Air passengers want more than ever from an airport retail offer. Hazel Curry is tasked with planning the fashion mix at BAA’s new Terminal 5 at Heathrow
Very few property developers can persuade retailers to come to them to prove they should have a space within a new shopping centre. But the team putting the retail offer together for Heathrow Terminal 5 is in a more privileged position than most.
There aren’t many developers that can promise a guaranteed footfall of 27 million passengers a year - roughly 13.5m inbound and 13.5m outbound. And the customers have a dwelling time way above a normal shopping centre average. This means the process of letting the terminal’s 230,000 sq ft of retail and leisure space is more akin to judging a beauty contest and installing the winners in the new scheme, rather than the usual prolonged will-they won’t-they courtship of an out-of-town or town centre development.
Terminal 5, which is devoted entirely to British Airways passengers, opens next year on March 30 at 4.30am. For the first time, domestic and international passengers will be able to shop in the same stores at the same tax-free prices, which BAA believes will create a whole new level of customer spend.
The scale of the development is impressive. Each floor of the five-storey building is the size of 10 football pitches, making it the biggest free-standing building in the UK. Retail covers two floors, with parking space for 4,000 cars underpinning the building. It will expand the size of the retail portfolio at Heathrow by 50%.
On a good day the totally glass-fronted structure will afford views that stretch as far as London’s Canary Wharf in the east and Wembley Stadium to the north-east. In a bid to cut queues, British Airways is aiming for 80% of passengers to use self-check-in facilities.
In terms of retail there are just 90 units to play with - a further 56 will be catering facilities. Of the 90 stores available, only 22 will be pure fashion players. BAA head of category fashion and fashion accessories Hazel Curry admits that she could have filled the space five or six times over. So choosing a retailer to fill the anchor store was a very big decision. In the end it was decided that Harrods was the perfect partner for the terminal.
Curry says: “Harrods has a proven history of trading in airports, having six stores already - four at Heathrow and another two at Gatwick.It was prepared to do something new with the space by creating an innovative, dedicated 10,000 sq ft fashion and accessories store. We talked to other department stores, but we’re looking for something iconic. It was obvious that Harrods would suit the development best.
“It was a big step for the retailer to take to create this store. It will also have a totally separate 1,200 sq ft Harrods signature unit, which will sell the more gift-led offer that people have seen until now in a Harrods airport store.”
The Harrods department store unit will offer bridge and diffusion-level labels, as well as the smaller “new luxury labels” that have emerged over the past decade, which would not be able to support their own airport outlet. Designed by consultant Fitch, the shop will have two large domes across its menswear and womenswear areas to create a light and airy space. A denim wall will be at the back of the women’s part of the store. There will also be a 400 sq ft By Appointment personal shopping area, which will mimic the one in Knightsbridge in terms of design, and a luxury accessories and travel goods area.
Raj Assand, the Harrods director with responsibility for all its airport stores, says: “Over the past few years there has been so much going on at Harrods in Knightsbridge, which has brought the store to the forefront of department stores across the world. This move to offer something totally unique in terms of service levels, offer and aspiration at an airport naturally evolves from that work. The idea is that we will be able to work with customers in a way never seen at an airport and move stock from Knightsbridge so shoppers can pick it up here on their way out of the country.”
Curry joined BAA in November 2004 from Selfridges, where she was the buying manager for women’s designer collections. She is the first person at BAA to hold the fashion role, which aims to develop the fashion and accessories offer across all BAA airports. Terminal 5, she says, will be the biggest space ever devoted to fashion in an airport. “In the past there has been a wrongly held belief that you can’t sell clothing at airports and that the fashion offer should generally be restricted to accessories. That view has now changed among retailers, but it has meant that in some terminals we have been stuck with retail space that just isn’t the size that high-street retailers are looking for. As a result, many of them don’t want to take a chance.
“In Terminal 5 we were given the chance to address this and here we have bigger spaces for retailers. Unfortunately the terminal doesn’t have double-height fascias, which would have been a boon, but it was planned back in the early 1990s so it missed out on this retail trend. However, what you lose on one area you gain in another. The lack of that kind of frontage means that when you enter the terminal you get a real sense of the space and how to navigate it, which I think passengers will love shopping in.”
By sharing information about passengers with the retailers in other terminals and reciprocating with sales data, BAA is starting to build up an incredibly detailed picture of the retail customer in every part of its business.
Curry explains that when planning a retail offer for a terminal, the mix is put together based on the type of passenger travelling through - something she admits has not perhaps been a priority for BAA in the past.
“Take the South terminal at Gatwick as an example. That terminal is used mainly by people going on package holidays. Customers there are people who may only travel by air once a year - it’s a big event for them and being at the airport is part of that experience. So they are more inclined to buy on impulse as part of the fun of the whole holiday. In terminals that are more focused on business travel, we need to tailor the offer more to that customer.
“Before I joined BAA I remember going on a buying trip to CPD in Dusseldorf and realising that I had left my all-important black jacket at home. I remember getting to Terminal 1 at Heathrow and searching in vain for a shop that sold a black jacket, and being so frustrated that the shops there couldn’t provide what should have been a basic service.”
Because Terminal 5 is an all-British Airways terminal there is quite a mix between leisure and business. It’s estimated that 64% of people will be travelling for pleasure and 36% business, and that 92% of them are ABC1, making them generally higher spending.
This means that as well as the high street’s more aspirational end, such as niche operators Reiss and Ted Baker, designer brands including Paul Smith and Mulberry and accessories name Tiffany’s are also part of the retail mix at Terminal 5.
Curry says each of the fashion retailers that have signed up to Terminal 5 has taken up the challenge laid down by BAA - to take their store concept beyond what is generally seen on the high street and give Terminal 5 a real point of difference.
Each of the retailers brings something new to the development. Paul Smith’s Globe store will be a whole new concept for the designer, while the Kurt Geiger store has decided to offer exclusive Terminal 5 product, including a signed Christian Louboutin espadrille for its first season. The Ted Baker store will have a nature theme that celebrates the English landscape and includes a mural of birds taking flight. Mulberry’s shop will feature a specially commissioned iron mulberry tree sculpture at the back of the store, while Reiss will have a central sculpture with a neon light feature.
Curry says: “In a way it has been harder for the very innovative retailers on the store design front, such as Reiss and Ted Baker, to prove themselves here because they always strive to give each store its own signature anyway. But they have really pulled out all the stops and come up with some great concepts. We are also delighted with the response from smaller stores such as Tie Rack, which have worked incredibly hard to come up with something totally different from what you would see elsewhere.”
Curry says it is not just space that has been an issue for middle market fashion retailers looking to move into airport retail - it is the extra costs involved. All stock has to be warehoused and security checked at Heathrow. But with far higher sales densities and average spend, she insists that the rewards when they get airport retailing right are worth it.
TERMINAL 5 AT A GLANCE
Cost to build: £4.3 billion
Opens: March 30 2008 at 4.30am
Passengers: The all-British Airways terminal will serve 27 million passengers a year - 13.5m inbound and 13.5m outbound
Space: 230,000 sq ft of retail space with 90 retail units, 22 of which are for fashion. There will also be a 600-bed hotel
Fashion names already signed:
Harrods: one department store plus a smaller signature store
Also Tiffany & Co, Mulberry, Paul Smith, Ted Baker, Reiss, Tie Rack and Links of London
Catering outlets: Gordon Ramsay, Caviar House, Giraffe.