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Ever been stuck in an airport, parched and hungry?
You've already spent a fortune on tickets and baggage fees,
and somehow you end up buying a giant Toblerone
and a $5 water.
You're not alone.
Spending in airports hit $40 billion in 2017.
On average, travelers will spend anywhere
from $11 and $140 per airport visit.
But all that spending is not entirely your fault.
Airports are purposely laid out
to lead passengers through moneymaking areas.
First, there's the parking lot.
In 2018, the average cost of a week
of airport parking was $96.
London Heathrow and the Abu Dhabi airport
in the United Arab Emirates had the most expensive lots,
charging $249 and $235, respectively,
for seven days.
David Slotnick: Parking is pretty lucrative.
Short-term and long-term parking cost absolute fortunes.
That's obviously just pure profit to the airport.
It's empty space, basically.
Narrator: Now you're ready for check-in and security.
Even though traveling is becoming easier worldwide,
passengers still arrive early for flights.
Two hours and 17 minutes before takeoff, on average.
By speeding up check-in and security with digital kiosks,
TSA Precheck, Global Entry, and 3D CT baggage scanners,
airports can get travelers to spend more time
in the profitable zones air side.
Now you'll find yourself in what's called
the recomposure zone.
Slotnick: One of the more interesting tricks I've seen
is the idea of having a composure kind of place
at the end of the security line.
So you go through security,
you have some time to get yourself together,
put your wallet back in your pocket,
your cellphone, put your shoes back on,
make sure you're all settled, and then you go shopping.
It's just a way to make people a little keener
on spending money.
Narrator: Often, the first thing you see
after security is duty-free.
You have to walk through it to get to your gate.
You even notice that, in some airports,
London Heathrow, for example,
walking paths in duty-free veer to the left.
This leaves more space for retail
on the right of the path.
According to the consulting firm Intervistas,
that leads to profits because
the majority of people are right-handed
and will spend more time looking to the right.
And while duty-free means foreign taxes
on goods are removed,
this doesn't necessarily mean they're cheaper.
Slotnick: Duty-free can be a great savings
if you buy something like alcohol or cigarettes,
which are usually highly taxed.
In terms of other things,
toys or electronics or even some foods,
those aren't really taxed as highly,
so even though there's no taxes,
there's a higher overall retail price.
Narrator: And you're not the only one
getting suckered into buying a marked-up giant Toblerone.
Globally, duty-free is a huge industry
valued at over $67 billion in 2018,
according to a report from Coherent Market Insights.
After you're through duty-free,
you find yourself in the main shopping area,
surrounded by even more dining and spending options.
If you're in a European airport,
this is where you'll likely be forced to hang out.
Airports like London Heathrow and Gatwick
don't announce gates until 25 to 90 minutes
before the flight, compelling passengers to stay
in the central shopping part of the terminal,
and there are strategically placed signs
that indicate walking times to gates and gate locations
in order to keep you stress-free and satisfied.
Not to mention massage chairs,
spas,
ponds,
and atriums.
Anything designed to keep you relaxed.
Because studies show if passengers are 1% more satisfied,
airport sales go up by 1.5%.
With two hours left to kill before your flight,
there's a chance you'll get hungry.
Even the restaurants are designed with
big windows, relaxing music, and outlets
to keep you satisfied and in the spending mood.
But, of course, these restaurants don't come cheap.
At Los Angeles International,
there's an 18% markup on food.
And while there are some airports, like Seattle-Tacoma,
the require food prices to reflect costs
you'd find outside the airport,
they fully expect you to end up spending more
because you think you're paying less.
The steep prices are partly because restaurants
pay high rents to airports,
generally a monthly based rent
and up to a 15% cut of gross revenues.
For Checkers restaurants, rent in American airports
is 50% more expensive than in their traditional
brick-and-mortar locations.
To offset high rents, airport restaurants
have gotten more elaborate.
Slotnick: So, it's not just, like, a chain restaurant,
like an Applebee's or Buffalo Wild Wings.
There's alternatives like steakhouses
and more closer to fine-dining-type places,
oyster bars, cocktail bars.
Narrator: In Portland International in Oregon,
there's a distillery making whiskey on-site
and offering tastings.
In Tokyo's Narita airport,
Sushi Kyotatsu restaurant changes the menu daily
based on fresh fish coming in from Tsukiji Market.
Places like these can easily charge a few extra bucks
for the experience.
Finally, your gate's announced.
On the long walk through the terminal,
you pass stores set up with diagonal displays,
so you can see all the goods from the concourse.
The aisles are wide enough to maneuver bags through,
and, similar to why you'll often spend
more in airport restaurants,
retail prices are inflated
to offset the cut airports take.
That means you could pay a 200% markup
for a bottle of water in some airports.
You've got your overpriced snack and magazine,
but if you're traveling to another country,
you'll need to exchange money.
There's always a currency-exchange booth at the airport,
but, generally, it's best to wait until you're outside,
because those airport booths charge between
10% and 26% higher exchange rates,
and that's not including service fees.
Slotnick: You're just never going to find
a worse exchange rate,
except for maybe one of those places in Times Square.
Narrator: And even once you've made it to your gate,
there are still plenty of shops to grab
last-minute necessities.
Slotnick: It's the idea of having retail
mixed with the gates themselves.
If you want to wait by your gate early,
you're still right next to the store.
You don't risk missing any announcements.
Narrator: Finally, you board your plane,
maybe a little frustrated at the airport
for your lavish spending.
But consider this:
Airports are not laughing their way
to the bank on all these markups.
Airports are expensive to run.
Of Europe's airports, 47% lost money in 2018.
But let's face it.
Some airports make you spend more because they can.
Slotnick: It's annoying, but, I mean,
it's the reality of it.
It's the captive-audience theory,
where people don't really have a choice.
You have plenty of time to kill, you're bored,
you know, what's a great thing to do?
Shop.
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Sneaky Ways Airports Get You To Spend Money

258 Folder Collection
Nina published on August 14, 2019
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