DUBLIN, Nov. 3, 2023 /PRNewswire/ — The “Global Travel Retail Market (by Product Type, Sale Channel, & Region): Insights and Forecast with Potential Impact of COVID-19 (2022-2027)” report has been added to ResearchAndMarkets.com’s offering.
The global travel retail market is poised for significant growth, with a projected value of US$75.93 billion by 2023, representing a robust compound annual growth rate (CAGR) of 17.37% during the forecast period from 2022 to 2027.
Travel retail refers to retail establishments primarily located in travel environments such as airports, train stations, cruise lines, and more. Recent surges in impulse purchases made while waiting for flights or trains at these travel touchpoints, especially airports, have driven the growth of the global travel retail industry. Travel shopping offers several benefits, including convenience, accessibility, a pleasant ambiance, and cost-effectiveness, attracting customers to these establishments.
Travel retail businesses are closely associated with travel environments and typically require customers to provide proof of travel to enter the commercial area, where purchases may be subject to taxes and tariffs. To entice customers, many stores and companies offer duty-free items.
- By Product Type: The global travel retail market is segmented into seven product types: fragrances & cosmetics, wine & spirits, luxury goods, tobacco, food, confectionery & catering, electronics, and others. The luxury goods segment is expected to exhibit the highest growth during the forecast period. This growth can be attributed to rising disposable incomes, increased exposure to social media, urbanization, and a preference for investments in personal luxury items.
- By Sale Channel: The market report categorizes the global travel retail market into four sale channels: airport, border, downtown and hotel shops, railway stations, and cruise liners. The airport segment currently holds the largest share in the travel retail market, driven by the increasing number of travelers and technological advancements at airports.
The global market is divided into five major regions: Asia Pacific, Europe, North America, the Middle East & Africa, and Latin America. North America encompasses the US, Canada, and Mexico, while Europe includes the UK, Germany, France, Spain, and the Rest of Europe.
Additionally, South Korea, China, and the Rest of the Asia Pacific are part of the Asia Pacific region. Asia Pacific dominates the global travel retail market due to the thriving travel and tourism sector, as well as the growth of new international routes in the region. South Korea, in particular, has a flourishing duty-free market, driven by its position as one of the largest in the world and an increasing number of Chinese and Japanese visitors.
Top Impacting Factors
- Dominating Gen Z and Millennial Population: Millennials and Gen Z travelers consider travel a necessity and prioritize unique experiences over traditional luxury, driving the demand for travel retail.
- Increasing Number of Airports: The growing number of airports and air travelers creates a conducive environment for travel retail businesses.
- Increased Personal Luxury Goods Consumption: Rising incomes and exposure to luxury goods on social media platforms contribute to increased spending on personal luxury items.
- Increased Traveling Offers: Expanding travel offers, including leisure trips and personalized experiences, boost travel retail sales.
- Lack of Availability of Space: Limited space in travel retail stores can pose challenges in merchandising and providing a positive customer experience.
- Tedious Air Travel Requirements: Stringent air travel requirements, including security checks and document verification, can deter travelers from shopping at travel retail outlets.
- Involvement of Artificial Intelligence: The use of artificial intelligence enhances the travel retail experience and helps retailers tailor offerings to customer preferences.
- Digitization of Travel Retail: The digital transformation of travel retail introduces new ways to engage travelers and enhance their shopping experience.
- Growing Trend of Robotics in Travel Retail: The integration of robotics in travel retail operations is becoming more prevalent, offering efficiency and convenience.
- Technological Advancements: Technological innovations, such as data analytics and personalized marketing, are shaping the future of airport retail.
The COVID-19 Impact
The COVID-19 pandemic had a significant impact on the travel retail market, with reduced footfall, travel restrictions, and economic challenges leading to decreased demand for travel retail products. However, as vaccination efforts progress and mobility at travel touchpoints such as airports and railway stations increases, the post-pandemic market is expected to regain momentum.
Analysis of Key Players
The travel retail market has traditionally been fragmented, with key companies focusing on analyzing consumer buying behavior and offering tailored retail products. Leading players in the market include:
- Dufry AG
- Shilla Duty-Free Shop
- LVMH Moet Hennessy Louis Vuitton (DFS Group)
- Hotel Shilla Co., Ltd (The Shilla Duty Free)
- Lagardere Group
- WH Smith PLC
- Shinsegae Inc (Shinsegae Duty Free)
- Lotte Corporation (Lotte Duty Free)
- Dublin Airport Authority (Aer Rianta International Duty-Free LLC)
- Duty Free Americas, Inc.
- China International Travel Service Corporation Limited (China Duty Free Group)
- Gebr. Heinemann SE & Co. KG
- Harding Brothers Retail Ltd (Flemingo International Limited)
- Everrich Duty Free Shop
- Dubai Duty Free
- The King Power International Group
For more information about this report visit https://www.researchandmarkets.com/r/ctynut
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SOURCE Research and Markets