Despite the global recession, customers at airport food outlets are likely to grow in coming years as passenger numbers recover from losses in 2008 and 2009, according to Mintel's Airport Catering (February 2010, UK) report. But food sales are not only reliant on the number of passengers, they also depend heavily on who these passengers are. The growth of airport catering is also expected to rise, with growing numbers of pre or no-family individuals expected to dominate the passenger market this year. Whether it be simply to pass time, or the result of having more cash to burn, these are the customers food retail outlets make most of their money from.
Although airport catering has totally unique market conditions, Mintel's report shows that it does remain intricately linked to the wider eating-out market, and Mintel says that even during the recession the market held up better than expected. However, one thing that still holds the airport food market back is its quality, or lack thereof. For this reason, catering options at airports alone are not enough to draw customers through airport gates, or even locals from outside eager to check out the view. Overall, once at the airport, customers, according to Mintel, are most concerned with the price, type and hygiene of the food that's on offer.
Reassuring airport customers with catering
This need for reassurance – quality, cost and service – is to some extent tied up with customers being risk averse as a result of the recession. This has left passengers relying on tried and tested brands that are familiar and, thus, likely to deliver on quality, cost and expectation.
According to Mintel's report, 27% of passengers surveyed said they don't buy food at the airport as it is expensive, opting for fast-food and self-service formats over sit-down outlets.
"Reassurance is a central concern for airport caterers," confirms the report. "Passengers mainly want reassurance that they are going to make their flight, which is why various catering operators have implemented 'time service promises' and departure screens in outlets."
Passengers' growing demands for quick, reasonably-priced food, from familiar brands, is having an impact around the world. "Airports have to achieve a careful balance of catering facilities for customers, taking into account cost, the time customers spend at the airport and the many different passenger profiles that the airport handles," a spokesperson for the UK's Birmingham International Airport says.
With about ten million passengers a year, and 73% of these using the restaurants and
bars, Birmingham Airport pays close attention to its customer demographic and their needs.
As a result, the airport now offers more versatility and choice through well-known UK takeaway food brands such as Burger King and Pret A Manger. "At Birmingham we have a wide mix of travellers due to the airline mix operating from here – charter, schedule, low-cost, long-haul, full-service – and our catering offer reflects this," Birmingham Airport's spokeswoman says. This year a new £13m project to merge its current two terminals, grow facilities and increase passenger flow takes place ahead of an M&S Simply Food outlet, which will open its doors in December 2010 (M&S is one of the UK's leading supermarkets, catering to a middle-class and high-end market).
Fast food at Denver
While connectivity is the main reason passengers travel through Denver – it's the biggest commercial airport within a 500-mile radius in the Rocky Mountain region – as the world's tenth busiest airport, it has to cater for a high volume of passengers. "It's about offering a variety of food and beverage options that are available and don't cost precious time," Denver International Airport's spokesman Jeff Green says.
Over the years the airport has grown its food and drink concessions in response to its increasing number of customers, offering fast food brand names such as Domino's, Pizza Hut and Starbucks. "We have a number of restaurants that offer quick service options and for travellers with a little more time on their hands, we offer full-service restaurants." Traditional American food can be found at The Denver ChopHouse and the Timberline Steak & Grille, and healthy choice and vegetarian options at its New Belgium Hub bar and grill.
Captive in Australia
As the gateway to Australia, Sydney Airport enjoys a captive market, perhaps more so than other airports. According to Mintel's report, flyers fear being exploited because of this reason – and despite efforts to prove otherwise, this perception continues to linger.
By combining qualitative research with passenger analysis to reveal nationality and cultural preferences, Sydney Airport strives to offer options for all demographics – particularly now, having just completed a major upgrade to its international terminal. "We now offer international brands such as Caviar House & Prunier for discerning travellers and there is also the first McDonald's anywhere in Australia's airside," Derek Larsen, Sydney Airport general manager for retail says. "We have also just moved to a very successful Grab & Go concept for take-on-board food". The airport also offers Santos, a coffee bar with fresh gourmet sandwiches and a variety of wholefoods, such as dried fruits, nuts and muesli.
Despite a desire for quality food, the report states that self-service and quick-service formats continue to dominate over sit-down outlets due to time constraints being a central source of concern for travellers. According to a Mintel survey, 18% use a coffee bar such as Starbucks or Costa Coffee, 14% a convenience store like M&S Food, 13% a outlet like Pret A Manger, 12% a McDonald's type of food service, 11% a pub or bar, 4% a sit-down restaurant such as PizzaExpress and 2% an upmarket restaurant.
In order for a high-end restaurant to thrive at an airport it must reassure customers about time and price concerns. This is where UK chef Gordon Ramsey's Plane Food service at Heathrow Airport – the world's second-busiest airport with more 65 million visitors a year – comes into play. The Plane Fast service guarantees two courses at £15.95 in 25 minutes and three courses at £19.95 in 35 minutes, sitting within a price bracket that customers are willing to spend.
The airport catering report reveals that 20% of adults spend between £10 and £14.99 on catering at the airport, but 18% spend £20 or more. The "summer picnics" range will appeal to customers in a rush, offering three courses for £11.95, which can be taken away in a compact shoulder bag and eaten on the flight. There is also a variation on this called "plane beautiful picnics", which for £14.95 uses healthy ingredients that are high in nutrients for health-conscious travellers in a rush. The report shows that almost 10% of travellers felt they would buy more food at the airport if more healthy choices were offered. If this is the case then this type of product could increase consumer spending at airports.
Frequent flyer thoughts
For frequent flyer Nino Di Cara, director of custom publishing with Transcontinental Media, this type of high-quality, stress-free option would be very welcome in more airports, not just Heathrow, as he flies regularly from Toronto to the US, Montreal and Europe. "When I fly long haul I usually have time to shop and eat; I would love there to be something like Ramsey's restaurant at Toronto Pearson airport as I thought it offered quality food reasonably priced," says Di Cara.
"Unfortunately most airport restaurants are middle of the road, bland and uninteresting."
Airline focus and demographics
Understanding passenger demographics is vital to airlines as well as airports so they can improve the selection of food items on board according to their potential demand. Demographic characteristics of passengers are significant due to their differing food choices.
Virgin America is an airline renowned for its customer relationship management and social media strategies aimed at engaging with its customers – and this extends to food choices on board. A Virgin America survey showed that 74% were frequent flyers (at least four flights a year) with 56% identifying themselves as healthy eaters.
As simple, premium food was most desired, as a result the airline offers one of the largest selections of fresh food items on a domestic carrier. "Our
respondents are very conscious of elevated food pricing on planes, and would rather spend the money on premium brands that seem worthy of the cost," says a Virgin America spokesperson.
However difficult it may seem to shift opinion, airports are investing and expanding their catering concessions, meaning that choice is set to keep on improving for customers. Right now, reassurance provided via familiar brands and high street names, and the implementation of "time service promises" is the order of the day.
Going forward, Mintel's report sees a focus on "freshly made, portable (and therefore flexible) meals" as well as "food to go" – as both offer reassurance to customers over choice and timing concerns. For the future it recommends catering operators ignite more interest in consumers, perhaps by way of an "upmarket graze box" with nuts, dried and fresh fruit options, as well as savoury snacks. "Catering operators need to be more proactive in creating distinct meal occasions and giving consumers a reason to spend," confirms the report.