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HomeNEWSAuckland Airport’s renaissance and what it means for retail

Auckland Airport’s renaissance and what it means for retail

Airport retailing is no small-scale operation. In 2015, 15.8 million passengers – or potential customers – travelled through Auckland Airport. This was an increase of 1.3 million on the year previous.

In comparison, Auckland’s Sylvia Park shopping centre has over 12 million shoppers passing through its doors each year.

While some might assume the work is done, seeing as shoppers have to pass by stores to get to their flights, this isn’t the case.

Airport retail is a more complex scheme than some give it credit for. Stores are often competing on an international scale.

Passengers can be prone to saving their pennies to spend overseas when they are jetting off somewhere exciting.

For Auckland Airport, general manager of marketing and communications Jason Delamore, says, this means promoting the benefits of shopping there which make the venue unique.

“I think from our perspective, what we’re definitely doing is ensuring people know the value of tax and duty free. The key benefits are there’s more selection than the High St and better value,” he says.

Take, for example, international lingerie retailer Victoria’s Secret.

It opened a store in Auckland Airport’s international terminal in September, marking the brand’s first and only foray so far into the New Zealand market.

This addition gives the airport exclusivity over an international retailer that other shopping centres will no doubt be hungry to acquire.

Delamore says Auckland Airport does a lot of research around who to tailor the retail experience to, which then feeds into its choice of retailers.

The airport then embarks on a brand-promotion programme with any retailer choosing to open there.

Two words Delamore mentions when describing the retail mix are “diversity” and “quality”, which can be seen in its most recent shop additions.

Last year, watch brand Casio G-Factory, New Zealand handbag brand Saben and New Zealand clothing label Ruby all opened stores in the international terminal.

Both Saben and Ruby are positioned in the luxury brand space, as are many other of the other shops in Auckland Airport’s stable.

Meanwhile, Aelia Duty Free and The Loop Duty Free replaced DFS and JR Duty Free in an international tender process last year.

Aelia Duty Free has also recently introduced its ACE Robot to the Airport, which packages up click-and-collect items.

The domestic terminal hasn’t been left behind in the changes either. Hospitality stores of 3 Wise Men, Shaky Isles café and bar and Pie Face have opened, along with other new convenience stores.

The airport’s retail earnings are also expected to increase by an additional $5 million in the 2016 financial year thanks to the changes that have taken place to its duty free and specialty stores.

More stores will join the fray once the airport completes its expansion by early 2018, though it’s keeping quiet about who is to come. 
 

It’s expected the leased area for retail and food and beverage on the first floor will grow in size by around 65 percent, following the expansion.

Also helping achieve this number is Auckland Airport’s app, which recently had a major rebuild to introduce a number of new features.

Auckland Airport is the first airport in the world to integrate Travel organising app TripIt’s technology into its own app, allowing customers to book parking or services on their phone, get reminders as to when their flights are leaving and remind shoppers to pick up their duty-free shopping they’ve bought via click-and-collect.

In the future, Delamore says shoppers will be able to shop duty-frees stores directly through the app.

For now, he says the app’s main benefit for retailers is that it adds another direct link from the customer to the retailer.

“What we’re trying to do is help make that journey better before you even get to the airport. From the comfort of your home, work or hotel, you can take care of a lot of your shopping before you get to airport and streamline journey, so there’s less stress and so forth. Even if you’re overseas, you can jump online or on the app and buy your duty free and pick it up as you race through the terminal,” Delamore says.

So far, it’s had 85,000 downloads, with a 25 percent increase in the number of regular users since the app upgrade.

This is a very good result so far, he says.

“We know from analysis there’s more page views and people are on it for longer.”

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