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of global airspace creates cascading operational challenges as route closures and rerouting drive-up congestion, costs, and unpredictability across the entire network. Third, the politicisation of consumer behaviour means that product origin is no longer commercially neutral. It can determine whether a purchase happens at all. The cumulative effect extends far beyond simple traffic volatility to create fundamental unpredictability in spend, sentiment, and category performance across different corridors.” It is critical for travel retail stakeholders to understand and respond to these geopolitical and economic shifts. Indeed, Lohmeyer described it as existential. “Travel retail operates as a frontline barometer of global shocks. Disruption shows up in terminals almost instantly when conflicts close air corridors, tariffs widen duty free price gaps, or social tensions shift consumer sentiment overnight.” Lohmeyer’s advice was threefold. “First, assume instability as the baseline, model multiple alternative futures, and then design strategy and test readiness ruthlessly against these scenarios,” he shared. “Second, invest in pragmatic monitoring of early, weak signals, from election cycles to tariff negotiations. Third, engage policymakers across jurisdictions to anticipate shifts, not just react to them. Success requires understanding the underlying drivers of volatility, not just its manifestations. This understanding is what matters. It enables genuine anticipation of change rather than perpetual reaction to it. And those who continue to treat geopolitical risk as a peripheral concern will find themselves increasingly vulnerable in an emerging future environment in which structural change will be more frequent and more complex. Leaders need to work relentlessly to avoid failures of imagination with respect to both risk and opportunity.” Opportunities for the travel retail sector to thrive, not just survive The most underappreciated deep force driving global transformation, according to Lohmeyer, is the intentional disruption of traditional international institutions, which is compelling countries to fundamentally reimagine how they secure their interests. “As established frameworks for global governance lose their capacity to constrain state behaviour, international law and multilateral agreements no longer provide predictable security,” he explained. “This institutional erosion is driving nations to reduce their exposure to geopolitical and geo-economic coercion through systematic efforts to build strategic autonomy: diversifying partnerships, developing local capacity through industrial policy, leveraging technology for resilience, and forging new private sector alliances. This is an environment in which demand is surging for innovative partnerships that create mutual benefit and optionality.” In a time of realignment and uncertainty, there are opportunities for the travel retail sector to thrive, not just survive. Uncertainty creates strategic openings for those positioned to capitalise on it. “Tariffs can widen the gap between downtown and duty free prices, strengthening airport value propositions,” said Lohmeyer. “Neutral hubs such as Dubai are thriving precisely because others are constrained, capturing diverted passenger flows and retail spending. Meanwhile, emerging trade blocs are opening new South- South routes that create untapped retail opportunities in previously underserved corridors.” At the same time, Agentic AI is transforming retail by enabling sophisticated AI assistants that can understand traveller preferences, navigate complex purchasing decisions, and provide personalised recommendations in real time, creating new opportunities for engagement and conversion in duty free environments. “The reality is that for those who can adapt assortments, pricing, technology, and engagement strategies quickly, volatility becomes a source of opportunity rather than a constraint,” Lohmeyer emphasised. “Success in this environment rewards agility and the ability to read geopolitical shifts as commercial opportunities.” Four key signals to track over the next 12 to 24 months Lohmeyer shared that leaders should track four key signals over the next 12 to 24 months. “First, early indicators of potential conflict: rising diplomatic tensions, military build-ups, and sanctions threats that could trigger airspace closures and rerouted corridors. Second, trade alignments, including tariff escalations, new regional agreements, and the evolution of currency flows. Third, the politicisation of consumer behaviour, which is often underestimated but increasingly critical. Values and geopolitics now influence purchase decisions as much as price, with 65% of duty free shoppers adjusting brand choices based on political tensions, rising to over 70% among Gen Z. This means brand heritage, national identity, and perceived alignment with consumer values can drive – or destroy – conversion in particular corridors almost instantly. Fourth, climate volatility and its operational impacts. Each of these signals could materially reshape travel retail economics, making early detection and rapid response capabilities essential for competitive advantage.” This year’s TFWA World Conference was especially vital because we are living through a fundamental transformation of the global order that demands entirely new strategic capabilities from travel retail leaders. “The institutional frameworks that once provided predictability are being intentionally disrupted, forcing companies to build resilience through diversified partnerships and adaptive models,” Lohmeyer added. Indeed, his address provided powerful insights into how to anticipate geopolitical shifts rather than simply react to them, and how to turn the resulting uncertainty into competitive advantage. Rudolph Lohmeyer, Senior Partner, Kearney, Foresight Global Head, National Transformations Institute, Global Business Policy Council: “The reality is that for those who can adapt assortments, pricing, technology, and engagement strategies quickly, volatility becomes a source of opportunity rather than a constraint. Success in this environment rewards agility and the ability to read geopolitical shifts as commercial opportunities.” Tuesday 30 September 2025 18 T F W A D A I L Y