ACI EUROPE CONFERENCE Digital and Innovation focus at ACI Conference


The 27th ACI Europe Airport and Commercial Conference and Exhibition, which took place in Tel Aviv, Israel (13-15 March) attracted more than 300 delegates. Digital, innovation, industry challenges and the overall evolving nature of DF&TR were among the topics discussed and debated in depth. Andrew Pentol reports back on a busy programme.


T


hemed ‘Transformational Disruptors in the Airport Commercial Space’, the 27th


ACI Europe Airport and Commercial Conference in Tel Aviv placed a strong emphasis on digital and innovation opportunities. The event, which attracted more


than 300 delegates, also assessed some of the more general challenges facing the DF&TR industry, such as the ongoing threat to tobacco. Additionally, it highlighted other


non-digital opportunities such as Brexit and the potential return of tax and duty free sales for passengers travelling between the UK and EU. In a powerful State of the Industry


address, ACI President Olivier Jankovec began by describing traffic as the “good part of our business”. He revealed a +8.5% rise in air


passenger traffic growth across European Airports in 2017 compared to the previous year. “Aviation has been an economic


outperformer of GDP growth in the past five years,” he said. “This shows the industry is of strategic importance to our economies.” On the technology front, Jankovec


added: “It is clear we are going to see technological changes impacting all businesses and not just airports. The ability of airports to accept and use data will be key.” With millennials set to account


for 50% of global travellers by 2020, Jankovec commented: “This is among several factors putting the pressure on commercial revenues and challenging the business model at European airports.” In terms of factors heaping


pressure on the industry right now, the World Health Organization’s Protocol to eliminate Illicit Trade in Tobacco Products (ITP) is a significant one, as outlined by European Travel Retail Confederation (ETRC)


MAY 2018


President Sarah Branquinho in a powerful presentation. She said: “The protocol mandates


that research should be undertaken within five years into why duty free contributes to the illicit trading of tobacco products which is complete nonsense. “We will build opposition to


any restrictions or ban on duty free tobacco products with key industry stakeholders. “I would like to emphasise that


the Duty Free World Council fully supports the Illicit Trade Protocol, but rejects any notion that the duty free industry is involved with illicit trade.”


E-commerce rise Another threat is the rise of e-commerce, which Israel Airports Authority Deputy Director General Commerce Business Development Yoram Shapira addressed. Shapira, who highlighted today’s


smartphone epidemic said: “We want to combine the digital and physical, but how do we do this? How do we persuade customers to come to our shop and buy in-store?” He added: “If they are not going


to buy in our shop we have to give them the opportunity to buy our products online.” On Tel Aviv Ben Gurion Airport


in particular (see page 27), he referred to the ‘new customer’, which has emerged following the signing of the Open Skies agreement in 2012 and its ratification the following June. “The changing passenger mix


has meant there are a lot of families and more children flying [who are not allowed to buy duty free liquor and tobacco products]. We must adapt to this.” It is certainly all change for JR


Duty Free, the long-standing duty free operator at Tel Aviv Ben Gurion, which began a joint venture with


Gebr Heinemann on 1 January (see page 22). Highlighting the changing face


of the global DF&TR industry, JR Duty Free Chairman Garry Stock commented: “We are moving into a new era. Look at what has happened with mobile phones. The world has changed and so has our industry.” According to Stock, retailers must


do more in the face of ‘much heavier regulation’ and continuing strong competition from elsewhere. “We have focused on elements


like pre-order, promotions, full online service, fresh design and easier queue completion,” Stock told members of the audience.He also challenged the current contract model: “Arrangements built around minimum annual guarantees are not helpful. Minimum annual guarantees should be reasonable and serve as a safety net. “The focus needs to be on


percent of sale and the operator needs protecting.” «


“It is clear we are going to see technological changes impacting all businesses and not just airports. The ability of airports to accept and use data will be key.”


Olivier Jankovec, President, ACI TRBUSINESS 25


Above: The 2018 ACI Commercial and Retail Conference and Exhibition in Tel Aviv attracted more than 300 delegates.


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