Retailing Luxury At Airports

This has always been an all too familiar feel stretching back decades but now things are changing “Luxury” has for some, and an increasing number of people, became a personal purchase, no longer a gift but a “must have” accessory to be for oneself.

This has come about for a wide variety of reasons and in different parts of the globe.  The Western world has enjoyed a significant long run of sound economic growth built on low interest rates and growing economies.  These factors, and there are more have increased peoples’ spending power and disposable wealth.  You do not have to “save up” for it with all the emotional baggage that goes with that scenario!  Economic growth has not just been for the West, it has now become global with huge increases seen in gross domestic product in countries in the Middle East, the Far East and Asia.

Personal wealth needs an outlet and luxury goods and services are the first step in the process.  Luxury products from planes, cars and luggage are enjoying considerable commercial growth and thereby economic importance for all the players within the burgeoning marketplace.  The UK newspaper The Financial Times has only just recently held a three-day seminar on “Luxury” in Venice, Italy where a group of brand owners, designers and investors exchanged views and provided the audience with their own ideas for market expansion.

Luxury brands need each other and it is no wonder that in each of the major capitals of the world that there are streets that have become synonymous with luxury.  This makes commercial sense for all concerned, if the luxury brand shops were located all around a city, cheek by jowl with lesser retail mortals, they would not attract the number they do when they are all clustered together.  For the consumer it makes for retail heaven and it also helps in price comparison especially when one is talking about accessories.  Store position has always been important for all retailers but for the luxury brand it is critical.  Luxury brands in airports started out as perfumes and specialist spirits and were located in the Duty Free offer Airside.

This has grown with the help of airport operators such as BAA plc into the fully-fledged stand-alone stores but even here they are few and far between in most airports.  What has been needed is the pioneering spirits and ability to attract luxury retailers into an airport and give them their own space together, to form clusters of luxury.  These are located Airside so as to allow the passenger the benefit of Duty and Tax Free in certain areas.  It is also important for these clusters to be near and around the right passenger profile.  It will not be near short haul Charter flight departure gates!

For luxury retailers operating out of a passenger terminal it is, like most retailers, to understand fully the type of retailing modus operandi that is an airport.  The need to understand that there is a different design requirement, some of this due to airport regulations but also how a passenger shops a terminal and finally the understanding that space is at a premium so choice of product range will be important.

The first major difference between your High Street location and the airport terminals is store shape.  Most shops have an in-store layout built around a front to back rectangle.  This can vary depending on the size of the store.  In an airport store space is from left to right with a very short depth of retail space.  Another factor is that most airport retailing wants an open front shop approach.  This is both beneficial to the retailer as the store can attract more consumers as they pass along the “mall” and for the traveller there is a feeling of connection between the shopping experience and the reason why they are there and that is to catch a plane.  Divorce the two and you either get an insecure shopper concerned about the time or you have no clients at all.

This is one of the most major shop design features that is different from the norm.  It is also one in which the luxury brand has most difficulty with as on the High Street luxury retailing has always had the tendency to protect and enhance the brand behind closed doors.  Some even go to the extent of posting a doorman either in or on the exterior of the shop door to both open and close the “barrier” to allow consumers in or out.  Some luxury retailers still do this within the airport but the terminal situation throws up a different opportunity for luxury brands to attract customers while still keeping the brand values.   This should be seen as a positive challenge and one in which retail designers such as The Design Solution are well versed in resolving in a very creative way.

Product range is also a critical element in luxury retailing as too is the way it is merchandised.  Luxury items are by their very nature expensive so product display needs to be compatible with the brand values, security and be consumer friendly so as not to treat them in a patronising way.  This is especially important where a luxury retailer is selling product clusters such as sunglasses or small leather goods where the choice between what brand to purchase is the paramount activity.

International airports especially of the Hub variety offer a great opportunity for luxury brands to put a toe in the water in different parts of the world.  This gives a luxury brand a huge opportunity to see how the brand performs at a fraction of the cost compared with opening a store within a luxury brand cluster in a major world city.  Chloe, the major French luxury retailer has for instance opened in Singapore but in Changi Airport.  There is also the opportunity for the ‘new’ luxury brands to open up their marketplace thereby giving them critical targeted exposure to the specific passenger profile that they may already have downtown.  A few select UK based luxury retailers such as Mulberry have done this to great effect when targeting the American market before opening in that country.  Airports can promote luxury brand awareness via the international passenger base.  Shanghai Tang the growing Asian luxury brand is now firmly established in many of the world’s major airports as a way of creating brand awareness.

Changi Airport in Singapore has a new luxury-retailing Island planned and designed by The Design Solution.  The Island site is in the very heart of the passenger thoroughfare and is seen as a one-stop shop for luxury retailing.  The centre itself is operated by Valiram, a company that has for a number of years handled luxury products in Asia.  In Changi Airport the retailing methodology is different in that it purchases all the luxury products that are sold within the centre and sells them on.  It operates as a franchise.

The first issue for The Design Solution was that the area that Valiram had been given needed meticulous planning so as to maximise and ease footfall in and through the Valiram luxury island.  It only has three main entrances to the area and on the “back” wall there is not an entrance at all.  At first glance this may appear contrary to the open plan scenario of most retail offers at airports but the five luxury brand shops all have their separate entrances with a further entrance-exit into the main body of the space.  Another important element to the design was to balance the individual shop frontage requirements, as all the shops are the same size.  Bvlgari and Cartier are placed on the two front corners and are stand alone stores with no second entrance-exit into the main area.  The main entrance to the island site is flanked by Fendi and Botega, which are both walk through shops.  As you can see the fluidity of the plan was critical for there is nothing worse for a shopper than having to retrace his or her own steps.

The benefit to this luxury brand area is the strategic placing of the key international luxury brands such as Cartier and Bvlgari these act as beacons attracting and drawing the passengers into the centre.  The “interior” works on the basis of a simple “T” shape with an organic and free flowing passenger flow.  This was critical as the centre of the area has a different retailing ethos.  Here there are product clusters of items such as sunglasses and luggage, all the luxury brands work as product clusters so there is a mixture of brands in each cluster.  This variety of retailing is not to be seen as “secondary” to the stores but actually expands further the retailing opportunities for each luxury brand.  If a passenger wanted luggage then he or she would simply go to that product cluster rather than having to complete a major tour of all the luxury shops.  It is beneficial to all concerned.

The Design Solution enjoyed close cooperation with all the brand owners ensuring that with this difficult floor plan all the luxury brands key elements with regard to the public’s perception of each brand was concerned was not only encapsulated but also enhanced.