The travel retail industry has seen huge growth over the past few years.
Valued at $63.5bn in 2014, it is predicted to grow to a mammoth $84bn by 2020.
We all love a bit of duty free, don’t we?
But when it comes to what people are buying at airports and stations, it appears that health and beauty is at the very top of the consumer’s agenda.
Today beauty accounts for around a third of all travel retail sales.
So, it’s unsurprising that many brands are focusing in on this area. Here’s a few reasons why.
Capitalising on the ‘golden hour’
The appeal of shopping at airports used to centre around the concept of duty-free – the fact that consumers might bag a bargain on the way to Majorca or Marrakech.
Now, it has become so much more, with travel retailers cottoning onto the fact that airports can provide a shopping experience to rival the biggest malls in the world.
Labelled the ‘golden hour’, there is a period of time that begins when a traveller steps through security and ends the moment they board a plane – and it is prime time for spending.
As a result, many retailers have begun experimenting with the airport as a unique space – one that is perfect for trialling new ideas and concepts.
We’ve seen the likes of Cath Kidston and Paperchase pop up with outlets in most major airports, and with more of a demand for their products, beauty brands seem to be following suit.
Alongside World Duty Free, it’s not unusual to see the likes of Dior and Jo Malone as stand-alone stores.
What’s more, as Heathrow Airport’s new personal shopper service shows, airports have become more about the experience consumers can have before they get on the plane, rather than about the act of travelling itself.
Promoting convenience and exclusivity
Another reason beauty brands account for such a big part of travel-related spending is that the product itself is perfectly aligned to the notion of ‘on-the-go’.
Minis or ‘travel sets’ are aimed at global jetsetters who don’t want the hassle of taking full-size products along with them.
Meanwhile, for brands, it enables them to promote their products as being exclusive to airports or duty-free stores.
An example of a company that cleverly combines both of these factors is Revlon.
Last year, it launched a new Travel Series Collection of make-up specifically for on-board travellers.
Instead of creating a physical presence in an airport, Revlon counts on the fact that consumers will more be willing to spend on a sense of exclusivity – a product that cannot be found elsewhere.
Aligning the luxury and the everyday
Although Revlon’s foray into the sector shows that there is opportunity for more affordable brands, travel retail is traditionally a market for the luxury and high end.
Research shows that airports account for 5% of total luxury sales.
And with consumers that buy luxury traditionally having a higher holiday budget than those that don’t, it makes sense that this demographic will be willing to spend big at the airport.
Having said that, we cannot ignore the fact that budget airlines and accommodation marketplaces (such as Airbnb) have made global travel more of a level playing field.
As a result, this means more flexibility for beauty companies that might otherwise target a limited demographic.
A company like L’Oreal, for example, has enough brands in its portfolio that it is able to target a wide range of consumers – regardless of their socio-economic status.
Instead of online or even physical stores, where people are much more likely to stick to what they know, the area of travel retail presents a unique opportunity to target all kinds of shoppers – all equally eager to partake in a pre-holiday splurge.