Duty Free and Travel Retail Market - Global Outlook and Forecast 2018-2023

DUTY FREE AND TRAVEL RETAIL MARKET SIZE TO CROSS $112 BILLION BY 2023, GROWING AT A CAGR OF OVER 8% DURING THE PERIOD 2018–2023

Duty Free and Travel Retail Market Size, Share, Trends, Analysis Report by Products (fragrance and cosmetics, liquor, fashion and accessories, tobacco goods, electronics, watches, and confectionery) and Geography (APAC, Europe, Americas, Middle East, and Africa) Industry Analysis Report, Regional Outlook, Growth Trends, Competitive Landscape, Share & Forecast, 2018–2023

GLOBAL DUTY FREE AND TRAVEL RETAIL MARKET REPORT SCOPE

Key Highlights 

• Increasing number of tourists, flights, and air travels has considerably increased the revenue of aviation industry and duty free and travel retail business.
• The availability of premium branded items at cheaper costs in the duty free retails and growing preference towards premium brands enables the growth of the industry.
• With the rise of middle class population in India and China, urbanization, and increase in disposable income, the air travels exponentially increasing, causing increase of sales across duty free outlets.
• Airports, airlines, and retailers take advantage of the growing of digital commerce and big data analytics. They are developing more sophisticated retail strategies to sell duty free goods to consumer.
• Travel retail is highly vulnerable to currency fluctuations. The volatility in currency markets has always played a prominent role in the global duty free and travel retail business.

Market Overview

The growing demand for retail chains that offer luxury and premium brands of various products is augmenting the growth of the global duty free and travel retail market. These distribution channels provide passengers value, enhance their experience while traveling, generate value addition to economic activity, and creates employment that contributes to overall GDP globally. The rising popularity of the travel and tourism industry is one of the primary factors in the global market. These services enhance the experience and value for money which enables consumers to shop premium, duty free and luxury brands at discounted price in the world market. The idea of temporary spaces that offer end-users extra time after security check-in and allows them to get entertained, excited, and indulgent with the ambience and experience of shopping for duty free international products, thereby boosting retail sales. The increasing focus on digitalizing the retailing process so that they could maximize their profit and convert more customers will boost sales. Various leading vendors are providing easy home delivery options and innovative customer services that improve their satisfaction levels and contributes to the growing revenues. The benefit of attractive prices, service, convenience, recognition, and high-end product merchandising are some of the factors that will promote the evolution of the global travel retail industry.

The growing number of international tourist, rising number of middle-class family, and increasing number of low-cost carrier (LCC) airlines will fuel the growth of the market worldwide. The leading brands are opening exclusive stores for special products, promoting, and selling limited editions to increase their visibility and brand awareness.

Market Dynamics

The rising number of middle-class population and rapid urbanization is propelling the growth of the global duty free and travel retail market. The increase in disposable income, improvement of standard living, and affordability and convenience of air travel are boosting the number of middle-class population traveling and purchasing products from these duty free stores. The leading vendors are developing consumer-focused businesses especially for this end-user segment to boost their travel retail industry size over the next few years. In emerging countries such as India and China, middle-class consumers are the largest contributors to the economic development and have the spending capacity to promote the growth of the duty free industry worldwide. With the surge in middle-class median income, their expenditure trend, traveling mode, and demand for premium brands will also rise, thereby, fueling the travel retail sales across the industry. The rapid development and urbanization will augment the development of infrastructure and offer access to better amenities in the market worldwide. The building of new airports and ports will boost the revenues.

Duty-Free and Travel Retail Market Segmentation

This research report includes a detailed segmentation by products and geography.

Insights by Products

Demand for premium perfumes to boost sales in the global duty free and travel retail market during the forecast period

The fragrance and cosmetics dominated the majority of the market share in 2017, growing at a CAGR of approximately 10% during the forecast period. The growing demand for premium perfumes and growing popularity of make-up amongst the women of all age is propelling the growth of this segment. The increasing number of professional working woman and rise in the travel frequency are some of the other factors augmenting the demand worldwide. The emergence of several dedicated outlets with modern and customer interactive designs will help vendors attract a large number of consumers. The players are providing pop-up stores that provide a range of personalized treatments, demonstrations, services, and gift with purchase to boost revenues. Additionally, rapid urbanization and boost in economic development across several emerging countries are driving the growth of this segment.

Insights by Geography

Introduction of LCC across APAC to transform the global duty free and travel retail market during the forecast period

APAC occupied more than 1/3^rd of the market share in 2017, growing at a CAGR of over 11% during the forecast period. The growing number of new air routes and the introduction of LCC carriers is one of the main factors promoting the development of the APAC region. The rise in the consumption size and the purchasing power across China and India will have a positive impact on the market in this region. The growing preference for differentiated and value-added products is boosting the desire to travel among the population in APAC will boost the demand in the duty free industry.  The adoption of new lifestyles and the introduction of cheap destination packages by companies such as Thomas Cook, MakeMyTrip, Cleartrip, Expedia, Yatra, GoIbibo will result in the growth of the market. Furthermore, the rapid penetration on social media and digitalization of the economy will create lucrative opportunities for vendors operating in the APAC region during the forecast period.

Key Vendor Analysis

The global market is highly fragmented, and top players dominated the majority market share. The boom of the tourism industry is encouraging the vendors to open new outlets and chains. The increasing focus on offering a diverse and wide range of product collection will enable vendors to attract a large number of consumers and gain a larger global duty free and travel retail market share. The adoption of innovative promotional campaigns and attractive price offerings will help the players sustain the competition. The procurement of super-premium and luxury products will help companies gain a competitive advantage over other vendors in the market during the forecast period.

Major Vendors:

• Dufry AG
• Gebr. Heinemann
• Lotte
• Lagardère Travel Retail Group

The duty free and travel retail market research report includes in-depth coverage of the industry analysis with revenue and forecast insights for the following segments:

By Products

• Fragrance and Cosmetics
• Liquor
• Fashion and Accessories
• Tobacco Goods
• Electronics
• Watches
• Confectionery

By Geography

• APAC
• China
• South Korea
• Europe
• UK
• France
• Americas
• US
• Brazil
• Middle East
• Africa

Key Questions Answered

1. What is the duty free and travel retail market size and growth rate during the forecast period?
2. Which product/region is generating the largest revenue in the Asia Pacific region?
3. What are the factors driving the growth of Europe duty free and travel retail market shares?
4. How is the growth of the fragrances and cosmetics segment influencing the growth of the duty free and travel retail market?
5. Who are the leading vendors in the duty free and travel retail market, and what are their market shares?