MALAYSIA Airports hosted the 9th edition of the Concessionaires Conference recently.
Centred on the theme “Gearing Towards the Future of Travel Retail”, the half-day conference discussed the challenges and opportunities of the industry and strategy to future-proof Malaysia Airports’ travel retail and airport experience.
Increase of tourist arrivals into the country has been recognised as one of the main opportunities that need to be leveraged by the travel retail segment.
As the operator of a network of 39 airports in Malaysia comprising international airports, 16 domestic airports and 18 Short Take-Off and Landing Ports (STOLports), Malaysia Airports plays a significant role in facilitating tourist arrivals into the country.
As of October this year, the Group’s Malaysia operations registered 89 million passenger movements with Kuala Lumpur contributing 49 million. Of these 49 million, 70% are international passenger traffic movements.
Malaysia Airports Commercial Services senior general manager Nazli Aziz said, “Malaysia Airports is committed to growing the airports’ connectivity as Malaysia’s strategic location in the heart of Asean is a huge advantage for the travel retail industry.
“With the latest Malaysia Airports Commercial Reset Strategy, Malaysia Airports aims to raise the retail profile of airports in Malaysia through real estate improvement, brand positioning and new retail mix,” he said.
Malaysia Airports is targeting to increase the average spending per pax (SPP) by four-fold, from the current RM35 to about RM140 in five years. Overall, the airport operator has also projected a boost from its non-aeronautical to aeronautical revenue with a 60:40 ratio, from the current equal 50% split.
“We also need to rethink travel retail as there are changes in passenger buying behaviour where they are now more informed than ever.
“Digitalisation and e-commerce are very important, and we need to move forward beyond our traditional retail business model,” Nazli said.
Key highlights of 2018 in the retail segment include introducing fresh concepts in dining selections and introducing more brands under the cosmetic and fragrances category.
Earlier in the year saw the addition of brands such as Innisfree, Dior Backstage and Atelier Cologne with the concept of something for everyone.
The focus on introducing brands under the cosmetic and fragrances category is backed by strong demand, seen especially among Chinese and Middle East travellers.
With more than 350 participating travel retail players nationwide, Malaysia Airports also held the Concessionaires Awards Night to recognise outstanding concessionaires.
The awards aim to inspire creativity and excellence in innovative approach towards raising the retail profile of Malaysia Airports.