The convenience factor and speed of the shopping experience means airport shops can’t compete with downtown outlets in categories attracting typically higher spends, according to Horizon Consumer Science.

Responding to a question on the rise of liberalised tax and duty free regimes specifically in places like Hainan, Horizon Founder Dr Ian L. Cesa told TRBusiness: “[Airports] have decent prices, but they are not considered the best prices – outlet malls win the price game, by far.

“But, they are typically located in inconvenient places and it is a bit of a gamble as to whether the long trip to an outlet mall is worth it.”

SPENDING ‘DIMINISHING’

Cesa suggests airports will probably never compete with downtown stores in the likes of fashion and accessories aisles due to airports’ smaller footprints and time constraints.

“It’s risky to wait until the airport because there is nowhere else to go if the airport doesn’t have what you want,” Cesa added.

The comments come as Horizon releases its 2018 Global Traveler Report, which suggests the size of the global travel shopping market [covering spending during the entire travel journey including duty and tax free] is ‘slowly shrinking’.

Horizon’s research claims global travel retail spending has shrunk by $15bn from $397bn in 2016 to an estimated $382bn this year, with the average travelling consumer spending nearly $170 less per trip than in 2012.

This is despite record air travel numbers, up from 415m in 2012 to a projected *808m this year.

CHINESE THE EXCEPTION

On the other hand, Chinese outbound travel volumes have risen by 50% since 2016 and now account for 40% of travel retail spending globally, the report continues.

Chinese travellers’ propensity to travel and spend is contrary to a decrease in spending from other nationalities such as South Americans (bargain hunters) and North American and Eastern Europeans (destination shoppers).

Cesa says the latest findings denote a ‘worrying trend’, with multi-billion dollar decisions at airports in particular made on assumptions about what appeals to travellers.

As a result, competition for duty free spending is stemming less from other airports, and more from shops visited by travellers during the total travel journey.

“Chinese spending has been fairly stable at around $2,000 per person, after a precipitous drop from $2700 to $2,000 between 2012 and 2014,” Cesa continued.

“Not coincidentally, [Chinese President] Xi Jinping’s austerity directive came out in 2013, so it appears that spending by Chinese international travellers is affected, so far, more by what the government wants than by what is available in the domestic market.”

* Figures based on international travellers. More than 31,000 travelling consumers from 38 countries surveyed in the Travel Retail Catalyst Studies (TRaCS) since 2012, which informs The 2018 Global Traveler Report.