A new report has shown that the Asia Pacific region will continue to be a major driver of global duty-free and travel-retail sales.
According to the study, titled ‘Economic Impact Report of Duty Free and Travel Retail in Asia Pacific,’ the Asia Pacific travel retail industry generated an estimated US$36.2 billion in 2017 which accounted for 45 per cent of total global duty free and travel retail sales, and is projected to maintain its global market leadership at an estimated 8.7 per cent annual growth rate between 2017 to 2022.
The report identifies several key trends in the industry across Asia Pacific. It finds that East Asian markets are driving growth, with South Korea being the world’s largest duty-free market accounting for nearly US$12 billion in sales. China and Japan are also globally significant markets, with Mainland China anticipated to strengthen its position as the second biggest player in the region.
Findings also show a growing diversity in product demand, and observes that duty free is becoming increasingly digital with shoppers in the Asia Pacific region increasingly looking to digital platforms to facilitate their purchases. There is also a marked channel diversification beyond aviation – downtown duty free in Asia Pacific comprises a significant portion of sales for all land channels, and ocean cruising is an emerging sector in Asia.
The study was commissioned by the Duty Free World Council (DFWC) and the Asia Pacific Travel Retail Association (APTRA).
Amid increased regulations, the report aims to highlight the impact of duty free and travel retail sales in real economic terms, while also calling out the trends affecting the increases.
“Asia Pacific is registering exceptional growth in duty-free and travel-retail sales. We are also seeing the regulatory landscape become more complex and dynamic across the various product categories,” said, Duty Free World Council president Frank O’Connell. “This report is an important investment on the part of DFWC and APTRA in getting the data that will help us engage policymakers and regulators in protecting the sustainable growth of our industry.”
“The report highlights the significance of the Asia Pacific region to global duty free and travel retail, and on a macro level to economies in the region through job creation and contribution to GDP,” said president of APTRA Grant Fleming. “As the industry body that supports, protects and nurtures the growth of the travel retail industry, we are encouraged by the positive trends indicated by the report findings.
“Understanding the industry’s size and its impact on the regional economy as well as the underlying impetus for emerging travel retail trends is critical to ensuring industry relevance and long-term growth. As the travel retail landscape evolves, the regulatory environment is evolving too. APTRA looks forward to applying the report findings and working with regional stakeholders to help frame and develop policies that will contribute to the sustainable growth of the industry in years to come.”