The m1nd-set research company has released its forecast for traffic and travel retail shopper behaviour for 2018, based on nearly 50,000 face-to-face interviews with travellers at departure gates around the world. It also reveals the key 15 markets for share of duty free sales in 2018, alongside their forecast traffic growth.

 

This detailed data has been compiled utilising its ‘Business 1ntelligence Service (B1S)’, which also draws on the Swiss company’s global shopper insights, IATA’s traffic analysis, plus its forecasting tool known as Direct Data Service (DDS) database.

 

THE TOP FIVE NATIONALITIES BY DUTY FREE SALES:

As a result, m1nd-set’s findings and B1S show the top five nationalities by duty free sales share as China with a 13.2% share, South Korea 5%, the UK 4.3%, France 3.5% and Japan with 3.4%.

 

China, which saw a 3% growth in outbound traffic over the past 12 months, is expected to see a 5% growth in international departure traffic in 2018 and will account for 6% of global traffic over the next 12 months.

 

South Korea, in second place for share of global duty free spend, will represent only 3% of international traffic over the next year. However, the research firm says the outlook remains positive, with the outbound market up 16% in the past year and expected to grow by further 9% in 2018.

Meanwhile, the research firm says that the UK outbound market, which is the second largest representing 8% of global traffic over the next 12 months, will see very stagnant growth in 2018. As such, this is in stark contrast to 2017 when UK outbound traffic rose 10% on the previous year.

 

m1nd-set adds that the French outbound market, which it believes will account for 4% of international traffic in 2018, will grow by 3% in the next 12 months, significantly slower than over the past year, when it grew by 7%.

 

CHINESE ALSO TOPS IN SPEND AND SHOPPING RATE

Japan, the fifth largest market in terms of global duty free sales, will represent 3% of international traffic over the next year. Traffic will grow by 5% on last year, which is considerably slower than the previous 12 months when Japan’s outbound traffic grew by 10%.

 

The report adds: “Regarding shopper behaviour among these leading markets, the report reveals that Chinese shoppers also top the charts in terms of both their shopping rate and average spend in duty free shops.

 

“Forty-one per cent of Chinese travellers say they shop at duty free shops while travelling; they also spend more than other nationalities, well ahead of the second place market in terms of average spend, which is India.

 

“Like the Chinese, South Koreans are also heavy shoppers in duty free with 39% of all travellers buying from duty free shops, and also spending more than average compared to other nationalities.

 

RELATIVE NATIONALITY SPEND LEVELS

“The British are significantly less likely to shop when travelling with spend levels significantly lower than those of the Chinese and South Koreans; only 16% purchase in duty free shops, while over one fifth (21%) of French travellers and one third of Japanese travellers shop in duty free shops.”

 

m1nd-set also adds that the B1S report identifies ‘five key customer segments’ within each nationality market segment, based on m1nd-set’s signature customer segmentation model it pioneered in 2012.

 

The findings apparently demonstrate that within each nationality segment there are clear behavioural differences.

Significantly, m1nd-set adds: “This underlines the need for marketing and sales teams to understand the different behaviour within the sub-segments, treating each shopper nationality as individuals, rather than adopting a cookie-cutter approach to all Chinese or Koreans for example.”

 

SOURCES AND METHODOLOGY:

IATA’s “Direct Data Service” (DDS) database combines global airline ticket sales data along with direct sales data from over 400 airlines and 80,000 travel agents across 170 countries. It also draws upon secondary sources, such as government statistics and airport data. The traffic data, which is sourced both from IATA and travel technology and data analytics company Airlines Reporting Corporation (ARC), provides m1nd-set’s Business 1ntellgence Service (B1S) with the industry’s most comprehensive repository of airline sales data available, including both current traffic and traffic forecast data.

 

For more information on m1nd-set’s Business 1ntelligence Service reports, contact m1nd-set by email at mailto:[email protected] or by telephone at: T: +41 21 925 5025