is booming. According to Research and Markets, the global travel retail market grew from US$68.91 billion in 2022 to US$79.05 billion in 2023 at a compound annual growth rate (CAGR) of 14.7 per cent. The market is expected to grow to US$126.48 billion in 2027 at a CAGR of 12.5 per cent.  What does travel retail mean? Travel retail refers to the sale of goods and services to domestic and international travelers in airports, train stations, border shops, cruise terminals, and other locations. The category encompasses a number of product types such as fashion and accessories, cosmetics and skincare, electronics, alcohol, and more.  The onset of the Covid-19 pandemic and the resulting travel restrictions led to a significant drop in international passengers, especially at airports, in the months of March, April and May 2020. In 2019, the global travel retail market was valued at US$74.31 billion and dropped to US$19.7 billion in 2020. However, with the release of the Covid-19 vaccines and the loosening of travel restrictions, there has been a surge of revenge travel in recent years. As domestic and international travel has been picking up again at an exponential rate, so has shopping at transport hubs. In 2022, the global travel retail market was valued at US$55.74 billion and continues to grow faster than in the pre-pandemic era.  Nadine Heubel, global senior vice president of revenue for the travel and hospitality division at Reklaim, a tech-enabled company in the pre-owned luxury space, noted that “pre-Covid the industry was forecasted to reach US$130 billion in 2030. In 2023 we are still in recovery mode primarily due to a slower recovery of the Asian market, notably mostly Chinese passengers.  “In 2023, I predict that we will finish at an 85-90 per cent rate versus pre-pandemic revenues. Chinese passengers are now starting to travel globally again, the group tour ban has been lifted recently, therefore a full recovery in 2024 should be possible.” How should retailers lean into the growth of the travel retail industry?  With regards to the growing travel retail market, Heubel explained that there are three tips retailers should keep in mind. First, retailers should consider universal operational excellence versus customised airport solutions.  “Retailers need to make sure that their back-of-house operations run smoothly and can be used as a plug-and-play for any location so that they can spend enough time (and money) to develop individual solutions for each of their airport locations, mostly around design and assortment. The airport locations should be an extension of the city the airport is in,” said Heubel.  “I want to know that I am leaving from New York and that the design and assortments are different from, let’s say, a Chicago location. Seventy to 80 per cent of the assortments will be very similar but these 20-30 per cent which are dedicated to the location will make the difference for the traveler and will also have a huge impact on passenger spending of the generic assortment.” Secondly, Heubel recommended that retailers should “be more sophisticated around data, and collaborate with airlines. Unlike stores in the city, every passenger is a known passenger.”  While information like consumers’ names can’t be shared due to privacy regulations, airlines can provide fairly thorough insights into the consumer demographics that retailers can expect on a daily basis, such as staffing, streamlining assortments, and so on.  Lastly, “develop solutions to ‘talk’ to the passengers during the whole customer journey, such as geo-fencing.” By “talking” to passengers through their travel retail expeditions, retailers will have a more in-depth understanding of what consumers are looking for and their shopping patterns.  Areas of travel retail growth Heubel noted that beauty and fragrance are two areas of growth in the travel retail market, in addition to growing consumer interest in locally produced and sustainably made products.  A report from market research company Fortune Business Insights revealed that in 2022 the leading product in terms of travel retail sales was cosmetics and fragrances, making up 38.11 per cent ove overall sales.  While heritage brands like Chanel and Shiseido have traditionally been the big drawcards at airports and other transport hubs, as the traveling duty-free shopper has gotten younger, they have also started seeking out niche and indie beauty and fragrance labels.  In recent years, millennial and Gen-Z-friendly beauty brands like Dr. Jart+, Drunk Elephant, Grown Alchemist, and Malin + Goetz have been expanding their presence in the travel retail space.  This trend is expected to continue as consumers continue to seek out brands with innovative ingredients, bold packaging, and focused sustainability efforts.