Travel Retailing Trends and Forecast
The future of the global travel retailing market looks promising with opportunities in the airport, airplane, cruise ship, and downtown markets. The global travel retailing market is expected to grow with a CAGR of 8.2% from 2024 to 2030. The major drivers for this market are increase in international travel and growth of the tourism industry.
• Lucintel forecasts that perfume & cosmetic is expected to witness the highest growth over the forecast period.
• Through this market, airport is expected to witness the highest growth.
• APAC is expected to witness highest growth over the forecast period.
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Emerging Trends in the Travel Retailing Market
Current trends that shape the Travel Retailing market include technological evolution, change in consumer behavior and changes in travel habits. It remains indisputable that the knowledge of these trends is key towards competing and winning over consumers.
• Digital Integration: More travel retailers are implementing digital solutions like e-commerce and mobile apps. These technologies allow travelers to browse, pre-order and pay by card online, which is a needed response to the increasing demand for integrated solutions.
• Sustainability Focus: Travel retail remains people-centered, but adequate attention has also been given to the resort on sustainability. Retailers have been changing their focus to incorporate green packaging and other forms and strategies to minimize the use of plastics and stock eco-friendly products due to demand and compliance.
• Luxury Product Expansion: Demand for luxury and premium products is on the rise, especially in major travel terminals. There is an expansion in luxury product assortments among retailers, including other forms of luxuries such as exclusives and limited editions targeting premium markets.
• Technological Innovations: Smart technologies such as artificial intelligence (AI), augmented reality (AR), and virtual reality (VR) are being used in the travel retail sector. These innovations improve the degree of customization, enhance the shopping experience, as well as optimize the appeal of the customers.
• Omnichannel Retailing: An omnichannel approach is increasingly important in travel retailing. The combination of e-commerce and physical retailing enables customers to scout, book, and buy the items in whichever channel connected to the travel retail experience.
• Health and Safety Measures: After the pandemic, there is a heightened concern for safety and health in the travel retail sector. Better hygiene, no-touch facilities, and social distancing are some of the measures that are adopted to enhance the safety conditions of the shoppers.
• Personalized Shopping Experiences: Personalization is gaining widespread attention in the field of travel retailing. Retailers have been employing analytics technologies so as to provide uniquely recommended products, specific offers, and personal information, and service to the customers which boost their loyalty.
Those trends are transforming the Travel Retailing market towards digitalization, sustainability, luxury products and development of technologies. Omnichannel strategies, health and safety measures, and personalization are enhancing the overall shopping experience for the travelers.
Recent Developments in the Travel Retailing Market
Changes in the Travel Retailing Market in recent times can be traced to the need by the sector to respond to changing client demands, technology trends, and changes in travel markets.
• Emergence of Digital Platforms: Shoppers, particularly travel retailers, in recent years have expanded the scope of their activities by utilizing digital platforms. This involves creating mobile applications and virtual duty-free shops, which provide comfort and facilitate easy shopping for tourists.
• Rise of Luxury Products: The luxury travel retail market is rapidly growing, offering a strong range of luxury products. Retailers are also adding more upscale and proprietary products to serve wealthy travelers and leverage the premium products market.
• Use of Advanced Technologies: The evolution of the travel retail industry has been accelerated by the application of advanced technologies, including AI and AR. They have been utilized for the development of engaging and tailor-made shopping experiences in order to capture the attention of customers and keep them satisfied.
• Focus on Green Initiatives: Attention to sustainability issues in the sphere of travel retail is increasing. Retailers are working in the direction of the so-called green practices: waste management and eco-friendly packaging in order to accommodate the demand for green products.
• Seamless Omnichannel Strategies: There’s an increasing trend of omnichannel marketing wherein brick and mortar and online channels are strategically intertwined by retailers. This strategy provides better customer/service traveler relationship by ensuring that travelers are able to contact brands through diverse channels.
• Health and Safety Enhancements: In the context of the COVID-19 pandemic, travel retailers have stepped up with some add-ons regarding health and safety measures. These are, for instance, cashless alternatives, additional cleaning, and arrangement of places to keep people further apart when they are shopping.
• Diverse Product Offerings: Retailers have begun to add more verticals to their offerings, and wellness products and lhs devices are part of these financial transformations. This diversification helps meet the changing tastes of people on the move.
These developments point to a Scientific evolution of the Travel Retailing market due to digitalization, luxury, sustainability, and health. Retailers have begun to adjust in order to improve the traveler experience and address new consumer needs.
Strategic Growth Opportunities for Travel Retailing Market
Looking in detail on the Travel Retailing market, there are several strategic growth opportunities in different applications. Taking these opportunities will promote market growth and improvement in the positions of retailers.
• Digital Expansion: E-trade association and investment in mobile commerce activities opens up vast opportunities for growth. Improving mobile app and website sales offer efficient shopping for techy travelers and enhances resulting sales.
• Luxury Segment Development: Investing in new product development of luxury and premium products can take advantage of the trend in the growth in appreciation of premium-brand products.The retailers are able to complement their collections by including high-end products and services aiming at affluent tourism.
• Sustainability Integration: Creation of a more eco-friendly environment by shifting to waste-free, recyclable or biodegradable packaging is beneficial because the majority of consumers prefers products that are ecological. Such approach can be rewarding due to better brand perception and attracting green consumers.
• Technological Advancements: Advanced Technology such as AI, VR, and AR will enhance the experience of travel retail. It can enhance customer relationships and foster brand loyalty by employing these technologies for individual recommendations, interactive shopping experiences, and seamless transactions.
• Omnichannel Retail Strategies: Creation of effective, consistent and appropriate online and offline networks enable unified shopping to customers. Return options as well as click and collect waters can improve the level of net promoter score.
These growth opportunities point out the core characteristics that travel retailers can pursue and innovate in areas where expansion is possible. Aspects like digital growth, luxury segment growth, and growth through technology, sustainability and omnichannel strategies are the areas that will improve the retailers’ footprint in the industry and meet changing demands of the consumers more effectively.
Travel Retailing Market Driver and Challenges
The Travel Retailing market has several drivers and challenges like technological improvement and development, economic situation as well as legal environment. These factors should be analyzed for the efficient interaction with the market.
The factors responsible for driving the travel retailing market include:
1. Technological Advancements: The growth of tourism and travel retail markets are interlinked due to the upsurge of certain industries/ business activities such as e-commerce technology, online shopping portals & tourism activities etc. The consumer experience is improved, systems are optimized and individual attention is given in a more efficient manner, thus fostering growth in the market.
2. Increasing Global Travel: The utilization of travel retailing is set to grow as international tourism rebounds after the Covid 19 crisis increased global business travel and international tourism some of which benefitted the travel retailing industry. More travel means more need for duty free goods which creates even more possibilities for retail in the airports and other places a traveler visits.
3. Rising Disposable Income: Higher levels of disposable income especially in developing countries are creating a market for out of reach luxury and premium class items. This economic factor is also minimal mostly due to demand in the travel retail market where more people are willing to spend because they travel to shops cheap luxury goods.
4. Consumer Preference for Convenience: Convenience is a competitive advantage since people are moving towards more of the digital and mobile approach when it comes to shopping. There is the involvement of e – commerce and the mobile applications in travel retailing hence movement of the goods where they are required and hence sales are increased.
5. Pay Attention to Personalisation: Customers want to feel a special touch, and so personalization is delivering that happy medium in travel retailing. Personalizing business offering and personalizing the relationships with customers through data analytics increases customers’ satisfaction and builds their loyalty.
Challenges in the travel retailing market are:
1. Regulatory Compliance: There are some boundaries to consider when dealing with duty-free sales and related regulation on product standards, as well as environmental standards. Such compliance is necessary to avaoid penalties and enable a smooth operation.
2. Market saturation: The market for travel retailing is almost filled up as many companies and places are selling the same goods. Being under the large number of competitiors IS challenging it is necessary to be and act differently by providing alternatives and better strategies while being in the saturated market.
3. Economic Change: Consumers’ economic condition plays a major role in how they purchase products and where they spend their time travelling for retail. A retailer must be responsive to such conditions and be able to mitigate the impacts of global market conditions.
The Travel Retailing market is driven by technological changes, rise in global travel, increase in disposable income, among others, and Constraints and Limitations in the travel retailing market which are compliance with regulations, market over saturation and economic changes. These factors should be considered in order to properly operate within and grow in the market.
List of Travel Retailing Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies travel retailing companies cater increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the travel retailing companies profiled in this report include-
• Lotte Duty-Free
• The Shilla Duty-Free
• China Duty-Free
• Lagardère Travel Retail
• Gebr Heinemann
• DFS Group
• King Power International
Travel Retailing by Segment
The study includes a forecast for the global travel retailing by type, application, and region.
Travel Retailing Market by Type [Analysis by Value from 2018 to 2030]:
• Perfume & Cosmetic
• Food
• Wine & Spirit
• Luxury Goods
• Tobacco
• Electronics
• Others
Travel Retailing Market by Application [Analysis by Value from 2018 to 2030]:
• Airport
• Airplane
• Cruise Ship
• Downtown
• Others
Travel Retailing Market by Region [Analysis by Value from 2018 to 2030]:
• North America
• Europe
• Asia Pacific
• The Rest of the World
Country Wise Outlook for the Travel Retailing Market
The Travel Retailing market continues to evolve with changes in consumer behavior, technological disruptions, and new patterns of travel. What follows are examples of such developments across the main regions.
• United States: The change in U.S. travel retailing is most evident in the use of mobile apps and contactless payments. Main goal is to adopt mobile duty free shopping and bring improvements in the physical location to meet clients’ expectations travelled after the pandemic.
• China: In China, the travel retail business is developing actively and targets tourists with premium and luxury goods. The growth is aggressive as the strategy focuses on omni channel approaches and enhancing the physical retail experience in key airports.
• Germany: Germany is embracing technology in travel retail in form of automated retailing and other technological advancements. There are also aspirations to achieve green tourism with more green products and practices in travel retail.
• India: There has been growth in the Indian travel retail market fuelled by the rise of middle-class travellers with more disposable incomes. Retailers are increasing product categories and enhancing the internet for an improved shopping experience that meets the needs of various consumers.
• Japan: In Japan, advanced technologies such as augmented reality and artificial intelligence are being used in travel retailing. There is also an emphasis on high-end service and premium products to capture the attention of selective customers.
Features of the Global Travel Retailing Market
Market Size Estimates: Travel retailing market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends (2018 to 2023) and forecast (2024 to 2030) by various segments and regions.
Segmentation Analysis: Travel retailing market size by type, application, and region in terms of value ($B).
Regional Analysis: Travel retailing market breakdown by North America, Europe, Asia Pacific, and Rest of the World.
Growth Opportunities: Analysis of growth opportunities in different types, applications, and regions for the travel retailing market.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the travel retailing market.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
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FAQ
Q1. What is the growth forecast for travel retailing market?
Answer: The global travel retailing market is expected to grow with a CAGR of 8.2% from 2024 to 2030.
Q2. What are the major drivers influencing the growth of the travel retailing market?
Answer: The major drivers for this market are increase in international travel and growth of the tourism industry.
Q3. What are the major segments for travel retailing market?
Answer: The future of the travel retailing market looks promising with opportunities in the airport, airplane, cruise ship, and downtown markets.
Q4. Who are the key travel retailing market companies?
Answer: Some of the key travel retailing companies are as follows:
• Lotte Duty-Free
• The Shilla Duty-Free
• China Duty-Free
• Lagardère Travel Retail
• Gebr Heinemann
• DFS Group
• King Power International
Q5. Which travel retailing market segment will be the largest in future?
Answer: Lucintel forecasts that perfume & cosmetic is expected to witness the highest growth over the forecast period.
Q6. In travel retailing market, which region is expected to be the largest in next 6 years?
Answer: APAC is expected to witness highest growth over the forecast period.
Q.7 Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 11 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the travel retailing market by type (perfume & cosmetic, food, wine & spirit, luxury goods, tobacco, electronics, and others), application (airport, airplane, cruise ship, downtown, and others), and region (North America, Europe, Asia Pacific, and the Rest of the World)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. Which region will grow at a faster pace and why?
Q.4. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.5. What are the business risks and competitive threats in this market?
Q.6. What are the emerging trends in this market and the reasons behind them?
Q.7. What are some of the changing demands of customers in the market?
Q.8. What are the new developments in the market? Which companies are leading these developments?
Q.9. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.10. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.11. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
For any questions related to Travel Retailing Market, Travel Retailing Market Size, Travel Retailing Market Growth, Travel Retailing Market Analysis, Travel Retailing Market Report, Travel Retailing Market Share, Travel Retailing Market Trends, Travel Retailing Market Forecast, Travel Retailing Market Companies, write Lucintel analyst at email: helpdesk@lucintel.com. We will be glad to get back to you soon.