Upcoming Generation Z travellers are “not on a mission to shop” in duty free, however, confectionery and the general shopping experience are top priorities, speakers at last week’s TR Consumer Forum have said.

The demographic was front of mind during the Dissecting the Segments session, which welcomed Clara Susset from m1nd-set, Nina Kristin Gür from Fraport, Berangere Bragard from SSP, Hazel Catterall from Newmark, Lilly Choi-Lee from TravConsult, Haakon Dagestad from Travel Retail Norway, and Karl Walter from Blueprint as speakers.

Susset, m1nd-set Chief Operating Officer, opened with the statement that “Gen Z passengers have become significantly more important” in travel retail. 

She stated that Gen Z were more likely to buy for themselves than as a gift, and that a potential barrier to the demographic shopping is that they’re not aware of duty free exclusive products.

“They’re not on a mission to shop,” she added, pointing to the lower conversion rates seen among the group.

SSP’s Director of Group Category Strategy Bragard said that the business had recently conducted a large-scale survey to gain insights between different demographics.

“We see that there’s actually more difference within the generation than there is across each,” she said, stressing that a demographic is not a homogenous group.

Within Gen Z, however, two major trends have emerged: ‘Good for me, good for the planet’, and wellness and sustainability. 

“We see two in three travellers telling us that buying healthy food is high on their agenda,” Bragard detailed.

She did note the difference between what people say they do and their actions. When it comes down to it, many passengers might want a ‘healthy’ choice, but on the day, when they’re in a holiday mindset, they may make a different decision.

“We’re finding that the answer tends to be choice,” she said. “It’s shouting about the work we’re doing on provenance, shouting about ingredients that are better for you. Having a whole concept dedicated to health might be more tricky to make it work for everyone.”

‘Get beyond price’

Walter, a Blueprint partner and also Nordic Travel Retail Group (NTRG) board member, opened with a rundown of the history of travel retail, and a reminder that the business model used to solely hinge on price reduction.

“We need to get beyond price. It’s about the experience,” he said, describing the preoccupation with pricing over delighting customers as a “fail” that’s played out over the last 25 years.

He also noted that he’s seeing Gen Z passengers purchasing confectionery as a top category. “You don’t see liquor.”

Dagestad, Travel Retail Norway Deputy CEO and NTRG Chairman, then took the floor to describe how his business is “running as fast as possible with digitalisation optimisation”. 

“One reason is of course, Norway is probably the most expensive country in Europe,” he said. “So the more we can do to make our shopping more effective, better it is for our business.”

One example of this is a weekly shopping event held for Gen Z, where shoppers can follow along on TikTok or Travel Retail Norway’s digital platform, ‘try on’ products, watch tutorials, and add products to their basket to collect next time they travel.

“It’s more about all the different things that make shopping more convenient, more practical,” he continued, adding that they were seeing rational, planned purchasing decisions.

He also stressed the importance for travel retailers to become more inclusive and ethical with their product assortments.

“Not all people living in the Nordics are white,” he said. He called out beauty brands for being unwilling to provide a product range with a broader range, saying it was difficult to source foundation for darker skin tones. 

“We need this complete assortment and we have people right now that we don’t have an offer [for] because we don’t sell the products that are made for them in parts of the world. 

“We have to just improve, do more.”

Cultural awareness is key

TravConsult’s Executive General Manager Choi-Lee gave a powerful presentation on how cultural awareness is the “missing link” when it comes to travel retail conversion.

“You can do all these things – marketing, spending money on strategies, online engagement, [create] amazing experiences,” she said. But it won’t make a difference if a store team member isn’t culturally aware and doesn’t engage with groups effectively.

By meeting different groups on their terms, understanding how they shop, and ultimately training store staff in cultural awareness, the conversion gap can be closed, she believes. Too many customers feel people are being rude and they are misunderstood. 

“​​Ultimately, that person walks out with their money still in their pocket. That is the missing link.”

Catterall, Newmark Retail UK & EMEA Director, was the next to speak. “I really feel for this group, especially 16-20 year olds,” she said of Gen Zs. They are the group that went through school during the pandemic, and for them “the world stopped”.

“Actually, we’ve not got much research about Gen Z yet because they’ve only really just started travelling independently themselves,” she pointed out. Blended travel – combining work and leisure – will be important for this group.

She added later that Gen Z “don’t really get travel retail”. “Unless everyone starts to talk to them more directly and really engaging, I don’t think they’ll understand. 

“I think today they don’t really see the benefit in shopping in airports when they’re travelling.”

F&B, however, is increasingly important to airport travellers. Even so, Gür, Fraport’s Vice President Retail Key Account Management, cautioned against moving too quickly towards blended retail-F&B concepts.

“If you start to merge those concepts, it might become difficult to really be able [be] safe, productive and also be able to fulfil the needs of fast moving areas,” she said. 

While she confirmed Fraport was “looking into it”, she doesn’t believe blended F&B is “going to be the concept of the future”. 

In conclusion, Gür posed an interesting question. What will Gen Z be like when they grow up? “How are they going to evolve?” she asked. What will happen when they have more spending power, when they become parents? “What of how they’re acting right now is going to stay in the future?”

The TR Consumer Forum took place in Vienna from 21-23 June. Coverage continues online.