Travel retail cannot survive if we do simple things wrong

Share on facebook
Share on twitter
Share on linkedin

By Marco Passoni

How much is it acceptable to charge for a bottle of water in an airport? I was walking through a major European airport this week, one which you would be forgiven for expecting to offer the best in bespoke service and travel retail excitement. In among all the luxury stores, and parts of the industry we like to highlight, I found small 20cl bottles of water being sold 2 for € 4,99, like it was a big bargain.

Surely something like this has no place in our modern travel retail industry – or certainly not in the one we all talk about building. Indeed, if this is how travel retail sees its future, then we could be headed for extinction.

Travellers are forced to give up any bottles of water they have before they pass through security area, so to charge this much for a bottle of water is taking unnecessary advantage of a situation which we, as a travel ecosystem, have created. Water is a primary demand for humans and it is ethically unacceptable to charge an unreasonable margin for it – even if operating costs are higher. The situation is made even more ridiculous when we consider that in some airports in Spain, it is contractually mandated that a small bottle of water cannot cost more than €1. So how does one justify a much higher markup elsewhere?

Something like this has no place in our modern travel retail industry…if this is how travel retail sees its future, then we could be headed for extinction

Most major airports today are well served with water fountains which allow travellers to refill their bottles. So, selling a bespoke airport bottle, or one tailored to the city, would make sense in the travel retail setting. But a huge mark-up on a small plastic bottle of water can only give more fuel to those who say travel retail is too expensive.

This speaks, for me, to a wider problem which the travel retail sector has as we move into our new normal: we have to do the simple things right. We talk a lot about the future we want to build, but shoppers will judge on what they see.  We are talking about bespoke experiences, unique products and innovative concepts. All of that is wasted words if we any part of our offer damages the overall appeal of the ecosystem.

All of our collective talk of new concepts and a bright future for the market are undermined if we give cynics and one-off travellers a reason to believe that we are not sincere about putting them first. Talk is cheap and all our best intentions can undone by wrong decisions. At its very core, the whole market, from landlords to brands, must be working together to make this a space where our best intentions can flourish. This means working in a way, and with contracts, which do not necessitate the selling of €5 bottles of water. We must not just talk about doing better and building brighter – we must actually do it. Continuing to do the simple things wrong will be the end of us all.

Marco Passoni has decades of experience in the travel retail sector. He has spent the majority of his career in senior leader positions throughout the market, including a 12-year tenure as CEO of a leading international Duty Free distribution company and a further 8 years running a retail firm that operated fashion mono-brand stores in several international airports.
Today, as Senior Executive VP and founding partner of 2.0 & Partners, he leads the company’s efforts in developing and innovating services which create new opportunities and partnerships for all members of the travel retail Trinity. A former elite-level sailor, with a World Championship to his name, Marco now spends much of his time airside, experiencing the changing travel retail industry first-hand, to better guide partners and clients on the best way to do business in this vibrant and unique market.