Anyone passing through Toronto Pearson International Airport’s Terminal One in recent years will have noticed a slow but steady (and welcome) change to its retail space.
Pearson hopes to cash in on a captive audience and entice travelers away from nearby competitors such as Buffalo Niagara International Airport (used by more than 2 millions Canadians last year, according to its website) by offering a travel experience similar to upscale international airports in places like Dubai.
Moving away from magazine and bookstores and shops filed with Canadian tchotchkes, the airport is on the other side of a grand transformation that took five years to complete.
To date, the facelift has resulted in the renovation or introduction of 38 restaurants, 24 shops and seven services including a full service GoodLife gym and manicure stations.
“Prior to 2010 and the start of redevelopment, we were heavily gift and souvenir weighted and recognized we needed to expand and diversify our offering,” said Erin Kennedy, manager, passenger activation and communication at Greater Toronto Airports Authority.
Considerable consumer research helped shape Pearson’s retail strategy, benchmarking it against the best global airports’ SPE – sales per enplanement – said Kennedy.
“We undertook significant research and strategy work in 2010, coupled with staying on top of retail trends and understanding what works in travel retail,” said Kennedy, when asked what Pearson looks for in a retail partner. “As our incoming passengers continue to grow and their demographics change, Toronto Pearson wants to ensure we have something for every passenger.”
Now, the airport boasts a mix of mid-to-high-end brand name stores including The Body Shop, Hudson’s Bay Trading Post, DavidsTea and Jo Malone, and a plethora of dining options along brightly lit and spacious walkways. Similar efforts are underway at Terminal Three, which are slated to be complete in 2017.
The expanded Duty Free shop, which spans 20,000 square feet in Terminal One’s international departures section, is home to Burberry, Gucci, Coach, Bvlgari, Michael Kors and more. According to a Toronto Pearson fact sheet, passengers shopped for three Burberry scarves per hour in 2014 and bought approximately 1,000 bottles of ice wine per day.
The recent changes “improve the atmosphere in Terminals One and Three, providing an open-concept, vibrant space that is pleasant and easier to navigate,” said Kennedy. “We designed the program to reflect a range of offerings and store/restaurant designs that would meet our passenger and employee needs and create a truly dynamic retail environment.”
The retail experience at Pearson Airport rivals any large city mall and speaks to the growing penchant for luxury goods. Within Terminal One, passengers can choose from a diverse mix of merchandise including everything from a tube of MAC lipstick to loose leaf tea, an $80 scented candle to a Hudson’s Bay branded canoe.
The product selection, explained Kennedy, is vetted with each participating retailer to ensure each is carrying that would appeal to Pearson passengers. “Travelers have specific needs that may differ from a brand’s street store and we’re happy to be able to provide some insight into Toronto Pearson passengers to help tailor the offering,” she said.
The airport has also overhauled its food service options, improving food quality and providing passengers with more options. Travelers can dine on every day items like sandwiches from Subway or burgers from A&W, rustic Italian cuisine from chef Massimo Capra’s Boccone Trattoria or a smoked meat sandwich from Toronto’s famed Caplansky’s deli.
Both the revamped retail and food strategy are getting passengers spending. Since adding new retail and dining offers, Toronto Pearson has seen an 8% increase in revenue and customer transactions from 2013 to 2014, Kennedy told Marketing.
And improvements are set to continue. Kennedy said the airport is “constantly evaluating how we can enhance our passenger and employee experience. For instance, passengers and airport employees have expressed interest in having an onsite pharmacy or drugstore and other personal care services.
Though Kennedy wouldn’t confirm how much Toronto Pearson Airport has invested in the renovations, she said “retail development is a partnership between us and our tenant partners, and jointly we’ve made a significant investment in creating an offering that benefits our retail operators and our passengers.”
