Interview: Heidi Woodhouse, managing director of Dixons Travel
There is plenty of opportunity for further growth in travel retail for Dixons on the back of airports increasingly focusing on giving customers a better shopping experience and people flying more often.
Heidi Woodhouse, managing director of Dixons Travel, says: “Travel retail continues to grow as airports are more engaged with the retail proposition having recognised that part of the enjoyment of going away is time spent in the airports. In the past three to four years there has been a step change in how airports run retail. There are numerous hub airports to use so people will go to the best ones [for shopping] when they have three or four hours [to spare].”
Shopping experiences improve
She cites Heathrow as an “absolutely wonderful shopping experience” and that Europe and the Far East airports have been working hard on their retail offers although the US has not yet made strident moves in this direction.
Growth in travel retail is also being fuelled by the fact people are flying more often and Woodhouse expects growth in shops on cruise liners too because there are a number of ships currently under construction that will boost capacity in the market.
These factors have given her the confidence to target more stores in overseas airports and on cruise ships as she acknowledges that the company already has the UK covered. Dixons currently has 34 shops located around the country but it only has a modest overseas footprint with two units in Oslo, two in Dublin, and one store on a cruise ship. It also recently opened an outlet in Belfast International Airport.
Focus on overseas expansion
“In the UK we have saturation in airports so it’s all about expanding overseas. We’ll be opening five stores in Germany in Q1 next year including Frankfurt and Dusseldorf. And definitely more cruise ships,” says Woodhouse.
Operating stores in travel locations is very different to running them on the high street. There are major variations in the customers using regional versus major airports, there are seasonal differences in what people buy, and the types of flights that are taking place at certain times of the day will also alter the mix of goods being purchased.
Although the core product mix is the same across all the travel stores Woodhouse says the goods we highlight and promote will be different: “We understand the demographics of each airport and our promotional plan will be different for each. In the ski season there will be more Garmin watches sold [at certain airports] and in summer audio is much bigger.”
Added complexity with airports
There is also complexity in the way the supply chain operates for airport stores, with all goods having to go through a consolidation centre. There is also the issue of all staff having to receive airport approval before they can be employed. The upside is that the employees in travel retail typically stay at the company much longer than those working on the high street.
Store managers stay for as long as 15 years on average and there is also a lower staff turnover across all levels of travel retail. “When we do engagement surveys they also feature [more highly]. Maybe it is because there is more of a family feel to it and so we retain them for a longer time. They are also very highly trained,” says Woodhouse.
Employees rank among most knowledgeable
This training is proving increasingly valuable, particularly within electronics where there is increasing complexity in the products and many consumers have little knowledge of the growing capabilities of connectivity for instance.
Woodhouse says there is a particularly strong relationship with suppliers because they believe the Dixons Travel employees are the most knowledgeable of any in the world. “They love the technology, they understand it, and see how it all connects. They can therefore excite customers – about everything from smart-phones to smart doorbells,” she says.
