AUSTRALIA. Melbourne Airport is launching an ambitious luxury boulevard as part of a significant redevelopment of its Terminal 2 international Departures area.
The luxury retail concessions will bring a host of upmarket fashion and accessories brands to the Victorian gateway.
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An artist’s impression of a current concept for the Terminal 2 luxury precinct, subject to board approval |
The airport is focusing on T2 as the next stage in an ambitious redevelopment plan, now that its domestic Terminal 4 is operational.
“We are managing a four-year programme of redevelopment at the airport, of which T4 was the start,” Melbourne Airport Executive – Customer Andrew Gardiner told The Moodie Report on a recent visit to Melbourne.
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“With the changing customer profile and particularly the emergence of the affluent Chinese consumers, luxury business is calling for more presence“ |
Andrew Gardiner Executive – Customer Melbourne Airport |
“Since we opened T4 last August the average transaction value has increased massively,” he said. “Year-on-year passenger spend rates are up by double digits.”
As reported , T4 groups 34 new stores and food & drinks outlets.
Retail and dining options have been opened in stages, with the launch of Victoria’s Secret this month completing that phase.
Informed by extensive market research, the choice of retail and food & drinks concessionaires is also monitored in customer surveys on a daily basis, with feedback very positive.
“We wanted a Melbourne-centric retail and food selection, reflecting the brands and characters that make this city distinctive,” Gardiner commented.
Fashion entries from Desigual and the full Country Road assortment (Country Road, Mimco, Ternery and Witchery) are among the strongest performers.
Among the dining options, the Brunetti’s café opened last November has received an enthusiastic response from Melbournians and visitors.
This Sense of Place contribution is complemented by Two Johns, a new concept alehouse from Red Rock that honours the founders of Melbourne, John Batman and John Pascoe Fawkner.
A new configuration for McDonald’s, with electronic ordering on screens at the storefront, is also delivering well.
T4’s layout is spacious, with ample seating, plentiful power outlets and free Wi-fi serving passengers on Jetstar, Tiger and Regional Express domestic flights.
“Our major consumer groups in T4 are Australians and New Zealanders, but across the airport we have a large and growing Asian clientele, which the airport must cater for,” Gardiner noted.
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Terminal 4 offers a new-generation commercial environment for domestic travellers at Melbourne |
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Fashion offerings from the Country Road family, including Trenery and Mimco, along with Lagardère Travel Retail’s Eye Love Melbourne and Amuse Beauty Studio |
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Desigual has made a strong debut |
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Amuse Beauty Studio is attracting busy traffic at Melbourne T4 |
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Jetstar and Tiger are key carriers at T4 |
A touch of luxury
Those passenger groups will be crucial to the planned luxury boulevard in T2 airside – where the airport will bring in fashion brands not readily available to many Australians and Kiwis.
The growth and purchasing power are particularly strong with Asian travellers, however. International passenger movements in January 2016 were up +11% on the same month in 2015, and within that Taiwanese passenger numbers rose +75%, Vietnamese +39%, Chinese +35% and Singaporeans +32%.
Annual growth in international passengers was +9% for calendar 2015, to 8.7 million.
“Chinese customers are pushing the growth in retail spend in T2, building on the core Australasian business,” Gardiner said.
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Food & beverage options Two Johns, McDonald’s and Think Asia at T4 (above); McDonald’s provides screen-based orders at the front of its outlet (below) |
Subject to board approval, the luxury development will include eight to ten leading brand names, most coming to Melbourne Airport for the first time, in the categories of leathergoods, upmarket fashion and jewellery.
The boutique precinct will sit as part of a full redevelopment of the airside retail, also slated to include duty free.
“In the airside area now there is a preponderance of souvenir stores, but with the changing customer profile and particularly the emergence of the affluent Chinese consumers, luxury business is calling for more presence,” explained Gardiner.
Melbourne promotes itself as Australia’s fashion capital, so the airport company plans to harmonise its development with that profile. Melbourne Airport will employ NH Architecture, which oversaw renovation of the award-winning Myer department store in central Melbourne’s Bourke Street mall, to design the luxury boulevard.
In feel the luxury precinct will take inspiration from the city’s Federation Square, with its bold, dramatic design. Melbourne’s bustling Laneways will set the theme for satellite retail and dining options, with five restaurants planned close to gate lounges.
“Melbourne has approximately 9 million international passengers a year, and the retail objective is to get the mix right as that number grows and diversifies,” explained Gardiner.
“Our retail for T2 is almost like that of a department store, with great attention to product sequencing and placement on the customer journey.
“We are looking for complementarity and that customer choices can follow logically. But as most concessionaires are on five-year leases, adaptability is also a key.”
Catering to all segments
“We see the importance of having the luxury offer. It acknowledges the range of consumer needs and our aim to match those with good, better and best offers,” he added.
The Connoisseur’s Choice range of premium spirits and wines in Nuance’s F1RST Duty Free store represents what the ‘best’ segment can mean, with some items priced in the thousands of dollars.
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The main F1RST Duty Free store (above) and express store (below) offer a diverse mix airside in Melbourne T2 |
To ensure segments of basic needs (‘good’) and more upscale requirements (‘better’) are well represented, Gardiner and his team work closely with concessionaires, especially those new to airports.
“If business is soft in any areas we work through this with our retailers to see how this can be improved. We bring travel retail expertise, and that can help develop fruitful relationships with the new national brands present in the airport.”
The combination of strong passenger numbers and a weaker Australian Dollar are bringing what Gardiner described as “phenomenal retail growth,” including +18% year-on-year growth in duty free.
“Having such growth in passenger spend rates provides strong momentum as we move on to the next phase of our redevelopment,” he reflected.
“At a later stage we will work with Virgin on enhancing the limited retail and dining options currently available in Terminal 3.”
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Where Terminal 4 has led, T3 may follow |
