The TR Consumer Forum second morning kicked off with a trio industry heavyweights giving their perspective on preparing for tomorrow’s consumer, touching on digital, the Gen Z traveller, and inflation.

Aude Ferrand, Chief Retail Officer at Groupe Aéroports de Paris, Vijay Talwar, Chief Digital and Customer Officer at Dufry, and Fraser Brown, Heathrow’s Retail Director, all gave company updates before looking to the future.

Ferrand brought delegates up to speed on the Extime retail and lifestyle concept, first revealed to the industry in 2022. 

She described the Extime’s performance so far as “best in class”, with 2022 airside spend per passenger at the Charles de Gaulle Terminal 2EK flagship ahead of both Dubai and Changi.

The category split at Extime is skewed towards beauty and fashion. “We’re not dependent on tobacco or alcohol, if something happens to these categories,” Ferrand said.

To date, Aéroports de Paris has acquired 2.2 million people to its Extime membership programme. “Average basket is twice higher than for non-members,” she disclosed.

She confirmed that the franchise model being pursued for Extime was on track to be leveraged before 2028, with the objective to roll the concept out both within and outside of Groupe AdP.

Gen Z around the world

Dufry’s Vijay Talwar then took the floor to share detailed insights into the Gen Z consumer, now aged around 8 to 25 years.

Africa is home to more youth than any other region, he said, adding that by 2025 the demographic will account for 25% of the entire Asia Pacific population.

India has more Gen Zs than the US and China combined, and no country in Europe ranks in the top 20. Around 90% of the global Gen Z population lives in Africa or other emerging markets.

On the importance of the demographic, Talwar noted that “16 to 24-year-olds drive global brand perception”. He added that 65% of Gen Zs think travel and seeing the world is the most important way to spend their money.

More than 52% of Gen Z adult travellers (aged 18-24) take three or more leisure trips a year. 

In addition to discussing connectivity and sustainability demands of Gen Zs, Talwar also discussed loyalty programmes.

While Gen Z like being made special and need personalisation, traditional loyalty programmes don’t resonate, he said.

“There’s a lot of chatter about rewards and accumulating points. But all the research on Gen Z will tell you they want instant gratification, not points that they can burn two months from now or two years from now.” 

He challenged: “What would you build if you were building things for that generation already?”

Talwar stressed the importance of experiences in the retail space. “Whether it’s beauty or liquor or cigarettes or other things, you do want them to come in and buy from your store. But the reality is we want them to come in for other things.”

He gave gaming and immersive beauty experiences as examples. “How are you going to entertain them?” He added that Dufry has just hired a Head of Entertainment with a background in the magic industry to drive this type of engagement. 

Talwar detailed some sustainability gains the Autogrill acquisition offers Dufry, before concluding with a point on community.

“The people who are frequently travelling, the people who are frequently shopping, are actually a small subset of the total population,” he challenged. “How do we focus on that community?” 

‘Increased digital behaviour’

The final keynote speaker of the session was Fraser Brown, Heathrow Airport retail director, who opened by encouraging stakeholders to pay closer attention to volume sales in the current inflationary environment.

“Inflation in the UK as of yesterday [22 June] is still 8.7%. If I look at the numbers, back to 2019 and units that I’m selling versus the value, it’s not the same. 

“So I would challenge all of you when you’re looking at your business and your numbers to focus not just on values but the volumes that you do as well.”

He added: “We might be selling as much value but we’re not getting the penetration and the conversion that we all need to be as successful as we can.”

Brown confirmed that Heathrow was once again the biggest airport by passenger numbers, and said April and May figures had been “great”.

He also confirmed the airport was seeing increased digital behaviour from passengers.

“We are seeing from our own data people coming on to heathrow.com and not just checking what they did before. Where do I park my car? What terminal is my flight? Is my flight on time or not? 

“They are delving much more into what is the offer that you have available in the terminal. What restaurants have they got? It’s some of the other services that we offer. things like click and collect, personal shopping. They are more digitally engaged.”

He vehemently opposed current UK government policy to abolish almost all tax free shopping – see the full story here.

Looking forward, he spoke of introducing new eCommerce services, for example fulfilment within 30 minutes, and trialling in-line shopping. “Penetrating into the lounge is a great opportunity.”

He also talked of the opportunities ahead. “We’re one of the only bits of the world that still has rising physical footfall,” he noted, adding that the massive potential when more people travel for the first time wouldn’t be exciting to the high street.

Brown concluded by offering a preview of some upcoming new retail concepts, including a new Burberry store in Heathrow T5, a Tiffany boutique in T2, and a stand-alone Glenmorangie single malt brand store set to open in August.

“Our job collectively, whether we’re an airport, retailer or a brand, is how do we get people to stop, to consider, and to buy,” he said in conclusion.  

“Therefore I would encourage you all to focus on that, and not get seduced by good numbers. 

Because the question from me isn’t are you back to 2019, inflation or not. It’s how good could you be?”

The TR Consumer Forum concludes today.