The growth in airport lounges demonstrates their ever-increasing popularity with travellers and arguably the important role they play in enhancing the passenger experience and boosting revenues, writes Joe Bates.
Airport lounges have undergone somewhat of a revolution over the last 10 to 15 years as a host of hospitality providers have entered the scene with new ideas and business plans that have completely changed our perceptions of them.
Traditionally the domain of the airlines and viewed as part of the service for their premium class passengers, in the old days the closest the vast majority of travellers ever got to a lounge was when they cast envious eyes at those entering or emerging from them as they walked past one.
This, thankfully, is no longer case as airports have realised the commercial and customer service benefits of lounges that are open to a far wider audience.
The new generation of lounges include independently run facilities which all passengers can access by paying an entrance fee and more corporate lounges, typically operated by or on behalf of credit card companies such as American Express and Capital One, to reward customer loyalty.
The first company to realise the potential of indepenent airport lounges was Plaza Premium Group, which launched the concept at Kuala Lumpur (KUL) and Hong Kong (HKG) in 1998, although as founder and CEO Hoi-See Song told us a few years ago, back then both airports needed some convincing.
He said: “It wasn’t easy in the early days and was quite challenging because the concept of independent lounges was a totally new and it was felt that lounges were only for CIPs [commercially important person) and that we would be competing against the airlines.
“We needed to change this mindset as there was clearly a gap in the market as, back then, lounges were only for premium travellers, which meant that the needs of 85% of passengers were not being met.”
Economics has, of course, played a major role in the development of all commercial facilities at airports, and lounges are no different to retail and F&B outlets, car parks and hotels in that they generate significant income for airports.
Non-aeronautical incomes currently account for almost 40% of total airport revenues and are a “key component of airport financial strategies”, as recently acknowledged by ACI World’s director of economic policy and sustainability, Slava Cheglatonyev, in his ACI World Insights article on May 8.
Talking about the importance of non-aeronautical revenue in his article ‘Maximising Non-Aeronautical Revenues: Key to Airport Financial Sustainability – https://blog.aci.aero/airport-economics/maximizing-non-aeronautical-revenues-key-to-airport-financial-sustainability/ – he notes that it enables operators to reduce reliance on aeronautical charges while enhancing profitability and supporting infrastructure development and future capacity expansion.
The article states that “from retail and duty-free shopping to digital transformation in airport services, leveraging these opportunities is crucial for financial resilience and sustainable growth in an evolving aviation landscape”.
In addition to the revenue that lounges generate, they can also enhance the airport experience of passengers passing through an airport and create a unique sense of place, leaving visitors in no doubt that they are in a particular city, region or country.
And ever-changing passenger dynamics means that airport lounges and the services they provide need to be regulalry updated to remain relevant and retain their passenger appeal.
Reflecting on how airport hospitality has evolved, PPG’s Song has previously gone on record as saying that travellers’ perceptions of airports and air travel and their journey through the airport is totally different today than when he started his business over 25 years ago.
“Today’s passengers are more affluent and discerning. They know what they want, and they expect efficiency and good customer service as standard,” Song told Airport World in 2023.
“People want to enjoy the airport experience. Lounging, for example, has now become a culture, lifestyle and a part of the air travel journey that any traveller would expect to have at major airport hubs.
“Another big change, of course, is the evolution of technology. It plays a key role in almost everything we do today, and we expect that its use will only grow in the future, espcially through the better use of data, which can take customer service and customer interaction to the next level. Labour used to be the way people progressed and made money. Then it was the brain and now it is technology.”
As if to prove the point about the growing popularity of airport lounges, this year alone has seen the opening of dozens of new non-airline operated lounge facilities of all shapes and sizes.
These have included new Airport Dimensions lounges at Jorge Chavez International Airport and Orlando International Airport in Lima and Orlando respectively; a marhaba/dnata lounge at Clark International Airport in the Philippines (dnata); a new Aspire/Swissport lounge at Calgary lounge International Airport; an Escape Lounge at Bristol Airport in the UK and new Plaza Premium Lounge at Taipei Songshan Airport in Taiwan.
Meanwhile in other lounge news, TAV Operations Services has signed a contract with Sofia Airport in Bulgaria to build and operate new business lounges at the gateway, and its Muscat Primeclass at Muscat International Airport in Oman was recently named as ‘Lounge of The Year’ for the Middle East and Africa at the 2025 Priority Pass Excellence Awards.
The following pages contain profiles, news updates and a little about the unique selling point (USP) of three major players in the field – Plaza Premium Group, Airport Dimensions, and CAVU.