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

SKU : ARZ180613
  • Published on : July 2018

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This market research report on global duty free and travel retail market offers analysis on market size & forecast, market share, industry trends, growth drivers, and vendor analysis. The market study also includes insights on segmentation by products (fragrance and cosmetics, liquor, fashion and accessories, tobacco goods, electronics, watches, and confectionery) and by geography (APAC, Europe, Americas, Middle East, and Africa).

Key highlights of duty-free and travel retail market:

  • 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 duty-free and travel retail 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 duty-free and travel 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.

Duty-Free and Travel Retail 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 across the global duty-free and travel retail market. 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 in the market. Various leading vendors are providing easy home delivery options and innovative customer services that improve their satisfaction levels and contributes to the growing revenues in the global duty-free and travel retail market. 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 duty free and travel retail market worldwide. The leading brands are opening exclusive stores for special products, promoting, and selling limited editions to increase their visibility and brand awareness in the global market. The global duty-free and travel retail market is estimated to generate revenues of around $112 billion by 2023, growing at a CAGR of approximately 8% during 2018-2023.

Duty-Free and Travel Retail Market at a Glance

Global Duty-Free and Travel Retail Market Size and Analysis 2023

Duty-Free and Travel Retail 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 in the global travel retail market. 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 duty-free and travel retail 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 in the global duty-free and travel retail market.

Duty-Free and Travel Retail Market - Segmentation

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

Segmentation of Duty-Free and Travel Retail Market

Duty-Free and Travel Retail Market – By Products

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

The global duty-free and travel retail market by product is segmented into fragrance and cosmetics, liquor, fashion and accessories, tobacco goods, electronics, watches, and confectionery. 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 in the global duty-free and travel retail market. 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 in the duty-free and travel retail market. The players are providing pop-up stores that provide a range of personalized treatments, demonstrations, services, and gift with purchase to boost revenues in the global duty-free and travel retail market. Additionally, rapid urbanization and boost in economic development across several emerging countries are driving the growth of this segment in the global market.

Duty-Free and Travel Retail Market – By Geography

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

The geographical segment in the global duty-free and travel retail market is categorized into APAC, Europe, Americas, Middle East, and Africa. APAC occupied more than 1/3rd 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 in the global duty-free and travel retail market. 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 travel packages by companies such as Thomas Cook, MakeMyTrip, Cleartrip, Expedia, Yatra, GoIbibo will result in the growth of the global duty-free and travel retail market. Furthermore, the rapid penetration on social media and digitalization of the economy will create lucrative opportunities for vendors operating in the APAC duty-free and travel retail market during the forecast period.

Key Countries Profiled in the report are: 

  • China
  • South Korea
  • UK
  • France
  • US
  • Brazil

Key Vendor Analysis

The global duty-free and travel retail market is highly fragmented, and top players dominated the majority market share. The boom of the travel and tourism industry is encouraging the vendors to open new outlets and chains in the global duty-free and travel retail market. 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 in the global duty-free and travel retail market. 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.

The major vendors in the global duty-free and travel retail market are:

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

Other prominent vendors of the duty-free and travel retail include DFS, Shilla, China Duty Free Group Co.Ltd., King Power International, Duty Free Americas, Inc., AER Rianta International, Dubai Duty Free, James Richardson Group, Qatar Duty Free, and Flemingo International.

Key market insights include

  1. The analysis of global duty-free and travel retail market provides market size and growth rate for the forecast period 2018-2023.
  2. It offers comprehensive insights into current industry trends, trend forecast, and growth drivers about the global duty-free and travel retail market.
  3. The report provides the latest analysis of of the global duty-free and travel retail market share, growth drivers, challenges, and investment opportunities.
  4. It offers a complete overview of market segments and the regional outlook of global market.
  5. The report offers a detailed overview of the vendor landscape, competitive analysis, and key market strategies to gain competitive advantage in the global duty-free and travel retail.

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