It was recently announced that the CEO of the Changi Airport Group – Lee Seow Hiang – has been awarded the prestigious CNBC Travel Business Leader Award for 2015. Changi Airport in Singapore has long been hailed as the world leader of the layover experience. I’ve written before about the importance of customer-centric approaches in the airline industry, particularly for the successful rebranding efforts of ‘no-frills’ budget airline carriers. And now it seems that airports, too, must utilise the chance to go far beyond the pragmatic and embrace their increasing scope in the retail market.
Changi is a supreme example of the comforts a well-curated airport is capable of providing, boasting a rooftop pool, butterfly garden, cinema and dedicated sleeping lounges. The airport’s success has also recently led the Changi Airport Group to pursue a SIN$1.12bn runway expansion contract, as part of a wider proposal including a new terminal and significant retail development. And Changi is not the only airport to have embarked on expansion recently, the last few years have seen a host of major revamps in locations as diverse as Dubai, Seoul, Helsinki and Bangkok. The fast pace of airport development is a natural consequence of globalisation and increased access to international travel, but it really seems to be abuzz with potential at the moment!
One fascinating recent development is an innovative new app pioneered by three former Continental Airlines executives. Known as ‘Grab’, the app helps travellers to navigate an unfamiliar airport during a layover, tapping into the ‘golden hour’ market in a hugely exciting way. Currently only running at Hartsfield-Jackson Atlanta Airport in the US, I for one am eagerly anticipating the impact technology like this could have globally.
The last few years have seen plenty of press exhorting the airport space as the new prime estate for the retail sector; Luxottica refers to airport sales as ‘the Formula 1 of retail’! And it’s certainly a burgeoning market – airport sales have been expected to grow 73% between 2013 and 2019, and are well on track. One interesting article this year suggested that not only is the golden hour between clearing security and boarding a flight, and the promise of duty free discounts, the source of the luxury sector’s success in airport terminals, but also that the democracy of airport shopping lures those who might normally be intimidated by trendy designer stores. Between check-in and the tarmac lies a space in which everyone feels entitled to be, all are idly seeking entertainment and many are prepared to spend.
It is no wonder, then, that Heathrow and Gatwick have contested so hotly for government backing to expand. The latest reports suggest Heathrow is anticipating the go-ahead this December and has begun preparing architects, designers and suppliers. Additionally, Heathrow – which has been named ‘Best Airport for Shopping’ in the Skytrax World Airport Awards for six years running – has recently announced a partnership with luxury lifestyle company Quintessentially to produce an extensive review of its retail offering. Taking such care to preserve a legacy that intimately pairs the transit experience with an impeccable, and more often than not premium, shopping experience is yet another indicator of the power of retail in the terminal space.
My own experience of international travel has been a testament to the changing landscape, and I must admit I dread my transit time a lot less than I used to. I predict airport retail will only get more lucrative – and no one will want to be left behind! Let me know your thoughts at email@example.com, and have a fantastic weekend.