Travel retail is an industry primarily revolving around airplanes, cruise ships, airports, and inner city duty-free stores. The travel retail market has been undergoing incredible growth in the last few years owing to the booming tourism sector across the world. Over the past 15 years, the collective revenue of the global travel retail market has experienced a growth because of continuous development of global travel and tourism industry, steady upsurge in disposable income of people worldwide, and increasing growth in the global urbanization.
In addition, the market for travel-related goods & services is reaching newer heights due to rapid digitalization worldwide and growing number of middle class customers that invest in tourism. Furthermore, retailers across different domains have realized that travel retail provides them remarkable opportunities to promote their products/services, develop customer loyalty, and attract new customers from different countries. These days, airports have turned out into a place where businesses assess their prospective to thrive in new markets’ depending on their clients’ flight destinations and nationalities; which is fueling the growth of the travel retail industry. Also, the global travel retail industry might undergo momentous expansion on account of the amplified digitalization of the process involved in retail businesses, which allows the businesses to maximize their profits. All these factors are immensely contributing in the changing panorama of the global travel retail sector since the past few years.
Newest Insights in the Travel Retail Market
As per a report by Research Dive, the global travel retail market is expected to grow with a striking CAGR of 16.0% in the 2022–2031 timeframe. The Asia-Pacific travel retail market is expected to perceive dominant growth in the years to come. This is because, the region has an enormous demand for travel retail owing to the growing travel and tourism sector, as numerous foreign investors travel to locations like Hong Kong and Malaysia in this region to shop tax-free.
How are Market Players Responding to the Mounting Demand for Travel Retail?
Market players are greatly implementing innovative business strategies and investing in novel developments to cater the rising demand for travel retail. Some of the foremost players of the travel retail market are Duty Free Americas, Inc Lagardère sca (lagardère travel retail), Aer Rianta International, DUFRY GROUP, China Tourism Group Duty Free Corporation Limited, King Power International., Lotte hotel, Gebr. Heinemann SE & Co. KG, LVMH Group, THE SHILLA DUTY FREE, and others. These players are focused on planning and devising tactics such as mergers and acquisitions, collaborations, novel advances, and partnerships to reach a notable position in the global market.
- In February 2022, Altavia, an independent international group focused on improving commercial communication for the retail industry across the world, launched ‘Altavia Travel Retail’ as a response to the industry’s needs for revolution to resolve mutual problems during the online and physical travellers’ journey.
- In July 2022, Dufry, one of the leading travel retailer across the world, joined hands with Walker’s Shortbread, a Scottish producer of biscuits, cookies, shortbread, and crackers, to launch its novel ‘Global Travel Retail’ range.
- In July 2022, Mast-Jägermeister SE, a German liquor company, launched travel retail campaign named, ‘The Secret is You’, at 5 main European airports to celebrate the return of travellers.
COVID-19 Impact on the Global Travel Retail Market
The unexpected rise of the coronavirus pandemic in 2020 has negatively impacted the global travel retail industry. During the pandemic period, the implementation of strict lockdown worldwide eventually lowered the demand for tourism owing to international travel restrictions and economic breakdown across numerous nations. The travel retail market witnessed sudden deterioration in growth due to the disastrous situations during the pandemic. However, as the pandemic is relaxing since the end of 2021, the market is projected to observe massive growth in the forthcoming years owing to growing desire for tourism across the globe.