IRELAND. New DAA Chief Executive Dalton Philips has said that the company is seeking to build its retail and food & beverage revenues at Dublin Airport while focusing on being more cost-efficient to attract new airlines.
Speaking at the Future Travel Experience conference in Dublin on Wednesday, he placed particular emphasis on driving costs down at the airport, drawing on his experience in the grocery retail business.
“We are at a fork in the road. We can play with the space we have until the technology disrupts us. Or option two is to embrace change and become part of this change.” – DAA Chief Executive Dalton Philips
He said: “You have to be low-cost to compete in retail in general; now the same applies to travel. We live in a world of extremes, which for middle of the road retailers is dangerous. It’s the discounters who are leading the way.
“Where does that all leave the airport? You have to follow the customer. We are at a fork in the road. We can play with the space we have until the technology disrupts us. Or option two is to embrace change and become part of this change, taking advantage of Dublin Airport’s place between Europe and the USA and go after that inbound growth. We are positioning ourselves accordingly in this changing landscape.”
“The F&B offer can be greatly enhanced, and pre-ordering F&B is a big opportunity.” – DAA Chief Executive Dalton Philips
He added: “Passengers are disruptive by nature. You can see disruption through the entire journey from transport to the airport to parking to check-in. As airports we have to think much more disruptively as the passengers are thinking disruptively.”
On the commercial opportunity, he said: “How do we make retail more interesting? I see a big opportunity in pre-purchasing duty free and duty paid. The F&B offer can be greatly enhanced, and pre-ordering F&B is a big opportunity.
“Beyond that we haven’t done anything around hotels and we can do more on airport parking. I want to focus heavily on finding new revenue sources. We are competing with many other channels for people’s attention so have to maximise entertainment and our point of difference as an airport.”
Returning to his core theme, Philips said: “The cost structure of the airport is important. Airport charges are around one third of the costs of short-haul airlines in Europe and we have to be careful that we remain competitive. Our landing charges relative to other airports put us in quite a good place but my focus is to drive these costs lower. If we do that we’ll attract more airlines to Dublin. If we don’t we’ll attract less and we’ll get disrupted. We may have not been as focused on this as we should have been. As in the grocery sector, if you’re not continually driving your costs down you are in trouble.
“We need to have good control over capex, flowing people through the airport faster, obsessive standardisation (of processes), innovating quickly and having great people.”
*The FTE event continues today when The Moodie Davitt Report will chair a session on a pioneering initiative between Budapest Airport, Wizz Air and Heinemann to drive airport and airline commercial revenues.