Marketing, Retailing & Advertising at Indian Airports

In 2006, when the Airports Authority of India (AAI) decided to privatize the Mumbai and Delhi domestic airports, the general sense among Indian air travelers was that this was a step in the right direction: service levels would improve significantly, the airports would be better maintained , and passengers would finally have the creature comforts that one has come to expect in all good airports internationally .

However , it wasn’t just the average air traveler who was looking forward to the privatization program — deep down inside, a wide array of brand marketers would have also sensed the opportunity that a well-oiled airport afforded for the advertising and marketing of brands.

A look at some basic statistics shows the inherent potential for brand marketing. According to the AAI, Mumbai airport, the country’s busiest terminal, recorded traffic of 14.9 million domestic passengers between April 2006 and March 2007, signifying a 21% yearly growth. Delhi airport, on the other hand, recorded a year-on-year growth of 26% comprising 13.8 million domestic passengers between April 2006 and February 2007.

And as per a 2008 IMRB International study, 71% of travelers spend one hour or more in the airport complex prior to departure, while 75% or more spend at least 30 minutes post arrival. The IMRB study also says that 42% of airline travelers frequently make purchases at stores or restaurants within the airport.

It’s no wonder then that innumerable brands are steadily gravitating towards having a strong presence within the privatised airports, be it in Mumbai, Delhi, Hyderabad or Kochi. These include the likes of Shoppers Stop, HSBC Bank, Barclays Bank, Airtel, Café Coffee Day, Croma, Tata Indicom, Baskin Robbins, Hard Rock Café and Gili, to name just a handful.

Any last minute shopping had to be done the night before catching the flight, but now passengers have a retail option within the airport; that is very important. Shoppers Stop, which has entered into airport retailing in association with Nuance, already has two 100-square meter outlets in Mumbai airport, and has taken a total of 3,000 square meters of space in the Bangalore and Hyderabad airports as well.

What makes airports attractive for marketers, particularly those with high-end products to sell, is the relative affluence of the average air traveler even if one were to discount the low cost airline clientele, derisively called ‘cattle class travelers’. For instance, 99% of airport travelers own mobile phones, 71% own credit cards, 42% own home audio systems, 41% own automobiles and 32% own diamond jewelry.

So it’s natural for Croma to have an 850-square foot presence in Mumbai airport, where it retails laptops, storage devices like pen drives, portable DVD recorders, MP3 players, travel accessories and cameras. Interestingly, a large number of shoppers in Croma’s airport store are women who pick up hair straightners and dryers — the highest selling products in that outlet.

The outlet attracts about 300 customers per day but has the potential to have up to 35,000 customers in a week. The Marketer’s idea is they need not buy anything, but the possibility to touch and feel products can influence their decision-making on big ticket items in the future. Indirect benefits of the store are very high as the store allows them to experience the brand.

Café Coffee Day (CCD) is perhaps the most aggressive marketer when it comes to airports. The chain is present in nine airports — including the major ones like Mumbai, Delhi, Bangalore and Hyderabad — with a total of 23 outlets that exist in different formats like takeaways and lounges. The biggest CCD outlet measures 2,400 square feet and is due to open in Bangalore airport, while the smallest occupies a mere 25 square feet of space.

Their aim is to be present across every airport in India and want to open 10-15 cafes this year. Most outlets receive average footfalls of 1,800-2 ,000 per day. The chain has special menus for airports like a breakfast buffet, which is otherwise absent in CCD outlets.

The airport is a very important location for us because it gives the brand a lot of visibility and works as an image-driver for Baskin Robbins says a Marketing director. The ice cream chain has two outlets in Mumbai and Delhi airports, and plans to set up five more across Hyderabad, Bangalore and Kochi by the year end. Spread over an area measuring roughly 150-200 square feet, these outlets see an average of 500 customers daily. The airport outlets do about four times the business done by their high street outlets.

Even brands that are presently not in airports are evaluating the potential. But airports are a logical destination for fashion brands, which explains why brands like FCUK and Calvin Klein are on the verge of opening shops in Mumbai, Delhi and Bangalore airports. Oliver Kaye, business head – CK & FCUK India, says, their success in retailing at airports in the UK and Australia has given the confidence to venture into new airport opportunities in India.

Various studies indicate that 85% of passengers want shops easily accessible from the departures lounge. Keeping that in mind, FCUK and CK stores have been centrally located and have been designed to provide an environment where the product takes centre stage.” On offer would be tees, accessories, sunglasses, underwear and more.

Retailing isn’t the only opportunity for marketers — traditional advertising options also abound. 75% of travelers look at advertising displays at airports, and 73% of travelers can be reached at least once during a three-month airport advertising campaign.

Airports offer the opportunity for marketers to connect with the SEC A crowd as they comprise a bulk of travelers. Up for grabs is 30,000 square feet of advertising space in the form of outdoor sites, the area above the AC ducts, the area above check-in counters, lit display units, vinyl posters, scrollers and LED screens.

Advertisers include HSBC, Barclays, India Post, Lodha Builders, Unitech and Emaar MGF, apart from airlines, telecom brands and beverage brands. But the airports are already contributing to 50% of the company’s revenues.

HSBC India’s brand head sees immense advantages in advertising in airports as there is a “good fit with the passenger profile at the
airports.” Apart from hoardings and banners, HSBC has also undertaken some innovative activation initiatives for its premium offering, HSBC Premier.