Passenger retail at airports: The case study of the republic of Croatia

Abstract

With the rising importance of air travel and the globalization process, retailers have started to change their perception of airports as not merely being marginal settings for their business, but rather an important part of the entire retail chain. Air transport has been developing rapidly, and low-cost carriers now offer cheap and regular flights to many destinations that were off the beaten track in the past. Due to this development, retailers are trying to respond to the rising demand and are also trying to tackle the rising competition and make airports function as full-sized shopping malls. Air transport is the youngest traffic branch in Croatia, but it is also the fastest-developing one, bringing more and more tourists every year and connecting the country with the rest of Europe and the world. This paper aims at presenting key characteristics of passenger retail at airports, with special focus on the analysis of duty-free shops on Croatian airport market. The primary research aimed at exploring students' perception of duty-free shops at Croatian airports. The findings confirm that this population is highly price-sensitive and often opt for cheaper products and more affordable transport and do not therefore frequent duty-free shops at the airport as much. In addition, it has been concluded how students lack information on what duty-free shops offer, and the advantages and conditions of buying at a duty-free. Alcoholic drinks, tobacco and perfumes are the best-selling products and therefore, more affordable at duty-free shops. More effective marketing efforts and price cutting would result in better sales and revenues for duty-free shops and would additionally stimulate their development worldwide, especially in the Republic of Croatia.