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Are travel terminals increasingly becoming shopping destinations?

Fiona Rayner, Head of Experiential and International at Blackjack Promotions, shares how travel terminals have the opportunity to create captive experiential activity that help engage potential customers.

Are travellers likely to spend more thanks to duty free/tax free?

The two have become blurred, and ‘duty free’ is not the offering it once was. There are still savings to be found in duty free at airports versus the high street, but the message terminal retailers are focusing on is offering shoppers something they can’t get on the high street. Airports are currently leading this, but as it isn’t dependant on a duty free/tax free hook, it could be translated into any terminal; I expect we will see more rail station retailers following suit.

Are travel terminals bucking the doom & gloom of the high street?

It’s certainly true that people still think of airports, travel retail and flying as glamorous – we all still look forward to going on holiday and that association with airports is perennial. I don’t think train travel is quite there yet, although I have noticed some of the major rail providers are trying to reignite ‘Golden Age’ excitement in their marketing campaigns to encourage people to think differently about train travel.

Due to the sheer volume of people airport terminals have to process, they tend to be technologically progressive spaces and technology is being harnessed to refresh the retail experience at these sites. Traveller demographics affect traffic flow throughout the day and retailers are able to use digital screens to change the duty free environment; the store design and ‘wallpaper’ can change at the flick of a switch. This creates an exciting and more relevant experience for shoppers.

Major train stations have ramped up their experiential offerings too, making the most of the captive ‘passing trade’ to create immersive moments and provide product sampling that helps to engage potential customers. We’ve seen an increase in specific place-based associations such as Paddington Bear at Paddington station, and Harry Potter at King’s Cross St Pancras, which tell a story and bring joy in a way high street shops are not traditionally placed to deliver.

Are certain retailers likely to perform better in terms of sales at travel terminals rather than the high street?

The main thing about travel terminals in particular is that they are able to understand their customers a lot more because they understand them as passengers first – and this provides key insight for retailers. If you think about the high street, you know your demographic, but you don’t necessarily know when they will be coming into the store. If it’s raining, they may not bother to pop out to the shops on their lunch break. These variables don’t have the same impact on terminal retailer trade. They are making an intentional journey, so retailers are able to better identify customer demographics, be they a commuter who wants convenience, a holiday maker who wants a travel exclusive, or a business traveller who wants gifts, it’s easier to make bespoke and targeted offerings based on the kinds of travellers you have coming through. Destination targeting can be employed. For example, if you have a train arriving from Edinburgh, you are unlikely to target shoppers with whisky. You know the journey the customer is taking, therefore the retail offering can be bespoke.  In train terminals in particular they are selling ‘impulse purchase’ products and can streamline what they are presenting because they have a heads-up on who is coming through the doors. Retailers providing a ‘one-stop shop’ experience are likely to perform well, as we have seen in the example of a major high street newsagent who have increased sales by diversifying their offering at terminal retail sites.

WHSmith’s travel arm is making profit while its high street sales are slumping – why is this?

In April, a leading high street newsagent diversified their retail portfolio at Gatwick North terminal when they introduced a pharmacy into the store. By offering more services, they are better able to service the time-poor clientele we often find at terminals, and increase spend per-customer. They have clearly taken a good look at their terminal retail demographic and responded by offering the customer what they want and need.

If you would like to find out how Blackjack Promotions can help you, get in touch with Fiona Rayner at Fiona.Rayner@abm.com