Airports as

Customer Experience Makers

Airport retail: a success story that only says half of the story

In appearance, airport retail was a success story until now:

  • It was fueled by the growth of traffic
  • Sales per square foot/meter were much higher than high street retail (over $15,000/sqm/year globally, which would place airport retail in the top 5 of London retail with Harrods or Selfridges), resulting in higher operating margins for retail operators and a subsequent capacity to pay high rents.

In 2016, Credence Research, a research company, reflected the enthusiastic mood that prevailed in the industry when it predicted that travel retail sales would triple by 2022 (they didn’t, and most certainly won't).

Airport have therefore focused their efforts in growing retail areas (to expand choice) and capturing the highest possible share of retail revenues through profit-sharing with retail operators. However, this strategy hasn’t been as successful as it could have been, notably in terms of spending per passenger that stagnated in the last years:

Graph 6 • Indexed spending per passenger in airports (2002: 100) • Years of growth followed by a drop in spending per passenger (-3.1% CAGR from 2013 to 2017) • Source: Boston Consulting Group – Why travel retail needs an upgrade

It looks like 3 trends and factors were overlooked:

  • Travellers are not a captive audience anymore: they can use their smartphones and connected devices to get some work done, watch a movie, or catch up with friends. Retail operators must now fight for travelers’ attention and build preference
  • E-commerce out-performs airport retail in terms of choice, convenience, and good deals. Airport retail has established itself as a good shopping destination for some specific categories (like perfumes & cosmetics or alcoholic beverages, notably in duty free), but suffers heavily from the e-commerce competition on all the rest
  • Size can become a problem: in average, there are about 600 to 800m2 of retail per million passengers. However, a 1,200m2/MPax delivers an optimal commercial performance. This is more feasible in small airports than in big ones, as it would require expansive shopping areas, resulting into longer walks, more stress and confusion for travellers, which negatively affects spending.

Covid reinforces competition from e-commerce and disrupts the entire business model of airport retail. Less traffic combined with travellers’ reluctance to interact with their physical environment will result in a drop in sales, and in some stores closures, which in turn will limit choice and push sales further down…

There is no miracle solution in the short term, apart from the same sanitary precautions implemented in all retail stores. However, airports can influence spending in the long term by re-focusing their efforts on how to create value for their customers and better integrate the retail component of the airport customer experience with the “transportation” component.

Such value creation strategy for customers would consider interactions with retail/advertising as services that fulfil customers’ needs & desires and enriches their experience. It should include:

  • A clear promise to customers based on a qualitative and quantitative analysis of their needs, motivations and decision-making
  • An in-depth analysis of pain points to focus efforts on initiatives that will help travellers manage their time and move freely in space, so they can enjoy their dwell time
  • A sourcing strategy to expand the pool of partners and the modality of their presence in the airport (beyond the multi-year retail lease or the advertising campaign), in order to reduce dependence on some sectors cycles and increase resilience
  • Customer engagement initiatives, possibly partnering with airlines (or OTAs like Expedia) to understand each customer context and be able to push the option to buy from the airport the time of decision (rather than relying on impulse purchase in over 70% of the cases), and expand shopping modes (notably “contactless” modes like pre-ordering, self/mobile check out, or delivery at gate)
  • An evolution of the spatial organisation of the airport that takes into account new social norms of distanciation and new shopping habits, but also distributes retail options and services in formats and locations that maximises customers’ capacity to make the most of their time in the airport in their own terms (including digitally, before and after the airport).

Integration with transportation experience to maximise efficiency

Customer experience in airports is essentially linear: travellers are herded through the building to accomplish a succession of tasks, from check-in to security and all the way to boarding. And many airports have incorporated retail as one of the steps of this sequential process.

As The Atlantic’s correspondent James Fallows describes it: “Lines to check in. Lines for the TSA checkpoints. Lines at the departure gate. Lines at restaurants and coffee shops to get the food and drink that the airlines no longer provide.”

This linear approach is imposed by the logical succession of tasks (it would be rather inefficient to check luggage after security!), which in turn creates an urge for about 50% of travellers to clear all steps and get to the gate as quickly as possible, without backtracking.

Knowing this, many airports follow the IKEA school of thought and try to maximise passengers’ exposure to the retail offering. It does work brilliantly for duty free shopping (with a typical 50 to 60% sales increase versus traditional setting), but has inherent limitations:

  • Forcing all customers through the entire retail offering is not physically feasible in larger airports: it is usually reserved for duty-free; speciality retail is concentrated in “side boxes” further down the customer path
  • It can saturate customers’ attention and desire to shop. It’s a one-shot gun, an adrenaline peak followed by what can feel like a long, boring desert. The few retail opportunities that are left (except food & beverages) look underwhelming in comparison
  • It can induce additional stress in some circumstances.

How to expand this concept of immersive commerce to the full range of retail and services without being intrusive or numbing travellers’ attention?

One answer is to de-linearise the airport experience. As a matter of fact, the two only compulsory steps for all travellers are security checks (including passport control) and boarding.

In this paradigm, the airport is divided into two areas for departures: land-side and airside. The goal is to design these two spaces as spaces of services and opportunities that are easy to navigate and that empower travellers to create their own path.

Operations in an environment constrained by the highest safety requirements

Many guidelines have been issued by regulatory agencies and industry bodies.

They all call for a systematic approach along the chain of the physical customer experience. This creates a new role for the airport: ensure that all guidelines are enforced for the best sanitary benefit at the lowest cost.

The sanitary integration of the customer experience is a critical part of the overall integration of the customer experience: it presents the same challenges of coordination, optimisation, and mutualisation of resources. The airport needs to build legitimacy through expertise, but also through a consolidated understanding of passengers behaviour, acquired through research and real time data collection.

This will lead to the emergence of new processes (and the supporting physical elements) to ensure compliance with these guidelines and, in broader terms, increase resilience of operations, to sanitary risks and more. This should be based on a broader assessment of risks and could include work on:

  • Space allocation between activities (security, check-in, retail, waiting…) in order to be able to guarantee social distancing up to a certain level of activity
  • Changes in the physical configuration of the experience to reflect new customers preoccupation: could there be a “health track” like there is a “fast track”, reserved to more fragile customers? How should the toilets be designed?
  • Changes to furniture to offer a sense of safety while optimising footprint
  • Remote management of the entire building
  • Capacity to isolate sections of the building to operate independently (to disinfect those not used for instance while keeping a minimum level of operations)
  • And more.


In order to boost spending per passenger regardless of traffic growth, airports can morph into service platforms, centred around passengers. Beyond core processes (security…), travellers should be able to compose their time in the airport in the way they prefer. The airport’s role is to minimise pain points and create multiple opportunities in line with their mission and target audience by:
  • Engaging customers in a dialogue, ahead of physical presence in the airport, to influence spending behaviour (which requests collecting and analysing data, including from airlines or OTA partners, to understand the context of each customer)
  • Expand choice: more brands, with different modes of interactions
  • Give flexibility and re-assurance, from price guarantee to health safety, through pre-ordering, delivery at gate, price matching…
This will require a shift in mindset, from maximising the value of each individual business partner contract to maximising the value generated for travellers by an integrated customer experience, and capturing a fraction of it together.

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