As 2025 draws to a close and the holiday travel period gets underway in earnest, hard-working travel retail executives will be hoping for a positive end to what has been another turbulent year. Many of them will get that wish. Despite heightened geopolitical tensions, seemingly endless tit-for-tat tariff spats between trading blocs, and bitter conflicts in Ukraine and the Middle East, demand for international travel has held up remarkably well.
According to Airports Council International (ACI), 9.8 billion people will have taken a flight by the end of 2025, a 3.7% year-on-year increase. Moreover, international travel is forecast to finish the year even more brightly, growing by 5.3%. The Middle East, Latin America, Africa and Asia Pacific are driving this growth, while North America and Europe are proving less dynamic, with ACI pointing to ageing populations and cautious spend.
The strength of the Middle Eastern market is exemplified by Dubai Duty Free’s record sales figures, which reached an all-time monthly high of $220.7m in October – one of eight record months this year. In October alone, sales of liquor at DDF amounted to $26.5m, the category ranking behind only fragrances and gold in terms of size.
Consequently, DDF remains a highly favoured launch pad for high-end single malt whisky releases such as the new Highland Park Between You and I: Journeys. The 17-year-old release – which made its worldwide debut at the airport in October – from the Orkney distillery was developed in partnership with chef Björn Frantzén (who holds three 3-Michelin-starred restaurants).
The buoyancy of the UAE market was further underlined a month earlier when fine wine and spirits retailer Le Clos opened two new outlets at Dubai Airport’s Terminal 3: a flagship shop in arrivals and a departures boutique in Concourse B. These new outlets build on Le Clos’s recent downtown store openings in Emirates Hills, Al Wasl and Ras Al-Khaimah, as the brand extends its reach within mainland Dubai.
Meanwhile, Chinese outbound travel is forecast for a 25% rebound in the final four months of the year, according to global digital marketing technology firm Eternity X. Travellers are being encouraged by lower airfare costs, visa-free access to many countries and a growing number of first-time independent travellers. Next year, Eternity X estimates that Chinese outbound travel will grow to 155 million trips, adding $250bn to the global economy.
How much of this gargantuan sum will end up in the coffers of duty free retailers remains a key question. Unfortunately, there is mounting evidence that shopping is losing its lustre as a holiday pastime among many younger Chinese travellers.
Sales drop
The Chinese duty free shopping island of Hainan, for instance, recorded an alarming sales drop of more than 9% in the first half of 2025, while China Tourism Group – the parent company of China Duty Free Group, the country’s largest travel retailer – suffered a 17% fall in profits during the third quarter.
Amid these challenging conditions, Cognac houses have also had to contend with a supply ban to Chinese duty free stores for much of this year. The dispute, part of a wider trade clash between Beijing and the European Union, was resolved in July, but not before the lengthy halt in shipments proved very costly for the major houses. Martell owner Pernod Ricard GTR, for instance, reported a 15% decline in travel retail sales in its most recent financial quarter, a drop the multinational partly attributed to the Cognac supply issue.
In stark contrast, the ascendancy of the Indian traveller as a crucial shopper nationality has continued this year. According to global economic advisory firm Oxford Economics, outbound journeys by Indian travellers have more than doubled over the past decade to nearly 23 million in 2024. Moreover, they are set to grow to 38 million by 2030.
India’s giant IMFL players are beginning to take travel retail seriously. Last month, for instance, Tilaknagar Industries – an exhibitor at the TFWA World Exhibition in Cannes in October – partnered with Hyderabad Duty Free to launch Mansion House and Monarch brandies at Rajiv Gandhi International Airport. The listing brings two of the country’s most popular domestic brandies into the travel retail arena for the first time.
Meanwhile, the annual five-day Hindu Diwali Festival of Lights is quickly becoming as important a seasonal promotional period for the travel retail business as Chinese New Year. Within the spirits sector, the sheer scale of some Diwali activations is now truly impressive. This year’s Dewar’s Diwali campaign by Bacardi GTR, for example, rolled out across 30 markets, promoting collectible bottles of Dewar’s 15 Year Old, Double Agent 16 Year Old and 18 Year Old.
As the global travel retail industry looks ahead to 2026, there is every reason for cautious optimism. Growth remains uneven and the recovery of the Chinese travel retail sector still shaky, but the wider appetite for travel, discovery and celebratory indulgence will continue to underpin demand.
