Big investments for Swedish airport retail

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Millennials in focus as Swedavia signs duty-free contract

Swedish airport operator Swedavia has signed a new concession agreement with Swiss-based travel retailer Dufry, which will operate and develop the group’s tax and duty-free shops for seven years, DFNI Magazine reports.

An estimate puts the value of sales in the shops during the contract period at SEK 8 to 10 billion (€812 million to €1.02 billion), during which time Dufry will make major investments to enhance the passenger retail experience at Sweden’s airports.

The biggest investment planned is a walk-through store at Stockholm Arlanda covering more than 2,000sqm, destined to be the flagship of the Swedish hub’s entire retail area. To be located in the airport’s terminal five, it is scheduled to be completed in 2021.

Revenue strategy
Dufry has run Swedavia’s duty-free shops since 2001. The airport operator sees non-aviation revenues from commercial operations as a vital part of its strategy to develop operations and increase connectivity to Sweden.

The retailer aims to make extensive investments in all of its shops at Swedavia’s airports over the next two years. The future flagship store at Arlanda is part of a new commercial concept at Swedavia, which wants to provide passengers with what it calls a completely new experience in food and beverage, retail and commercial services. The concept will also be launched at Gothenburg Landvetter airport.

There will be an innovative product mix, a clearer positioning of brands and locally adapted ‘destination zones’ in the shops.

There will also be a focus on products for the fastest growing target group in the world of travel retail – millennials. That will appear through in-store digital solutions, while Dufry’s RED loyalty scheme will be made available more expensively, “to deliver better value and unique promotional benefits to all customers”.

Massive growth
“We have a massive growth in passengers in Sweden where it has been a lot about training and making it more commercial,” Eugenio Andrades, Dufry’s chief executive for the UK and Central and Eastern Europe, tells DFNI.

“We have introduced new tills, tried to make the customer experience better, done a bit with the layout and brought a lot of new promotions. We also have VIP vouchers and brought bestsellers to the front of the stores. We have to be very active due to the changing profile, which requires more value. There are more millennials and younger generation passengers.”

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