PUBLISHER: Grand View Research | PRODUCT CODE: 1530227
PUBLISHER: Grand View Research | PRODUCT CODE: 1530227
The global travel retail market size is expected to reach USD 128.94 billion by 2030, registering a CAGR of 9.4% from 2024 to 2030, according to a new report by Grand View Research, Inc. According to the statistics published by UN Tourism, in the first quarter of 2024, international arrivals, measuring overnight visitors, rebounded to 97% of their 2019 levels, signaling a near-complete recovery from pre-pandemic volumes. Approximately 285 million tourists ventured abroad during this period, marking a notable 20% increase compared to the first quarter of 2023. This growth was fueled by sustained robust demand, the gradual reopening of Asian markets, improved air connectivity, and streamlined visa processes. These factors collectively bolstered the market growth of travel retail by expanding the pool of potential customers with higher disposable incomes, thereby driving increased footfall and spending at duty-free shops and retail outlets in airports and travel hubs worldwide.
The growth of travel retail, encompassing duty-free shops, airport retail, and other travel-related shopping venues, has seen remarkable expansion globally. This sector has flourished primarily due to increasing international travel and the rising affluence of global middle-class populations. As more people travel for business and leisure, the demand for convenient shopping experiences at airports, train stations, and cruise terminals has surged. This trend has been further fueled by the growth of low-cost carriers and improved global connectivity, facilitating greater passenger throughput and, consequently, higher footfall in travel retail spaces.
Moreover, the strategic location of airports and other travel hubs as retail destinations has attracted both retailers and brands seeking to capitalize on captive audiences of travelers with disposable income. The allure of duty-free shopping, where travelers can purchase goods at prices often lower than those in domestic markets due to tax exemptions, has become a significant driver of sales in these venues. This pricing advantage, combined with the perception of exclusivity and convenience, has positioned travel retail as a lucrative channel for both luxury and everyday consumer goods.
Furthermore, the evolution of travel retail has been shaped by advancements in technology and changing consumer behaviors. Digital transformation has enabled retailers to enhance customer engagement through personalized marketing, online pre-ordering, and seamless shopping experiences across physical and digital platforms. These innovations not only cater to the preferences of tech-savvy travelers but also contribute to increased sales volumes and customer satisfaction. In parallel, consumer demand for unique and culturally relevant products has prompted retailers to diversify their offerings, thereby enhancing the appeal of travel retail as a destination for distinctive shopping experiences.
In addition to organic growth, mergers and acquisitions (M&A) have played a significant role in shaping the landscape of the travel retail market. M&A activities within this sector are often driven by strategic objectives such as expanding market presence, gaining access to new geographical markets, and consolidating market share. For instance, in February 2023, Lagardere Travel Retail Group completed the acquisition of Marche International, a global catering company.
The company aims to strengthen its food service operations and expand across all segments of Travel Retail and Dining. This move enhanced its portfolio of proprietary brands, including Marche, a well-established global brand. As companies continue to pursue growth opportunities both organically and through strategic partnerships, M&A activities are expected to remain a prominent feature of the market, driving consolidation and innovation while shaping the future of travel retail on a global scale.