Delta Eliminating Onboard Duty Free Sales

Delta announced yesterday that they’ll be discontinuing onboard duty free sales as of today, August 8, 2014. The sudden decision is apparently due to a disagreement with their vendor, though it seems that’s more the catalyst rather than the reason, since they’re not planning on finding a replacement vendor.

Via Runway Girl:

The decision to end the program came after Delta and its duty free vendor, DFASS, were unable to agree on terms to resolve disagreements over how the program would be administered.

A replacement duty free vendor is not being explored at this time and all duty free items, catalogs and inflight advertisements will be removed from the aircraft in the coming weeks. Customers and employees interested in purchasing duty free items are reminded that most international airports offer a wide selection of products at duty free retail outlets.

Onboard duty free has always fascinated me. The reasons it shouldn’t be successful are obvious — it’s inherently inefficient (given today’s fuel costs, carrying a shop around the world isn’t cheap) and the selection is limited compared to what you’d get on the ground.

On the other hand, you sure do have a captive audience on an airplane. It’s probably the same reason food is often more enjoyable on planes. When you don’t have anything else useful to do, you’re more likely to make irrational decisions and impulse purchases.

I’m not really surprised Delta is cutting duty free. For many non-US airlines, duty free is massive business. I know some airlines where on flights to Africa it’s not unusual to sell six figures worth of stuff through duty free. Though that’s typically on airlines that have a decent selection, and also airlines where crews are properly incentivized to sell. I don’t know how Delta rewarded flight attendants for duty free sales, but I know at least one other major US airline where flight attendants had virtually no incentive to sell, which is probably a large part of the reason it’s not so successful here.

Still, for the frequent traveler this is probably good news. It means fewer onboard announcements, less noise in the galley and the cabin, and hopefully the lights being dimmed more quickly after the meal service.

I’ve actually made my fair share of onboard duty free purchases over the years. No, not brand name merchandise, but rather I’m a sucker for airline branded teddy bears, etc.

I couldn’t say no to this Cathay Pacific pilot bear or ANA iPhone case, for example:

ANA_iPhone_Case

Are you happy or sad to see onboard duty free go?

Comments

  1. Surprised this took so long. Only thing I ever bought was a foreign power adapter (left mine at home).

    I’m sure the airlines crunch the numbers on this, but I hardly recall anyone ever buying anything on the flights I’ve been on. Hopefully, a few more minutes of lights off and sleep will be produced by this decision!

  2. I think that the economics of onboard duty free are much different for US airlines than for most foreign carriers. Most of the goods offered through duty free — alcohol, perfume, etc. — are subject to much lower taxation in the US, thus limiting the market for duty free goods to US customers. For example, I’ve only rarely seen duty free alcohol (whether sold onboard or in the airport) offered at a cheaper price than in my local liquor store.

    While there is certainly still a market for US-based carriers — foreign travelers, people who forget to pack things (i.e. the travel adapter example), or even US customers that want to drink their duty free alochol while abroad — airport duty free stores also compete for these same customers and the airport stores can offer a much wider range of products.

    I wouldn’t be surprised if other US carriers eventually followed suit. I wonder what the fuel savings are from not loading a duty free cart?

  3. I’m thrilled with this announcement. Earlier this week I took a BKK-NRT flight on DL which departed predawn at 5:50AM. After breakfast I wanted to go straight back to sleep but Nooooooooo, we had to listen to the duty free spam in not 1, not 2 but THREE languages (English, Japanese and Thai). Hopefully it never comes back.

  4. A friend of mine got drunk and bought some really expensive stuff that he didn’t need (and spending money he saved for the trip). So, yeah, there is market for duty free onboard.

  5. To be perfectly honest I’m surprised ground based duty free stores still exist in the US. Occasionally they’ll have a gift set that’s uncommon to find elsewhere but the prices almost never cheaper than what I can find in regular stores and are often more expensive. Most of what I might buy would be in liquid form and thus potentially subject to disposal by the some rent-a-prick.

  6. Dax, they’re for foreigners who don’t have cheap booze and smokes back home. Even Canadians save ~50% at duty free comparatively.

  7. I checked Delta’s Duty Free selection for an upcoming flight with them YVR-SEA-ICN and I have to say that compared to Asian carriers the available goods sucked…

  8. Yeah cigarettes are pretty much only thing that is cheaper for US customers duty-free wise (and even then only if people live in certain places with super high cigarette prices like NYC) and most people who want to buy them stock up before takeoff…

  9. Happy, I’ve never seen a Flight Attendant happy hauling duty free trolley. They’re tired enough already to be doing this!!!

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