Incheon aims for $3bn duty-free sales by 2015

Gavin Lipsith

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The South Korean airport outlines its plan to become the world’s busiest international hub and its biggest duty-free retail location

Incheon International Airport Corp outlined bold plans for the next stage of its development at the Gate One2One conference earlier this month. The opening of its new concourse A next month will be a major step in its plans to become a leading international airport—and to grow duty-free sales to $3bn by 2015.

The aim, outlined by retail marketing group director Kwong Soo Lee at the conference, would make Seoul the biggest airport duty-free location in the world, a title it inched closer to last year as sales grew 17.3% to over $1bn. The addition of 50 more shops and 5,000sq m (53,800sq ft) of retail space in the new concourse will be key to its plans.

Lee explained that a two-year effort to maximise retail performance had resulted in the strong growth, and in the creation of a new airport and commercial brand, AirStar. He also revealed that, as a result of strong bidding for last year’s duty-free tenders, the airport has been able to reduce landing charges by 10%. He added: “This will mean we earn $300m less from landing charges over the next three years, but we are confident that we can compensate for it based on increased retail revenues.”

The new branding and IIAC’s commercial vision was driven by a heavy investment in consumer analysis—the company has spent over $1m with research consultancy Nielsen over the past two years, said Lee.

“We want consumers to think of Incheon with a special image,” he said, “something different to Singapore Changi or Hong Kong International airport.”

The airport anticipates that non-aeronautical revenues will grow from 55% to 57% of total revenues this year.