COMMENT: How train stations closed the gap in travel retail

Airports used to be the clear leaders for travel retail, but train stations have now closed the gap. Network Rail's head of retail Daniel Charles explains why.

train station retail

When it comes to station and airport retail it used to be a case of “mind the gap” – with railway stations historically failing to capitalise on their potential, while airports offered a quality retail experience.

But now the days of dark and dingy stations with a limited retail offer have long since passed. For example, stations in Network Rail’s portfolio are now a slick, contemporary operation with a retail mix that puts the customer at the heart of everything it does. While airports have traditionally dominated transport hub shopping in the public consciousness, railway stations have now significantly closed the gap – capitalising on a series of distinct strengths and differences to tread their own path.

Those strengths start with footfall. In 2017 the UK’s five busiest airports recorded just over 193 million passengers. In the same year, footfall in Network Rail’s five busiest managed stations was well above 500 million. While the two are different businesses, this statistic alone makes it easy to understand why retailers are increasingly embracing stations as part of their business model.

Location is another huge factor. The metropolitan setting of most railway stations means that they unlock their surrounding areas and act as thoroughfares as well as transport hubs. This also boosts footfall and allows full accessibility, regardless of whether people are travelling or not. They therefore attract a wide range of people who are looking to eat, shop, and socialise.

Stations are evolving to meet this rising demand, whilst also maintaining the safe and efficient running of the railway itself. This evolution does have to contend with space constraints that few airports suffer from, but in recent times this challenge has driven innovation and the constant reappraisal of existing station spaces, such as the successful redevelopment of the Lawn at Paddington station.

Although the captive audience at airports tend to dwell for longer, railway stations benefit from frequent use by the same people multiple times a week. This repeat custom means there are plenty of opportunities to offer shoppers something new at a destination that’s already on a daily commute. Alongside this deep pool of potential repeat business, there are signs that station investment has improved customer satisfaction and increased the amount of time passengers spend in them.

Nowhere is this more prevalent than Network Rail’s flagship retail hub at London Bridge, which has recently undergone a £1 billion redevelopment and will soon have more retail units than any other Network Rail station.

“Railway stations benefit from frequent use by the same people multiple times a week.”

Responding to changing passenger demands, the quality of the retail offer at train stations is matching the quantity. Ted Baker, Hamleys, and Rituals have all already signed up to open branches, joining a range of brands already open at London Bridge.

Indeed, premium brands’ appetite for opening in railway stations shows that convenience shopping is changing how these brands approach their target markets. A 2017 survey of 1000 UK shoppers, commissioned by Savvy found that almost three quarters (71 per cent) said that convenience was more important to them now than it was five years ago.

It’s clear then that retail is changing and convenience is king. Stations are positioned perfectly to take advantage of this and it’s important that Network Rail continues to use its expertise to ensure that railway stations lead the field as retail destinations of choice. Especially as the profits that we make from retail are reinvested back into the railway.

Of course railways and airports, though similar, will continue to have distinct differences which set them apart. But with an ongoing focus on the customer offer, rail stations can use their strengths and their growing status as destinations in their own right, to ensure they continue to evolve and meet the needs of their customers.

Daniel Charles is the Head of Retail at Network Rail

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