IIM Calcutta Blog : Leading The Way



Posted by: Anaika Verma, Aakash Bhamre, Ritu Mehta.
(Anaika Verma and Aakash Bhamre) PGDM students, Ritu Mehta (faculty in the marketing group at the Indian Institute of Management Calcutta).
Jan 04, 2016

Airport shopping has seen a tremendous growth over the last couple of decades with the ever increasing number of ‘transumers’, i.e. consumers who travel. The world’s first duty-free shop was established at Shannon Airport in Ireland by Brendan O’Regan in 1947 and is in service till date. Since then, thousands of shops have opened up throughout the world’s airports. With the global duty-free industry all set to become a $73.6 billion industry by 2019, it asks for serious attention. It is interesting to note that 31 per cent of airport revenues come from non-aeronautical services, but surprisingly limited attention has been given to airport shopping behavior of transumers. This lack of research motivated marketing group of Indian Institute of Management Calcutta (IIM C) to conduct a research on airport shopping behavior. The research aimed to address questions like why passengers buy or don’t buy at the airport, what level of service are passengers looking for, and how retailers could improve their sales. The research was carried out at Netaji Subhash Chandra Bose International Airport, Kolkata. It involved interviewing customers as well as retailers and shop-owners at the airport, as well as conducting a questionnaire survey of travelers at the airport.

A total of 171 respondents completed the questionnaire across different age groups. The survey revealed that almost 80 per cent of the travelers did not plan their purchase in advance. However, travelers who came to the airport with an intention to make a purchase at the airport were significantly more likely to make a purchase (70 per cent of them) than those who had not planned their purchases (45 per cent).This highlights the need for airports to project themselves as retail destinations.Reasons cited for not buying in spite of having planned to buy were “products were expensive” and “did not want to carry”. The primary motivations to shop at the airport included “availability of exclusive products”, “duty-free imported products”, and “credible brands”. The study also revealed that customers look for variety and exclusive offers. “There should be more stores for traditional handicraft and food items. The quality and variety of products in India are poor as compared to available at international airports,”explained a female shopper. “Deserted stores are a turn off. More offers can pull more crowd,” a male shopper explained. When asked to comment on customers’ reaction to price, a store manager said, “In spite of the fact that we provide good deals and prices, we are perceived to be priced high.” This indicates that stores at the airports need to rebuild their price image.

Further, a high correlation was found between liking of an airport and decision to enter a store in that airport. Over 50 per cent respondents indicated that they would not enter any store if they had negative opinion about the airport. Sixty-five per cent of people who had positive opinion of the airport made a purchase after entering the store,as against 28 per centof those who did not like the airport. This highlights the need for stores to work in collaboration with airport authorities to improve the overall perception of the place. When looked into what made an airport likable, a whopping 70% and 63% of respondents indicated that airport ambience and comfortable seating arrangement were the factors that affected airport likability.

The research gives a snapshot view of airport shopping behavior. It provides the shopping motivation of transumers at the airports and highlights the need for airports and the stores there-in to understand the evolving needs of the ever increasing number of transumers. This would enable them to come up with a value proposition that creates a win-win-win situation for the transumers, airport, and the storesat the airport.

Article By: Anaika Verma, Aakash Bhamre, Ritu Mehta.
Anaika Verma and Aakash Bhamre are PGDM students and Ritu Mehta is a faculty in the marketing group at the Indian Institute of Management Calcutta.


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