Enliven CEO, Tim Harms, considers the strategic power of beverage partnerships and how they can potentially transform retail revenues at airports.
Airports are in the midst of a commercial transformation. As traditional revenue streams fluctuate, leaders are reimagining how every square foot and every touchpoint can contribute to non-aeronautical revenue and world-class passenger experiences.
From biometric screening to boutique retail, change is everywhere – but one of the most impactful, and sometimes overlooked levers is the humble beverage partnership, commonly known as ‘pouring rights’.
Once the domain of universities and sports venues, these agreements are now gaining traction at airports, delivering significant gains for all stakeholders – travellers, concessionaires, and airport operators alike.
WHAT ARE POURING RIGHTS AND BEVERAGE PARTNERSHIPS?
Pouring rights agreements are exclusive or semi-exclusive partnerships between airports and major beverage companies such as Coca-Cola, PepsiCo, or Keurig Dr Pepper.
These comprehensive contracts grant beverage companies the right to be the primary or semi-exclusive supplier of their product categories across an airport’s entire commercial ecosystem, including restaurants, cafes, retail outlets and vending machines.
The establishment and management of these partnerships involve sophisticated negotiations that consider multiple factors: guaranteed minimum payments, volume-based incentives, marketing support, equipment provision, and sustainability commitments.
Effective management requires ongoing co-ordination between airport management, beverage company representatives, and concessionaires, including monitoring compliance across all outlets and co-ordinating promotional campaigns.
THE CURRENT MARKET SHIFT
The adoption of strategic beverage partnerships at US airports is accelerating, driven by compelling financial incentives and operational benefits. Since the first US airport deal in 1995 (DFW), nearly 20% of the top 40 US airports have formal pouring rights agreements in place.
Additional airports have signalled their intention by incorporating pouring rights language within their leases.
The results are contributing to the spread. Industry data indicates that airports implementing comprehensive pouring rights agreements typically see revenue increases of 15-30% from their beverage-related commercial activities, with total programme values often reaching several million dollars annually for major airports.
TODAY’S MARKET DRIVERS
These include new streams of non-aeronautical revenue; the desire for an enhanced customer experience; cost savings and operational efficiency; and sustainability and environmental initiatives.
The imperative to diversify revenue streams has never been more critical for airports. Non-aeronautical revenue, including commercial partnerships, has dropped since the pandemic to 35-40% of total airport revenue for major international hubs. Beverage partnerships excel in this context because they generate multiple revenue streams simultaneously through direct payments from beverage companies, increased concession sales, and enhanced overall commercial performance.
Modern travellers expect airport experiences that rival high-end retail and dining destinations. Beverage partnerships enable airports to deliver this elevated experience by ensuring consistent product availability and quality across all outlets, enabling co-ordinated marketing activities, and facilitating the introduction of premium beverage options and new, innovative products that appeal to diverse passenger preferences.
Beverage partnerships deliver significant operational benefits beyond direct revenue generation. By standardising beverage supply chains across the airport, these agreements reduce procurement complexity for concessionaires while ensuring competitive pricing through volume purchasing power. The beverage companies typically provide equipment, training, and ongoing support that reduces operational costs for individual outlets.
Environmental responsibility has become a central concern for airports worldwide. Beverage partnerships increasingly incorporate sustainability commitments including recyclable packaging, funding to implement closed loop recycling programmes, and commitments to phase out plastic bottles.
TRUE PARTNERSHIPS: CREATING VALUE FOR ALL STAKEHOLDERS
In essence, this means the concessionaires, ACDBE tenants and boosting volumes and performance.
The most successful beverage partnerships provide concessionaires with several key advantages: strategic airport-wide marketing campaigns to drive up beverage sales, preferential pricing through volume purchasing (or the ability to continue purchasing through their existing agreements), dedicated onsite service reps, and equipment provision that reduces capital requirements.
Airport Concessions Disadvantaged Business Enterprise (ACDBE) programmes are essential components of airport commercial strategies, and beverage partnerships can be structured to provide additional support for these important tenants. This includes access to favourable pricing, dedicated training programmes, and mentorship opportunities that help these businesses succeed in the competitive airport environment.
Effective beverage partnerships create positive feedback loops that benefit all participants. Higher passenger satisfaction leads to increased dwell time and spending, which benefits concessionaires
and generates higher volume incentives for beverage companies.
The data sharing and analytics capabilities built into modern partnership agreements provide valuable insights that help all stakeholders optimise their strategies.
BRAND BUILDING AND MARKETING SYNERGIES
Partnerships can bring added value to beverage companies and lead to more co-ordinated marketing programmes.
For beverage companies, airport partnerships offer unique brand building opportunities that extend far beyond traditional retail channels. Airports provide access to affluent, diverse, and internationally-minded consumer segments that are difficult to reach through other channels. The high-traffic environment and extended dwell times create multiple touchpoints for brand engagement and product trial.
The most successful beverage partnerships include sophisticated marketing components that benefit all stakeholders.
These programmes can include seasonal campaigns, co-branded promotional materials, digital marketing initiatives, geo-tagged social media buys, and experiential activations that create memorable passenger experiences.
The partnerships also enable co-ordinated product launches and promotional campaigns that maximise the impact of marketing investments across all airport touchpoints.
PASSENGER EXPERIENCE ENHANCEMENT
Beverage partnerships at airports can enhance the overall airport experience and encourage innovation.
From the passenger perspective, well-executed beverage partnerships deliver tangible benefits that enhance the overall travel experience. These include consistent product availability across all outlets, competitive pricing through volume purchasing, and access to premium products that might not be available in other travel retail environments.
Modern beverage partnerships extend beyond traditional retail transactions to create experiential touchpoints that differentiate airports from competitors.
This includes interactive displays, product sampling programmes, and themed retail environments that reflect local culture and preferences. The partnerships can also support unique dining and retail concepts that wouldn’t be economically viable without the guaranteed volume and support provided by exclusive agreements.
AN OPPORTUNITY FOR EVOLVING AIRPORTS
The strategic implementation of beverage partnerships represents a unique opportunity in how airports approach commercial operations and revenue generation.
These partnerships offer a proven pathway – refined in other industry verticals – to enhanced non-aeronautical revenue, improved passenger experiences, and operational efficiency that benefits all stakeholders in the airport ecosystem.
As passenger volumes continue to grow and expectations for airport experiences continue to rise, pouring rights deliver.
The key to success lies in approaching these partnerships as strategic alliances rather than traditional vendor relationships, with careful attention to stakeholder alignment, performance measurement, and continuous optimisation.