Inflight Retail or Onboard Duty Free is a little bit like marmite; you either love it or you can’t stand the thing. On this topic I feel I am slowly becoming the latter. Here’s why:
I admit in the past when I’ve been travelling with my parents I have purchased the odd item, but at the end of the day a lot of the items on sale are exactly the same if not similar to what you can purchase in their terminal before you step on the aircraft. And can it really be that profitable?
It’s expensive business for airlines (and the IFR suppliers too)
Airlines spend millions each year on duty free, regardless of whether it is all managed in-house or by one of the many suppliers in the marketplace. The supply chain is just the tip of the iceberg as you have to factor in marketing costs, the in-flight catalogues which seem to change very frequently and of course the logistics. In a day where airlines are looking to reduce their cost base, why hasn’t inflight retail been hit? I was intrigued to learn that in-flight retail is actually down by approximately 10% year on year – which doesn’t sound like much, but in terms of the travel industry… it is.
It can be profitable or a complete disaster
As with aviation in general; some routes are more profitable than others – and while passengers travelling to and from destinations such as Lagos may love the opportunity to purchase things in the sky, very little may be sold on a flight to Miami.
Sorry ma’am, we don’t have that in stock
Those famous last words. Aircraft are heavily bounded by weight restrictions and the amount of storage available is severely limited; which means there can only be a number of items onboard at one time. Sometimes there may just been the single item. As a passenger, I’ve observed many situations where several of my fellow travellers have expressed interest in a particular perfume after seeing it advertised on the inflight manage zone; only to find that not one bottle has been loaded.
As times have passed, airlines have been able to recover from these situations very well by encouraging customers to pre-order online in advance of their flight, for their inbound journey, or even for it to be delivered to their home address. But not everyone has the time or likes to receive hundreds of emails (from the airline) inviting them to pre-book their seat, upgrade their meal or browse the retail booklet before they fly, or even after too.
Isn’t it all the same?
In many cases, you might fly with one airline this week and another the next; only to notice the items for sale in the brochure are the same. Dare I say even down to specifics such as the images, text and layout. Not good. However there are a few suppliers whom look to ensure every airline customer has different offering – such as the products fitting in with the airline’s brand, customer demographic and unique products too.
In such a competitive industry, airline duty-free suppliers have to work tirelessly to get their hands on the latest products before anyone else. The old tale about exclusivity rights comes into force and it works very well. A good example would be one supplier whom were able to offer sleep-bracelets to their airline customers as early as four months before anyone else.
So what do you think?
Inflight retail has always been controversial, both with passengers and within airlines themselves; with some even ditching the concept altogether as it appears as non-viable investment. Specifically this would be US carriers, but others have been following suit. There are however; a handful of airlines whom are only just jumping on the in-flight retail bandwagon. Ethiopian Airlines are set to launch a duty-free offering in August, after awarding the contract to Tourvest – one of the major duty-free suppliers to the industry.
I am sure that this debate will carry on for a long time, but in-flight retail is certainly something which get’s everyone talking!
I’d love hear your thoughts on in-flight retail. Just leave your views below.
Thanks to all whom have already got in touch with their views and provided me with further insight.