Optimism levels among respondents to the Q2 2024 TR Confidence Tracker, sponsored by Suntory Global Spirits, have hit their lowest levels to date.

Just half of respondents to the flash poll reported feeling very or quite optimistic about the global travel retail industry over the next 12 months, compared to 85.71% during the first quarter of the year, representing a 35.71 percentage point drop.

Although the share of respondents who were very optimistic grew by 12.36 percentage points, there has been a notable increase in the slice of those holding a neutral viewpoint (28.12% compared to 9.52% in the previous quarter).

Pessimistic feeling is also more prominent, comprising a 21% share of voice – way above the 8% share of respondents who said they were ‘quite pessimistic’ in Q4 2023.

How respondents felt about their organisation’s performance in travel retail over the next 12 months paints a similar picture. For this key indicator, confidence levels have been falling steadily since Q1 2023.

Those feeling very or quite optimistic during the second quarter of 2024 shrunk to 56.25% – down from its peak of 91% in Q1 2023 and slipping 15.18 percentage points from Q1 2024.

The share of those who were neutral, as well as those who were quite pessimistic, both comprised just over a fifth of the result.

Commenting on the dynamics impacting sentiment during the quarter, Nina Kristin Gür, VP Retail Key Account Management, Fraport AG said: “We notice that the development has slowed down a bit and passengers are becoming more sensitive to higher prices and we notice changes in the travelling behaviour of relevant destinations. So it will remain interesting to see how this will evolve in the coming months.

“We are very much aware of the potential obstacles and are working on different measures to provide an even better offer and guest experience and address our target groups more precisely,” she added.

Tommy Nilsson Klostermann, CEO/Senior Entrepreneur, Scandinavian TaxFree Trading expressed concern about “the world’s situations with mass tourism aspects and war situations” while Harry Peter Kartasis, Managing Director, Global Drinks Ltd. flagged “APAC retailers asking for more discounts, increased credit terms, and no new listings until 2025”.

“While we are growth positive in travel retail, the lack of Far East visitors is still having an overall affect,” commented Chris Terris, Head of Business Development, Eurostick Brands. “We still see extensive opportunities for us in the travel retail space to both grow existing partnerships and develop new ones. Our customers are still confident in briefing us on new opportunities and our long-term range developments are flowing well into next year.”

Signs of optimism also came from Guy May, Director – Global Business, The House of Somrus, who said: “The world is a smaller place than it has ever been. Business travel is rebounding and leisure travel has opened to a larger part of the global population than ever before. Consumers are flocking to airports in record numbers – a good indication of a bright future for travel retail.”

More contributors to the Q2 tracker included Anson Bailey, Head of Consumer & Retail, Asia Pacific, KPMG; Alexander Nekrasov, Director Travel Retail, Promate Technologies; Steven Candries; Export & Travel Retail Director, Chocdecor BV; Cecile Vangelisti, GTR Director, Piper-Heidsieck champagne; and Kreol Arakulath, Executive Director, Kreol Group.

Almost 60% of respondents to the flash poll wished to remain anonymous.

More than half (56.25%) of the duty free and travel retail (DF&TR) stakeholders who responded to the Q2 2024 flash poll were a supplier/agent/distributor, with 31.25% being retailers and 6.25% being airports.

 

What provided the biggest boost for your company in DF&TR during Q2 2024 and how did this help propel you toward your year-end goals?

“The development of F&B is still strong. We are looking forward to some concept updates and opening in the coming months to provide a better offer.” Nina Kristin Gür, VP Retail Key Account Management, Fraport AG

“A big pick up in business in South Korea. They have realised that they must focus on their Korean pax and this has proved [to be] a successful strategy.” Barry Geoghegan, Founder, Duty Free Global

“We were delighted to win new listings in the duty free space, creating bespoke souvenir ranges for UK regional airport customers, most of which landed in Q2 in time for the summer peak.” Chris Terris, Head of Business Development, Eurostick Brands

“Providing distribution optimisation analytics allows customers to dial in on opportunities in order of return on investment.” Jeff Elderton, Executive Consultant, GTR, TELUS Agriculture & Consumer Goods.

Additionally, Christophe Girard, Strategic Retail Projects manager, VINCI Airports, highlighted the “increase in long haul international traffic” as a boost.

The TR Confidence Tracker is sponsored by Suntory Global Spirits. It was launched by TRBusiness in early 2023 to track sentiment among DF&TR executives to provide an insightful barometer for the wider industry. Thanks to all those who have contributed. Watch this space for the Q3 flash poll, which will go live in October 2024.

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