New Terminal Targets Truly Captive Audience
By Bernice Hurst, Managing Director, Fine Food Network
Shops pay rent and generate income. People (a.k.a. passengers) may spend money. But if they don't, should they be teased, tempted and tantalized until they do?
When London's Heathrow airport, one of the world's biggest, opens its Terminal 5 next March, it will host one of the world's largest airport shopping areas. What it won't have is very many seats for non-shopping moments. The huge space contains a mere 700 seats (other than those in bars and restaurants, of course) to accommodate an anticipated 30 million passengers per year.
Heathrow already boasts a huge range of shops but, according to the Guardian, Terminal 5 will increase the available retail space by 50 percent, offering 142 stores and 25 restaurants for a total of 250,000 square feet of retail space. Last year, the newspaper reports, landing charges brought in nearly £900m, while retail income was more than £600m.
Mark Riches, managing director of World Duty Free (WDF), calculates that "About 70 percent of passengers will come down those escalators (into his flagship 30,000 square foot outlet) and we will be ready."
With an average spend of only £4.26 and one third of passengers not spending at all, Mr. Riches apparently sees huge opportunities for improvement. WDF last year recorded sales of £380m (selling one in every five bottles of perfume in the UK) and will have seven outlets dotted around the terminal.
The Guardian also reports that Mr. Riches, a former Marks & Spencer executive, is planning "to put the glamour back into airport retailing" by "moving away from just selling stuff to providing services" such as cosmetics counters and an area dedicated to treatments, including manicures. What he calls "contentainment" means music will change according to where you are in the shop and a 14-meter-long crystal curtain "bigger than a double-decker bus and thinner than a calculator" will show videos, advertising and sports events.
The store will also include a tasting bar in the cigarettes and spirits section. Nearby, a cocktail bar, co-financed by Diageo, is being installed inside the store. Mr. Riches' ambition to make the bar the best in London might raise questions about encouraging passengers to board already worse-for-wear.
Many already frustrated by the Heathrow experience aren't expected to be enthused by the retail expansion. Notoriously lengthy security queues, poor facilities, the proliferation of shops - and lack of seating - have already been blamed for a sharp increase in the number of business flights out of small airports around London.
Actually, unless the Guardian simply omitted to mention it, there may
still be a missed opportunity. Passengers resisting shopping temptation but
desperate for a free seat may be found hiding out in toilet areas. (Just don't
tell World Duty Free.)
Discussion Questions: Do you think airport passengers want and/or need such a massive range of shopping options? Are there any ethical considerations in setting up shops when the customer is basically trapped in an airport? Is this group truly captive, or is there some danger of losing passengers to other airports?