Airport Retailing

Fossil Embarks on Non-traditional Forms of Retailing: Airport Retailing

Now virtually at every large airport, as well as medium ones, there are full blown shopping areas, increasingly resemble shopping malls. The potential retail market is huge. World-wide, more than 1,200 commercial airports handle nearly 5 billion passengers each year. Overall airport retailing generates $30 billion in global sales annually and many airports generate annual retail revenues of at least $50 million. Although airport rental is about 20-30 percent higher per sq foot for airport retailers, sales per square foot of retail space are much higher than at regional malls.

Distinctive advantage of airport retailing:

- Large group of prospective shoppers. A typical mall attracts 5-6 million annual visits while a big airport may have more than 20 million or more people passing through the concourse.

- Air travellers are temporarily captive audience at the airport and looking to fill up their waiting time, which could be up to a few hours. They tend to have above-average incomes.

- Airport stores are smaller, carry fewer items and have higher prices than traditional stores. Thus higher margins for the shops.

- The sales of gift items and forgotten travel items, from travellers not having the time to shop elsewhere, are excellent.

- Passengers are at airports at all times of the day. Thus, longer store hours are possible.

- International shoppers are often interested in duty-free shopping.

All these advantages of Airport retailing have prompted Fossil to set Airport retailing as one of the main key focus in Market Development Strategies.