Today, virtually everyone is banking on the market’s continued growth and success, with major regions all over the globe upping investment. Yet earlier, the aviation market segment “was facing a turmoil due to increasing fuel prices and economic recession, [and] the sudden compulsion for alternate revenue streams became a necessity for airlines and airports to sustain their presence in the industry,” describe analysts at MicroMarketMonitor in Pune, India.
One smart investment that many airports made – and even more continue to make – is in hardware and software systems that help optimize flight and passenger throughput. Many turned to aerospace industry leaders for their advanced, integrated airport operations management solutions to better increase capacity and decrease delays.
At the same time, investments were (and are being) made in the area of passenger comfort – with the addition of modern electronics to add amenities like high-speed wi-fi, personal electronic device (PED) charging stations, airport apps with timely information updates, improved baggage handling, efficient lighting and communications, enhanced security, and more.
What has really boosted the bottom line for airports, with the added benefits of enticing airlines and satisfying the traveling public and locals alike, is retailing.
“The concept of airport retailing has helped the aviation industry to cope with its sluggish growth, by offering various opportunities to substantiate revenue sources. Nowadays, airports are investing heavily in optimizing revenue per visitor, by providing an enhanced retailing experience with various facilities, such as parking, boarding, lodging, catering, and advertising,” MicroMarketMonitor analysts explain, while offering the following data.
The North America airport retailing market has been increasing due to rise in international air traffic to/from the U.S., which totaled to more than 80 million passengers in 2015 -- a 5 percent increase year over year. Canada also witnessed air traffic of more than 27.5 million passengers, a 7 percent year-on-year increase.
In North America, the proportion of duty-free airport retailing market is estimated to account for more than 25% of the global duty-free airport retailing market in 2015. This market in North America grew by 16.3% in 2014, as compared to 2013. The U.S. was the top performer in this market, due to increase in the number of flights that further results in rise in footfall at airports.
The North American airport retailing market is expected to grow from $4.15 billion in 2015 to $9.9 billion by 2020, at a CAGR of 19 percent from 2015 to 2020.
The above figures are offered in a new Market Research Report: "North America Airport Retailing Market By Category (Liquor & Tobacco, Perfumes & Cosmetics, Fashion, Food & Confectionery), By Type (Direct Retailer, Department Store, Specialty Retailer, Supermarkets), By Airport Size, By Geography - Forecast to 2020."
Airports in North America are also focusing on various promotional activities such as events, digital advertising, campaigns, and press activities, to boost duty-free retail shopping and enhance product visibility. Recently, numerous airports and duty-free operators have developed their own mobile apps to provide passengers a convenient shopping experience. These applications facilitate passengers to buy and choose from the available product portfolio, acquire updates on exclusive offers, and gain information about the availability of nearby shops & restaurants.
I don't travel much these days, but when I do, I am always grateful for a safe, smooth, secure, and efficient experience and appreciative of the people and the high-tech solutions that make it so. If retailing enables airport authorities to increase investment in hardware, software, systems, and personnel that improve the end-to-end process, I say "have at it." I am happy to do my part -- you can find me shopping in between flights from now on.
Rockwell Collins' vision of airports of the future, replete with advanced electronics and software systems.
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