Retail Brands Target Growth as New Airports Transform Travel Shopping in India
Brands chase flyers as new airports open a runway to revenue for retail
Business Standard
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The expansion of new airports in India, particularly in Tier-II cities, is creating significant opportunities for retail brands. Companies are focusing on travel retail to engage premium consumers, with expectations that this segment could contribute up to 15% of their revenues over the next two years.
- 01New airports in Tier-II cities are boosting retail growth in India.
- 02Brands are focusing on high-intent consumers in transit environments.
- 03Travel retail is projected to contribute up to 15% of total revenues for some brands.
- 04Secondary airports are expected to enhance per-passenger retail spending.
- 05The premiumisation trend is driving demand across various sectors, including fashion and beverages.
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The recent surge in air travel and the opening of new airports in Tier-II cities and metropolitan areas in India are transforming these terminals into lucrative retail hotspots. Brands like The Body Shop and DailyObjects are capitalizing on this trend, with expectations that travel retail will contribute significantly to their revenues. For instance, DailyObjects anticipates that travel retail will account for 12-15% of its offline revenue and 6-8% of overall revenue in the next two years. Retailers are focusing on high-intent consumers, with companies like Brand Concepts actively evaluating emerging airport developments to align with their premium positioning. The overall retail real estate market in India absorbed approximately 8.9 million square feet in 2025, indicating robust growth. As airports evolve into high-velocity gateways for curated retail, brands across sectors, including fashion and alcoholic beverages, are increasingly viewing travel retail as a critical part of their go-to-market strategies. For example, the tequila brand Loca Loka aims to achieve 15-20% of its revenue from travel retail, while premium spirits makers like Piccadily Agro Industries are allocating 30-35% of their marketing budget to this channel over the next two years.
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The growth of travel retail at new airports will provide consumers with enhanced shopping options while potentially increasing prices due to higher demand for premium products.
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