growing international tourism is driving the Duty-free Retailing Market
Technavio analyzes that the Duty-free Retailing Market is expected to grow at a CAGR of 11.28% during 2023 and 2028. During this period, the market is also expected to show a growth of USD 33.93 billion.There are various factors that contribute to the growth of the market. The surge in international tourism has significantly boosted the growth of the duty-free retailing market. Travelers seeking tax savings and unique shopping experiences have fueled the demand for duty-free goods. Airports and border crossings serve as prime locations for these retail outlets, offering a wide range of products from luxury brands to local specialties. The market's continued expansion is expected to benefit from increasing global connectivity and the rising trend of duty-free e-commerce.
The cosmetics and perfume segment holds a prominent position in the global duty-free retailing market, accounting for approximately one-third of the total revenue. Factors such as the increasing number of international travelers, rising disposable income, and the trend of luxury shopping during travel have significantly contributed to the growth of this segment. Travelers from the Asia Pacific and Middle Eastern regions have shown a particularly strong preference for duty-free cosmetics and perfumes. Brands like L'Oreal, Chanel, Christian Dior, Estee Lauder, and Guerlain are among the top sellers in this market. L'Oreal, in particular, holds a substantial market share in the cosmetics and perfumes segment of the global duty-free retailing industry. This growth can also be attributed to the savings travelers achieve through the exemption of taxes on purchases at duty-free stores during import.
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Duty-free Retailing Market Segmentation
As per our research findings, here are some of the key competitors that are leading the industry
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The global duty-free retail industry caters to international travelers, offering tax-exempt purchases at airports, international flights, and railway stations. This regulated retail environment, known as travel retail, generates significant non-aeronautical income through sales of duty-free goods to diplomatic and military personnel. Arrivals duty-free shops are a key revenue source, with purchases driven by tax savings on imports, including value-added tax. The shopping experience is a significant aspect of international travel, making duty-free retailing an essential part of the retail landscape. Through a certificate course, industry professionals can enhance their knowledge and skills in this unique sector.
The global duty-free retailing market is a segment of the broader USD25 trillion retail industry, as classified by Technavio. This sector specifically focuses on tax-exempt sales to travelers in regulated retail environments, primarily at airports serving international flights. Market size is determined by revenue generated from duty-free shops, which fall under the umbrella of general merchandise companies within the broader retail market. Key growth drivers include the increasing use of advanced mobile devices and high Internet penetration, enabling consumers to access on-demand products and services during travel.. Industries are leveraging the products belonging to the market for customer engagement, transactional notifications, and promotional offers.
Technavio Research
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