Shopping at Changi Airport: Buy before you fly

Travel, for many people, begins at the airport, where passengers - the excited, nervous and blase - exchange goodbyes and await their flights.

But airports have evolved beyond their core function as transport hubs to also serve as lifestyle and shopping destinations.

Travel booking platform Booking.com's 2025 Travel Predictions found that 71 per cent of Asia-Pacific (Apac) travellers are interested in discovering airports with unique experiences and facilities. The same survey indicated that around 44 per cent of Apac travellers would consider visiting a destination based on the quality of its airport.

"Today, airports are no longer just transit points but destinations in their own right," says Mr Anthony Lu, regional director of South-east Asia and China at Booking.com.

"When airports go beyond functionality to truly impress, they do more than just improve the travel experience. They make the destination more memorable and appealing, encouraging travellers to return and share their experiences with others."

Top airports around the world include Hamad International Airport in Doha and Incheon International Airport in Seoul, which regularly vie with Changi Airport for top spot on global rankings, such as an annual list by Britain-based consultancy Skytrax. In 2024, Changi Airport placed second on the list.Changi Airport's retail growth

To stand out amid the competition, Changi Airport has undergone a slew of upgrades in the past five years. Airport retail complex Jewel Changi Airport, which has the Rain Vortex - the world's tallest indoor waterfall at 40m high - and attractions like the 14,000 sq m Canopy Park, opened to much anticipation in April 2019.

In November 2023, Changi Airport Terminal 2 fully reopened to passengers after a 3½-year revamp, which included the addition of biophilic attractions like the Dreamscape garden and new retail brands such as scent company Lynk Fragrances and bakery Baker's Well.

Terminal 1's (T1) transit hall has also been undergoing refurbishment, which started around August 2019. It unveiled three luxury boutiques - Louis Vuitton, Christian Dior and Tiffany & Co - in its central section in June 2022, and has made upgrades to the stores and facades of its east and west wings.

Singapore eateries such as Chatterbox Express and Crave Nasi Lemak now operate in a space with increased visibility, as walls that once sectioned them from a main walkway have been removed.

Around $10 million was pumped into upgrading T1 East, which is estimated to be completed by May.

Such upgrades drive airport retail, which generates revenue for the airport's operations.

Airport financing relies on two main streams of revenue, according to aviation experts.

The first is aeronautical revenue, which comes from taxes and fees levied on passengers or airlines, such as aircraft parking fees and fuel charges.

The second is non-aeronautical revenue, which comes from retail concessions and property rental income, among other sources.

According to data from Airports Council International World, a trade association of the world's airports, non-aeronautical revenue was a primary source of airport revenue in Apac in 2019. It accounted for 49 per cent of total revenues, ahead of aeronautical revenue (46 per cent). In 2023, aeronautical revenue was the primary source of airport revenue in the Asia-Pacific region, followed closely by non-aeronautical revenue that includes retail concessions and property rental income.

In the wake of the Covid-19 pandemic, the weightage was reversed. Non-aeronautical revenue fell to 42 per cent of the total revenues in Apac in 2023, while aeronautical revenue rose to 52 per cent.

In Singapore, the airport's concession sales have picked up steadily since borders reopened, on the back of strong passenger arrivals.

Changi Airport Group (CAG) posted $1.1 billion in total concession sales in 2022, and $2.2 billion from January to November 2024.

In 2019, the group reported a record $2.8 billion in total concession sales. Changi Airport's concession sales has picked up steadily as Singapore posts strong tourist arrival numbers.

While numbers have not yet returned to pre-pandemic levels, Ms Chandra Mahtani, senior vice-president for airside concessions at CAG, says the retail sector remains "flexible and nimble" to meet the needs of an evolving passenger demographic.

Travellers from China, India and Indonesia emerged as the biggest markets for the airport in 2024. In 2022, the biggest spenders were travellers from Indonesia, India and Thailand.

The return of Chinese travellers to Singapore, traditionally a major market for Changi Airport, bodes well for airport retail. But hot on the heels of Changi Airport are other international hubs becoming increasingly diversified and innovative with their retail strategies, as passengers seek both personalisation and variety in their shopping.

Amsterdam Airport Schiphol has self-service shops that sell meals and snacks. At Dubai International Airport in the United Arab Emirates, passengers can order food, beverages and retail products via its online platform DXB&more.

Asked if CAG looks to airports abroad for inspiration, Ms Mahtani says: "We draw inspiration from everywhere. Even if I think something from another airport is good, I will make sure what I bring into Changi Airport is more elevated."Passenger is king

Mr Mario Braz de Matos, co-founder and managing partner at Singapore-based global innovation consultancy Flying Fish Lab, says retailers are often trying to achieve a common goal - making consumers happy when they part with their money.

"It's not about the price tag. It's about what you get in return for what you're paying, and retail is about unlocking that with an experience, ideally." Changi Airport's new collectible series, Changi Editions, was launched in conjunction with its Changi Millionaire Experiences campaign.

Knowing passengers' shopping motivations and understanding their purchasing behaviour are key.

For instance, travellers often have only a few hours in transit and are lugging bags across the terminal. To capture their attention, retailers have to ensure that their branding is prominent, the products they sell are not bulky or heavy and that they have feasible delivery options.

In Changi Airport, the open layouts of stores - with wide entrances and no doors - make them more inviting to enter. Shelf displays are designed for passengers to spot from afar.

The airport also offers a 24/7 complimentary shopping concierge service (str.sg/gYTk) for both travellers and non-travellers.

Customers can engage the service via WhatsApp or WeChat. A personal shopper will get in touch and can either send photos or videos of items or conduct a video call for travellers to browse products.

For instance, he or she can shop on behalf of travellers from any of the four airport terminals and deliver the items to their boarding gate. Personal shoppers from Changi Airport's shopping concierge service can help passengers browse products in the airport over a video call.

Complimentary courier delivery services to a local address outside the airport are available with a minimum spending of $280.

Retail experts say passengers are typically in a heightened state of emotion when they arrive at the airport. These might include negative feelings like stress and anxiety, driven by situations like flight delays, long security clearance queues and unfamiliarity with a new environment.

Mr Braz de Matos says passengers may turn to retail therapy to alleviate such negative feelings.

Those filled with excitement at the prospect of a trip may also end up purchasing items that they normally would not, as studies suggest that higher levels of positive emotions lower the barrier to spending.

Dr Lynda Wee, an adjunct associate professor at NTU's Nanyang Business School, says the role of emotions influences the design of airport retail.

For instance, passengers often feel a need to buy souvenirs for themselves as a nostalgic keepsake or as gifts for friends and family. Local brands like chocolaterie Mr Bucket and boutique Charles & Keith line the walkway to boarding gates in Changi Airport's transit halls.

As such, lining local brands along the walkway to boarding gates - such as boutique Charles & Keith and chocolaterie Mr Bucket - is likely to influence people to shop.

And when travellers clear departure immigration and enter Changi Airport's transit halls, they are greeted by a spacious atrium and greenery instead of an immediate cluster of shops.

Dr Wee describes this as a decompression zone.

"Up to the point of clearing immigration, travellers likely remain highly stressed. But when they step into this big open space, it signals, psychologically, that everything is done and it is time to eat and shop," she says.

"After what people have gone through during the Covid-19 pandemic, I think they now want to take home memories. They want to take home things they can connect with," says Ms Mahtani.

Retailers at Changi Airport have enhanced in-store experiences to cater to this sentiment.

For instance, the Forest of Li Bai lounge - situated on the upper floor of the Lotte Duty Free store at Terminal 2 - has a sampling counter of 18 whiskeys. The lounge is open to the public.

In Terminal 4, TWG Tea's flagship store features an 11m-high tea wall, showcasing over 2,000 tins filled with 800 varieties of loose-leaf teas sourced from around the globe. The eye-catching display lures curious passengers and makes a good photo opportunity.

Ms Maranda Barnes, chief commercial officer of global luxury gourmet lifestyle group V3 Gourmet and co-founder of TWG Tea, says: "Travellers often seek meaningful and memorable experiences during their journey. And when they connect with a brand they admire or resonate with, they are more inclined to take a piece of that experience with them."

In line with the trend of experiential travel, CAG has overhauled its "Be a Changi Millionaire" shopping campaign for 2025, rebranding it "Changi Millionaire Experiences".

This revamp comes as CAG notes more demand for hybrid experiences of retail and entertainment, which Ms Mahtani dubs "retail-tainment".

Instead of one person winning a million dollars, the new shopping campaign will see one winner drawn each quarter. Four winners of the new Changi Millionaire Experiences campaign will get to enjoy luxury all-expenses-paid trips that include suite-class flights.

Each winner can choose one of five all-expenses-paid trips to South Africa, Finland, France, Japan or the Bahamas.

Winners can take along a companion for the luxury vacation, which includes suite-class flights, five-star accommodation, private tours, gourmet dining and personal concierge services.From bricks-and-mortar to online shopping

The airport retail experience was once a purely in-store experience. Yet today, e-commerce is both a boon and bane for the industry.

On the one hand, it has added a new digital channel to reach consumers and bolstered sales during the pandemic.

Changi Airport's e-commerce platform iShopChangi is integrated into the airport's retail eco-system, with a majority of products from its bricks-and-mortar stores listed on the platform. Between 2023 and 2024, iShopChangi doubled its offered brands to more than 2,000.

On the other hand, it must compete with online platforms such as Amazon, Lazada and Shopee, which dominate the e-commerce space.

Ms Chan Sok Ling, chief commercial officer at The Shilla Duty Free Singapore, says: "Travellers today have access to a wide variety of products at competitive prices and with high convenience. Coupled with our strong Singapore currency, the value proposition of duty-free savings is less attractive than before."

Lotte Duty Free Singapore's managing director Jeff Jeong agrees.

He says that as a result of these challenges, even though passenger traffic is high in Changi Airport, the passenger penetration rate - the number of passengers who make purchases - has not kept up.

He does not think duty-free sales are likely to return to pre-pandemic levels soon.

Lotte Duty Free's contract as the sole liquor and tobacco operator in Changi Airport ends in June 2026, and its management is in discussions with CAG on future plans.

The Shilla plans to tap artificial intelligence and data analytics more to better understand consumer behaviour at Changi Airport.

It will use recognition technology via security cameras, which will help with identifying what customers are most interested in, and heat map technology to show where consumers are spending time in the store.

This project, which was trialled in the last quarter of 2024, has been implemented in its Terminal 1 store.

Ms Chan says: "Especially in the airport, where you have only a few seconds to impress your customer, I think AI can help to optimise our entire operations process by fine-tuning our promotion mechanics and product placement."

The retail industry is evolving so rapidly that Dr Wee feels the word "retail" will one day no longer be relevant.

"I think the word 'retail' is very specific and seems to just hit the 'need to buy' part of you. But increasingly so, when we look at customers, we want to know their lifestyle needs," she says.

Dr Wee believes the future of airport retail is more experiential and holistic, and that passengers will look for more interactive experiences.

CAG's Ms Mahtani agrees. "Things change a lot. My plans for the end of the year will change halfway through the year because it is so fluid and customers change what they are looking for so fast," she says.

"We take inspiration from what we do and learn today to dream about what we want to do for Terminal 5."