Travel Retail and Duty Free Business Intelligence    Thursday 24 July 2014

PICTURE GALLERY

BAA unveils revamped Heathrow Terminal 4 commercial offer as WDF takes the specialist route – 04/12/09

Published: 04/12/09

Source: ©The Moodie Report

By Martin Moodie

UK. BAA today showed off its new-look commercial offer at London Heathrow Airport Terminal 4, an integral element of the facility’s recent £200 million redevelopment programme.

As reported, the terminal’s 85,000sq ft of retail and catering space has been extensively revamped over the past year. BAA said this programme reflects its ambition to provide passengers with improved shops and facilities as well as higher standards of service.

The revamped retail offer includes a number of new introductions to T4, including the first-ever airport Cath Kidston store and premium fashion brands such as Jimmy Choo and Etro.

Iconic UK retailer Harods enjoys a multi-dimensional presence at Heathrow Terminal 4, via both its main generic shop (top) and a range of specialist outlets including Jimmy Choo (only its second airport outlet in the world) and Loewe
Meet Rodney, the 7ft Harrods bear, outside the main Harrods store at Terminal 4, while inside the outlet offers a range of familiar merchandise from the luxury retailer's flagship Knightsbridge store
The terminal’s main concessionaire, World Duty Free, has also unveiled a number of new or revamped specialist stores, including World of Whiskies, Beauty Studio, Simply Chocolate and Glorious Britain.

Another highlight is Dining Street (a word play on Downing Street) Restaurant, created by food & beverage concessionaire Delaware North. The 4,018sq ft restaurant (below) has capacity for more than 180 diners and offers a quirky, heavily British-themed experience and menu.

This morning BAA conducted a tour of the revamped terminal for industry press, while WDF CEO Mark Riches led a media briefing on the company’s specialist stores, including the newly opened Simply Chocolate.

Rule Britannia: Food & beverage specialist Delaware North brings the 'Dining Street' concept to life brilliantly
ALL CHANGE AT TERMINAL 4

As soon as any experienced Heathrow passenger enters T4, they will notice a profound change. A complete refurbishment of the check-in area (utilising some of the former forecourt space) has created a modern, spacious and bright environment – a far cry from the old terminal that, a BAA spokesperson admits, “people used to avoid at all costs”.

Some 37 airlines are currently using the facility (including 25 from the recently deceased T2), a figure that will rise to 44 in early 2010.

T4 is the new home of the SkyTeam airline alliance (embracing Aeroflot, Aeromexico, Air France, Alitalia, China Southern Airlines, CSA Czech Airlines, Delta Air Lines, KLM Royal Dutch Airlines, Korean Air, Air Europa and Kenya Airways), which means a significant shift in the facility’s passenger profile – a factor with big repercussions for the terminal’s retailers.

SkyTeam even has its own dedicated premium check-in area for business class and first class passengers – a world first. In keeping with world trends, landside retail and catering has been minimized, though an expansive new Cafe Rouge takes pride of place in the landside check-in zone.

With British Airways now departed, the percentage of business traffic has fallen by five percentage points to 30%. Pre-Terminal 5’s opening there were some 8.3 million passengers using T4; going forward there will be 5.1 million – a remarkable 90% of them falling into the ABC1 consumer category.

Whereas around a third of the terminal’s passengers used to be UK residents, that ratio has risen to around a half. Previously 75% of the mix were bound for non-EU destinations; that figure has now fallen – 46% going to Asia and the Middle East (compared with just 20% before); with around 33% headed for intra-EU. Because of the departure of BA, the percentage of transfer passengers has also fallen sharply, now down to around 20%.

“Our suspicion is that the passenger base we have now will engage more in the retail offer,” said Heathrow Airport Retail Concessions Director Brian Woodhead.

Once central security is cleared – and that should be a lot quicker now that the number of security points has been increased from eight to 13 – the traveller also discovers a much more spacious airside environment.

The prominent central island of retail that used to dominate the immediate post-security zone has been removed, creating a much easier, more relaxed transition into the commercial area.

“Our objective is to get 99% of people [across all terminals] through security in less than 10 minutes,” said Woodhead.

Today well over 85% of the retail mix is airside. “In Terminal 4 the big thing we wanted to do was to get the sightlines right and the views right. Now if you look left or right [post-security], you can see all the way through.”

Premium watch retailer Watches of Switzerland has opened its first stand-alone airport store in a 1,076sq ft unit at Terminal 4, which features a selection of the world’s finest watch brands including Rolex, Cartier and Jaeger–LeCoultre
Clockwise from top: Thomas Pink, Roberto Cavalli, Tie Rack, Mulberry (including, for the first time at Heathrow, footwear)
The anchor World Duty Free outlets – liquor, tobacco and confectionery to the left; perfumes & cosmetics to the right – are first up. These are largely unchanged, though now that the airline mix has been finalised an ambitious makeover will follow.

Essentially passengers turn left or right after security, so BAA had some critical decisions to make in terms of where it located the various stores. Brands that are more familiar to European travellers have been broadly grouped to one side and a different mix to the other where the long-haul flights dominate.

That split is reflected in how Harrods, which enjoys a major presence at T4, has allocated its offer. Its core stable of great brands that it represents (Cartier and Dunhill, for example) can be found in the Southeast area, whereas the newer, funkier names such as Jimmy Choo are located in the Northwest zone, explained BAA Head of Category – Fashion and T5 Retail Operations Mark Jennings.

Woodhead added: “One of the challenges of a terminal like this with security being in the middle is that you have to manage your merchandise and make your choices.”

We’ll examine those choices – and the resultant offer – in a more detailed report coming soon.

We'll also follow up with an extensive feature in The Moodie Report Print Edition (also available digitally), out next month.

Sunglass Hut gets the stand-alone retail prominence that this booming specialist category warrants
And more from Harrods (above and below), covering a range of brands and price-points

Fashion statement: T4 also houses stand-alone boutiques from Escada, Burberry and Bally
Tumi has become one of the airport world's leading retail brands and it's showcased to good effect at T4
Dixons Travel provides a suitably cutting-edge consumer technology offer and environment
MORE STORIES ON BAA

BAA passenger traffic slips by -1.4% in October; Middle East and Indian routes show double-digit growth – 10/11/09

BAA unveils new-look offer following £200 million refurbishment of London Heathrow Airport Terminal 4 – 02/11/09

Strong retail performance buoys BAA’s London airports in first nine months – 28/10/09


BAA announces sale of Gatwick Airport – 21/10/09

Recovery for BAA as UK traffic slips just -2.6% in September; Gatwick bounces back – 09/10/09