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News Article

Airport Retailers Face Business Disruption

By Sofía Hanna | Wed, 01/26/2022 - 17:11

Retail, duty-free and currency exchange shops and restaurants are facing the largest disruption to their businesses given the lack of customers at airports, which is also leading them to accumulate debt. Moreover, the younger and less affluent travelers of generations Y and Z have proven less interested in traditional airport products and services, reports Bain & Company.

 

Consultancy firm Bain & Company’s Airport Retail report points out that omnichannel retailing is suffering from a lack of customers and a major shift in passengers, trends poised to transform traditional airport shopping. By 2025, the firm expects that digital technologies will have changed retail in general and radically transform traditional airport purchases, paving the way for a connection between digital platforms and in-store purchases.

 

Airport businesses are also being forced to adapt to the new generations of passengers, which will be gradually taking over the majority of flights. Younger generations are less likely to use traditional airport products and services, a troubling trend considering that younger passengers with fewer economic resources will continue to take over.

 

These trends are also affecting Mexican airports. For example, Mexico City International Airport (AICM) closed 2021 with a pronounced drop in passengers and soaring rental debts, which are expected to continue affecting the airport as the Omicron variant spreads. As of Sep. 30, 2021, 243 companies owed AICM MX$1.99 billion (US$97.5 million) from the rent of spaces and other services. AICM’s debtors include currency exchange stores, restaurants, taxi services, car rentals, duty-free stores and airlines, both local and foreign.

 

With the passenger decrease forecast in the next five to six years, airport retailers will have to double their sales to have the economic solvency to maintain their retail space and pay off the accumulated debt. Specialists have pointed out that having a mix of product categories, integrating experiences in shops and increasing customer engagement through an omnichannel customer journey could improve sales. Bain & Company urged airport retailers to increase passenger penetration in shops, invest in digital capabilities and customer relationship management tools, shift to a data-driven commercial strategy and rethink commercial contracts. 

The data used in this article was sourced from:  
Bain & Company, MBN
Sofía Hanna Sofía Hanna Journalist and Industry Analyst