Travel retail has a rosy future ahead of it. US tourists, top spenders in Europe, will be joined by the Chinese, who are slowly returning to travel. Therefore: after the Covid drubbing, the sector is on the upswing. Fashion and luxury brands will benefit from the upturn in travel, both in stores located inside airports and in boutiques in tourist cities. The only negative note: there will be a lack of Russians in Italy. But their absence may not be felt if revenge travelling is vigorous.
And yet, people travel and the US spends the most
Today, US tourists are the top spenders in travel retail to Europe. In January 2023, their spending grew by 91% compared to the same month in 2019. At the opposite pole are the Chinese: -89%. Overall, tax-free purchases recorded in January in Europe are about 75% of those in 2019, but up 125% compared to January 2022. These are the most significant figures that emerged in an analysis by Bernstein and Planet reported by Fashion Magazine. In order, France, Italy, Spain, Germany and Portugal are the main European destinations. Italy has doubled its tax-free receipts compared to January 2022, but still stands at -38% on 2019.
The Chinese will come
International travel from China to Europe is only 24% over 2019. But this percentage is set to grow over time in the name of ‘revenge travelling’. It is the desire to travel ‘for revenge’, after years of the Chinese staying within national borders. This is why travel retail has a bright future ahead of it. Il Sole 24 Ore reports Statista estimates that the shopping market at airports, railway stations, cruise ships and duty free shops is expected to grow in double figures year on year for the next five to seven years. Shopping is in fact among the top 5 motivations for travelling.
From 17 to 35 billion
For Altagamma and Bain, luxury shopping by tourists in 2019 was worth around 17 billion euros. The outlook is that, after the collapse due to the pandemic, it could reach 35 billion euros in 2030. Turnover will double thanks to the Chinese, who are starting to travel again after the reopening of borders at the beginning of the year. Global Blue points out that their intention to travel has risen from 62% in the last quarter of 2022 to 76% in the first two months of 2023.