It’s no longer a matter of selling key chains and postcards. Business experts note that the traveling retail market at the nation’s busiest airports is now as lucrative as mall shopping. Airport retailing, however, requires a special dose of “smart marketing” that can keep up with the ever-evolving consumer market and with the flood of shifting federal air travel regulations. Consumers at U.S. airports are on-the-go. To them nothing is as essential as grab-and-go items, says Abigail Hubbard, Ph.D., clinical assistant professor for the University of Houston’s Bauer College of Business. For that reason business owners in an airport environment must cater to the unique demands of this public, she added. “(Businesses) have to be ready to turn at the drop of a dime, they have to know what is going on and understand the industry that (the company) is serving,” she said. “They have to know what the airlines are doing, what their policies are, and (they have) to be able to meet the needs of their customers.” Because of a growing layover time between flights more and more passengers are looking at airports as shopping malls. And concessionaires are responding with a diverse offering of everything from sugar-coated pretzels to designer-name clothing lines. At Houston’s George Bush Intercontinental Airport (IAH), the fourth-fastest growing airport in the world, this lucrative airport retail business is redefining what it means to shop and travel – and passengers are noticing the difference. “Some parts of the airport are looking like malls,” said Olusegun Fatoye, a passenger at IAH who was shopping during his two-hour layover. “The pricing is quite competitive; it’s just like any price at the mall or much cheaper.” For airport retailers the secret to their success is in adapting to the fluctuating round of airport security policies, while still making the customer feel like they are the number one priority. John DePriest, general manager of HMS Host – one of the leading concession management companies at Houston’s airports – knows retail business well and notes that there’s nothing quite as exciting as the phenomenon of airport shopping.

© Houston Airport System Airports are looking more like malls everyday and business owners are enjoying the increase in profits. At IAH, business is especially promising.

Before joining HMS Host, DePriest spent 20 years in management at the leading retailer in the world, Wal-Mart.

Unlike at Wal-Mart and the rest of the retail industry outside of an airport environment, at IAH the peak sales months are during the summer and the hottest items are those that can easily be carried on an aircraft, DePriest noted.

“We make sure that we stay current with the fashion industry,” he said. “It’s no different in the airport industry; the same person that is going to get on the plane will drive their car to one of these stores to shop the current fashion trends. So we have to be just as savvy on the street and at the airport.”

The potential for airport concessionaires is tremendous, Hubbard said. According to her, at an airport you are dealing with a captive audience. Passengers don’t have a choice but to wait around for their flight – “smart marketing” then drives the industry to give this public something to do with their time, shop.

“Travelers are sharp and smart, and they remember,” she said. “If a passenger has a pleasant experience at your store or at your airport they will tell their friends about it, no matter where they’re headed to. You have an opportunity to make your airport a destination shopping place for these people.”

Hubbard, who’s a fervent airport shopper herself, confessed that usually when she travels though an airport she makes it a point to arrive early in order to get in a little shopping in before her flight. Like her, she says, there is a growing segment of the traveler market that is doing the same.

Heightened security alerts and changes in federal regulations are no obstacle to airport business, she added. Instead they increase the potential for innovation and for profit.

“Catering to the needs of customers when you have these types of regulations is a huge opportunity,” the business professor affirmed. “Smart people running these organizations will respond to these needs and you will see them packaging (toiletry) products in zip lock bags instead of shopping bags and the really smart ones are going to have their logo on it instead of those court size bags.”

DePriest agreed. During the recent heightened threat level alert that banned liquid items aboard an airplane the general manager says that retailers saw a boost in their profits of up to 25 percent.

For folks like Brad Herrington, a retail store manager for HMS Host at IAH, the increase in profit is further proof that his airport business is headed in the right direction.

“It’s becoming a little mini-mall inside the airport,” the store manager said. “I have had a lot of comments from customers that walk in and say ‘oh we have a regular store in the airport.’ And they are really happy that they can come in and do some shopping for some clothing and some sunglasses that they normally were not able to do before.”

So lucrative has airport shopping become that retailers are always on the hunt for new trends and commodities.

InMotion Entertainment, for example, found a need for a wider variety of options in electronic entertainment. The retailer rents and sales DVD merchandise to travelers.

“We make it real easy, we allow customers to rent (movies) for any period of time and they can return (them) from anywhere in the country,” said Eden Goldberg, vice president of marketing & business development for InMotion Entertainment. “If they rent from Houston they can drop it off at any one of their destination cities, they can return it back to the Houston airport or they can return it back in a prepaid pack.”

For Hubbard, the vast potential of the airport retail industry is in catering to the unique needs of this consumer market.

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