Tweaked luxury mix and online-offline commerce push occupies Heathrow

By Trb Editor |

Heathrow's Retail Director Fraser Brown.

Left: Heathrow has slightly reduced its luxury offer due to the government’s changes to VAT-free shopping. Right: Fraser Brown.

As consumers’ wallets tighten across the globe, striking the right balance of digital and physical retail propositions remains a driving focus for London Heathrow Airport (LHR) according to Retail Director Fraser Brown.

Brown shared his vies in the the TRBusiness Global Industry Survey 2023*, including his assessment of the travel retail industry in 2022, which he described as “in recovery”.

“Challenges with recruiting people to deliver the right level of service and brands have supply chain problems,” said Brown.

“It’s good to see some sectors such as alcohol really investing in travel retail and working on digital. The right balance of digital and physical [retail] feels more important than ever.”

Read on for Brown’s answers to our top questions…

Question: What are your expectations for your business in travel retail in 2023 and what are the major challenges you anticipate?

Answer from Fraser Brown, Retail Director, Heathrow Airport: We will see growth at LHR, but remain focused on ensuring our partners ramp up their colleagues to deliver a great service to our passengers.

“It’s good to see some sectors really investing in travel retail and working on digital; the right balance of digital and physical feels more important than ever.” Fraser Brown, Retail Director, Heathrow Airport.

We continue to work with retailers, partners, and our OOH media partner JCDecaux ensuring not only we deliver great physical stores and pop-ups but the great digital experience as well with the growth of our reserve and collect and our e-commerce only ranges.

Heathrow Airport.

Revenue from retail concessions rocketed 240.5% year-on-year to £143m in the nine months ending 30 September 2022. Source Heathrow Airports Ltd.

How do you anticipate inflation and the risk of global recession affecting your business and the consumer appetite to spend in the travel retail channel in 2023?

Labour shortages driving wages, supply chain challenges, the war in Ukraine’s impact on fuel prices etc. are all macro headwinds.

READ MORE: John Holland-Kaye to stand down as CEO of Heathrow Airport

We are watching things carefully and do see European countries’ consumers are more cautious, as the war chest of Covid savings dissipates.

How has the shift in passenger demographics as a result of the pandemic/travel restrictions affected your product portfolio and growth plans?

It has a little – although not perhaps as much as people think. Coupled with the UK Govt VAT changes we have slightly reduced our luxury offer and have more high street brands such as JD Sports and Hugo Boss.

CLICK HERE: To read the Global Industry Survey 2023 in full.

*The Global Industry Survey was conducted during November 2022 up until the second week of January 2023. Some of the views expressed are representative of individuals rather than their entire organisations. Some of the comments were also shared prior to China’s announced easing of travel restrictions from 8 January. 

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