchase rate (41% vs 20%) and conversion (76% vs 52%).

Take note that investments in marketing, advertising campaigns, and merchandising at the terminal can pay off. “In the post-COVID period, luxury shoppers are more inclined to visit the duty-free shops following brands and retailers marketing activities than before; they are also significantly more likely than non-luxury shoppers to visit the duty-free shops as a result of branding campaigns seen before arriving at the airport,” the report’s authors state. “Differentiation and packaging, in particular, are more important to luxury shoppers than before.”

  • 25% of luxury shoppers said they place importance on purchasing something different compared to 18% on average in the years from 2017 to 2020 and compared to 21% of non-luxury shoppers.
  • 20% said they were more conscious about the product packaging in 2021 compared to only 11% on average in the years from 2017 to 2020 and compared to 17% of non-luxury shoppers.

80% of luxury shoppers said they would purchase a duty-free exclusive, up 28% on the 4-year average between 2017 and 2020 and 8% higher than among non-luxury shoppers.

 

Hire Staff with the Right Stuff

Perhaps unsurprisingly, luxury buyers are also influenced by the quality of the sales staff, m1nd-set finds.

  • 8 out of 10 say they were positively influenced by the sales staff, more than 30% higher than in 2020.
  • 14% of luxury shoppers said they bought an item that they would not have otherwise purchased thanks to the sales staff advice, compared to 8% in the four years between 2017 and 2020.
  • Before 2021, 18% of luxury shoppers said they were influenced to purchase something different than initially planned; in 2021, 30% of luxury shoppers said the staff advice had influenced them to purchase a different product.

Your online presence matters, and so does print

“Post-pandemic luxury shoppers are extremely likely to be influenced at some point by online branding, including the brands’ website, social media, ad campaigns, key opinion leaders’ posts, livestreams or other moments online while booking the trip or during the trip,” m1nd-set states. “More than nine out of ten luxury shoppers state this to be the case compared to 73% of non-luxury shoppers. They were more likely to see brand communications on duty-free offers at the airport itself. But, the influence of touchpoints at the airport has declined over the recent years, whereas the influence of touchpoints seen in the home country prior to travel has increased in influence, up from an average of 20% between 2017 and 2020 to 37% in 2021. Articles and advertising campaigns in the printed press such as magazines have also grown in impact to become a primary source of information amongst luxury shoppers in travel retail.”

 

Okay, then HOW?

Knowing the value of luxury travellers, airlines and airports should look more closely at their values, perceptions and needs to deliver consistently on that promise. Sustainability, eco-friendliness, and wellness should be highlighted and evident throughout the journey. It can extend beyond the duty-free and retail strategy to FAB offerings, recreational spaces, and the terminal or onboard product, as well as the passenger experience.

According to m1nd-set, the critical thing to keep in m1nd is that luxury travellers today have also been significantly impacted by the COVID pandemic. They look at the world differently. What they value most has shifted. They are now substantially more Eco-conscious and achieving a sustainable luxury lifestyle matters to them.

“They have abandoned their quest for extravagance, exuberance and exorbitance that once ruled the luxury landscape pre-pandemic. They’ve exchanged these worldly, superficial desires for greater accountability and responsibility, but still demand durability and exclusivity and do not wish to compromise on the aesthetics or quality of their luxury purchases,” m1nd-set finds. “The most forward-thinking luxury brands in retail and in travel retail will seize this opportunity to educate consumers about the unique history and sustainable attributes of their products or services. They will also focus more on pushing the pre-loved, secondhand luxury product range which is increasingly appealing to the new generation of consumers seeking both more sustainable luxury consumption as well as the unique story behind the acquisition.”

 

Be Aware and Be Consistent

Airlines and airports need to be consistent in their messaging and performance to ensure that all touchpoints reflect shared values.

  • Airlines and airports alike will gain from highlighting their sustainability initiatives.
  • Be sure to highlight the eco-friendly aspect of your product (like any vegan leathers used in aircraft seat dress covers and antimacassars, and airport terminal seating, for example).
  • Focus on creating memorable places, eliminating friction points from the journey
  • Don’t lose sight of the health and wellness trend.

“Luxury consumers seek more emotional and spiritual experiences, leading to a marked growth in the luxury health and wellness travel sector. Travel and tourism operators are seeing a significant growth in demand for services such as yoga, meditation, fitness programmes and spas.”

Time to heat up those spas again, Helsinki. Get the butterfly garden buzzing, Singapore. You get the idea. Lots of airports around the world have added unique features that focus on health and wellness. Now is an ideal time to remind people that they are there.

Airlines can likewise up-sell their premium cabins, not just focusing on the luxury features, but by highlighting any eco-friendly or well-being aspects of the onboard product.

Both airlines and airports should invest in de-stressing the journey. Cut out those friction points through automation, digitalization and app-enabled travel guides.

Airlines might consider retailing their up-cycled travel products. Bags made from old dress covers and former crew uniforms will appeal to the significant conscious consumer segment.

  • The growth in conscious consumption in the luxury fashion sector globally has grown nearly 3 ½ times faster than standard non-luxury products.

 

Tomorrow, and tomorrow, and tomorrow

The massive advantage for airlines and airports that focus on consistently meeting these consumer values is that they have a lasting generational impact.

  • Secondhand luxury growth is mainly driven by Millennials and Gen Z consumers who are increasingly focused on sustainability, affordability and uniqueness.
  • Gen Z consumers, who are significantly more concerned than other age groups with individuality and self-expression, particularly those from China, are increasingly interested in purchasing one-of-a-kind items to share the story behind the product. The product itself becomes an experience that they can share through the story-telling with their entourage.

As m1nd-set suggests, “The acceleration towards sustainable business practices among luxury brands in the wake of the pandemic, which has accentuated the consumer trend, will ensure the consumer segment remains relevant for future generations.”

 


WRITTEN BY MARISA GARCIA