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Leading the AI Adoption in Travel Retail: A Conversation with an Industry Trailblazer

By: Qihua Wang, EVP Strategy & AI, Lagardère Travel Retail | Wednesday, 6 November 2024

Qihua Wang serves as Executive Vice President of Strategy & AI at Lagardère Travel Retail, leading strategic initiatives and AI-driven transformation to enhance global retail operations. With deep expertise in strategy and innovation, Qihua focuses on advancing customer-centric solutions in the dynamic travel retail sector.

In a thought-provoking interaction with Global Woman Leader Magazine, Qihua shares her insights on how AI-driven solutions can reshape travel retail by analyzing emerging consumer behaviors amidst fluctuating global travel patterns and economic uncertainties. She also explores how AI innovations can address environmental concerns, align with sustainability trends, and enhance collaboration within the industry.

What makes applying AI in Travel Retail unique, and how can it address industry challenges?

AI has the potential to transform many industries, and I believe much of that potential is still untapped in Travel Retail.

Applying AI in Travel Retail is unique because it has to address the dynamic traveler behaviors that define this complex sector. Unlike traditional retail, Travel Retail operates in environments where customer profiles change daily, and inventory space is constrained. AI can help travel retailers navigate these challenges by enabling smarter, real-time decisions based on data analysis of passenger demographics, sales patterns, and even flight schedules.

These capabilities translate into more personalized offers, more efficient inventory management, and improved engagement with travelers. The goal goes beyond efficiency—it’s about creating enriching, meaningful interactions with each traveler in a constantly changing setting. By harnessing AI, we can make every encounter count, offering travelers the kind of tailored experiences that create the best experience for customers and the best value for landlords.

Looking ahead, what excites you most about the future of AI in Travel Retail?

I'm most excited about the potential for AI to create truly seamless, personalized experiences for travelers. I envision a future where, with more data sharing and exploration, we can digitally connect with passengers throughout their entire journey—and even beyond. This means better understanding our customers, building deeper connections, and engaging them in meaningful ways that enhance their overall experience.

By integrating AI across different stages of the travel experience, we can make interactions smoother and more enjoyable, all while building a deeper emotional connection with our brands. It’s about more than just convenience; it’s about making every step of the journey meaningful. AI gives us the ability to deliver on these promises, ultimately ensuring that the travel experience is not just efficient but truly memorable.

As sustainability becomes a growing priority for consumers, how can AI-powered innovations help travel retail organizations address environmental and ethical concerns? How can AI-driven strategies align with broader sustainability trends in the industry?

AI can play a significant role in addressing environmental and ethical concerns in Travel Retail. There are a few perspectives I see among many:

One of AI’s most impactful contributions is in its ability in providing more accurate and comprehensive measurement of carbon footprints across the entire supply chain. Machine learning algorithms can analyze complex data sets to identify areas for environmental improvement, from packaging optimization to the use of energy.

Additionally, AI can help accurately forecast demand, which minimizes overstock and waste, thereby reducing the environmental impact of unsold inventory. By predicting customer demand more precisely, retailers can avoid excess production, which directly reduces resource wastage and the carbon footprint associated with overproduction.

Also, AI supports sustainability efforts by offering greater transparency into sourcing practices, enabling brands and retailers to make informed, data-driven decisions that align with consumer values.

By increasing efficiency and optimizing resource use, AI ensures that growth in Travel Retail is both economically viable and environmentally responsible, aligning with the broader sustainability trends in the industry.

With the evolution of travel retail, integrating online and offline channels is essential. How are brands using AI to effectively blend these channels and create a seamless shopping experience? What role does AI technology play in enhancing this integration?

Integrating online and offline channels is becoming essential to enhancing the traveler’s shopping journey, and AI serves as the critical enabler that makes this seamless connection possible. AI also enables more personalized recommendations and augmented reality experiences.

For example, we have already implemented AI-driven digital engagement in-store. Such digital engagement allows us to offer travelers tailored suggestions for items like wines, perfumes, and books, making their in-store visits more interactive and engaging. By merging digital and physical shopping elements, AI turns potentially fragmented experiences into a unified journey, enhancing customer satisfaction and maintaining consistent brand relationships.

In a dynamic market, strategic alliances offer substantial advantages. How can AI enhance collaboration between travel retail companies, brands, technology providers, and service providers to drive innovation and growth in the industry?

AI can significantly enhance collaboration across the travel retail ecosystem by addressing critical business needs for passengers and customers. Here I’d like to highlight two aspects.

We all know that data is still at the heart of AI.Capturing, processing, sharing the relevant data would add value for different stakeholders in the industry, brining closer collaboration among landlords, travel retailers, brands. Together, we could turn scattered data into meaningful actions and improve passenger journey.

Generative AI is also reshaping how we communicate with travelers across different touchpoints.Now more and more airlines, airports, train stations, and brands are experimenting passenger engagement with Generative AI. With predictive tools, we can offer timely guidance, services, and tailored recommendations. This collaborative, AI-driven approach helps us work towards a common goal—making the passenger journey as seamless as possible. By integrating these efforts, all players in the ecosystem can create a holistic experience that elevates both the traveler’s journey and the overall value proposition for brands.