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Retail concessions must improve to ensure airport competitiveness

Posted: 1 November 2019 | | No comments yet

Airports Council International suggests that commercial offerings must improve in order to increase non-aeronautical revenue.

Airports Council International suggest that commercial offerings must improve in order to increase non-aeronautical revenue

Airports Council International (ACI) World has emphasised that airports’ commercial offerings need to advance and progress in order to keep pace with customer expectations, ensuring competitiveness and increasing customer satisfaction.

The industry’s financial performance had significantly improved from the previous year, earning $172 billion worldwide in 2017, representing a 6.2 per cent increase. However, ACI World Director General, Angela Gittens, pointed out that the challenge for airports will be to cover their capital and operating costs.

Gitten said: “According to the just-released ACI Annual World Airport Traffic Forecasts (2019–2040), global passenger traffic demand will double by 2037 based on a projected growth rate of 3.8 per cent a year. On average, aeronautical revenues do not fully cover capital and operating costs, and airports rely on non-aeronautical revenues for their financial viability.”

She continued: “Worldwide, retail concessions remain the leading source of non-aeronautical revenue for airports, representing over 30 per cent of the total, growing by 10.1 per cent in 2017. Airports and airport retailers worldwide must continue to forge innovative business partnerships and develop new revenue streams and commercial models that are in line with what customers are demanding. This involves embracing the digitalisation of airports including the phygital.”

In a bid to provide airports with advice on how to capitalise on these changes, ACI have created an Airport Service Quality (ASQ) programme. The ASQ’s solutions aim to provide airports with a 360o view of passenger experience management and help them deliver the best experience to their customers.