Airport Dimensions has released AX24: The Age of the Airport Experience, a comprehensive study that delves into how younger travellers are redefining expectations of consumer wants and needs.
The study – which involved a 9,000-participant survey – reveals that travellers anticipate +8% growth in their travels over the next 12 months. This growth is led by a strong return to travel in emerging markets, driven primarily by Millennials and Gen Z.
AX24: The Age of the Airport Experience identifies key areas in which younger travellers’ expectations are evolving, creating both challenges and significant opportunities for airports.
Due to recent changes in airport passenger duty and easy price comparisons using smartphones, traditional airport retail faces challenges in perceived value.
According to the report, airports must bolster both existing and future revenue streams to sustain growth.
AX24 shows how satisfying the needs of the younger generation – the travellers of tomorrow, with spending power only set to increase – can help airports weather wider regulatory changes to the industry.
Experiential spending trends
The report shows that younger travellers outperform their seniors when it comes to spending on new services and experiences.
Gen Z are less interested in spending on traditional amenities such as parking and fast track but are particularly drawn to services such as sleep suites, with experiences now representing 25% of discretionary spend.
The customer experience no longer starts on arrival in the car park or transport hub, but when travellers go online to plan their trip.
As digital natives, millennials and Gen Z are more likely to pre-book airport services than older travellers. 78% say they are interested in pre-booking services across the airport compared to 68% overall.
Airports looking to develop experiences in these areas will attract the attention of younger travellers and get a jump start on opening new revenue growth opportunities.
When it comes to food and beverage offerings, older travellers are increasingly interested in more premium F&B options (61%).
However, this is markedly lower for Gen Z audiences. A high-end dining offering is less important to this demographic than the non-food experiences highlighted above.
Future-proofing airport retail
Older generations are twice as likely to spend on more practical, utility-based services such as airport parking.
In contrast, younger travellers are more likely to direct their discretionary spend towards offerings such as a VIP shopping experience. According to Statista, Millennials and Gen Z consumers will make up 45% of luxury sales by 2025.
Retail needs to pivot to experiences to make the future more immersive and hybrid to appeal to younger shoppers. 57% of Millennials and 56% of Gen Z want to see more walk- through duty free concepts, and 57% of Millennials and 59% of Gen Z want more automated kiosks and vending machines.
Gen Z are also far more likely to share and advocate for their experiences on social media, so airports need to consider how to support them in creating ‘Instagrammable moments’.
By focusing on creating memorable experiences for travellers, airports can shift the emphasis away from direct price comparisons that can see airports perceived as poor value for money.
Ecommerce also has a key role to play in the future of airport retail. More than half of travellers expressed an interest in airport shopping online via their mobile device from the comfort of their lounge seat; a location where travellers typically have time to spare and are in a more relaxed state of mind. 58% of travellers across all segments stated that they would use e-commerce more if it were better promoted at the airport.
Investing in ecommerce and dialogue technology platforms to engage travellers would allow airports to personalise incentives, promote deals and recognise loyalty to create a more rewarding and less price-sensitive retail experience.
Airport Dimensions Global Strategy Director Stephen Hay said: “Airports are entering an exciting era as travel looks forward to strong long-term growth.
“Younger travellers in particular are returning with a desire for fresh and engaging airport experiences. They are actively seeking out amenities such as lounges, quality food and beverage options, and unique retail offerings.
“Airports should capitalise on this opportunity by equipping themselves with the right tools, partnerships and engagement strategies to drive revenue growth.” ✈
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