European sales trail traffic growth in new ETRC Index

Gavin Lipsith

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The European Travel Retail Council's regional index reveals that sales in third quarter of 2005 grew slower than the increase in passenger traffic

European travel-retail sales in the third quarter of 2005 grew by 1.2% compared with the same period in 2004, according to the latest edition of the European Travel Retail Council's (ETRC) Index. The index, which now covers about 90% of the business in the European Union, reveals that sales continue to lag behind growth in passenger traffic, up by 5.9% for the quarter.

Beauty products recorded the highest year-on-year increase in sales, followed by confectionery and liquor, while sales in the tobacco and "other" categories declined compared with the third quarter of 2004.

Meanwhile most categories continued their improving trend from the first and second quarters of 2005, with tobacco, confectionery and "other" products building on successive sales increases, while sales of beauty and liquor products dipped slightly from the previous quarter.

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ETRC said the results indicate that lower penetration continues to be the main problem in Europe, particularly given the increasing frequency of travel and the fact that passengers do not buy every time they fly.

The council also revealed that it plans further enhancements to the index, including an analysis between sales to intra- and extra-EU passengers, which the ETRC said was likely to confirm its belief that the growth in passenger traffic using low-cost carriers on intra-EU routes is the principal reason for current sales trends in Europe.