The surge in travel and tourism has increased demand in the industry for clothes, cosmetics, culinary products, and technology retail. Increasing urbanization and social changes are projected to drive the growth of the global industry throughout the forecast period. Furthermore, there has been an increase in discretionary income among middle-income groups, a change in economic conditions, and technological developments support industry growth by making it easier to obtain transportation and book hotels through online portals.
Rising Sales of Duty-free Products to Stimulate Growth
The global travel retail industry growth is expected to grow due to the increasing sales of duty-free products during the projected period. Duty-free and travel retail are two of the many services provided by airlines. Expansion in the scope and size of disposable income has become essential to the function of some low-cost airlines, allowing companies to accept cheaper ticket costs and, as a result, stimulate overall airline industry. Furthermore, as compared to airport retail, airline retail sales are significantly smaller, both in size and proportionately. The global travel retail industry size is expected to gain momentum owing to the rising number of international passengers during the forecast period.
Government Restrictions to Hamper the Industry
The duty-free and travel retail industry were badly impacted in 2020 due to the abrupt drop in tourism caused by the COVID-19 pandemic. The tourist industry has already seen the pandemic’s detrimental influence on its performance. Travel bans and measures were implemented globally as early as January 2020. Domestic and foreign visitors avoided traveling owing to the risk of getting COVID-19.
Increasing Number of International Visitors to Promote Growth in Asia Pacific
Asia Pacific is expected to hold the largest global travel retail industry share during the forecast period. The introduction of low-cost airlines and the expansion of new air routes are two of the expected to drive the growth of the industry. The rise in consumption and economic output in China and India may have a beneficial influence on this region’s industry.
North America is expected to have a sizable share of the industry. This is due to large spending of the population on domestic travel activities and growth of business from domestic travelers in countries such as the US and Mexico.
By product type, the industry is segmented into food & beverage, cosmetics, fashion accessories, tobacco products, and others. On the basis of product category, the industry is segregated into duty-free products and duty-paid products. On the basis of sales channel, the industry is fragmented into airports, seaports, railway stations, and others. Finally, by geography, the industry is divided into North America, Europe, Asia Pacific, South America, and the Middle East & Africa.
The acquisition of super-premium and luxury items may assist businesses in gaining a competitive advantage over other vendors in the industry throughout the projection period. The research examines the key international competitors in the industry, and the adoption of creative promotional strategies and appealing pricing offerings may assist companies in the sector maintain competition.
Industry Development
- July 2020: WHP Global collaborated with E. Gluck Corporation, an American watch manufacturer, to distribute the partner’s watch goods through different distribution channels such as travel retail and e-commerce stores.