Gaurav Dewan, Chief Operating Officer, and Business Head, Travel Food Services
The compounded annual growth rate of travellers is expected to reach 3.6% per cent outpacing the projected global GDP growth rate of 3.2 per cent, over the next 20 years. This implies that in the future, growth in passenger traffic is expected to surpass that of income and output. The accelerating growth in travel has necessitated an upgrade in the modes of tourism, majorly in the aviation sector. India’s air passenger traffic is also expected to grow six-fold to 1.1 billion by 2040. Airlines and airports need to adapt to changing consumer trends by offering improved services, superior F&B outlets, and exclusive travel retail stores.
In the past, retailers had to be incentivised to establish their airport outlets. Today, all major retail and F&B outlets compete for coveted airport spaces. Higher rentals are no longer a discouraging factor as retailers vie to tap into this nascent consumer segment. Though airport retail is still in its rudimentary stage in India, Indira Gandhi International Airport in Delhi, the busiest airport in the country, has already recorded a 62 per cent contribution by retail stores in its total non-aeronautical revenue, as per reports.
However, airports cannot get complacent with these numbers as statistics show a diverging trend between growing traffic, and stalling duty free and travel retail sales. Brands at airports must innovatively display and execute their products and services for customer engagement. Chhatrapati Shivaji Maharaj International Airport, Mumbai already houses such initiatives, like the ‘Flight 4 Fantasy’ stimulator that allows users to pilot a flight to over 20,000 airports around the world, or the exuberant displays of luxury automobile makers that allow for first-hand interactions with customers.
The new generation is more informed and rationalises its purchases while blending comfort with luxury in services. They relish exclusive dining options, spas and lounges, and aspire for each step of their journey to be an experience in itself. This trend is now being adopted by most travellers, regardless of their age, profession or other demographic factors, who wish to streamline every aspect of their travel, from easy web check-in, ordering food on their smartphones, relaxing in luxurious lounges, and visiting fine dining, to departing without any hassle.
While self-check-ins, mobile food orders and online tracking of flight statuses have already been widely adopted, new trends in technology to provide effortless services are gradually being introduced. Smartphones called ‘Meal Ordering Devices’ have been given to cabin crew in the business class by Emirates to accelerate the F&B service, and a few airlines have allowed passengers to place orders through the in-seat IFE system. Using Artificial Intelligence and Internet of things (IoT) has already enabled smart airports, and the progress made in these fields is being imbibed by F&B and retail sectors at airports.
Customers are appreciative of these advancements, as with real-time monitoring and updates, passengers, who are always struggling for time, can get prompt resolutions for their grievances, and airport authorities can post flight updates to all passengers irrespective of their physical location. This ensures uninterrupted connectivity and less travel disruptions.
In recent years, international leisure travel has been on the rise. To accommodate these changing dynamics, airports must evolve and refine their functions by upscaling their employees, furnishing services in multiple languages, and responding to the new-age global health-culture.
According to The Centre for Asia-Pacific Aviation (CAPA) has estimated that the collective expenditure on duty-free, duty-paid and food and beverage services will reach an astronomical USD 3.5 billion by 2021. Aware of this growth trajectory, airport facilities have embarked on an elevated path of progress, highlighting a prosperous future for the sector.
