Asia Pacific beyond the airport

02/03/2016 For the last decade, over half of all duty free and travel retail sales globally have taken place at airports, so it’s unsurprising that airside shops are often top of mind for travellers looking to buy. Even more so in Asia Pacific, home to world-class airports like Seoul’s Incheon, Singapore Changi and Pudong in Shanghai. Recently, however, developments well beyond the airport perimeter have been making headlines in the industry’s no.1 region.

Downtown drama

The origins of today’s downtown duty free stores date back to Asia in the 1970s, so there’s a certain symmetry to the new-found prominence this sector has found there. The opening of China Duty Free Group’s gigantic Sanya shopping complex, the world’s largest duty free store, on Hainan Island 18 months ago underlined that airports aren’t necessarily where all the action is. Downtown duty free was in the news again last November, when the Korean government’s reallocation of licences for outlets in Seoul caused controversy and major financial upheaval among the companies concerned.

New beginnings

One of those involved, Lotte Duty Free, is active in Japan’s downtown marketplace. The Korean company opens a new 4,400 sqm store in Tokyo’s fashionable Ginza district at the end of March, and recently announced plans for another in Osaka. With three further downtown outlets in the country either already open or shortly to do so, Japan’s off-airport duty free business is in expansion mode. Back on Hainan, HNA Group’s new Duty Free Plaza, to open in co-operation with the local authorities later this year, will bring a new angle to travel retailing outside the airport. This vast 280,000 sqm commercial complex opposite the Haikou Meilan Airport Terminal building will combine entertainment, dining and shopping, with 18,000 sqm devoted to duty free goods. Downtown duty free, it seems, can come right to the airport’s front door.

With so much happening off-airport in Asia Pacific it can be difficult to keep up, harder still to see the broader regional context. This year’s TFWA Asia Pacific Exhibition & Conference (8-12 May in Singapore) not only brings together duty free and travel retail’s leading brands and operators in Asia, but also offers a workshop specifically devoted to off-airport duty free. Pre-registration for the industry’s Asia Pacific summit is now open, so be sure to book your place.