Airport Retail Optimization

Retail is a key driver of value for most airports, as well as a driver of customer experience for all. The retail sector is undergoing seismic change, and the consumer is getting accustomed to new models. Airports cannot sit back and rely on their past successes.

To help drive this revenue, L.E.K. brings a unique combination of deep airline, airport, hospitality and retail expertise.

The Airport Retail Environment

Airports are a unique retail environment. Expectations are shaped by multiple factors — from brands and products to the in-store and online experience. This is further complicated by:

  • Constraints of airport retail delivery, given that the airport is a landlord to retailers and brand owners
  • Airlines’ protectiveness of their passenger data (which premier retailers “own” for their customers), and their desire to promote on-aircraft retail sales
  • Online competitors and airlines seeking to capture more passenger value, including retail sales
  • Other factors beyond your control, such as security requirements and experiences that can significantly reduce productive airside dwell time
  • The changing character of the terminal throughout the day, as banks of arrivals and departures flow through

By working with L.E.K., you gain a clear understanding of passenger segmentation and the dynamics of today’s complex retail airport environment. We combine your understanding of this environment with the broader everyday experience of your customers to help optimize your retail and food and beverage offerings.

The result? A stronger retail strategy and additional revenue.

Customer Experience Approach

Our approach involves understanding and responding to passenger needs and expectations across customer touch points, and then applying this insight to improve the customer experience.

  • We rely on facts and analysis of all relevant data (internal as well as external) to develop insights and recommendations.
  • We develop potential improvements based on the products and services that matter most to customers, while also considering broader strategic requirements and implications for you and your airline tenants.
  • Our airline and airport industry experience coupled with our expertise in the retail sector offer a unique approach and ability to think beyond the current travel paradigm.
  • Our recommendations are practical and based on the realities that you face. They’re also designed to be implementable — sometimes all at once, and other times in stages to ensure they can be achieved.

Airport Retail Successes

“Future retail” trends: For a global airport investment company, we developed a screen of innovative retail and service concepts and structured them into key themes that an airport might use in developing its commercial offering. This was used to develop the key elements of the commercial strategy for each airport in the portfolio.

Duty-free category management: To optimize the post-security space, we helped this airport manage its duty-free selection based on flights and customer preferences. We studied demographics and purchasing patterns by time of day and day of week, applying the data to a rotating duty-free offer that best fit the demographics of each departure bank.

Retail category management plan: A major international airport sought to understand how consumer behavior and market trends affected category space allocation, in order to address category gaps and optimize category mix. We developed a category management plan to maximize retail space, improve category and product assortments, and enhance vendor relationships.

Chinese pax retail strategy: L.E.K. helped a leading airport understand the true competitive arena in which it competed for Chinese spend, including off-airport and the other end of the city pairs, as well as the unique needs of the Chinese passenger. We identified the strategies and partnerships to significantly lift spend from this fast-growing, high-spend demographic.

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