By Marco Passoni
The TFWA World Exhibition in Cannes is almost upon us once more. This is a show I have been attending since 1992 and I am proud that this year we will be returning with a strong 2.0 & Partners team, ready to work alongside partners new and old to make journeys better for our consumers.
Every year the Cannes show is a platform to discuss the top issues of the moment in travel retail. There is, of course, no better way to create an innovative solution for a problem than face-to-face with fellow stakeholders. I have no doubt topics such as experience, exclusivity and China will be much talked about – alongside, I hope, both price and the UK’s foolish Tourist Tax and how to continue the fight against it.
But one issue which will certainly come up, as it has for many years now, is the current business model and the outdated nature of the Master Concession in many locations. It is amazing to me that this has been an identified problem for so long – but is still one which persists.
Let me be clear, the Master Concession model has its place in travel retail. It is the right approach in smaller airports, where a holistic overview and pure, connected experience is key to keep passengers moving and engaged – especially if time is limited. But in big hubs, it is not just a missed opportunity, it is damaging our offer as an industry.
I have been very honest in my firm belief that only brands can deliver the experience which shoppers need and expect today, and they must be allowed to do so through directly-operated stores. Putting a logo onto a copy and paste store is not enough. Shoppers will see through the deception and it damages both the airport retail experience and the brand equity, and it disappoints the customer – the absolute worst outcome for everyone.
Only brands can deliver the experience which shoppers need and expect today, and they must be allowed to do so through directly-operated stores. Putting a logo onto a copy and paste store is not enough.
The same can be seen in the F&B sector; all too often, exciting new concepts from popular brands appear in airports, only to be revealed as simply fresh packaging for the same big operators. These companies are, of course, experts in delivering economies of scale and driving revenue for landlords, and they can assist new brands, but this must not be at the expense of the bespoke and tailored experiences expected of these brands and their reputation.
What amazes me, in fact, is that this model continues to be used, with major airport operators seeking out a single partner to run all of their retail space. Any airport contract signed today will still be influencing airport operations in 10 years time, and the Master Concession model is already out of touch with what our customers want.
This, of course, speaks to the wider issue around the business model and profit/loss sharing, and the need for landlords to offer more flexibility in the business to allow brands to operate their stores in a way which encourages creativity and innovation, rather than stifling it with a copycat plan from other locations.
This speaks to the wider issue around the business model and profit/loss sharing, and the need for landlords to offer more flexibility in the business
But the good news is there are signs of change. The Gebr Heinemann team have spoken in recent years about “red lines” they will not cross in signing new contracts, and their preference for a joint venture model which puts retail at the heart of planning. The Extime Duty Free model is another, which puts retail and flexibility first and gives brands space to operate – and it is working. More recently, the tender for the new Western Sydney International Airport called for a duty-free operator, with more tender opportunities to come.
These are the opportunities we need. If airports and landlords are not willing to evolve and move away from the Master Concession and inflexible business models, then they are not doing their jobs properly. As in the past, the time for talking is over – we must do better.
