Welcome to the latest instalment of a thought leadership column in partnership with Nestlé International Travel Retail that aims to raise the profile of food and highlight its potential as a key growth driver in the travel retail mix. In this issue we assess the food & confectionery offer as viewed by travel essentials specialist WHSmith.
“The group is in its strongest-ever position as a global travel retailer.” So said WHSmith Group Chief Executive Carl Cowling last month, speaking about the Travel division’s stand-out performance in the six months to 29 February.
Travel revenue climbed by +13% year-on-year to £670 million (US$839), with strong results across all markets.
The results were bolstered by strong performances in all three Travel divisions, with overall sales in the UK up by +15%, North America by +7% and the Rest of the World up by +19% year-on-year.
The company highlighted key factors beyond passenger traffic growth underpinning its revenue performance, notably increased spend per passenger, higher average transaction values and an expansion of its categories.
The latter is typified, notably in its UK home market, by the shift from being a news, books and convenience retailer to a one-stop-shop for travel essentials.
A prime example is the 6,000sq ft flagship store opened in late 2023 at Birmingham Airport. This was the latest in WHSmith’s development of the one-stop-shop format following executions at London Heathrow and London Gatwick airports and across rail sites, including London Euston and London Paddington stations.
The Birmingham Airport space was reconfigured as part of a transformation of the departures lounge, and features zones for food & drinks, books & magazines, plus health & beauty, tech products, locally themed gifts and a Costa Coffee kiosk.
Within this and other one-stop-shops, food plays a vital role.
WHSmith UK Travel Managing Director Andrew Harrison told us: “Chilled food was a category we didn’t do ten years ago; now we sell ten million meal deals a year in UK Travel. We also go beyond our traditional meal deals to healthy, plant-based options, premium options plus coffee, which also opens up breakfast as a day part in our stores as well. Food therefore is a strategic growth option.”
For confectionery, WHSmith is working with manufacturers on optimising pack sizes for travel. “People buy bags as part of deals and share them out on the plane. We want to keep innovating in this category.”
Also in food, health & wellness is high on the agenda when framing the offer.
Harrison said: “Some brands have emerged and grown very quickly across snacking so we need to stay close to manufacturers and trends. Health is a key category in food.
“Across snacks and drinks, you must have a wide range to set yourself apart and meet consumer choice.”
Packaging and presentation of food have also taken a step forward in the UK market, said Harrison, an example being the introduction of food chillers with energy-saving doors.
“Our fridges are very innovative, which with the latest air flow technology allow us to reduce energy consumption. You have to keep innovating here and in the offer.”
That innovation is especially important as food grows its share. Food and drinks contribute around 40% of WHSmith sales at UK airports, 50% in rail and is even higher in the hospital market the company serves.
Harrison said: “Food is a big part of what we do. There is more competition in airports from other F&B providers so you have to remain at the top of your game.
“The one-stop-shop concept is all about the halo effect of bringing all categories together. Our mission is to help passengers find what they need at the airport quickly and easily, and so everything we do is through a travel lens, not a High Street lens.
“The new stores will evolve according to customer needs and we will respond. We are an essentials retailer and we will serve that market as it changes.” ✈
*Note: This article first appeared in The Moodie Davitt eZine. Click here for that version.
