Global airport retailing market to reach $54.6b by 2027
The global market for Airport Retailing estimated at $34 billion in the year 2020, is projected to reach a revised size of $54.6 billion by 2027, growing at a Cumulative Average Growth Rate of seven per cent over the analysis period 2020-2027.
The Airport Retailing market in the United States was $9.2 billion in 2020.
China, the world‘s second largest economy, is forecast to reach a projected market size of $11 billion by the year 2027 trailing a CAGR of 9.4 percent over the analysis period 2020 to 2027.
Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 5.8 percent and 7.3 percent respectively over the 2020-2027 period.
Within Europe, Germany is forecast to grow at approximately 6.6 percent CAGR. Led by countries such as Australia, India, and South Korea, the market in Asia-Pacific is forecast to reach $7.5 billion by the year 2027.
The market growth , experts say can be attributed to the increasing number of air passengers, rising disposable income, and growing demand for luxury products and services. In terms of type, the food and beverage segment is expected to hold the largest share in the global airport retailing market during the forecast period. This can be attributed to changing consumer preferences for healthy food options and an increase in spending on food items by air passengers.
Airport Retailing , experts say, is important because it allows people to buy items they need while traveling, and it also helps to generate revenue for the airport.
The airport retailing industry is expected to witness significant growth over the forecast period owing to increasing air passenger traffic which in turn will augment the demand for leisure facilities at airports.
The Airside application segment accounted for the largest share of more than 60.0 percent in 2017.
The growth can be attributed to the increasing number of passengers traveling with each other on a single flight and increased spending on food and beverage products by airlines within airports. Moreover, retailing activities at airports creates additional revenue opportunities as shops are able to charge higher prices due to limited competition among retailers.
Landside application segment is expected to register a significant CAGR over the forecast period owing to rising passenger traffic at various airport destinations across the globe coupled with an increase in air travelers’ preference for shopping during their travels or shortly after arrival at their destination airport, which provides greater opportunity for retail stores operating near airports.
North America dominated the global airport retailing market in 2017. The growth of the regional market can be attributed to increasing demand for food and beverage products, along with rising expenditure by passengers on these products. Furthermore, new investments by companies such as Kroger and Albertsons Companies Inc., are expected to drive the growth of this regional market over the forecast period.
Asia Pacific is projected to witness significant growth over the forecast period owing to rapid developments taking place at airports across countries such as China, India, Japan among others. In addition, growing air passenger traffic has led major airlines operating out of Asia Pacific region’s airports to have also contributed significantly towards increased spending on airport retailing within this region over recent years.
This trend is expected to continue over future years which will further boost demand for various types of retail space at airports across Asia Pacific , except Hong Kong.
The growth factors are determined by many criteria.
An expert said : “ The number of passengers travelling by air is increasing every year. This is driving the demand for retail services at airports.
Rising income levels: As incomes rise, people are spending more on luxury items such as branded clothes and accessories. This is boosting the airport retailing market.
Proliferation of duty-free shops: The number of duty-free shops at airports is growing rapidly due to the increase in international travel by consumers from different countries.
“ E-commerce is becoming increasingly popular, especially among young consumers who prefer to shop online for convenience and value for money reasons .This is benefiting airport retailers as they are able to sell their products online too .This trend will continue in the future, providing growth opportunities for airport retailers. Airport retailers are using new technologies such as augmented reality and virtual reality to enhance the shopping experience for customers..”