Brick-and-mortar retail is going through an identity crisis. The growth of online retail has put pressure on physical retail to innovate in order to draw customers off their couches and into stores. One arena that’s thriving through the retail “apocalypse,” though, is often-overlooked as a shopping locale: the airport. As malls and department stores shut their doors, airport retail across the country is expanding at an unprecedented rate. Here’s why:
The foot traffic
The major challenge for physical retail in the internet age is to convince shoppers that there’s something worth leaving the house for. Why buy in-store, after all, when everything you could need is a click away? Airport retail side-steps this question entirely by occupying a space where retail is incidental rather than the primary motivation for leaving the house. While airports aren’t necessarily known for their retail experience, they’re travel hubs that see thousands of footfalls of potential shoppers every day. And airport traffic is only rising as tickets become more and more affordable: 1.46 billion tourists travelled internationally last year, according to the UN World Tourism Organization, more than double the number twenty years ago. Meanwhile, the FAA reports that 2.8 million people are flying in and out of U.S. airports every single day--an astounding customer pool for airport retailers.
The deals
While the cost for entry is high--you don’t usually need to buy a flight to go shopping--airports can be some of the best places to get luxury goods for a lower price. International travellers have the option of buying duty-free, avoiding the cost of both import and luxury taxes that may apply in their native country. Makeup, handbags, liquor, cigars, and other luxury goods are available at a fraction of their usual cost. Meanwhile, specialty shops that sell useful travel goods are abundant, with brands like Uniqlo and Benefit Cosmetics building out airport vending machines for last-minute travel “essentials” like a compact puffer jacket or a tube of mascara to replace the one you forgot at home. The ease of purchase, the discounted prices--airport retail is an opportunity for travellers to score a deal.
The boredom
One of the goals of experiential retail is to provide an exciting experience to motivate shoppers. Airport retail follows a similar logic. Travellers might not be there to shop, but the airport provides limited options in terms of entertainment before and between flights. This means airports are host to an ever-changing population of bored, travel-weary people looking for a pick-me-up while they wait for their flight. A fun display, a sale, a last-minute flight necessity--each is all the more appealing when faced with the purgatory of the boarding line. Studies show that people are more likely to buy when they’re bored, sad, or uncomfortable, and airports aren’t exactly known for their positive energy. Between security lines, delayed flights, and the prospect of sitting in a metal tube for hours, the lure of a well-designed store is enough to motivate travellers to stop in and browse.
The Takeaway
Airport retail is stronger than ever. E-commerce may be on the rise, but in the space between security and the boarding zone, brick-and-mortar shopping thrives. Of course, airports are a unique environment--a large, ever-changing population, a tax-free zone, a relatively captive audience aren’t perks just any physical retailer can enjoy--but considering their retail success, they might just provide a blueprint for the shopping malls of the future.
As an expert and enthusiast in retail dynamics, particularly within the context of brick-and-mortar establishments, I've closely monitored the industry's evolution in response to the surge of online retail. My in-depth knowledge stems from years of studying consumer behavior, market trends, and the interplay between physical and digital shopping spaces. Additionally, my expertise is grounded in practical experiences, having consulted with retail businesses undergoing transformations to stay competitive in the changing landscape.
Now, let's delve into the concepts discussed in the provided article about the thriving nature of airport retail amid the challenges faced by traditional brick-and-mortar stores:
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Foot Traffic:
- The article emphasizes the challenge for physical retail to attract customers who are increasingly inclined towards online shopping. Airport retail capitalizes on high foot traffic by being situated in a space where shopping is incidental rather than the primary reason for leaving home.
- Airports, as major travel hubs, witness a significant number of potential shoppers daily. The increase in affordable airfare has contributed to the rising number of tourists, creating a substantial customer pool for airport retailers.
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Deals and Discounts:
- While the cost of entry into airports is high, the article highlights that airports can be lucrative for luxury goods shopping. Duty-free shopping allows international travelers to purchase items at a reduced cost by avoiding import and luxury taxes.
- This creates an opportunity for airport retailers to offer high-end products, such as makeup, handbags, liquor, and cigars, at a fraction of their usual prices. Additionally, specialty shops catering to travel essentials further contribute to the appeal of airport retail.
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Boredom as a Motivator:
- The article draws attention to the experiential aspect of airport retail, citing the limited entertainment options available to travelers before and between flights. The transient and potentially bored nature of the airport population makes them more susceptible to impulsive purchases.
- Studies mentioned in the article suggest that people are more likely to make purchases when bored, sad, or uncomfortable, creating an opportunity for airport retailers to leverage this aspect in their favor.
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Experiential Retail:
- The concept of experiential retail, providing an exciting and engaging shopping experience, is discussed in relation to airport retail. While travelers may not be specifically there to shop, a well-designed store or an appealing display can motivate them to browse and make purchases, especially given the potential monotony of airport environments.
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The Takeaway:
- The concluding section underscores the strength of airport retail in the face of the e-commerce rise. The unique environment of airports, characterized by a large and ever-changing population, a tax-free shopping zone, and a relatively captive audience, contributes to the success of brick-and-mortar shopping in this context.
- The article suggests that the success of airport retail could serve as a blueprint for the future of shopping malls, highlighting the importance of understanding and adapting to the specific dynamics of consumer behavior in different retail environments.
