World Duty Free Shop UK Airport

The Duty-Free Market Is Growing, Discounts Not So Much

The global duty-free market is expected to reach £47.7 billion by 2019 according to some reports.

As a child I remember my father bringing back bags of duty-free from business trips to America — a tradition I have failed to uphold. In fact I can’t remember the last thing I bought at a duty-free shop, only the hours spent wandering around seemingly indifferent shops the world over.

With the growth of ecommerce, surely duty-free shops have lost their competitive advantage of price. But with the market growing, perhaps not.

Are savings still to be had at duty-free shops in Europe?

Methodology

I first identified two sources for duty-free purchases — airport duty-free shops and inflight duty-free shops.

Many airlines publish inflight magazines with price lists for products available onboard. I found 5 budget airlines that operate from European airports that publish such magazines: Ryanair, WizzAir, Easyjet, Thomas Cook, Flybe and 2 premium carriers: British Airways and Qatar. The infight magazines used were dated within the first quarter of 2016 (Jan – Mar).

I drew up an itemised list of all perfumes (113 in total) and prices (Male and Female) from these magazines. Perfumes were chosen as a product for comparison because they are a standard offering to compare across all retail channels.

My initial assumption was that, each class of carrier (budget and premium) would each carry an almost identical inventory of perfumes. In fact, all airlines carry an almost unique range of perfumes available for purchase onboard.

Out of the 113 perfumes I analysed sold by these airlines, only 1 was sold by both premium and budget airlines — Marc Jacobs Daisy Dream 50ml (Female). 21 perfumes were sold across multiple airlines in the same class. 92 were available on only one airline.

Full list.

The largest duty-free shop operator in UK airports is World Duty Free. Their website publishes prices available in aiports. I used prices availbale in London Heathrow Terminal 2 for perfumes found in the in-flight magazines — but prices seem fairly static UK wide, it is only range of products that differs.

In addition, I also collected prices of these perfumes from Amazon UK for comparison. Prices from Amazon include delivery fees, if applicable (I did not consider Amazon Prime as a delivery option). I used Amazon for its range of products and its ecommerce market share in the UK.

Analysis

Amazon – airline prices

Histogram of Amazon less ave airline price all classes GBP Mar 2016

Download chart.

Onboard 46 perfumes are cheaper at an airlines duty-free store (average price on all classes) than Amazon (67 that are more expensive).

Overall perfume prices are on average £3.54 GBP cheaper on Amazon compared to buying onboard at an airlines duty-free store.

68 of the 111 perfumes have very little price difference (between -£10 GBP and £10 GBP). At each end of the distribution 2 perfumes are over £35 GBP cheaper on Amazon, 2 are £20 GBP more cheaper on airlines..

Splitting out by carrier type, budget carriers have more perfumes that are cheaper onboard (34) than expensive (22). Conversely, of the 58 perfumes carried on premium carriers, 12 are cheaper onboard compared to 46 that are more expensive.

Amazon - airline prices GBP Mar 2016

Download chart.

The best airline for discounted perfume is Ryanair with average savings of about £5.36 GBP. Compare that with the worst, Qatar, where you are likely to pay £11.97 GBP more for perfume onboard. All premium carriers considered, British Airways and Qatar, are both more expensive than Amazon, on average.

Amazon – World Duty Free prices

Histogram of Amazon - World Duty Free Price GBP Mar 2016

Download chart.

Again, Amazon comes out slightly better for price when compared to World Duty Free shops. 22 perfumes are cheaper to purchase at World Duty Free shops versus 39 that are more expensive.

Amazon – average all duty-free retailers prices

Histogram of Amazon - All Duty Free Price GBP Mar 2016

Download chart.

When considering the average price of perfumes across all duty-free outlets (airlines and shops) 47 are cheaper on duty-free, 66 are cheaper on Amazon.

Clearly if your flying on one airline you won’t have the luxury of being able to compare prices, but duty-free does still offer a number discounts — something I was not expecting. Savings are still relativly small though, with the average

Duty-free rank Perfume Size (ml) Gender AMZ – Ave. Duty-free Price GBP Mar16
1 Gucci Oud Intense 90 Male £22.10
2 Ajmal Aurum 75 Female £20.00
3 Jimmy Choo Illicit 60 Female £19.40
4 Acqua di Parma Colonia Oud 100 Male £19.37
5 Mont Blanc Lady Emblem 50 Female £18.75
6 Lacoste Love Of Pink 90 Female £17.52
7 Viktor & Rolf Spicebomb Extreme 50 Male £16.94
8 Gucci Guilty Studs 50 Female £15.50
9 Dolce & Gabanna L’imperatrice No. 3 100 Female £10.36
10 Taylor Swift Wonderstruck Enchanted 50 Female £9.62

Full list.

The 3 best perfumes to buy at duty-free retailers are: 1) Gucci Oud Intense 90ml – Male (savings of: £22.10 GBP), 2) Ajmal Aurum 75ml – Female (£20.00 GBP), 3) Jimmy Choo Illicit 60ml – Female (£19.40 GBP).

World Duty Free prices – Airlines

Histogram of World Duty Free - Ave Airline Price GBP Mar 2016

Download chart.

There is also a normal distribution of price differences between the two duty-free channels, airlines and airport shops. In summary, 24 perfumes are cheaper at World Duty Free stores when compared to the average price you’d pay onboard a plane. 2 perfumes have no price difference, whereas 35 are more expensive at World Duty Free stores.

Improvements

Overall this is a fairly trivial analysis. One of the biggest issues with this analysis is Amazon’s product pricing which can change many times per day. Given this is our single source for non-duty free pricing, daily variations may be skewed. The addition of more retailers would add more stability to price calculations.

tl;dr

  • Perfume prices are typically more expensive at duty-free retailers when compared to buying on Amazon.
  • Most savings are less than £10 GBP between duty-free retailers and Amazon.
  • The 3 best perfumes to buy at duty-free retailers are: 1) Gucci Oud Intense 90ml – Male (savings of: £22.10 GBP), 2) Ajmal Aurum 75ml – Female (£20.00 GBP), 3) Jimmy Choo Illicit 60ml – Female (£19.40 GBP).

Acknowledgements

  • All the retailers used in this post for publishing thier products for sale online.
  • And finally… XE.com for exchange rates.

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