Business travel in most cases is similar whenever you have a journey to make: leaving home, taking the train to the airport, waiting at the airport… flying, arriving, taxi, meeting, taxi, waiting at the airport…flying, train, home. Aside from the endless meetings and travelling on buses, trains and taxis, the most time you spend is at the airport.
While this can be really boring, I realised over the last couple of years this ‘airport time’ is being used more and more efficiently.
A modern airport could be likened to a full service, 24/7 convenience store with all amenities that you would expect of a c-store… and more.
The profit lies on the ground
Consider what has happened to petrol stations over the last decade or so? They have developed from being purely service providers for fuel to service-oriented shopping destinations, which generate more than half of their profit from non-fuel products and services.
The scenario is similar at train stations. The station operator (in most cases a state-owned organisation) makes more profit out of renting shop space to retailers than the revenue share it gets from the train operator.
There is a pretty similar development at modern airports today: the non-aviation revenue of some larger airports already accounts for more than half of the airport operator’s revenue.
According to the Flughafen Zurich AG, each person taking off from Zurich [ZRH] on average spends 40 Swiss Franks ($44 USD) at the airport on food-to-go, coffee or shopping items in one of its 193 stores and over 40 restaurants.
Offers that make you stay
Today’s airports are more than just a place for transit. They offer food courts, shopping centers and conferencing facilities; as well as five star hotels, like London Heathrow [LHR] with the Sofitel hotel providing direct terminal access.
The average duration of a stay at an airport is around three hours, depending on the location and the main purpose of the airport (eg more focused on holiday or business travel or being a regional hub or local end destination).
But airport operators around the world are working on expanding this time to 24 to 48 hours. Airports are investing in building a ‘city within a city’, a full service, all-you-need destination for business and holiday travelers. In short, they are creating airport destinations.
Destination airport
Normally when you think of a destination you would imagine a city, hotel, client’s office, a beach or resort. The airport would simply be the transit place to get you there. An airport destination sounds strange. But airports are becoming more and more a destination in themselves.
Most business travelers spend more time at an airport than in the city they are visiting. And this is being heavily supported by the airport operators, offering space for conferences, symposiums and global company meetings; pulling top of the range concerts and events to the airport, combined with offering hotels for every budget and all the food and drink options you need.
The Circle at Zurich [ZRH] airport is the largest construction project in Switzerland and one of the biggest in Europe, worth 1bn Swiss Franks ($1,1bn USD). A whole new city is being created within an airport. According to the operator’s website, The Circle is described as combining the ambience of a small town with the synergies of a big city.
A similar project is The Squaire at Frankfurt airport [FRA], a new centre, located in a 660m long building that hosts two hotels, a conference centre, offices, a gym, several different shops and restaurants as well as a kindergarten…and it is connected with a train station for high speed long distance trains.
And at Bergamo [BGY], one of Milan’s airports, a well signposted footpath leads airport visitors right to the Oriocenter, a shopping mall with 200 stores right next to the airport.
Airport city
The trend to offer everything a traveller needs at the airport and in the surrounding vicinity is creating so-called airport cities or an ‘aerotropolis’, the name coined by the American urbanist Dr John Kasada.
In Dusseldorf [DUS] a complete new city district is being built right next to the airport on an area of over 200,000sq m. In Switzerland, meanwhile, 72 of the top 100 Swiss companies are being located within a radius of less than 100km of Zurich airport [ZRH].
Grand architecture
And with big projects comes grand architecture. Building a new structure as large as an airport, including hotels, shopping mall, food courts etc. has inspired many well-known architects to create some magnificent pieces that have become landmarks.
Examples include the new hall at Kunming airport [KMG]; the new Terminal 2 at London Heathrow [LHR], designed by Norman Foster; and the award winning Madrid Barajas airport [MAD].
The freedom to build something of this size from scratch allows space for innovation and to really think out of the box. This gives everyone in the convenience sector the opportunity to walk through a newly opened or renovated airport with different eyes: to look at the innovation, new retail and food concepts, the symbiosis of work, travel and shopping and a lot of ‘big ideas’ that may also work on a smaller scale in a c-store.
Conclusion
Airports are evolving from being a transit station to a destination. They are full of foodservice and shopping possibilities and combine workplace and leisure space. They are making half of their revenue from non-aviation offerings. There are a full service, 24/7 convenience offering on the largest scale imaginable.
Airports are now a place to check out when thinking about the future needs of travelling consumers and new ideas for convenience stores.
Unfasten your seat belts and get ready to stay at the destination: airport.