SUMMER 2022 / V20 N242
ALTERNATIVE CONCESSIONS MODELS GAIN TRACTION
AIRPORTS EMBRACE DIGITAL SOLUTIONS FOR PASSENGER SATISFACTION
TRACKING STREAMLINES PASSENGER JOURNEYS
Market 901 with Gateless Closure System
Distillery District offering the best Tennessee Whiskeys
The Best of Both: Innovation and Service Our new retail program at Memphis International Airport showcases our focus on today’s traveler with creative local products and influences complemented by innovative conveniences – gateless closure systems and self-checkout stations – that deliver exciting yet efficient shopping experiences. Wrapped in world-class designs, our new MEM stores define our High Tech, High Touch approach to elevated customer satisfaction.
Grind City Essentials with Self-Checkout
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14 The Evolving Lounge Experience
More and more, airport lounges appeal to the crowd-fatigued traveler. Historically low returns from members-only spaces have given way to independent lounge experiences that utilize otherwise-unused terminal space to generate revenue.
22 Embracing Alternatives
Leasing contracts have always been a point of contention between concessionaires and their airport landlords, and never more so as during the pandemic and its aftermath. While most airports are sticking with the traditional approach, a few airports are doing things differently.
26 Eyes on the Market
Digital marketing is the new frontier for U.S. airports, many of whom are looking to increase revenue as passengers return to the terminal through use of new, interesting technologies and experiences.
32 Going Global
This summer, two international airport conferences hosted conversations revolving around global air travel trends, the continuing evolution of airport retail and new innovations for future growth.
36 Tracking Upward
Airports today want to keep up with customer demands and expectations, and one way to keep on top of the passenger experience is to track it from curb to gate.
3 Letter From The Editor In Chief
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4 Data Check
A global air travel comeback is well underway, but with full recovery still years off, some countries are faring better than others coming out of the pandemic.
6 Latest Buzz
Newark Liberty International Airport is debuting a brand-new terminal later this year with a lineup of local concessions and a distinctly New Jersey feel.
10 Director’s Chair
Jesus Saenz took over at San Antonio International Airport just over two years ago. Now that traffic is returning in dramatic fashion, the airport is laying the groundwork for a new terminal.
42 Sustainability Snapshot
The restaurant industry is no stranger to food waste, but airport concessionaires have found that donating unused food products can reroute that excess to people who need it.
45 Advertising Index 46 Before You Take Off
Chicago’s Brown Sugar Bakery has been ready to enter the airport space for years, but an unlikely tragedy was the catalyst that finally got it there.
A X NEWS SUMMER 2022
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TEAM Desiree Hanson
Executive Vice President
Melissa Montes
Vice President/Publisher
Carol Ward
Editor-in-Chief
Jean Claude Chaouloff
Business Development Manager
Andrew Tellijohn
Senior Reporter
Shafer Ross
Copy Editor and Writer
Sally Kral
Contributing Writer
David Ward
Contributing Writer
Barbara McCarter
Portfolio Manager
Chad Wimmer
Senior Editorial Art Director
Rae Lynn Cooper
Production Manager
Amanda Gochee
Group Marketing Director
Paige Heady
Senior Marketing Manager
Catherine Babbidge
Marketing Coordinator
Simon Kimble Chairman
Greg Topalian
President and Chief Executive Officer
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Mark Wilmoth
Chief Financial Officer
Airport Experience® News Is a Division of CLARION Events 6421 Congress Ave., Suite 107 Boca Raton, FL 33487 Phone 561.257.1026 Fax 561.228.0882 To subscribe visit https://airportxnews.com/subscribe/ ISSN: 1948-4445 Copyright © 2022 Airport Experience® News, all rights reserved. Any reproduction of this magazine is strictly forbidden without prior permission from Airport Experience® News.
SUMMER 2022
Dear Readers, SUMMER 2022 / V20 N242
Lounges Evolve As Interest Spikes
ALTERNATIVE CONCESSIONS MODELS GAIN TRACTION
AIRPORTS EMBRACE DIGITAL SOLUTIONS FOR PASSENGER SATISFACTION
TRACKING STREAMLINES PASSENGER JOURNEYS
Earlier this summer, in June, AXN Publisher Mel Montes and I attended two global airport conferences – The World Airport Retailing Summit within the Future Travel Experience Conference in Dublin, and the Passenger Terminal Expo in Paris – to gain some insights into how airports around the world are rebounding from the pandemic and positioning for new growth. Some takeaways from those events are outlined in an article in this magazine. More personally, our travel experiences to those markets and to others we’ve visited during this busy time – Seattle, Phoenix, Chicago and Denver, to name a few – were remarkable in that they underscored just how quickly our industry has recovered. Parking garages were nearly full, terminals, restaurants and retail shops were thrumming with business, lounges were at capacity and gatehold areas were crowded. I’m sure many of you have experienced the same during your recent travels; I just wanted to highlight the extraordinary and positive transformation we’ve all witnessed during a highly tumultuous time. And speaking of crowds, concessions and lounges, this issue is packed with information you need to map the continuing evolution of the airport experience. Check out our features on the latest in airport lounges, alternative concessions models and traveler tracking for optimal experiences. Enjoy!
Best regards,
Carol Ward Editor-in-Chief Airport Experience News
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DATA CHECK
INTERNATIONAL REBOUND While Still Far From Pre-Pandemic Levels, Rapid Recovery Is Underway For International Travel BY CAROL WARD Recovery By Regions: Q1 2022 Departures In % Of Q1 2019 Departures Domestic 78%
GLOBAL International 46%
North America Domestic International 88% 57%
Domestic 74%
Europe International 59%
Asia / Pacific Domestic International 68% 14%
Middle East Domestic International 83% 64% Latin America and Caribbean Domestic International 97% 70%
Domestic 81%
Africa International 62%
Source: m1ndset
hen the U.S. government announced in early June the elimination of the COVID test requirement for entering the U.S., the travel industry rejoiced. The final barrier to rebuilding international traffic has been eliminated, paving the way for what most in the industry expect will be a robust recovery curve. Globally, the situation varies by market, but the overall prognosis for travel is better than originally predicted. In the first quarter of this year, the International Air Transport Association (IATA) predicted that international air traffic would reach pre-pandemic levels in 2024. More recently, IATA revised its forecasts and is now projecting pre-Covid levels will be attained by next year. Travel research experts M1nd-set examined the latest data for their June 2022 edition of M1nd-ful, the company’s monthly newsletter. The company notes that domestic air traffic recovery has been robust across
W
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the globe, most notably in the Americas and lagging somewhat in Asia. Domestic air travel is set to reach over 90 percent of 2019 traffic levels by the end of 2022; in 2021 domestic traffic was around 60 percent of 2019 levels. The international traffic piece has been slower to come back, but with restrictions easing around the world the trend toward pre-pandemic traffic levels is accelerating. By the end of 2022, international traffic is expected to be at about 67 percent of 2019 levels, compared to 30 percent in 2021.
International Winners In the first quarter of 2022, international travel was at 46 percent of pre-pandemic levels, but most major world regions were well over halfway back. Weighing down the recovery was Asia, which in Q1 was at just 14 percent of 2019 international traffic levels. That compares to the high of 70 percent in
ACI_2022_2_Page_Insert_OUTLINE.pdf
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21/07/2022
09:47
DATA CHECK Global International Departures – Top 20 Airports In Q1 2022 63% 7.35 57% 4.91
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4.10
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3.80
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3.21
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79% 2.30
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56%
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73% 1.91
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Source: m1ndset
Latin America and Caribbean, Middle East at 64 percent, Africa at 62 percent, Europe at 59 percent and North America at 57 percent. The United States remained the top-ranking country for international departure nationalities and had an international traffic recovery rate of 60 percent. The relatively strong performance of the U.S. specifically and North America overall meant that some top airports in the region moved up in airport rankings.
According to the M1nd-set report, New York’s John F. Kennedy International Airport (JFK) moved into 10th place among airports ranked by international departures, from 21st place, based on international departures in the first quarter of 2022, compared to the same quarter in 2019. Miami International Airport (MIA) ranked 11th in Q1 2022, up from 29th during the same quarter of 2019.
JFK and MIA were the only two U.S. airports among the top 20 airports ranked by international departures. The M1nd-set data showed that JFK had recovered 66 percent of its Q1 2019 traffic at that point, while MIA had recovered 79 percent of its traffic. Toronto Pearson International Airport (YYZ), the only other North American airport in the top 20, had recovered just 44 percent of its Q1 2019 traffic.
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LATEST BUZZ
“A” FOR NEW JERSEY
The New Terminal A At Newark Liberty International Airport Was Designed For, And By, New Jerseyites BY SHAFER ROSS
Above: The 33 gates in the new terminal will accommodate the widerbody aircraft that many airlines are planning to add to their fleets in the coming years.
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etting to, in and through New Jersey’s Newark Liberty International Airport (EWR) will soon an elevated experience due to new construction nearing completion. The work will modernize, expand and streamline the new Terminal A, a 33-gate, one millionsquare-foot, $2.7 billion building with a distinctly “New Jersey” feel. “It’s a brand-new terminal, to meet the latest in customer satisfaction, the latest trends – so it was already well-designed. It’s always easier to work on a green field rather than flip a program in an old terminal,” says Jean-Pierre Tabet, managing director of Munich Airport US Holding, the company whose New-Jersey-based subsidiary was awarded management of EWR in 2019. “So, we developed a comprehensive vision for Terminal A that obviously impacts the
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design of the concessions program, but also extends into the passenger amenities. We wanted to provide a vision for New Jersey and create a unique sense of place that truly represents New Jersey along the entire passenger journey from curb to gate.” EWR has served the cities of Newark and Elizabeth and the surrounding areas in both New Jersey and New York for more 70 years. As part of the Port Authority of New York and New Jersey (PANYNJ), EWR is one of three major airports serving the New York metropolitan area, making it nearly impossible to avoid the pitfalls of such a large catchment: traffic congestion, long lines, lack of modern amenities. “We are committed that Terminal [A] and Newark, as well as our other airports, are world-class infrastructure that provide a world-class passenger experience. And what
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LATEST BUZZ
Left: Newark Liberty International Airport’s new Terminal A will boast 33 gates and one million square feet, and cost the Port Authority $2.7 billion. Below: In addition to the brand-new terminal, frequent fliers at Newark Liberty International can expect new, streamlined roadways to make for a more convenient journey.
we have to acknowledge on both sides of the river is that our facilities have historically been a long, long way from that,” said Rick Cotton, executive director of PANYNJ, when the Port announced in 2019 that it would be funding a full redevelopment of Terminal A. “So, we have a ways to go both in terms of rebuilding these facilities into world class brick and mortar, but we also want a world class passenger experience and we’re committed to that. “But that’s only one part of it,” Cotton continued. “The other part is what’s represented by this solution, it’s an absolute, total commitment to work with the communities in which our facilities exist. …We want the benefits – from a business point of view, from a hiring point of view, from an opportunity point of view – of recruiting from the communities around our facilities.”
New Concessions Approach This commitment to representing the state of New Jersey and the immediate areas around the airport is evident in every aspect of the project, from the selection of local architects and designers to well-loved New Jersey brands to the aesthetics of the entire terminal, says Tabet. The concessions lineup for the new terminal is varied. The retail side is stacked with nationally recognized brands like Sunglass Hut, Kiehl’s, MAC makeup from
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Hudson, as well as a slew of the company’s proprietary concepts, like Evolve and an Ink bookstore. Marshall Retail Group, a WHSmith company, is also bringing in a mix of company-owned concepts along with some popular and well-known brands, with a clear focus on New Jerseybased names like New Jersey Monthly, Vue New Jersey and a market concept called Shore Points Market that will offer locally produced goods from New Jersey business owners and crafters. “The retail spaces – size and location – and overall environment within Terminal A allowed us to really push concept development around this theme of locally curated experiences,” says David Charles,
president and COO for the Marshall Retail Group. “It gave us the ability to build a showcase of uniquely inspired retail concepts created specifically – and only – for Terminal A… [as well as] training and onboarding programs for our associates that story-tell the broad range of local offerings.” Villa Restaurant Group will be operating a host of food and beverage outlets that many will recognize, like Starbucks and Shake Shack, along with names like Zaro’s Bakery, a popular New York bakery, and Office Tavern & Grill, a New Jersey favorite. Midfield Concessions will be offering chain daytime café Playa Bowls, Guy Fieri’s Flavortown Kitchen, Jersey Mike’s Subs and a handful of other
LATEST BUZZ
casual and sit-down eateries. Guests can look forward to a location of the nationally popular BurgerFi, plus other delicious options from Master ConcessionAir. In addition to these well-known airport operators, a lineup of independent entrepreneurs and small businesses will also join the new terminal as part of Munich Airport US’ new incubator program. “We will support these local businesses in how to work at the airport,” Tabet says. “Obviously, it’s not always easy, because working at an airport is always more challenging than working at a downtown location… so we are working strongly together with brand owners and operators to make this into a success.” This “small spaces” program is made up of primarily locals, just another factor to add to the New Jersey feel of the terminal. As both a domestic and international terminal, Terminal A is designed to welcome locals home as soon as they’re off the plane, as well as wow visitors unsure what to expect from the state they’ve just touched down in. “The program caters for all,” Tabet says. The goal is to “bring in a concessions program that is unique, state of the art and reflective of New Jersey,” a sentiment that is popular at many airports currently undergoing development – the idea that the enhanced “taste of place” gives guests the “vacation” experience they’re seeking through travel while still in the airport. Still, consumer tastes change, a phenomenon many know all too well after the tumult of the past few years and the wild swings in trends that came with it. “It was obviously a challenge when we went to market,” says Tabet. “Keep in mind, we went to market and Covid hit. …So, it was challenging, but nevertheless successful, because on multiple levels we had people who believed in the future and believed that things would be coming back.” The team at Munich Airport US wanted to balance longer contract lengths that allow operators to recoup their buildout and operating costs – especially after the financial hit many took with the pandemic – with the opportunity to still keep things fresh as travelers return to the skies and continue to evolve their expectations. “The contract term for Newark Terminal A is for a long time, so in developing the retail program we took a strong forward-
Right Top: As part of the Port Authority of New York and New Jersey, EWR is one of three major airports serving the New York metropolitan area, making it nearly impossible to avoid the pitfalls of traffic congestion, long lines, and lack of modern amenities. Right Middle: California-based firm Gensler designed the hold rooms made to welcome locals home and wow visitors. Right Bottom: The Portland Design Co., a group based in the U.K., handled much of the overall terminal look and the New Jersey sense of place.
looking point of view to the way we developed the concession proposal,” says Marshall Retail’s Charles. “In determining the right mix of store concepts, local and national brands and positioning, we spent a lot of time in the market, a lot within the current airport and with local suppliers and customers. “Market research informed a lot of what worked well within the current offering as well as what customers were looking for in a future space,” he adds. It was with a focus on the future that the gate area was designed, as well. Tabet says the 33 gates that will make up Terminal A will all accommodate the larger-body aircraft that many airlines are looking at
adding to their fleets in the coming years, such as the AirBus 220. “We can handle all these types of planes,” he says. “We are ready for the future.” California-based firm Gensler designed the hold rooms while Tabet says the Portland Design Co., a group based in the U.K., handled much of the overall terminal look and the New Jersey sense of place. The terminal is anticipated to open later this year, and Tabet couldn’t be more excited to welcome travelers to the new and very improved space. “Everyone is going to be surprised. It’s going to be great. …It’s tremendous change. A milestone for Munich Airports, a milestone for Newark.”
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DIRECTOR’S CHAIR
POSITIONING FOR GROWTH SAT Is Laying Groundwork For Future As Passenger Demand Surges BY CAROL WARD
ditor’s Note: San Antonio International Airport (SAT) suffered through the pandemic like all airports. However, its rebound has been quick and robust, with nearly all traffic back and some days exceeding 2019 levels. Facilities are getting tight, so the airport is quickly installing a few new gates this year and is in the early stages of a new terminal development. Jesus Saenz was appointed director of airports for the city of San Antonio in January 2020. He led the airport through the pandemic and now is excited about the next phase of development. AXN’s Carol Ward spoke with Saenz about what’s next for SAT.
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Above: Jesus Saenz, director of airports, City of San Antonio.
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WARD: As we talk in early May, can you share how your spring travel season went at San Antonio International, and what you’re expecting for the summer months? SAENZ: We’ve been doing incredibly well. 2019 was the best year the airport ever experienced, at a little over 10 million passengers in one year. Obviously 2020 wasn’t good. 2021 was a little bit better, but as we started off in 2022, we’re probably experiencing somewhere around 90 to 95 percent of where we were in 2019, which is incredible. And we anticipate a good summer and a good fall that will help us catapult and get back into pre-pandemic numbers. WARD: You have a largely leisure travel base, correct? What’s your split between business and leisure? SAENZ: I would say it’s probably a 60/40 split, with 60 being leisure and 40 being business. On some days it’s probably higher than that. We’re noticing a really significant difference in the way passengers are moving and the type of passenger that’s moving by the day that they move. We have a very large convention market that comes to San Antonio as well. We do have a number of significant leisure offerings here in the city. It’s a gorgeous city with a ton of charm [so] people want to come here for leisure reasons.
WARD: Do you have much in the way of international traffic, and if so, how’s that doing? SAENZ: Ironically, as we look at 2021 in totality, we were pretty close to 60 percent above 2019 on the international market. We were able to increase a number of different destinations coming from San Antonio to the country of Mexico, which is where the majority of all of our international traffic is coming from. We want to continue to grow that. People from Mexico are very interested in coming to San Antonio – we have very similar cultures. WARD: Let’s talk a little bit about expansion at SAT. I think you’re adding a couple of gates at the moment, and then you have a larger Terminal C expansion in the works. Is that correct? SAENZ: Yes. We’re super excited about that. We completed a 20-year plan with our Strategic Development Program, and we were able to have [a] unanimous decision of support from the city council; 11-0 vote. The city is eager to expand the existing footprint of our airport. [We have] a little over a million square feet in assets in just the terminal area that’s available for us to process and ensure that we have the appropriate passenger facilitation with good levels of service for our passengers.
DIRECTOR’S CHAIR
However, our capacity is becoming minimal. We do have three gates that we’re installing - two brand new gates into Terminal B and one new gate into Terminal A. That will happen by the end of 2022. That will give us a little over 1.3 million in passenger capacity to add to that. We’re looking at expanding as well in the international realm, so we’re looking at doing some ground loading facilities of three additional gates into Terminal A as well. So, we’ll have six new gates, hopefully within the next 24 months, with three of those coming in the next six to eight months. And then long term, we will start to put together advanced planning and terminal design work and programming work for the Terminal C complex. So that has a capability of adding 17 additional gates to be prepared for the future. Right: New gates are being added to ease capacity issues at SAT, and early planning is underway for a new terminal.
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DIRECTOR’S CHAIR
WARD: For the Terminal C portion, we’re talking probably a couple years before groundbreaking, correct? SAENZ: In a perfect world, we’d like for it to happen in the next three to five years, but it’s to be determined. We’ve got to get through some of our advanced planning work. Once we finish 2022, we’ll start to look at how we’re going to deliver that; take on hopefully somewhere around 15 to 30 percent design work and then [agree] to some type of delivery method so that we can start to put shovels in the ground. Is it eight gates, 10 gates, 12 gates, 15 or 17, to be determined? We want those decisions to be demand driven based on our passenger activity levels and then begin those efforts. WARD: Inside the terminal, how are your concessions and passenger services performing now, with passenger levels at 90 to 95 percent? SAENZ: We do have some long lines. There has been a large concern with human capital, as it is with just about every industry in the nation. I really credit all the teams that are out there. They do an incredibly great job. We do have all of our concessions open and we have three additional ones that we will be opening. We just finalized an agreement with Paradies [Lagardère] to bring on Whataburger. We’re looking at sometime in between July and August of
Right: Concessions are constrained at SAT. Three new locations are coming on stream this year, and an RFP will be issued later this year for a food and beverage and retail revamp.
that opening. We’ll also have a brandnew market offering. There’s a lot of history and culture here in San Antonio related to having different open markets. So, we’re going to have a market in the airport as well – that too is through our relationship with Paradies. [They’ve partnered with] the Cortez family that has great market offerings in the Market Square here in San Antonio. Then we’ll have brand new offering called The Beer Code. All of these are scheduled to open this year. WARD: What about existing concessions? Do you have any changes in the works or are your leases coming up for renewal? SAENZ: We have some that are monthto-month and we’re going to be going out for a new proposal at the end of this year. We’re putting together an RFP to solicit to a new concessionaire to come into the airport, or an existing concessionaire, to be determined. We want to increase the overall square footage that we have as we look at the expansion of Terminal C and we look at additional gate offerings in Terminal A and in B. We’re utilizing every inch we can to increase our overall footprint for concessions. So more to come on that as we finalize some different
Left: San Antonio International Airport has rebounded quickly from the pandemic and this year is expected to post traveler numbers at or exceeding 2019 levels.
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drawings to determine where specifically we want to utilize brand new concession offerings. WARD: Is that food and beverage and retail? SAENZ: That is correct. A mixture of both. We’re doing a lot of the homework right now to determine what’s going to be best for the passenger to ensure that we’re providing the best. As I mentioned, there’s a large change in the passenger characteristics and what the passenger expects, and we need to be considerate of that as we look going forward. How do we incorporate some of those changes into the contractual language with a prime or however we decide to solicit this going forward for the fall of 2022? WARD: Are you looking to incorporate more technology into your concession? SAENZ: I think it’s going to be imperative that we shift to what I would call a framework that’s going to be a hybrid approach. You have passengers that are very needy for grab-and-go, and then you have some that are still interested in sit-down restaurants. We’re looking at a number of different options. We’re wondering: do we establish ghost kitchens? There are a number of new technologies and some vending machines. We’re excited about possibly being able to have some different robotic vending machines here at the airport as well that still allows a passenger to get exactly what they need in a very quick timeframe, so that they can catch their flights and not have to wait.
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Left, Above: Capital One sought feedback from its cardholders to help determine what they’d be looking for in an airport lounge, the first of which opened at DFW last year.
Loaded Lounge Market Competing In Growing Space BY ANDREW TELLIJOHN
When Capital One opened its first branded airport lounge at Dallas/Fort Worth International Airport (DFW) late last year, the financial services company became at least the sixth firm vying for the white-hot lounge space at airports. Capital One aims to create lounge spaces that fit each individual traveler’s needs, whether they are headed off on a honeymoon, seeking some yoga, cycling or a ride on a Peloton bike, or seeking a quick bite between business flights. “We’re all about putting our customers first,” says Jenn Scheurich, head of travel. “When designing Capital One lounges, we want to create a unique experience for our cardholders and we spend a lot of time talking to both our customers and industry experts to truly understand and hone in on what works and what doesn’t for travelers.” In addition to exercise and relaxation options, the Capital One Lounge in Terminal D at DFW has locally sourced on-the-go food, cold-brew coffee on tap and high-speed wi-fi and quiet zones for work and charging up. “We thoughtfully and purposefully design our lounges with local touches that inspire our cardholders by celebrating the many offerings of their respective regions, including partnerships with area artists, breweries, coffee roasters and cocktail bars,” she says. The company has two more slated for 2022 openings: one at Denver International Airport (DEN) and one at Dulles International Airport (IAD).
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Swissport Tweaks Brand, Re-Enters Lounge Scene Another new entrant is more of a re-entrant. Swissport has retired its Airspace brand, closing lounges at Baltimore/Washington International Thurgood Marshall Airport (BWI), Cleveland Hopkins International Airport (CLE) and in Terminal 5 at John F. Kennedy International Airport (JFK), while renovating one and relaunching as Aspire Lounge at San Diego International Airport (SAN). The company has two more planned for Ontario International Airport (ONT). Swissport is a ground services company that offers myriad services in and around airports, including lounges, says Nick Ames, head of lounges for North America. Previously guests would get in with coupons and use tokens to exchange for food. Now, in its Aspire brand, the company has gone with a more traditional open buffet with a central counter and free house drinks. “We consider ourselves experts given we’ve been doing lounges since the 1990s,” he says. Ames says the company is about operational excellence and efficiency. Swissport likes to add amenities and technologies, where possible. For example, current offerings include snooze pods,
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where travelers can sit in a pressure-less pod and relax. “You’re meant to be able to drift off for a 20-minute nap and it buzzes when your time is up so you don’t miss your flight,” he says. There is a seamless charging facility for convenience. And food and beverage is “often the backbone of the lounge,” he says, adding that Swissport is looking to partner with local businesses for food options. “We’re about bringing the local environment to the space and… reflect[ing] the local environment rather than being a cookie-cutter approach where you could be anywhere in the world,” Ames says. “Those elements are probably what separate us slightly from competitors.” A m e s a l s o t o ut s Sw i s s p o r t ’s independence, meaning anyone traveling can access the Aspire Lounge. There are daily and pre-booking rates and special thank-you prices for emergency workers and military personnel. “Our strategy is very much experienceand brand-led,” he says. “We’re proud to be independent. Our independence gives us the widest appeal to the widest amount of people, whereas linking yourself with financial services providers, as good as it is – it’s an interesting strategy – there is, from an airport perspective, always going to be somebody who is excluded from the pack, who is not able to use the lounge because of the affiliation.”
Above: Swissport re-entered the U.S. lounge market with its Aspire Brand, the first of which reopened at SAN earlier this year. The company has been operating lounges globally for more than 30 years.
American Express Still Pushing Limits One of the leaders in non-airline lounges is American Express, which began offering Centurion locations to its cardholders many years ago. The credit card company is still breaking new ground, says Pablo Rivero, vice president and general manager of global lounge experiences. The company kept moving through the pandemic, opening its first Centurion Lounge in Europe in 2021 and unveiling a significantly expanded offering at Las Vegas’ Harry Reid International Airport (LAS) the same year. And earlier this year, American Express announced plans to open a new 26,000-square-foot Centurion Lounge at Hartsfield-Jackson Atlanta International Airport (ATL), that will include multiple outdoor areas with open views of the tarmac, a modern bourbon bar curated by a local chef and Centurion Lounge mixologist Jim Meehan, and many natural, local landscape features.
Left, Above: American Express started the Centurion Lounge concept to provide an oasis for its premium cardholders. The company will open a 26,000-square-foot lounge at ATL next year, the largest in its network.
It will be accessible from every ATL terminal through the Plane Train or by walking along the Transportation Mall. ATL officials were thrilled at the prospects of adding an amenity to the airport that will drive revenue but also provide a great experience for those passengers who can access it. “As a concession that is utilizing existing airport space, these lounge development projects can create significant revenue because they aren’t following a food and beverage or retail model of needing to sell to commodity passengers,” says Tony O’Brien, assistant general manager for aviation commercial property management. “Their model is a marketing expense to keep their customers contented.”
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The benefits to the airport come not in rent, but in capital investment. “We are looking for substantial capital investment and therefore the rental revenue is not as high as another model, but we get the capital,” O’Brien says. Rivero says the experience is the goal that drives the company’s innovation. To meet the push for wellness, it established Equinox Body Lab at JFK, which offers selfguided meditation and stretching sessions. For those who would prefer a cocktail, it established a speakeasy on the bottom level of the lounge. It has sunrise and moonrise
rooms at Los Angeles International Airport (LAX) to help deal with time changes. The lounge industry is competitive and constantly evolving, Rivero says, but the company remains confident in its ability to stay ahead. “The lounge business has always been very competitive, it has become more competitive,” he says. “We are really confident in our lounge offerings in that they will continue to stand up well to the competitors Travel is in our DNA. Having a presence in the airport lounge space has Left, Below: Airport Dimensions has 20 “the Club” lounges in North America and 41 nationwide. Going forward, some new locations will be opened in partnership with JP Morgan Chase and branded as Chase Sapphire Lounge by the Club.
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really enabled us to back and support our cardholders travel from start to finish. We will continue to innovate in that space.”
Chase Enters With Airport Dimensions American Express and Capital One have been followed into the lounge market by another financial services powerhouse. JP Morgan Chase will bring its Chase Sapphire Lounge by the Club concept to airports via a partnership with Airport Dimensions. The company has tested lounges across the country as part of marketing hub activations for unique events involving culinary, entertainment and cultural experiments and will, the company says, utilize the same inspiration in creating its more permanent locations. The company announced recently during an Investor Day that it has been awarded nine locations to date. Its first openings will be at LaGuardia Airport (LGA), Boston Logan International Airport (BOS) and at Hong Kong International Airport (HKG). A spokesperson added Phoenix Sky Harbor International Airport (PHX) to that list and a representative from SAN indicated Chase and Airport Dimensions would team on a lounge there, as well. Airport Dimensions will continue opening lounges both in tandem with Chase and alone, says Chris Gwilliam, vice president of global business development. “Our lounge brands span a spectrum of requirements, leaving us well placed to respond to a broad range of consumer demands, either with brand partners or with brands developed in house,” he says. “The decision of which brand to offer an airport is made on a location-by-location basis based on the specifics of the individual opportunity.” The company has 20 lounges open in North America with 11 more planned and 41 spaces globally with 18 currently in development, Gwilliam says. Proposals are typically evaluated on several factors, he says, including market experience, design and concept, operational capabilities, ability to drive revenue and financial compensation. Airport Dimensions attempts to deliver on all angles, but has found its approach to localizing each concept and successful partnerships with airlines and the Priority Pass membership base to be key differentiators.
Above, Right: There are a dozen Escape Lounge locations in the U.S. right now with three more on tap. Each has a localized feel so travelers will recognize where they are, says Sid Higgins, Cavu’s vice president of operations.
“Air ports understand both the commercial value that a lounge with Priority Pass access brings as well as the positive impact it has on passenger guest satisfaction rankings,” Gwilliam says. The company, when looking at an opportunity, looks for a minimum enplanement threshold and a favorable terminal layout. It considers competition from other lounge brands and the commercial expectations of the airport. It has spaces ranging from 3,000 to 12,000 square feet in large hub airports and can do smaller venues for medium hubs. “The key thing is right-sizing the lounge for the specifics of each airport,” Gwilliam says. “We like to work with airports in early space planning stages to ensure the space allocation is optimal.”
New Name, Same Multi-Dimensional Focus At CAVU Manchester Airport Group has long owned three airports in the United Kingdom. The company came to the U.S. as MAG USA six years ago hoping to see a privatization program emerge. That has yet to happen, but the company still has built a network of 12 Escape Lounges, with three more coming this year, and built a clientele around a series of digital services, such as pre-bookings for parking, lounges and security. The parent company recently merged its U.S. and digital divisions, resulting in CAVU. The name is an abbreviation for “ceiling and visibility unlimited,” an aviation term designating perfect flying conditions. CAVU won’t be flying planes, but it is attempting to create those same conditions within the airport realm.
MEMBERSHIP PAYS
Financial Service Firms Invest Big In Lounges For Cardholder Customers BY ANDREW TELLIJOHN American Express opened its first airport lounge more than a decade ago as part of its “Project Haven” program which was, simply put, an effort to create an oasis for its cardholders amid the cacophony of a trip through an airport. “We have been in the travel business for more than 100 years,” says Pablo Rivero, vice president and general manager for American Express Global Lounge Experience. “We know what our cardmembers’ expectations are when they are traveling. We knew lounge access was one of the most important benefits they wanted.” But looking at the marketplace, company officials felt the offerings at the time weren’t up to those members’ expectations. So, they decided to do something about it. From wellness rooms to local chefs and sunrise and moon rooms, the company changed the lounge industry through its innovation. And it keeps raising the bar, with the announcement earlier this year of a massive lounge with outdoor space coming to Hartsfield-Jackson Atlanta International Airport (ATL) next year and improvements coming to many others. “We wanted to create a benefit for cardmembers,” says Rivero. “It’s a physical manifestation of the brand. When you walk through those blue doors, we want the members to physically experience what the brand is.” American Express is being joined by at least two other credit card companies in providing these benefits to customers. Capital One, which opened its first lounge at Dallas/Fort Worth International Airport (DFW) last year, recognizes that its upscale travelers have a passion for travel. “We spend a lot of time talking to our customers and know that travel is a huge passion point for many,” says Jenn Scheurich, head of travel. “That’s why over the last several years, we’ve been very committed to innovating and investing in the travel space to help customers, and opening our network of lounges is just one way we strive to do that.” It’s an effort to put a bit of relaxation into what can be an, at times, stressful journey through airports. “We’re aiming to establish a best-in-class airport lounge experience that fits a variety of travelers’ needs by providing a calm space ion the chaos of airports and a place to enjoy a moment of relaxation and luxury during the travel journey,” she adds. “It’s a really unique way to bring Capital One’s innovative, customer-centric brand to our customers in a way they don’t traditionally interact with us.” JPMorgan Chase has yet to open any Chase Sapphire by the Club lounges to date but intends to do so soon in tandem with Airport Dimensions. As with its financial services peers, Chase sees lounges as a perk for its customers. “Travel has always been important to our customers who aspire for compelling and elevated experiences,” said Marianne Lake, co-CEO of Chase, in a statement announcing the move. “We’re investing in meeting our customers where they want to be as more and more of them have the confidence to travel again.”
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Above, Opposite Page: From kids areas for play to quiet spaces for unwinding, Plaza Premium lounges try to meet guests wherever they may be in the airport journey.
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Sid Higgins, vice president of operations at CAVU, says the company is creating a digital platform where people can purchase any of those services or set up hotel reservations or rides between hotels and airports all from a single app. “Where Amazon started with books but now it sells everything, that’s what CAVU is,” he says. Higgins indicated the Escape lounges truly are common use. Now, American Express platinum card holders get in free with guests. Flyers from certain airlines and AAA members get discounts. Or you can pay a fee at the door. “The lounge market is getting more familiar to people,” he says, referencing the past, when lounges were reserved for frequent flyers, first-class international travelers and a few select others. “Anybody can come in. There’re a number of ways you can get in.” Once in, Higgins says, there’s a full kitchen where cooked meals are prepared on site. The robust food and beverage programs are cultivated with touches from local chefs who in some cases offer signature dishes in each location. “You always know you are in an Escape Lounge, but you also always know which one,” he says of the local feel CAVU tries to create.
The prevalence of leisure travel right now, as business travel recovers from the pandemic more quickly, requires a different menu than might have been served pre-COVID. Those leisure travelers often have kids in tow, which requires some different amenities, as well. CAVU uses its digital capabilities and relationships with airlines to help keep ahead of the trends, he says. “It’s also a dynamic and changing experience that adapts as the consumer does. “At the end of the day, we’ve got to understand what our customers really want. Is it the same as it was five years ago? The answer to that is probably not.”
Leading, Partnering With Plaza Premium Plaza Premium Group operates lounges at five Canadian airports and five more in the U.S., with two more – DEN and Orlando International Airport (MCO) – under construction. The company also operates the Capital One Lounge at DFW and partners with Air France and Virgin Atlantic. “Americans can expect more lounge space inventory as North America is a priority market for growth right now,” says Stuart Vella, vice president of commercial development and operations, USA. “We are also increasing
our independent lounge inventory as well as strategic partner network, such as Capital One, with others to be announced.” Plaza Premium broke into the lounge market in Hong Kong in 1998 and it now has more than 250 lounges in 70 airports internationally, believed to be the largest pay-per-use lounge network in the world. “That means no matter the ticket status of a passenger, guests can pay to have access to food and beverages, showers, private resting suites, recharging stations, workstations and children’s play areas, and more.” The lounges provide different zones to accommodate different needs, including quiet areas for unwinding, Vella says. “Some of our lounges include a wellness spa, which offers massages and manicures, complete with showering stations.”
Plaza Premium also has diversified into other areas, including in-terminal airport hotels, airport dining and passenger services. Innovation is also key,” Vella says. “We never stop at whatever we achieved. We continuously evolve and strengthen our products and services based on observations. We take a holistic approach to delivering airport hospitality services and facilities throughout a guest’s journey.”
Outstanding Amenity Deanna Zachrisson, director of revenue generation and partnership development at SAN, says lounges are one more amenity for travelers and they often fill space that is less than ideal for retail or food and beverage concessions.
In addition to the recently renovated Swissport location, SAN recently entered an arrangement with Airport Dimensions to construct a new common use lounge under the Chase brand. “The location is an upper-level space with incredible airfield views,” she says. “The location is fantastic for a lounge for all the reasons it’s not a good location for any other type of concession – it’s away from the hustle and bustle of Terminal 2 West below.” In addition, Zachrisson says, when Terminal 1 is renovated, the airport will have a Delta Club room and another common use lounge. It’ll be a secondary priority, she adds, after making sure the terminal’s food and retail programs are built out.
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Standard Concessions Lease Models Continue, But Three U.S. Airports Take Different Approaches BY CAROL WARD
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Throughout the worst of the pandemic, many concessionaires and a few airports regularly opined about the need to upend the traditional lease parameters governing agreements between airports and concessionaires. Terms vary by airport, of course, but many stick to a general formula that involves a minimum annual guarantee (MAG) and percentage of gross sales, with concessionaires paying the greater of the two each year to their airport landlords.
Most North American airports waived or suspended MAG payments during the worst of the pandemic when sales reduced to a trickle or stopped completely. The situation called into question the efficacy of MAGs, with many calling for a new framework for airport leases with concessionaires. Evolution happens slowly. The majority of new concessions requests for proposals issued over the past year or so keep the same general terms, including a MAG
and percentage rent approach, and concessionaires are competing as heavily as ever to win those contracts. However, some airports are taking alternative approaches. AXN looked at three airports – one large hub, one medium hub and one small hub – to highlight how they’re doing things a bit differently.
ONT’s Varied Approach
Opposite Page, Below: Ontario International Airport has eliminated MAGs, instituted longer lease terms and “tiered waterfall” payment obligations to allow concessionaires to invest and grow their businesses. It is also experimenting with a joint venture for one location opening later this year.
Flexibility in the approach to concessions is crucial if small and medium hub airports want to maximize revenues, says Dan Cappell, chief commercial officer for Ontario International Airport (ONT). “I don’t think for the larger airports, the major hubs, that much will change going forward,” Cappell says. “All of the big global players all want to be in the major hubs and they all compete against each other for the RFPs. But for medium and smaller hubs…the concessionaires only have so much money to play with. Unless there is a paradigm change in the business model, I think the
smaller and medium hub airports will suffer greatly,” he says, because a broad swath of concessionaires just aren’t willing to invest the same ways in these smaller markets. For ONT, a medium-hub airport, “we’ve tried to be as flexible as we possibly can,” Cappell says. Since the pandemic started and through today, “the starting point is no MAG. “The second point is having a length of contract that gives sufficient time for the amortization of the capital investment,” he continues. For many new food and beverage or retail contracts, that involves 13-year contracts with five-year extension options, although one opportunity currently in play carries a 10-year term. “We’re looking at ‘tiered waterfall’ concession fees, so as the business grows and as the airport grows and brings in more passengers and the turnover increases, based on reaching agreed financial tiers, the concession fees increase,” Cappell says. “We’re not asking for unrealistic concessions fees upfront, but we do expect a fair return, once the business grows.” ONT has been one of the fastestgrowing airports in the country over the past three years, and traffic is already back to pre-COVID levels. Further growth is projected, and ONT wants to see its revenues from concessions increase in line with the traffic growth. For one food and beverage contract, ONT is testing an approach that is a further departure from the norm. The airport teamed with local brewer Brewery X on a new location scheduled to open later this year. “It’s a 50/50 joint venture,” Cappell says. “ In simple terms, [each party is responsible for] 50 percent of the all the design and construction costs, 50 percent of the all of the operational costs, and there is a straight 50 percent split of the net profits.” The new model emerged after ONT tried and failed to attract a local operator willing to make significant capital investments under a more traditional contract. “That is a type of model that airports should look at in more detail, because it gives the airport skin in the game,” Cappell says. “The other thing is it sends the message that we are open to have any discussions on any type of business model. If it’s fundamentally different to what’s happened historically, that shouldn’t be a barrier to at least sitting down and having the discussions.”
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Left: Charlotte Douglas International has two master concessionaires – HMSHost for food and beverage and Paradies Lagardère for retail. Each has a profit sharing agreement with the airport.
Long-Term Partnerships At CLT Charlotte Douglas International Airport (CLT) has long been an outlier in terms of how it structures its contracts with concessionaires. Its approach harkens back to the 1980s and 1990s models of the single provider “master concessionaire” approach. When the vast majority of airports evolved their approaches over the past two decades, CLT stuck to the tried and true. Ted Kaplan, chief business and innovation officer at CLT, a large hub, says the approach works for the airport, creating partnerships that can weather vagaries in the market. “We have an exclusive food and beverage concession with HMSHost and we have a non-exclusive retail concession with Paradies [Lagardère], although Paradies operates all of our retail,” explains Kaplan. “In both agreements, the core business arrangement is we charge them a per-square-
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foot rent for the real estate that they use for their units and the storage and office space that’s needed to run the operation. “We have a profit share [agreement] with HMSHost and with Paradies in which they are contractually allowed to subtract a certain number or certain categories of expenses out of gross revenue,” he continues. “At the end of the year we take the net revenue and we split that evenly between ourselves and either HMSHost or Paradies.” Kaplan says CLT’s approach creates a true partnership between the airport and its operators. “When they are prospering, we are prospering,” he says. “And then when times get a little bit more difficult for them, our share of the revenue decreases correspondingly. I think it has fostered a very collaborative partnership between ourselves and these two concessionaires.
“We work together very closely over the course of a year to really make sure the operation is running as effectively and as efficiently as it can, so that they’re able to build out their units economically and efficiently, they’re able to operate economically and efficiently such that they’re able to maximize their business,” he continues. “At the end of the year what that means is that we both share in a larger pot of revenue.” CLT has been partnering with both HMSHost and Paradies Lagardère for multiple decades, and the current contracts stretch to 2028 for retail and to 2030 for food and beverage. “We go to market with RFPs less frequently than other airports,” Kaplan notes. The contracts call for periodic reinvestment on the part of the operators, who are also required to have “reasonable pricing,” which Kaplan says generally translates to street pricing plus 10 percent. If a concept is underperforming, the airport will work with the concessionaire to troubleshoot or possibly identify an alternative, he adds. Currently undergoing a massive overhaul, CLT has remained committed to the master concessionaire model throughout, and Kaplan says any internal discussion on change doesn’t make it too far out of the starting block. “From our perspective, [our model] really creates a business relationship where, when things are going well, and the locations are making a lot of money, we’re both sharing in that prosperity,” he notes. “And then when things aren’t going as well and they’re not making a lot of money, we both enjoy less revenue equally. To us, that seems like a pretty fair model.”
Direct Involvement At GSP
Below: With its food and beverage operator departing during the early days of the pandemic, Greenville-Spartanburg International Airport took on management of five concessions locations. A third-party handles day-to-day operations but GSP staff are hands-on in everything from staffing levels to opening times to pricing.
Greenville-Spartanburg International Airport (GSP) upended its approach to food and beverage concessions during the depths of the pandemic. The pandemic hit in full in March of 2020. By July, OHM Concession Group had exited the airport, leaving GSP without a food and beverage operator. Scrambling for a solution, airport officials realized that the chances of finding a qualified operator to take over during such an uncertain time were slim, according to Scott Carr, who until recently was vice president, commercial business and communications at the airport.
Carr, who has since left the airport, said in May that the airport decided to look internally for a solution. “At GSP we run the [fixed-base operator], we handle the cargo, we do land development. It was just kind of natural – why would we not get into the food and beverage business?” GSP contracted with Metz Culinary Management to provide food and beverage service at five of nine locations at the airport. GSP staff directly oversee the operations, making decisions on overheads, staffing levels, opening hours and other issues. “We have regular coordination meetings with them and we approve their budget for the year, as long as they stay within the budget,” Carr explains. “They they’re free to operate on the day-in and day-out basis. We set the staffing numbers for the year – allocation per concept. If something needs to change, that’s something that we would have a discussion about.” “If we decide that instead of two cashiers we need three, we just say that’s what we want,” Carr says. “In that way, we can make sure we’re providing an excellent passenger experience and there’s not a lengthy, protracted discussion. Another operator [might push back], saying ‘that’s going to increase our overheads.’ This eliminates those conversations. We obviously want things to be profitable, but we balance that with customer service, which for us is paramount.” Expenses are subtracted from total revenues, after which Metz is awarded a portion of the profits. “After we pay all the bills, the net is split 80 percent-20 percent, the airport district takes 80 percent,” Carr shares. The model is definitely a heavy lift on the airport side, Carr says, compared to operations under a traditional model. GSP staff track expenditures, study passenger data, examine which product lines are selling best and myriad other factors normally left to concessionaires. “Ultimately it’s the airport district’s money that’s being spent, so I feel some fiduciary responsibility to have a good pulse or understanding of what we’re doing each and every day,” he says. “It’s the same on the customer service side.” The Metz deal covers five food and beverage locations. GSP has more standard contracts for other food and beverage locations
that are operated by Hudson, which also holds the retail contract at the airport.
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Digital Marketing Efforts Boost Revenue, Improve Passenger Experience BY SALLY KRAL Last fall the Meehan Aviation Group was tasked by the Airport Cooperative Research Program (ACRP) to examine the use of digital technology in airports to enhance non-aeronautical revenue. As part of its research, which was completed this year, the group interviewed nearly 15 airports, seven tech companies, two concessionaires and two market sources. The final report should be available this fall. According to Sonjia Murray, managing director of the Meehan Aviation Group, when the pandemic hit, the aviation industry lost $5 billion in revenue, 70 percent of which was non-aeronautical. “Pre-pandemic, non-aeronautical revenue per enplanement was growing
modestly – up 70 cents from 2015 to 2019 – but that kind of tepid growth isn’t going to make up the shortfall,” she says. “Airports really need technology to help get those numbers up and it’s here and it’s available – they just have to leverage it.” And airports are beginning to leverage it – especially since 2020, when COVID accelerated the need for more digital, contactless solutions, both because of safety concerns and because of the staffing shortage. Murray notes that the ultimate goal for airports should be to digitalize the entire passenger journey to better understand and influence passenger behavior – because once airports know more about their customers, they can market services and products directly to them and encourage revenue growth. From mobile apps to QR codes to WiFi logins and more, there are numerous ways that airports can securely collect data on their customers so they can grow their digital marketing efforts. “An integrated platform of the passenger’s journey from home to gate isn’t yet there, but it has gained momentum and there are airports that are further along on the spectrum,” Murray says.
Success Stories Tech platforms allowing for mobile order and delivery of concessions have been around for years and they’re more common than ever now. Servy launched in 2015 as an ordering app called Grab and has since expanded and evolved to offer a suite of digital solutions, including the Grab Airport Marketplace, which provides airports the option to create their own e-commerce marketplace with ordering from multiple outlets; the Order@ solution, which allows for contactless mobile ordering and payment at traditional dining services; and selfservice kiosks. This suite of services is currently in use at more than 80 airports across the United States, Europe, the Middle East and Asia Pacific.
Left, Above: Servy offers a suite of digital solutions, including the Grab Airport Marketplace, which provides airports the option to create their own e-commerce marketplace with ordering from multiple outlets; the Order@ solution, which allows for contactless mobile ordering and payment at traditional dining services; and self-service kiosks.
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The Grab Airport Marketplace platform, branded as LAX Order Now at Los Angeles International Airport (LAX), launched in partnership with Unibail-RodamcoWestfield Airports during the height of the pandemic. “It quickly became one of our top performing airport programs,” notes Jeff Livney, chief experience officer for Servy. Heath Montgomery, director of public relations at LAX, also notes the success of the platform, pointing out that it has “doubled in sales over the last two years.” The Grab mobile ordering app has been in use at Austin International Airport (AUS) for years, and the airport is looking to expand to a digital marketplace approach in 2023 due to customer demand, notes Mookie Patel, chief business and finance officer for AUS. “The goal is to have a machine learning service that can provide a more personal ordering experience that will improve their airport experience overall,” he says. Minneapolis–Saint Paul International Airport (MSP) has MSP ASAP, a concessions delivery option that combines the offerings of Servy and AtYourGate, but Cassie Schmid, director of strategic marketing for Metropolitan Airports Commission (MAC), which owns MSP and six reliever airports in the Twin Cities area, notes that the airport is in the process of rebranding to be on the Order Now marketplace brand. “This is so there’s some continuity for passengers – whether they’re flying from LAX to MSP or vice versa, we want them to understand what the food delivery service is regardless of where they are.” Another tech company making waves with digital marketplaces is FetchyFox, which offers an artificial intelligence (AI)-powered e-commerce platform that features personalized recommendation and discovery of food, retail and other services offered at the airport. “The platform hooks into airports’ existing customer relationship management (CRM) tools, parking reservation platforms, hotels and the like, and offers targeted marketing for higher conversion rates, cross-selling and upselling,” explains CEO Christina Apatow. FetchyFox launched in 2019 at Edinburgh International Airport (EDI), with the Comfort Concierge solution, which was designed to create an equitable commerce experience for passengers with reduced mobility. “While our solution was meant for a small fraction of overall passengers, we had a 200 times increase
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Right: The Grab Airport Marketplace platform, branded as LAX Order Now, is an expansion of the Grab food ordering mobile app. It launched at Los Angeles International Airport in partnership with Unibail-RodamcoWestfield Airports during the height of the pandemic and quickly became one of Servy’s top performing airport programs.
in e-commerce orders with a 137 percent increase in average order size compared to a similar service that was available to all passengers in the entire airport at EDI,” Apatow says. She adds that most recently the FetchyFox Digital Marketplace has demonstrated a nearly 25 percent increase in average ticket size at Reno-Tahoe International Airport (RNO) compared to offline ordering and existing order-at-table solutions. FetchyFox currently works with four airports in the U.S. and U.K., with many announcements to be unveiled this year, Apatow notes. In addition to mobile ordering and e-commerce platforms, pre-book parking has been a bright spot for boosting revenue and providing digital marketing opportunities. “We recently launched a new 4,300space LAX Economy Parking facility and added smart parking technology to many of our garages in the Central Terminal Area, giving customers the ability to pre-book their parking and save money, and we’ve seen
interest in these products continue to grow,” Montgomery says. When a traveler uses the pre-book parking service, LAX can then reach out to them before they ever arrive, alerting them to platforms like LAX Order Now so they can consider using these services long before they’ve even left for the airport. At MSP, Schmid notes that pre-book parking is their most tangible success story. “The results have been twofold: there’s obviously the primary objective of revenue generation and we’ve seen amazing growth of that program year over year in terms of revenue, but there’s also the database that we’re building of customers that are using it.” She notes that, to date, MSP is up to more than 50,000 customers in its database that have used the pre-book parking platform, which they’ve promoted through paid social media ads, email drip campaigns and more. “What that does is not only gives us insight into who our passengers and customers are, but it really starts to lay the foundation for us to create a more personalized experience for those travelers in their journey.”
Additional Approaches While e-commerce and pre-book parking are currently the main areas where airports are gathering information about their passengers to provide more personalized suggestions and services to them, they’re not the only opportunities out there. “Early on in the pandemic we leaned pretty heavily into QR codes and we’re thrilled that those are back,” Schmid says. “We just launched an in-terminal campaign a couple weeks ago that involves a lot internal signage with QR codes, designed to help passengers find what they’re looking for in terms of airport amenities. And the signs are zoned so that we’re aware of where those decision points are in the terminal and where we need to lean a little bit more heavily into messaging. It’s been really effective.” Another area where MAC is using digital marketing heavily is with job searches. “We just had a job fair in May and did some pretty new things with our social media advertising – we did Reddit ads for the first time for two weeks leading up to the job fair and we got over 125,000 impressions and we had over 300 people attend the fair,” Schmid says. At AUS, Patel notes that they’re working on an Internet Protocol Television Digital Signage Program, which utilizes an inventory of digital monitors throughout the airport campus, including in the terminal and public-facing areas, to push out digital
marketing in the form of graphics and videos. “The goal is to provide customers with critical messaging and information, which can also be customized to increase relevancy based on their location in the airport,” he says. “It’s still in development, but we anticipate launching it this year.” In April, AUS partnered with Atrius to launch its first Personal Wayfinder, which provides a digital map of the airport that’s mobile- and desktop-friendly so that users can search concessions, including kiosks, as well as art displays, music stages and more. It also integrates with Grab so users can view menus and place food orders. Patel adds that an area of the airport ecosystem that could benefit from more digital marketing efforts to boost revenue is the ends of each concourse. “Passengers tend to interact with the center services and concessionaires before heading to their gate; human passenger behavior shows that, once they’re at their gate, they’ll ‘gate hug’ and not venture out much once settled. So if they’ve experienced the center of the terminal and then head to their gate that might be at the end of the concourse, we don’t see a lot of activity.” While the Wayfinder service may help to a certain extent with this, AUS hopes to launch a geo-locating service in the future that will suggest and list places where passengers can go to find food and other services around them.
Much More To Come Servy’s Livney points out that it’s more essential than ever for airports to provide a digital experience across the entire ecosystem, especially now that travelers have come to expect it as standard, rather than considering it a luxury. “The average person does just about everything now through their personal mobile device and being able to reach travelers digitally in the airport experience is an essential part of driving business in today’s economy,” he says. Indeed, the future of the airport – of retail at large – is digital. “Eventually all airports will have digitalized concession programs and they’ll have news and gift shops that have no employees because that’s the way we’re going – eventually it’ll be pervasive,” says Deborah Meehan, president and CEO of Meehan Aviation Group. “But in the short run, airports are going to struggle to do this on their own and they need partners. They can partner with vendors of course, but the number one partner that they need help or cooperation from is the airlines.” Meehan believes that this partnership would be so successful because, while many airports struggle to reach passengers directly, airlines do it regularly with texts and emails about flight updates. “What it’s going to come down to is for the airlines and the airports to agree that they have a mutual goal of a good customer experience
Left: FetchyFox, which launched in 2019 and is currently in four airports in the U.S. and U.K., offers an artificial intelligence (AI)-powered Digital Marketplace platform that features personalized recommendation and discovery of food, retail and other services offered at the airport.
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and that the airline and airport are both better off if they cooperate,” she says. “Right now, it’s the airlines that are hesitating, but I think that they’ll start to cooperate and we’re going to have a great digitalized system that is much better for all travelers in the United States. It’s already better overseas, but we’re going to catch up and I think in the next five years it’s going to be completely different than it is right now.” Murray agrees, but sees the changes happening even more rapidly. “I wouldn’t even say five years out, I’d say in the next year there’s going to be rapid, rapid expansion on this,” she says. “Right now, where a lot of airports miss opportunities is to try to get to understand their passenger.” She points out that there are many “access points” where airports can be collecting data on passengers, such as by requesting a zip code or email address when logging into the airport’s WiFi. For its part, MAC has made major investments in a CRM system that will allow it to bring in customer data inputs from things like MSP ASAP, pre-book parking and social media into one platform. “This will allow us to build out the customer journey in a way that’s responsive to likes, dislikes, what airlines people are traveling, what time of day they’re traveling – we’re really excited about that coming to fruition and really being
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able to play with that within the marketing space,” Schmid says. “We’re inundated with all various types of data, whether it be from the operation side, the marketing side, the retail side, there’s so much. To make sense of it and truly turn those data insights into action is where the transformation lies.” And tech companies are eager to help airports in this transformation. “One of the ongoing frustrations we’ve heard from airports is that they don’t know their customers and have no real way to connect with them, but they’re trying to bridge that gap,” FetchyFox’s Apatow says. “An optimal digital marketing program will center around a singular AI-powered digital infrastructure backbone, like ours, so the airport can provide a one-stopshop e-commerce platform under their brand and leverage an intelligent toolset that is specifically designed for the airport ecosystem and their partners to engage with passengers like never before while maximizing revenues.” Apatow adds that the power of digital marketing lies in the ability to personalize experiences to the individual users’ preferences, history, the context of their travel and even things as simple as the weather. This is beneficial to airports and brands, as it allows them to engage with people who will
Top Left, Above: In April, AUS partnered with Atrius to launch its first Personal Wayfinder, which provides a digital map of the airport that’s mobile- and desktop-friendly so that users can search concessions, including kiosks, as well as art displays, music stages and more. It also integrates with Grab so users can view menus and place food orders.
be receptive to what they’re offering, and it’s convenient for customers who already expect Amazon-like experiences. Livney also notes the importance of seamless and integrated digital experiences, as they enhance the guest journey while requiring minimal effort on their part. “Leveraging AI, which we’re further building within our products, and partner integrations to help drive efficiencies and anticipate traveler needs and desires will certainly evolve and become more standard,” he says.
The AXN family offers our deepest sympathy to the Paradies Lagardère team and to all those who were impacted by the passing of longtime industry professional
Renee Tedesco Renee spent 30 years in airport concessions and she will be dearly missed in our industry.
Global Airport Executives Share Strategies For Retail Reinvention BY CAROL WARD
Evolving the commercial offer and passenger experience is very much front-of-mind for North American airport concessions executives. If comments and observations at recent industry events in Europe are any indication, the same is true for their counterparts abroad. The World Airport Retailing Summit within the Future Travel Experience Conference in Dublin, and the Passenger Terminal Expo in Paris both took place in June. In tracks devoted to airport commercial activity and the passenger experience, executives sought to set a new course for growth and evolution. Fraser Brown, retail and property director, Heathrow Airport (LHR), says the pandemic gave him the leeway to re-evaluate his approach.
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“I’ve been given a lot more latitude because the business was dead anyway,” he said at the World Airport Retailing Summit. “It’s about taking more risk and accelerating decisionmaking. Heathrow is a place where things don’t happen fast, but I’ve done [things] over the past 24 months that I would never have been able to do pre-Covid.” Susan Gray, managing partner of Australia-based airport commercial planning consultancy CPI, feels that too many airports continue to operate in “cruise control,” relying on strategies of the past to maintain a dull status quo in airport commercial activities. “Airports and operators have been quite arrogant and inflexible in how they’ve done business,” she said. “The ones that will succeed or will succeed faster are the ones that have become much more flexible.” Brown insisted that the objective can’t simply be to make money, and he expressed concern about heightened expectations at his airport now that passengers are coming back in droves. “We need to have absolutely nailed-on vision, and everything starts with that vision,” he says. Below, Opening Page: Heathrow Airport has long been known for its robust concessions program (Chanel and EL&N locations shown). The pandemic accelerated a move toward more experiences and less focus on revenue-based transactions.
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The general thinking today is to focus on experiences rather than simply transactions. “The challenge – and the opportunity – is to find the perfect balance between a remarkably unremarkable customer journey and an elevated experience that they cannot wait to tell their friends about,” says Gray, adding that then entire journey should be ripe with “opportunities to experience and engage.” These opportunities shouldn’t be anomalies; instead, they should be part of the fabric of the offering, she said. “Don’t waste your time trying to create manufactured ‘wow’ moments,” Gray said. “The urge to connect, engage, consume and explore is stronger than ever. We need to capitalize this on every stage of customer journey.” Digital technology is one avenue to achieve that goal, she said.
Digital Push “Technology is an enabler, expediter, enhancer,” Gray said. “It’s an enabler of journeys, an expediter of experiences and an enhancer of revenue. It is, or it should be, the primary goal of every airport to create the platform for a seamless and, frankly, uneventful process.” At Milan Malpensa Airport (MXP), retail has gone digital. Luigi Battuello, director of non-aviation business, says
“The challenge – and the opportunity – is to find the perfect balance between a remarkably unremarkable customer journey and an elevated experience ....” – Susan Gray, managing partner, CPI the airport launched the Milan Malpensa Boutique in July 2021, initially as a forum for luxury product purchases. Passengers simply browse the digital catalog and reserve available products, which are then available for pick-up in-store or at the gate on the day of departure. Products can be purchased on a duty free basis if the passenger’s travel warrants the privilege, but can also be purchased duty paid. Both prices are listed in the catalog. Battuello said the program has been expanded and “now the entire retail offer is on the digital site.” Post-pandemic, MXP has shifted some of its focus to an expanded food and beverage offer, often with larger footprints. In the first quarter of 2022, spending per passenger in food and beverage was up eight percent, and spending per passenger in duty free shops was outperforming pre-Covid levels. A pop-up program, which Battuello described as “low income but interesting,” is also in expansion mode. “This is about experience, not only making more revenue,” he says. “It’s about making the airport more attractive, more interesting.” Separately, at a panel discussion at the World Airport Retailing Summit, Keith Hunter, chief retail officer for Urban-Air Port, said a balance between digital and physical retail is crucial. Each airport and airline has a different goal, but he noted that “there are still a few airports that are shying away from it now. “A lot of that is down to they don’t know what the solution is. Do they invest? Is it right? Will they be able to evolve or keep up with technology? I can understand the nervousness…” he said. Jeff Livney, chief experience officer, Servy, said digital adoption on the food and beverage side is more straightforward than on the retail side. “On the retail side
we have a much easier value proposition,” he said. “It’s a consumable product. I’m not competing with Amazon that is shipping something to your house. I’m competing with starvation and queue.” Livney noted the labor shortage impact on concessions in the U.S. and other major markets around the world. “Many of our concessions can only operate because they’re leveraging digital solutions with limited labor resources,” he said. For duty free retail, digital adoption has been challenging, according to Wassim Saade, founder and CEO of Inflyter. “Consumers are looking for value [in duty free] and, let’s be honest, the value is not there,” he said. “To get some interesting conversion you have to create desire,” Saade continued. “Putting products online has been done for the past five years, but for the top [duty free] retailers it’s not doing well.” His firm is taking a different approach, focusing on convenience and offering an “interesting experience” for travelers who are shopping. The panelists said convincing the airlines to share more data would be a pivotal step in broadening the acceptance of digital among airports and passengers, because that data would allow for tailored messaging and product assortments to different traveling groups. Hunter noted that the onus is on airports to push digital strategies forward, and he suggested that there needs to be “a little bit more transparency between all
the stakeholders in terms of what the prize is,” he says. “There is potential to share… but ultimately airports are going to have to accept that they’re going to take a small cut, but of a much larger pie.” Timothy Barnes, senior director, commercial ser vices at Ca lg a r y International Airport (YYC), took his message on younger consumers and demands for digital and artificial intelligence to the Passenger Terminal Expo audience this summer. Barnes thinks the challenge is to cut through the clutter of messaging that is bombarding younger generations tethered to their devices. “In terms of what the expectations are of these groups, [the answer is] instant and relevant,” Barnes continued. “How many of our airport service offerings don’t do either one of those? We also have an issue in the fact that if someone is on their phone and they’re used to doing all their shopping online, coming to the airport they’re now faced with the physical world – wayfinding, store design, etcetera – why have we not thought of the phone and the digital experience first, to try to get to a better shopping experience?” Barnes says one solution is to integrate the customer experience with the virtual world, using solutions like digital wayfinding, QR codes, virtual assistants and other technologies to better engage younger travelers.
Above: The Milano Malpensa Boutique showcases the airport’s entire duty free and luxury retail selection online. Passengers are encouraged to shop before arriving at the airport.
The pandemic accelerated moves toward low-touch and low-labor offerings as part of a digital solutions strategy, he noted. “I think we have a great opportunity to more toward staff-less, touchless, digital-driven and artificial intelligence-driven solutions,” Barnes said. “And, we need to think about services more than products. If we can start with the experience, focus on services, and get away from trying to sell impulse items through a mix of what I would call very generic offerings, I think we can really start to win with these segments.” Company values also matter more now than ever before. Noting the macro, secular trends of diversity and inclusion, care for the environment and other factors, Barnes says it’s important that airports take note. “How many of us are looking at products that we’re selling [to assess whether] they actually align with those values?” he asks. “It’s very important for the generation that coming, and we need to start thinking about it when we decide on the products and services we offer.”
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HEADLINE Deck
BY AUTHOR
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Passenger Tracking Provide Airports With Insight Into Ever-Changing Consumer Demands, Standards BY SHAFER ROSS Before the pandemic, security in public spaces was a hot-button issue. Meta, nee Facebook, was and has continued to be in hot water over the third-party collection of user data, while heavily surveilled cities like London, U.K., were defending against accusations that the mass use of CCTV to combat and reduce crime was too invasive. Then Covid swept the globe and convenience became king. Convenience, of course, had always been a priority, though in the years preceding the onset of the pandemic, it became so ubiquitous that consumers almost seemed to take it for granted that their airport experience could happen, for the most part, on their time. Now, as the smoke from the worldwide crisis clears, people want to travel, they want to travel now, and they don’t want to wait, even if it means giving up some data to get a more streamlined experience. “As consumers, we are used to being ‘tracked’ and we volunteer for it with apps like Google Maps because those provide a benefit to us in our daily lives,” says Tara Richards Biondolillo, director, strategic accounts – aviation and entertainment for Atrius, provider of insights into facilities’ performance through use of AI-powered location tracking. “When the value of enabling location services is clear to the passenger, as well as the option to turn off tracking when they’re not using the app, we see a lot of success. It requires transparency and trust, as well as true value to the passenger.” Passengers have been clear that they value a streamlined and pleasant experience from the moment they arrive on airport property, and they’ve acclimated to many new technologies and capabilities just over the last two years to get it.
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Right: Xovis’ Cody Flores Shulman says that actionable information about where passengers are and what they’re doing can be valuable to airports trying to staff accordingly.
Below: Vancouver International Airport has completed the production of the campus’ digital twin – a virtual world designed to accurately represent the airport, its grounds and facilities, and incorporate real-time data to inform airport management.
Building the Experience “We knew that we had to come out of the pandemic a different airport,” says Lynette DuJohn, vice president of innovation at Vancouver International Airport (YVR). AXN reported in May that YVR had completed the production of the campus’ digital twin – a virtual world designed to accurately represent the airport, its grounds and facilities, and incorporate real-time data to keep airport officials apprised of where people are and what they’re doing. “How could we leverage technology to serve our strategy as an airport? That’s where the concept of the digital twin came from. “When we started out, our first [focus] was situational awareness,” she continues. “So, basically, we have a tool that allows us to understand how passengers are moving through the terminal. Not specific passengers, but numbers of passengers that are moving through different processes at the airport, whether that be security, or customs, just how people move on the curb.” This data, vast and varied as it is, creates an image of the airport’s current conditions for management, allowing resources to be reallocated as needed for optimal service. Cody Flores Shulman, president of Xovis, believes “passenger tracking is really about passenger flow, queue management.” Xovis is a crowd flow management service and platform started in Switzerland over a decade ago to track and analyze how
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people move through public spaces in large numbers. “It’s about first being able to identify people in a space – making sure that they’re not luggage or other things – and then taking that a step further to know how they’re behaving, whether they’re moving about, whether they’re in a queue, whether a space is full or there’s extra capacity and that can apply really anywhere that’s a significant touchpoint in an airport. The obvious choices are security, immigration, check in, but those could also be those waiting to board a jet bridge or shopping at a retail space or standing in line for a taxi,” he says. In a letter to shareholders published earlier in 2022, biometric security company CLEAR reported that in the year prior, total enrollments in the program – which allows users to bypass the traditional airport
security checkpoint and breeze through with a simple scan of their eyes, fingers or documents – increased by 112 percent, from just over 5,500 users in Q1 2021 to nearly 12,000 by the end of the same period in 2022. “The magical experience we deliver in airports and the trust we have built with our members has earned us the right to expand in travel, to enter new verticals and to bring the CLEAR experience to new industries. We give members back their most precious asset – time,” said Caryn Seidman-Becker, CLEAR co-founder and CEO, in the letter. “We remain bullish on the travel recovery as there is significant pent-up demand for experiences such as travel. March was our best CLEAR Plus enrollment month on record and that strength has continued into Q2.”
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Total Cumulative Enrollments, CLEAR Secure, Inc. (In Thousands)
11,819 10,366
8,076 6,322 5,562
Q1
Q2
Q3
Q4
2021
Q1
2022
Above: In a letter to shareholders, biometric security company CLEAR reported that in just the last year, total enrollments in the program increased by 112 percent, from just over 5,500 users in Q1 2021 to nearly 12,000 by the end of the same period in 2022.
This abrupt jump in usership reflects not only on the viability of programs like CLEAR and TSA PreCheck, which allow users to provide additional access to their information in exchange for a smoother security process, but the willingness overall of travelers to be more open with data they may not have been comfortable sharing in the time before Covid. “It’s a hot topic in the age of self-service and touchless [tech],” says Xovis’ Flores Shulman. “Even in the U.S., where airports are publicly owned, they’re basically shopping malls that have flights. That’s where their money is. It is in their best interest to make it as smooth and functional and clean for the passenger as possible.”
Passenger-Facing Insights United Airlines announced in September 2020 a feature within its app to allow users to navigate around the airport and take care of necessary tasks. “With the Terminal Guide [feature], we now offer customers personalized, valuable information, like estimated time to leave for the airport or where to check bags, to make their travel day less stressful and more efficient,” says Anthony Cozzi, director of
digital products, mobile/travel for United Airlines. Cozzi and Atrius’ Richards Biondolillo spoke at the Passenger Terminal EXPO in Paris in June to discuss the feature, as well as the role technology will play in the airport experience looking forward. In an interview with AXN, he says, “To [provide this convenience], we use information from a customer’s booking, like their airport, gate and number of checked bags, paired with location-based services on the mobile device of passengers who grant permission for us to do so. Customers can easily access this information on the home screen of their United Mobile app.” Being honest with customers about how and when their information is being used, and to what end, has built a level of trust, and consumers are willing to trust if the value is there, Cozzi says. Atrius’ Richards Biondolillo adds, “The new frontier in aviation will, we believe, be driven by location services. Whether you’re looking at improving passenger experiences by offering someone a direct path to their gate from where they are standing, or even precisely locating a lost bag or sending the nearest airport staff member to a problem in the airport, location services offer so much potential to airports and airlines to improve their processes. “There are many benefits to passengers to enabling location services – those benefits need to be clear to the user,” she adds. Products like Thanks Again from GlidePathCX, which provides ecommerce solutions in airports, prove their value in the form of a rewards program active in many airport shops and restaurants around the country, which can provide discounts, loyalty points and other savings in exchange for access to user data.
Left: United Airlines announced in September 2020 a feature, created by Atrius, within its app that allows users to navigate around the airport and take care of necessary tasks.
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“In return for being able to gain insight into members’ transaction activity, we provide points and special offers that are targeted to those particular members,” says Edmund Puckhaber, president and COO of GlidePathCX.
The Airport Side GlidePathCX also provides insights to their airport clients, a far more vast selection of data than what a typical passenger would ever need to see. “We have a real comprehensive approach to being a one-stop shop for airport data, providing the airport executives one place where they can log in to see a comprehensive view of what’s going on at their airport,” says Puckhaber. “We provide all that in a comprehensive data dashboard called Insight360. The airports can log in, they can see what’s happening on the loyalty side of the equation, they can see what’s happening on the surveys. …They can also look at additional KPIs or metrics according to different input data that we receive from third-party sources, the airport itself, and airport vendors.” Varied in style, approach and medium though they are, all these players seek to answer a common question: where is the passenger going, and what are they doing there? “’Tracking the passenger’ is really about providing important services to the passenger,” says Atrius’ Richards Biondolillo.
At YVR, this is something the digital twin technology excels in. “We’re putting it in the hands of our guest service agents, so they know where there are chokepoints, where there is congestion within the terminal, and it tells them where they need to go to be able to help people move through the airport more effectively.” Accessibility for disabled travelers and those with conditions that make travel extra-stressful, like autism, could also be an important use-case for this kind of technology, DuJohn says. While most agree that technological additions won’t replace a human workforce, United Airlines’ Cozzi says it can lessen the burden on short-staffed teams. “Operationally, while our customer service team is always available, Terminal Guide, in addition to other recent launches like United’s bespoke Agent on Demand service, helps reduce customer service wait times and gives employees more bandwidth to focus on the providing excellent customer service to those situations that are a bit more complicated. “Additionally, the information gathered via Terminal Guide can be used to dispatch staff to areas where we might need extra focus in a real-time manner, such as large groups checking in, flight delays, lines and more. We can also leverage passenger trends, volumes and other insights for future planning,” he adds. That kind of actionable information is more valuable than some may even realize, according to Xovis’ Flores Shulman.
Above: In addition to customer loyalty data, GlidePathCX also provides insights to their airport clients, a far more vast selection of data than what a normal passenger would ever need to see.
“As soon as someone’s wait exceeds ten minutes in a security queue, they’ll spend about 30 percent less money once they get through it,” he says. If that’s the case, technologies that both allow the traveler to take the journey back into their own hands, while also providing airports the insights they need to properly staff their facilities, may be the golden goose many are searching for coming out of the pandemic slump. To that end, the many stakeholders in the airport space may have to collaborate more than in previous years to meet elevated customer standards. “We see this as a critical collaboration opportunity between airlines and airports,” says Richards Biondolillo. “We are hearing from our global airline partners that innovation is back, customer experience and loyalty are again the number-one goal, and to get where they want to go, airlines absolutely need their airport partners to be a part of enabling the future.”
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SUSTAINABILITY SNAPSHOT
WIN-WIN SOLUTION
Excess Food Donation Programs Reduce Waste And Feed Those In Need BY SALLY KRAL
Above: At ATL, Delaware North has partnered with GOODR, an Atlanta-based startup addressing the problem of food waste, since 2018. Unsold food from Delaware North’s concessions at the airport is picked up by GOODR for transport to more 27 nonprofit organizations throughout Atlanta.
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hile it can take some time – many years, even – to see the effects of certain environmental actions, donating excess food makes an immediate impact: it puts food directly into the hands of those who need it most, in turn keeping that food out of the country’s significant waste stream. According to the U.S. Department of Agriculture (USDA), more than one-third of all available food in the United States goes uneaten through loss or waste, with food waste taking up more space in U.S. landfills than anything else. By taking excess food – not expired, simply unsold – from their restaurants and sharing it with local charities, concessionaires can
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make good on their sustainability goals while also supporting the communities they serve. “Donating food that we didn’t sell makes sense for the environment and helps address the food poverty so many Americans and Canadians are experiencing,” says Michael Svagdis, CEO of SSP America. “There are more than 35 million people across America and one in eight Canadian households living with food insecurity.” As with all things that have environmental ramifications, this is as much a human issue as it is a sustainability one. “Food insecurity is a major problem in the U.S.,” notes Ann Fondersmith, senior director of sustainability for HMSHost, pointing out that according to the USDA, 10.5 percent of U.S. households – 13.8 million – were food insecure at some time during 2020. “With the cost of food at historic highs, more men, women and children will be hungry – at HMSHost we strive to make a difference in people’s lives by donating food.”
SUSTAINABILITY SNAPSHOT
Community Care HMSHost began donating excess food at Tampa International Airport (TPA) to the nonprofit organization Feeding America beginning in 2010. Due to the program’s success in Tampa, the concessionaire decided to expand it to all locations. Pilot programs were conducted at Charlotte Douglas International Airport (CLT) and Minneapolis–Saint Paul International Airport (MSP) in 2011 and the program was rolled out to all locations in 2012. Donations primarily include unsold items from HMSHost’s grab-and-go and bakery locations, and the concessionaire also donates “retired equipment” and has donated at least two vehicles and more than 20 pieces of commercial restaurant equipment to nonprofit groups. “Between 2010 and 2021, we donated over 26 million pounds of food to over 135 charities across the country,” Fondersmith says. “When COVID hit in 2020 and forced us to close most of our stores, many airports donated large amounts of food inventory that otherwise would have expired during the closure. As our business returns to normal, we are actively rebooting our donation program and expanding to items across all our restaurants, not just grab-and-go and bakery items.” Delaware North donates unused food across the board in its travel division, but the gold standard is in Atlanta. In 2018, Delaware North became a beta-test for a new partnership with Hartsfield– Jackson Atlanta International Airport (ATL) and GOODR, an Atlanta-based
startup addressing the problem of food waste. The partnership entails Delaware North associates safely packaging and storing food that GOODR then picks up for transport to more 27 nonprofit organizations throughout Atlanta. The GOODR impact report from inception through 2021 identified significant social and environmental benefits of this partnership, including 106,221 meals served, 127,465 pounds of wholesome food diverted from landfills, and 69,214 pounds of carbon dioxide emissions eliminated. “These results are all the more remarkable given the impact of the pandemic in significantly reducing our operations and resulting food waste produced,” notes Scott Knight, Delaware North’s general manager at ATL. “As our business resumed in 2021, we’re pleased that Delaware North relaunched the food donation program with the support and assistance of our supportive associates and strong partners.” Knight adds that Delaware North has the means to help and therefore a responsibility to do the right thing by donating excess food. “First and foremost, we provide meals to community members in need, plus we do our part with landfill diversion: It’s truly a win-win,” he says. “As GOODR founder Jasmine Crowe has said: ‘Hunger isn’t a scarcity issue. It’s a matter of logistics.’” Paradies Lagardère also partners with GOODR, and Claude Guillaume, senior vice president of operations for the concessionaire’s dining division, notes appreciation for the organization’s approach to hunger in terms of logistics rather than scarcity and that it has made for a very effective partnership.
“Paradies Lagardère has organized a food donation program, in different capacities, from our airport restaurants for approximately the past eight years,” Guillaume points out. “We’ve been able to gather surplus, non-expired food items – grab and go sandwiches, salads, sides and others – and transfer those items to various kitchens or shelters in the community that support the homeless or other groups in need. As we’ve performed these activities in several cities, we’ve worked with various organizations, so several groups have benefitted from these donations. Such efforts are just one part of an overall effort through our dining division to support the communities in which we serve.” Guillaume adds that in addition to food donations, Paradies Lagardère has partnered with No Kid Hungry, Meals On Wheels, Open Hand, and other important organizations that champion a positive impact on hunger and nutritional education. SSP America works closely with Food Donation Connection, an organization that links companies with hunger relief organizations. Within the next three years, 100 percent of the concessionaire’s locations will participate in this partnership, Svagdis says, adding that SSP America also partners with Meals on Wheels and Food Banks Canada. “Restaurant industry food waste averages at seven to nine percent – our goal is to waste less than one percent,” Svagdis notes. “Our culinary team has designed a proprietary program called WasteTrax to achieve our goals. The program uses specially marked bins
“We’ve been able to gather surplus, non-expired food items – grab and go sandwiches, salads, sides and others – and transfer those items to various kitchens or shelters in the community that support the homeless or other groups in need. – Claude Guillaume, Senior Vice President of Operations - Dining Division - Paradies Lagardère A X NEWS SUMMER 2022
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SUSTAINABILITY SNAPSHOT
Above: As part of Lagardère Travel Retail’s larger CSR strategy called PEPS (Planet. Ethics. People. Social.), Paradies Lagardère has organized food donation programs across its airport restaurants for approximately the past eight years.
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located at each kitchen counter that capture compostable materials. Our teams are trained in the precise cutting, preparing, and packaging of food to minimize waste, and we also regularly adjust our prep volumes and production pars based on projected business because the best way to reduce waste is to manage production.” Echoing this, Guillaume notes that, “a side benefit of food donation programs is our ability to review tracking reports and determine which items may be more popular than others. This can help our production as we prepare these items fresh every day.” Paradies Lagardère’s food donation program is part of its parent company Lagardère Travel Retail’s larger CSR strategy called PEPS (Planet. Ethics. People. Social.). In April, the company announced its commitment to work toward global, collective carbon neutrality across all its operations before the end of 2023, with a goal of net zero emissions by 2050. Additionally, the organization set a goal of 100 percent of its operations worldwide having a waste reduction program in place by 2025. “We’re certainly doing our part to achieve these goals in North America,”
Guillaume says. “In addition to the food donation program, we’ve already begun an initiative for biodegradable products. This includes containers for grab and go items and straws, using paper bags in many proprietary and some local brands, eliminating Styrofoam in locations, and piloting new napkin dispensers that help manage use and eliminate waste.” As HMSHost’s Fondersmith points out, environmental and charitable programs take a lot of collaboration, moving parts and effort – but it’s well worth it. “With our food donation programs, each airport connects with a local charity that distributes food locally; to avoid the need for insurance, we have to identify a pick-up location that is accessible and then systematically deliver to that location food that is gathered from across the airport; the containers are typically provided by the charity and then we manage the distribution and collection of the containers; hot food must be bagged, frozen, stored in unique designated areas in the walk-in freezers and then properly packaged to be donated – it’s all a rather complex process,” she says. “But together we strive to eliminate food waste because feeding the hungry is our passion.”
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Autumn Issue 2022 Volume 20, Issue 243
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SWEET ON AIRPORTS
“Devastating” Accident Results In Chicago Bakery Realizing Airport Aspirations BY SHAFER ROSS
Left: Stephanie Hart, owner of Brown Sugar Bakery, was devastated by the crash at her bakery, but realized a yearslong dream when she was invited by URW to sell her products at O’Hare International Airport. Below: Chicago travelers can now enjoy chocolates and candy from one of the city’s favorite bakeries.
arly in the morning on a Sunday in March, a car crashed into the walk-in freezer at Chicago’s Brown Sugar Bakery. Owner and founder Stephanie Hart recalls feeling quite discouraged when she got the call about it three hours later. “It was a new addition to our bakery, and to see it broken up like that was devastating,” she said. Brown Sugar Bakery had just added the new freezer a few months earlier to help with the holiday rush. With construction and materials costs ever rising, it had taken near five months just to complete the project – nearly double the amount of time the bakery was able to enjoy the new space before it was destroyed. An employee called to alert her of the accident, and Hart made her way to the store she had spent 20 years building up. She recalls the dread propelling her, though she laughs as she recounts the wreckage. “There were car parts in my store, the bumper was hanging out the bakery. I can chuckle about it now, but when you start a business… and you grow from one person – it was just me, in the beginning – and
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everything you acquire, you try to put one block on top of the next, on top of the next. I was devastated, in that moment, seeing that [destruction of what I’d built].” Still, she was heartened by the amount of community support that showed up that very day. A crew in the area came by to help board up the damage while another
group helped clear the debris from the site. Word spread of the accident and patrons from all over the city came to show support, as the bakery went ahead and opened for business that same day. It wasn’t just customers that heard about the unlucky news. Wally Kruce, general manager for operator Unibail-RodamcoWestfield (URW) at Chicago’s O’Hare International Airport (ORD), also caught word of Brown Sugar Bakery’s fate. “We saw it in the news – it was the day after the accident and we saw an online news story,” Kruce says. He and his team decided to find a place for Brown Sugar Bakery products in the airport’s international Terminal 5. “It fits well with our community outreach, on a hyper-local level, as we call it. It’s a hyper-local opportunity for us to get involved, and her product is a great fit for the airport. We knew right away that there was an opportunity to help her.” Enter Goddess and the Grocer, another local company that already had a full-service location in Terminal 5. The company volunteered to begin stocking and selling pre-packaged Brown Sugar Bakery goodies as part of its grab-and-go offering. It all came together in just a few weeks, and Chicago travelers can now enjoy chocolates and candy from one of the city’s favorite bakeries. Hart, a longtime admirer of Goddess and the Grocer, is thrilled with the result. “The whole idea that something bad can happen and something good can come out of it – it was great that the people stopped and helped me on a Sunday morning, that was pretty special,” she says. “But then to receive this as an opportunity – that doesn’t just affect me, it affects the people that work with me, and it’s an aspiration I already had.” Early on in the life of her business, Hart says she had envisioned one day selling her products to travelers from all over the world. It was an unusual path, but now that goal has been achieved.
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