NEWS ROUND-UP Diaz: “Low-cost passengers are not a threat to TR”
Dufry CEO, Julián Diaz, says he believes low-cost passengers will be significant contributors to the company’s success as they continue to increase in number on a global scale, prompting the company to deliver commercial concepts that better target these travellers. During a press conference call with
analysts last month, Diaz was keen to point out on more than one occasion that he does not see the increase of low-cost passengers as a threat to travel retail, but actually the opposite. “We’ve seen a very healthy increase
in passengers,” he said. “In the places we are operating it was around 9%. This was driven by an increase in the low-cost passengers and British passengers. “The low-cost passenger is a very good
passenger…I have read in many locations that low-cost passengers are a threat to travel retail…it’s completely the opposite. “Low-cost has seen a significant increase
in passengers, so we need to really deliver what these passengers are expecting. We have different commercial concepts that will accelerate sales based on low-cost passengers. Maybe the average spend per passenger will drop but…we believe these passengers will be big contributors to the company’s sales.” Unfortunately, British passengers–
which Diaz cites as one of the company’s most important customer groups– were unable to bolster revenue for the company’s Spanish operations in Q1 2018, as the devalued pound continued to put off travellers purchasing in the comparatively strong Euro. “A significant percentage of the
passengers to Spain are British and what we’ve seen recently is a devaluation of the pound. This is important because in Spain we nominate the prices in Euros and as a consequence British passengers are not contributing to the growth in Spain. But in
any case performance in Spain for the first quarter was positive.” Supporting the company’s continued
turnover growth has been its aggressive expansion – which has been gargantuan in recent years – and in Q1 2018 alone the company opened 4,500sq m of retail space across 57 shops.
TFWA Singapore 2018: APAC is $30.6bn pacesetter
Sales in Asia Pacific DF&TR surged by 11.6% to record $30.6bn in 2017, but stagnant global spend per head versus passenger traffic is undermining potential ‘boom times’ in the industry, delegates at last month’s TFWA Asia Pacific Conference heard. Opening the plenary session held at the
Marina Bay Sands Expo & Convention Centre, TFWA Managing Director John Rimmer pointed to a sense that the industry ‘is not fulfilling its true potential’. TFWA President Erik Juul-Mortensen
then revealed in preliminary data from Generation research that Asia Pacific accounts for a 45% share of global sales. The fastest growing category remained
perfumes & cosmetics, which grew by 19.9% to $14bn, with a +12.9% return to $3.9bn demonstrating a strong showing from wines and spirits.
Global industry sales lifted by 8.1% to $68.6bn, with perfumes and cosmetics again the frontrunner with growth of +13.8% to hit $24.5bn. The TFWA President noted that a number
of Asia and Indian subcontinent hubs ranked among the globe’s 60m-plus passenger airports, underpinning ACI’s reported 8.4%
rise in global pax traffic in 2017. “Singapore Changi, Bangkok, New
Delhi, Jakarta and Guangzhou all broke through the 60m-passenger structure, with Shanghai (Pudong) and Hong Kong surpassing 70m.” Airports took the lion’s share of sales
at $38.3bn (+7.7%), closely followed by other shops at $25.5bn (+9.3bn), while the ferries business grew to $2.2bn (+7.4) and airlines showed modest improvements (+4.2%) to $2.6bn. Also, airports continued to increase
their share of sales, but also other shops, effectively duty free and tax free downtown malls and shopping centres,” said Juul- Mortensen. “The promising cruise line market delivered the strongest performance in terms of year-on-year growth.” The airline sector will be the subject of TFWA research later this year.
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