Kian Gould Interview Part 1: "Frankfurt Airport was a pioneer in Omnichannel E-Commerce"

What are the challenges in Travel Retail? How can airports, travel retailers and airlines respond to changing customer behavior? And what role does E-Commerce play in airports' new business models? Kian Gould, CEO and founder of AOE, answers these and other questions in an interview with Peter Marshall.

The two industry professionals took the TFWA Summit in Cannes as an opportunity to discuss the most important trends and topics in the travel retail industry. In the three-part interview, Kian explains the beginnings of the OM³ Platform, which first went live worldwide at Frankfurt Airport, and explains the different business models and USPs at Frankfurt, Auckland International Airport and London Heathrow.

In this first part, you can also find out how to measure the success of digitalization strategies and Omnichannel platforms, why and how online and offline commerce support each other and how digital solutions improve the customer journey. A transcript is also available for download.

In their three-part video interview, Peter Marshall of Marshall Arts International, and Kian Gould, CEO of AOE, discuss challenges that airports and the travel retail industry are facing. Learn about different approaches to these challenges and find out how Frankfurt Airport, London Heathrow and Auckland International are digitalizing their business cases to optimize the customer experience and create new non-aviation revenue streams.

1. Peter Marshall: Frankfurt was a pioneer, so it was a huge learning curve for you and airport. Subsequent to that success story – I’m sure you will walk us through what the basket size has improved to and so on – you’ve picked up Heathrow Boutique, another major hub, and really an even more fully-developed omnichannel, multi-retailer solution for Auckland. Just walk us through the nuances between the three different opportunities.
   
   Kian Gould: Frankfurt was pretty much the first to attempt something like this. If you are a pioneer, then you make some mistakes at the beginning. You have challenges. They set up a fantastic team internally with the right people. The brought in people from DHL, a lot of people that had experience with E-Commerce before, and they did a very thorough business analysis. There was huge learning in this process.
   
   The approach of each airport is quite different, because each airport has its unique own USP.
   
   For example, while Frankfurt wanted to capitalize on the breadth of products and the benefits of services and really create this all-encompassing marketplace, the focus for Heathrow at the very beginning was pure luxury – primarily to have that that boutique feeling. Heathrow is really one of the airports that has the broadest product range of luxury brands directly at the airport. So, that is what we capitalized on there.
   
   For Auckland, there is actually a unique setting there, because New Zealand is still somewhat underdeveloped when it comes to E-Commerce; simply, because the market is too small for one of the big players to set up huge warehouses, logistics and infrastructure.
   
   To give you an idea, a lot of places in New Zealand don’t get mail daily, they get it every three days. Same day delivery is not a common thing that people expect there. So, for the airport, the idea there was really about how can the airport become one of the biggest E-Commerce players in the whole country. That is how they approached it, which is, of course, very different from a market such as Germany, which is very mature with hundreds of players. Amazon can deliver within four hours to very location in Germany. So, a different focus. And this is what we really try to do: To bring out the USPs in each airport and develop them.
   
   
2. Peter Marshall: Frankfurt has been up and running for about two years plus. Heathrow, under a year and Auckland has just started trading. They all start slowly, but it grows, but the vision is for it to be very broadly based for all three. How would you determine how successful your platform has been for each of these?
   
   Kian Gould: I think there are three ways to measure success.
   
   One, is the pure financial success of the transactions that you generate through platform. That is something that is growing continuously and it’s very much driven by how much relevant traffic the airport can generate onto a platform. It is partner-driven, marketing-driven, reputation-driven. An airport like Heathrow, which has a reputation as the best shopping airport for ten years running, hasit much easier to get people to a shopping site than an airport that is not famous for that.

Do you want to know what the other two factors for measuring success of travel retail commerce platforms are? Interested in finding out how the USPs of each airport influence their respective non-aviation revenue business models? And, most importantly, how do these platforms impact spend per head? Read the entire transcript of Part I below for answers to these – and other – questions.

Download Transcript