photo 3 (2)-2_MG_1024-2_MG_1036-2BJ.st.patricks.day.2_MG_2012-2

Getting to grips with destination targeting

As the balance of spending power shifts around the world, destination targeting is set to become an even more important skill for travel retailers to adopt and understand. Sally Alington, Managing Director, Blackjack Promotions and Joint Chairman, Airport Promotion Agencies (APA) shares her views on why it’s vital to have a solid understanding of the mix of cultures and what ‘added value’ means to those customers.

What is destination targeting and why it has become so appealing for airports and retailers?

Destination targeting refers to the spotlighting of some of the highest spending nationalities and directly targeting them at airports around certain flights and providing native language speakers to help their every need – from shopping to finding their way around the airport.

Over the years the question of ‘who owns the passenger – airport or airline?’ is really where airports began to raise their game in terms of customer service delivery and the retail offering, which in return sparked the rise of a multitude of destination targeted services that we see being delivered in airports today. Global airports such as Dubai, Frankfurt, Schiphol and Heathrow compete to be the international hub that passengers choose to fly through and there is an expectation that excellent service and shopping opportunities will therefore create brand loyalty for that airport and ultimately boost passenger spend.

In addition to this, the economic downturn and challenges airlines have faced in recent years has meant that travel retail has never been more important, as airport operators find themselves increasingly more focused on non-aeronautical revenues and the pressure is certainly on with regards to generating ever higher retail sales. While it is not just retail that feeds into the all-important ancillary income stream for airports, with car parking being another significant sector, tax & duty free retail has some significant advantages to explore.

Firstly, there is an absolute wealth of information at the fingertips of airports and retailers about the profile of customers, when they enter the retail space along with a very good idea of what those passengers like to buy. Furthermore, there is the all-important airside dwell time pre-boarding where airports and retailers essentially have a captive audience looking for distraction and retail therapy. There is no doubt that High Street retailers view the travel retail industry with envy, as the combined power of these benefits can enable a completely tailored and bespoke sales approach that puts money in the tills and generates a better customer experience. Destination Targeting is essentially the result of airport retailers, brands and suppliers becoming savvy and leveraging these distinct advantages to create some very impressive results in terms of service scores and sales results.

How important is it for airports and travel retailers to have a firm understanding of local cultures?

It is essential that any destination targeting plans are well researched and well executed – getting it wrong is not an option. This is particularly relevant with destination targeted events, as mimicking a national costume or tradition in an inappropriate way would undoubtedly have the reserve effect for the customer. Airports and retailers themselves should not be afraid to celebrate their own nationality with regards to destination focused activities. If you take a look at the focus Heathrow Airport placed on their retail strategy they have achieved a shopping experience that creates a ‘sense of place’ with British brands and iconic British food and beverage on offer – the forthcoming opening of John Lewis and Heston Blumenthal’s restaurant in T2 illustrate this strategy well. The quintessentially British approach has its own appeal to other nationalities who want to savour ‘Britishness’ while they can.

Are there any airports in particular that you feel do destination targeting particularly well?

Heathrow is without question an airport that has been totally committed to destination targeting both in terms of service and sales. In 2013, Heathrow invested in a ‘first to the market’ Passenger Service Ambassador concept not only provides hundreds of multi-cultural and multi-lingual hosts across the airport but also connects Service Ambassadors across all terminals with tablet technology. This bespoke technology can link a passenger with the right language speaker via Facetime, no matter where they are in the airport. This investment has seen service scores and retail sales hit all-time highs – 75% of passengers now rate their experience at Heathrow as ‘excellent’ or ‘very good’ compared with just 48% in 2007.

In terms of retailers, World Duty Free Group, has done some incredible work to focus on destinations and we are lucky enough to be a service provider to World Duty Free Group where we can share ideas and best practice to ensure activities are a huge success. A great example of this was the very recent launch of the Doha flight in Edinburgh Airport (this week) where our staff, along with World Duty Free, donned traditional Scottish Tartan and gave a truly Scottish welcome to Qatar Airlines passengers with some great impact in store on sales and positive customer comments.

How do you make sure the right staff are in the right place at the right time?

A lot of work goes into understanding the changing profile during the day and of course this is an ever moving picture. Airlines summer schedules versus winter schedules, new airline launches or flight moves between terminals as well as new destinations mean that we have to have our finger on the pulse in every location we operate. There is no better example of getting this right than WDFG’s Contentainment which has been refining the art of destination targeting since 2008, winning awards and receiving well deserved recognition not only within the travel retail industry but also in the wider arena of experiential marketing and brand experience. Airports, retailers and brands that can manage the logistics of changing the product promotion and fine tuning their focus through the course of one day are onto a winner. Without giving too much away, all eyes should be on the new WDFG store in Heathrow T2 (opening on 4th June 2014) to see destination targeting innovation in action!

How do you train staff to ensure they adopt the right sales culture?

Actually this starts with talent selection which is an area we have refined over the last 18 years of working in airports across the UK. With the ever growing demand for tailored activations with a destination focus, we have to be able to proactively plan our recruitment for category and sales specialists with the right language and cultural awareness abilities. The work we do in Gatwick is a good showcase of that where we have had to focus on providing staff for diverse destinations such as Indonesia, Norway and Vietnam.

We also have our own specific induction process for our travel retail specialists. Airports need people who can advise on all elements of the passenger journey so that passengers can feel relaxed and want to indulge in the retail experience. Some passenger profiles won’t even consider going shopping until they have clear in their mind how long they have until boarding, where their gate is, how long it will take to get there or where they can get their VAT refund. There is a clear hierarchy of passenger needs that our staff need to understand before they can start trying to sell a product. The service element always comes before the sales element which contributes to putting people in the right frame of mind for shopping. A common misconception of destination targeting is that it is just about providing the relevant language speaker, it isn’t. The language element is clearly important, however it adds little value to have someone speaking perfect Korean if they do not deliver a good service to all customers and are of little use when the Korean flight has departed. A holistic approach with service at the forefront needs to be considered to ensure a happy customer, a happy retailer and a happy airport. 

What advice would you give to travel retailers who are keen to capitalise on these new markets?

If I were to produce a ‘must do’ list for anyone considering destination targeting activities in airports I would say that planning and research are paramount. Getting it right only comes with the attention to detail, sensitivity to the culture and customs along with a focus on how to achieve the desired outcome. Profitability and ROI are always a consideration for any activation or investment in skilled staff but that does not mean to say that the cheapest option will be the best. My advice would be not to compromise on the quality of the event or promotion. The return on investment will always be greater for a well-executed activity that respects the traditions and customs than something at the other end of the spectrum.

Another point of consideration is the emphasis that has been placed on the BRIC (Brazil, Russia, India, Chinese) nations in the last few years and how to capitalise on the spending potential of these customers, but there should also be an awareness of the emerging MINT (Mexico, Indonesia, Nigeria and Turkey) markets. This is particularly significant when you consider the geographical importance of these future economic power-houses. Mexico’s proximity to both the USA and Latin America means that airports, retailers and brands in the Americas should really consider how they can tailor what they do to maximise this opportunity. Turkey is also a significant gateway between Europe and Asia and must already have some great experience with destination targeting for Russian passengers.

The final point is not to lose sight of the home-grown customer. Domestic passengers are a significant portion of the retail spend and can often be the most regular customers in an airport. Frequent flyers are known to use their time passing through airports to take advantage of special offers, airport exclusives and the tax-free benefits in store. They are also probably the most susceptible to the ‘seen it, done it, bought the t-shirt’ syndrome and could use a proactive welcome and extra special service to highlight what they didn’t know was available for them to buy.