20 Airport Success Factors

2
INSIGHT 8 Duty-Free News International • February 2013 www.DFNIonline.com T he identification and valu- ation of success factors in non-aviation business for German airports’ strategic success factors in non- aviation areas have been analysed empirically and displayed by means of a model within the scope of the benchmark study. According to the study, non-aviation includes not only retail (duty-free, duty-paid and food and beverage), but also parking, car rental, other means of transportation, advertisement, real estate development and management and development of new business areas. The final category implies busi- ness development, identification of potential of non-aviation activities and consideration of new trends with the main focus on future revenues. Success factors The study identified 20 relevant str- ategic factors of success based on detailed interviews with retail managers of key German airports including Frank- furt, Münich, Hamburg and Berlin; the manager of Macquarie Group, responsi- ble for commercial activities at Sydney airport; the German airport association; a marketing company specialising in advertising strategy for airports; and a number of airport retail operators. The study concluded that the fac- tors of success are defined as follows: Number of square metres per one million passengers. This suggests a specifically planned area for non- aviation supply, which is regarded as benchmark and therefore as the best possible way for the investi- gated market. Quality and quantity of non-aviation area. This involves dividing these areas into aviation and non-aviation subdivi- sions regarding percentage. Depending on the type of airport and passenger structure, both qualitative and quanti- tative determinants can vary strongly. Merchandise mix displays an interac- tion between branches, products and special offers, which border on each other. Variation in offer and continuous adjustment for every target group creates a challenge for every airport retail manager. Concept of guidance is crucial for the development of income per passenger in the aviation industry. Fast and optimised passenger han- dling is closely connected to large investments in latest technology. Operator’s model is based on deci- sions by the airport’s management and proves to be essential for the devel- opment of non-aviation businesses. Retail theatre involves social media, e-commerce and m-commerce, digiti- sation, and sharing the airports’ worlds of entertainment with stakeholders. Developing Airport City is identified as a special element at airports. While expanding areas for airport cities the location becomes increasingly signifi- cant, creating an attractive spot for various companies and hotels. Creating the terminal concept first and foremost involves terminal layout and architectonical design. DFNI ’s & m1nd-set’s Question of the Month Twenty non-aeronautical airport success factors Kateryna Hess outlines her benchmark study on the success factors in non-aviation business for the travel- retail industry, which identifies factors of success in German airports Agree: 31% Disagree: 69% Three out of ten international travellers enjoy going to duty-free due to the exclusives and novelties. Interestingly, almost every second international passenger from Brazil and Argentina enjoys duty-free because of novelties and exclusives and has the highest shares in the world, followed by the Russian, Chinese, Indian and UAE travellers with around 40%. Peter Mohn, co-founder and partner of m1nd-set, says: “Our research clearly shows that travellers from the BRIC countries and other emerging markets are the most attracted by novelties and duty-free exclusives, whereas passengers from Europe are the least captivated.” Overall, the younger the travellers are, the more interested they are in duty-free exclusives and novelties, as well as women and less frequent travellers. Source: m1nd-set n=2,004 I enjoy going to the duty-free shops because of novelties and exclusives they offer Group 1 Group 2 Group 3 Must-Have Nice-to-have Less-important Factors of success Factors of success Factors of success Number of square metres per one million Fast & optimised passenger handling Local colour passengers Quality & quantity of non-aviation areas Operator’s model Eventisation Merchandise mix Retail theatre (entertainment through social media, e-commerce & m-commerce, digitalisation) Variation in offer and continuous adjustment Developing Airport City for every target group Creating the terminal concept Fair prices for secondary costumers (not passengers) Market research & questioning costumers Cooperating with airlines (exchange of data) Price strategy/ price distinction Business development Quality of staying and atmosphere of comfort Concept of guidance Consideration of trends and new regulations Passenger volume and mixture Source: Dornier Consulting Non-aviation factors for success

description

Success Factors in Performance appraisal

Transcript of 20 Airport Success Factors

Page 1: 20 Airport Success Factors

INSIGHT

8 • Duty-Free News International • February 2013 www.DFNIonline.com

The identification and valu-ation of success factors in non-aviation business for German airports’ strategic success factors in non-

aviation areas have been analysed empirically and displayed by means of

a model within the scope of the benchmark study.

According to the study, non-aviation includes not only retail (duty-free, duty-paid and food and beverage), but also parking, car rental, other means of transportation, advertisement, real estate development and management and development of new business areas. The final category implies busi-ness development, identification of potential of non-aviation activities and consideration of new trends with the main focus on future revenues.

Success factorsThe study identified 20 relevant str- ategic factors of success based on detailed interviews with retail managers of key German airports including Frank-furt, Münich, Hamburg and Berlin; the manager of Macquarie Group, responsi-ble for commercial activities at Sydney airport; the German airport association; a marketing company specialising in advertising strategy for airports; and a number of airport retail operators.

The study concluded that the fac-tors of success are defined as follows:Number of square metres per one million passengers. This suggests a specifically planned area for non-aviation supply, which is regarded as benchmark and therefore as the best possible way for the investi-gated market.Quality and quantity of non-aviation

area. This involves dividing these areas into aviation and non-aviation subdivi-sions regarding percentage. Depending on the type of airport and passenger structure, both qualitative and quanti-tative determinants can vary strongly.Merchandise mix displays an interac-tion between branches, products and special offers, which border on each other.Variation in offer and continuous adjustment for every target group creates a challenge for every airport retail manager.Concept of guidance is crucial for the development of income per passenger in the aviation industry.Fast and optimised passenger han-dling is closely connected to large investments in latest technology.Operator’s model is based on deci-sions by the airport’s management and proves to be essential for the devel-opment of non-aviation businesses.Retail theatre involves social media, e-commerce and m-commerce, digiti-sation, and sharing the airports’ worlds of entertainment with stakeholders.Developing Airport City is identified as a special element at airports. While expanding areas for airport cities the location becomes increasingly signifi-cant, creating an attractive spot for various companies and hotels.Creating the terminal concept first and foremost involves terminal layout and architectonical design.

DFNI’s & m1nd-set’s Question of the Month

Twenty non-aeronautical airport success factorsKateryna Hess outlines her benchmark study on the success factors in non-aviation business for the travel-retail industry, which identifies factors of success in German airports

Agree: 31%

Disagree: 69%

Three out of ten international travellers enjoy going to duty-free due to the exclusives and novelties.

Interestingly, almost every second international passenger from Brazil and Argentina enjoys duty-free because of novelties and exclusives and has the highest shares in the world, followed by the Russian, Chinese, Indian and UAE travellers with around 40%. Peter Mohn, co-founder and partner of m1nd-set, says: “Our research clearly shows that travellers from the BRIC countries and other emerging markets are the most attracted by novelties and duty-free exclusives, whereas passengers from Europe are the least captivated.”

Overall, the younger the travellers are, the more interested they are in duty-free exclusives and novelties, as well as women and less frequent travellers.

Source: m1nd-setn=2,004

I enjoy going to the duty-free shops because of novelties and exclusives they offer

Group 1 Group 2 Group 3Must-Have Nice-to-have Less-importantFactors of success Factors of success Factors of successNumber of square metres per one million Fast & optimised passenger handling Local colour passengersQuality & quantity of non-aviation areas Operator’s model EventisationMerchandise mix Retail theatre (entertainment through social media, e-commerce & m-commerce, digitalisation)Variation in offer and continuous adjustment Developing Airport City for every target groupCreating the terminal concept Fair prices for secondary costumers (not passengers)Market research & questioning costumers Cooperating with airlines (exchange of data)Price strategy/ price distinction Business developmentQuality of staying and atmosphere of comfort Concept of guidanceConsideration of trends and new regulationsPassenger volume and mixtureSource: Dornier Consulting

Non-aviation factors for success

Page 2: 20 Airport Success Factors

EDITORIAL • INSIGHT

February 2013 • Duty-Free News International • 9www.DFNIonline.com

Local colour displays the products of various regions in which airports are located.Fair prices for secondary consumers is a principle primarily based on the concept of reasonable prices, espe-cially in respect to gastronomy for employees, residents, visitors and carriers. In addition to gaining a higher income and expanding non-aviation businesses, improving the airport’s image is another important part. As a result, offers are not per-ceived to be over-priced compared with the equivalent offer downtown.Eventisation is particularly important for airports that feature large non-aviation areas that enable the organisation of events without damag-ing the commercial premises.Market research and questioning consumers is identified as an ongoing process that primarily takes into consid-eration the future wishes of passengers when it comes to non-aviation offers.Cooperating with airlines covers the active exchange of data between rele-vant stakeholders, the outcome of which ought both to support common goals and simplify communication.Price strategy/price distinction involves major strategic decisions on the part of the management in order to achieve price identification for every target group and thus present non-aviation offers as affordable

compared with downtown stores.Quality of dwell time and atmos-phere of comfort deals with a stress-free environment for the passen-ger during the time he or she spends at the airport. This includes areas where passengers can simply linger and those with a variety of non-aviation offers.Consideration of trends and new regulations is crucial when producing business plans and adjusting non- aviation portfolios.Business development indicates new subdivisions that should be devel-oped in addition to the areas that already exist.

Passenger volume and mixture involves predicted passenger growth as well as the constitution of passen-ger structure.

The table on page 8 divides factors of success into three categories accord-ing to ranking provided by experts.

A number of factors of success identi-fied in the study—notably quality and quantity of non-aviation areas, mer-chandise mix, market research and questioning costumers, as well as pas-senger volume and passenger mixture, have become the foundation for any strategic decision and future develop-ment of non-aviation businesses.

Finally, the table above displays the interrelation between identified essential factors of success that result from investigating non-aviation areas. Hereby, the maximisation of income per passenger is seen as a superior goal, and thus this paper’s results pre-sent the airport’s management with the necessary tools to realise strategic goals. The identified factors of success, as listed in the must-have category could ultimately increase an airport’s core competitiveness. nDornier Consulting business devel-opment consultant Kateryna Hess, [email protected]

ContentsNews 1-7Insight 8-9Product news 10-19Exchange rates report 21-23China report 25-26 Western Europe report 29-33Airlines report 31-37Duty-free legends 41-43Launch pad 44-45People & company news 46

Bill [email protected]

Editorial

Maximising sales per passengerThe main goal: Maximize sales per passenger

Basic requirement: Passenger volume & passenger mix

Market research & customer survey

Quality & quantity of non-aviation-area Unique merchandize mix

Customer satisfaction

Customer awareness

Staff training

Product knowledge

Customer services

Friendly staffRapidness of staffProfessionalism

Short waysLittle change of levels

Extension of areaAreal productivity

Welcoming atmosphere & comfort

Optimal architecture of non-aviation-area

Optimum of square metres per one million passengers

Price strategy and competitive

capabilities

Boost the product image

Advertising & social media Actions

PromotionsSpecial offersUse of economies of scopePresentation of trendsSource: Dornier Consulting

Know your customers & speak to them