The Travel in Motion and Oystin teams attended Aviation Festival Asia this week. We had the opportunity to catch up with industry colleagues in warmer climates, and the opportunity to taste some fantastic local dishes too! Though there was one experience that we rarely get to trial at home in Europe: the super app.
Super apps are prominent here in Southeast Asia and China. They offer a wide range of financial instruments and online-to-offline services such as food delivery, package delivery and transportation. These super apps position themselves in their user’s daily life and create a marketplace around just about anything. The apps are typically connecting buyers with suppliers that, until now, may not have had a digital presence, for example taxi drivers, takeaway houses, and laundrettes.
The super apps have the similar measures for success: user acquisition and retention. It’s all about user activity (and accompanying revenue, of course). They prioritise having access to the right content overlaid with making a customer’s shopping, booking and fulfilment experience excellent. In doing so they increase their share of sales with the supplier, putting them in a superior distribution position. For some services they even set the price, for example with ride hailing.
Customers who find something easy to use return time and time again, often no longer giving the competitors a second look. The super apps are a snowball, the value users place in their brands are increasing and the more daily users they acquire, the easier it is to launch a successful new service.
Airlines too have capitalised on their well-known brand to become part of a user’s daily life, albeit in a different way – the loyalty programme partnership. Your wallet may contain a credit card with an airline logo, your supermarket may advertise the opportunity to earn points and whilst you top up fuel for your car, you may also be topping up your air miles account too.
Whilst airlines are striving to become better retailers, a super app is an extreme form and its value versus cost is unproven. Here are some questions to consider before going down this path:
“Is it a feasible proposition for an airline to execute on? Would it lead to positive daily experiences with its brand or lead to negative brand impact?”,
“Why would consumers choose an airline over Grab, Uber, WeChat etc…?”,
“Should an airline offer these additional services and become a more integral part of users’ daily lives?”,
“Does the current loyalty play, where airlines partner with everyday brands, already go far enough to build brand loyalty and affinity to the airline?”, and
“Would it lead to consumers valuing the airline brand so much that they don’t shop for flights elsewhere?”
Super apps are built on a deep motivation for excellent user experience, consistency, and commercial policies which promote an ease of doing business. To meet these expectations, super apps have modern, fast, and scalable systems.
One question that arises is whether super apps pose a risk to an airline’s distribution and commercial strategies, could a super app change the airline market in the same way it did for ride hailing. Very few super apps offer public transportation services today. Air Asia’s super app does sell flights and hotels. However, it is powered by an online travel agency (OTA) so the experience is limited to what the OTA can provide, which in turn is often limited by the functionality of the airline. Uber has recently launched trains and coaches on its app and has shown an intent to sell flights too. However, they obtain their content, they are likely to face the same issues as Air Asia, the experience they can provide is limited to what the airline’s capabilities are.
So, should an airline enter this space too? Are they at risk of missing out? Airlines have a lot of competing priorities to contend with, such as their own financial stability as they recover from the COVID-era. Purists may argue that airlines should focus on efficient, safe, and enjoyable transportation. Others within the airlines are focused on a diversification of income streams by leveraging the airline brand. An example of where this has been successful is the airline loyalty business units. They were able to raise funds during COVID, which for some airlines provided a significant lifeline.
Travel in Motion’s (TiM) opinion is that running a consistent experience across multiple services is not for the faint-hearted. This takes considerable focus to get it right, and that will lead to less attention on the airline’s core business. However, we do believe airlines still can learn a lot from the super app experience to guide their own digital offering. Offering relevant and personalised offers, easy-to-use booking systems and a well-designed digital experience to accompany the physical travel journey is extremely valuable to a growing segment of customers.
Airlines have already started down this path by pursuing modern offer and order management systems, a key enabler to meeting the modern customer’s expectation. Those systems could help airlines become a super app. However, we at TiM believe there are many areas airlines will choose to improve once they have a modern technology stack. In doing so they will strive to improve customer satisfaction, revenue, and de- risk being commoditised.
In the meantime, whether you are attended Aviation Festival Asia or not, consider downloading a super app and experience what your customers are experiencing on a daily basis.
AirAsia and Plusgrade Announce Partnership to Enable Bid for Upgrades and Extra Seating Space for Travelers
PRESS RELEASE: Montreal – Tuesday, February 28th, 2023
Expansive multi-year and multi-product Plusgrade and AirAsia partnership announced at Aviation Festival Asia in Singapore
AirAsia guests will soon have the opportunity to bid for upgrades and reserve empty seats beside them on flights
This is a significant partnership for Plusgrade as they continue to expand their footprint in the APAC region
Plusgrade, the leading provider of ancillary revenue solutions for the global travel industry, is proud to announce its partnership with AirAsia, Asia’s leading low-cost carrier. This extensive partnership will soon allow AirAsia customers to bid for upgrades and reserve the seat(s) beside them for extra space and comfort. The deal was unveiled today in Singapore at Aviation Festival Asia, the largest aviation tech event in Asia.
With the relaxation of the remaining travel restrictions in the Asia-Pacific region in early 2023, travel industry recovery is well underway. Ancillary services that delight customers and drive revenue will be an essential tool for airline, hotel and rail companies as travel returns to – or even exceeds – pre-pandemic levels. Today’s travellers are looking for streamlined travel experiences with a focus on comfort and innovative services to improve their journeys.
For consumers, ancillary services such as upgrades or the ability to reserve open seats beside them on their flight can make travel more enjoyable, giving them room to stretch out and relax, or enabling them to experience premium products and services that might otherwise be out of reach.
“We are thrilled to join forces with AirAsia to support them in driving meaningful ancillary revenue through incredible traveler experiences,” said Plusgrade CEO, Ken Harris. “We look forward to supporting AirAsia as they continue to innovate and develop new products and services for their customers, and to expanding our footprint in the thriving APAC region.”
Ms Karen Chan, Group Chief Commercial Officer at AirAsia added: “This collaboration will enable us to offer more passengers the chance to access our premium products and services, such as our award winning premium flatbeds or hot seats with extra legroom. We are confident that our guests will love this innovative and seamless way to enhance their travel experience.”
AirAsia is the World’s Best Low Cost Airline, flying to more than 130 destinations in the region and beyond. Founded in 2001, the airline has flown close to a billion passengers. With the resume of travel worldwide, AirAsia has gradually reinstated flights for many of its popular routes whilst launching new ones. AirAsia’s vision and mission have always been to serve the underserved. Throughout its two decades of service, the airline has connected people and places, and has largely been credited for democratising affordable air travel in the region with its now famous tagline ‘Now Everyone Can Fly’’.
Plusgrade powers the global travel industry with its portfolio of leading ancillary revenue solutions. Over 200 airline, hospitality, cruise, passenger rail, and financial services companies trust Plusgrade to create new, meaningful revenue streams through incredible customer experiences. As an ancillary revenue powerhouse, Plusgrade has generated billions of dollars in new revenue opportunities across its platform for its partners, while creating enhanced travel experiences for millions of their passengers and guests. Plusgrade was founded in 2009 with headquarters in Montreal and has offices around the world.
The future era of technology-driven smart airports
To keep pace with the ever-increasing needs and demands, airports worldwide are constantly evolving. With air travel on the rise again, airports are not just expected to facilitate passengers and cargo movement; they also need to expand their horizons to cover other crucial aspects, like:
Execution of seamless operations with low to minimal manual intervention,
Augmenting safety and health protocols,
Optimizing the use of facilities, preventing wastage, and becoming sustainable,
Scaling up scrutiny and security, and,
Boosting passenger experience.
At the same time, with the high scarcity of human resources in most of Europe and North America, the need to establish measures to utilize resources efficiently has never been as critical.
The challenges are not new; airports have been addressing them over the years by embracing technology at different stages of their growth. However, each of these challenges has evolved and needs airports to adopt state-of-the-art technologies to keep up with the changed dynamics. This evolving era of airport digitalization and digital disruption, which saw its inception decades back, constitutes what we call ”smart airports”.
Within the smart airport ecosystem
Smart airports stimulate the need for an integrated and comprehensive ecosystem that demands the airports to be not only fully functional but also intuitive, efficient, and predictive. This also requires that the manual airport processes, which are often slow and error-prone, be reduced and digitally governed to bring automation, efficiency, and accuracy to day-to-day functioning.
Smart airports are functional, intuitive, efficient, predictive, and digitally governed.
Therefore, it becomes imperative that digital technologies and solutions like cloud networks, biometrics, mobility solutions, data science and related fields, immersive technologies and IoT, and other sensors-based solutions, be leveraged increasingly to encompass the diverse areas of airport operations and processes.
Although the smart airport concept is blooming in several spheres, the following are the three regions where we think airports can drive maximum gains:
1. Achieving airport operational efficiency through data and digital engineering
Airports are structurally complex, and a single channel does not drive their smooth functioning. A deeper understanding of the intricate association and dependency of various airport departments has brought awareness that siloed operations cannot be the solution to achieving operational efficiency and resilience. Airport stakeholders need to be transparent and readily available with real-time data they can exchange to deliver consistent and exceptional performance.
With the right technology and data solutions, airport stakeholders can achieve efficiency and productivity.
To achieve this, more and more airports should start adopting networking and collaborative frameworks like AOP (Airport Operational Plan) and ACDM (Airline Airport Collaborative Decision Making). These frameworks encourage initiatives to promote data sharing and transparency within and between airports.
Data science and AI must be leveraged to derive meaningful insights from past and present data. Building such data-rich integration platforms can help airports extract immediate and real-time information from various interconnected departments. This will help smoothen communication and increase responsiveness in multiple ways. For instance:
Swift and efficient allocation of gates and counters to airlines
Smooth passenger flow management with better predictability
Better resource management
Improved runway slot adherence
Further, airports can also employ sensor-based solutions in various areas to improve efficiency. For example, using RFID-based solutions that can read data instantly from numerous items like luggage and cargo and can aid in bulk item transportation with proper tracking and tracing. Also, it simplifies the manual and time-consuming inspection of assets by instantly reading information like expiry date, next due scan date, etc., from the asset and sending it back to the data source.
Similarly, technology in the form of mobile solutions can also stand out in comparison to the usual paper-based checks. Their highly interactive and data-rich interfaces allow airport staff to send immediate updates, retrieve data, and take corrective actions.
2. Upscaling the passenger experience
Since passengers spend more than 60% of their total travel time at the airport premises, their comfort and convenience put a lot of onus on the airport’s authority. Even with many initiatives to smoothen the process, passengers invariably express their distress towards adhering to the airport’s elaborate checks and protocols. The actual journey that begins from flight take-off for passengers exhausts them beforehand due to the:
Need to reach airports hours before flights take off,
Long and unpredictable waiting times in several queues,
The exhaustive process of baggage tracking and collection,
Extensive scans and scrutiny, and,
Being unheard and feeling lost in the complex airport maze.
Understanding passengers’ needs, their interaction with various touch points across the whole journey, predicting their next move, recommending them with the right offer, and intuitively guiding them in the right way are some areas where airports can effectively act. Again, customer data plays an important role here. Keeping track of customer preferences, concerns, and historical transactions can help airports in improving those relationships and bring in a personal touch.
The long-term vision of airports for a passenger aims to shift the notion of “being stuck inside the airport” to “experiencing a world of leisure and excitement.”
With features like smart parking, virtual queues, digital identities, baggage notifications, personalized merchandizing and recommendations, smart menus and smart washrooms, virtual assistance, and an immersive feel, more and more airports can work to provide a different experience beyond the usual to the passengers.
3. Bringing in greener initiatives
Now that the aviation industry’s contribution towards global greenhouse emissions is well established (around 3% of the total emissions), airports need to pace up to achieve their target of becoming carbon neutral by 2050 or before. The path to net zero is long and challenging, and although there are measures being taken, much is yet to be done in this zone.
By embracing smart operations using data and analytics, airports can reduce their carbon emissions.
Some ways to become a green airport would involve the following:
Tracking & MitigationThe first step requires thorough analysis and regular tracking of direct and indirect sources that contribute to emissions. After that, airports need to define immediate short-term and long-term sustainability targets. To achieve this, airports must start by leveraging sustainability tracking solutions and showing progress towards net zero objectives. For example, using cloud-based sustainability platforms that offer detailed dashboards and provide periodic details on fuel consumption, offset achieved, emissions via waste, business travel, etc., and other sources and provide a clear progress report using science-based targets.
Moderating the consumptionAlthough some airports are also considering shifting towards renewable energy sources by setting up solar panels and using CNG, reducing incidents from day-to-day airport operations (wherein the consumption of resources like fuel, water, and electricity goes much beyond the need) should also be tracked. Keeping a continuous and consistent check on these expenditures would certainly go a long way in keeping up with the net zero goals.
Technologies like sensor-based IoT devices could also be harnessed to regulate the usage of electricity, water, and air conditioning as per need by sensing a human presence. Similarly, computer vision-based ML solutions could be used to build smart dustbins that identify types of waste and help in proper disposal. Leveraging AI and analytics could aid airports in measuring the food, paper, and other waste passengers generate. This can help drive eco-conscious passenger initiatives.
In the stride to become exceptionally performant, there is a continuous need for airports to explore further upcoming avenues and adapt. Also, emerging technologies and innovations play a huge role in curating specific solutions, and the coming times will see them being leveraged even more. It would be apt to say that with all these digital disruptions, the long-term vision of airports will be to bring efficiency, comfort, and luxury inside the terminals.
We haven’t mentioned Blockchain, for quite some time.
We at Travel in Motion have already published numerous blogs, white papers, and podcasts about, hopefully, relevant subjects in our industry. But until now we have only once discussed blockchain and this was quite some time, ago. Are we missing out on something? Or are we “clever” enough to know that blockchain is simply a buzzword and will disappear like many others that were once hype and are now out of sight, out of mind? I think it is a case of “neither one nor the other”. As many others, we have mixed feelings about the relevance of blockchain technology in commercial airline IT. Thus, we are simply not yet confident enough to take a definitive position.
Maybe it would be helpful to summarize what blockchain technology really is and where it makes (or could make) the difference in comparison to “traditional” systems, such as databases. For me a good, but non-scientific start to get a high-level understanding of a new topic has often been Wikipedia, which describes blockchain as:
“A distributed ledger with growing lists of records (blocks) that are securely linked together via cryptographic hashes. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data (…). The timestamp proves that the transaction data existed when the block was created. Since each block contains information about the previous block, they effectively form a chain (…), with each additional block linking to the ones before it. Consequently, blockchain transactions are irreversible in that, once they are recorded, the data in any given block cannot be altered retroactively without altering all subsequent blocks.”
Comparing blockchain technology with traditional database technology shows that it delivers advantages. IBM provides an informative and easy-to-read summary on their website, which I have used for this blog:
Enhanced security: as the records are distributed over numerous entities with an end-to-end encryption, fraud-like manipulation of data and other unauthorized activities are simply not possible.
Greater transparency: as a blockchain uses a distributed ledger, all data and transactions are recorded identically in multiple locations. Thus, all participants see the same information at the same time, leading to transparency.
Instant traceability: through blockchain the provenance of data is documented and can be audited.
Increased efficiency and speed: compared to traditional paper-heavy and manual processes blockchain technology can lead to faster and more efficient execution.
Automation: through “smart contracts”, transactions are automated when pre-defined conditions are met. Smart contracts are programs stored on a blockchain that run when predetermined conditions are met.
As I am not a computer scientist, I am still not 100% sure if I understood all the above, but it has at least given me a view of where blockchain technology may provide advantages over traditional database technology. In a traditional database setup, data is stored in tables and can be modified any time. Blockchain is more secure, more or less immune to fraud, transparent and does not require a centralized third party to secure the system. Through this, blockchain as a technology creates confidentiality and trust without being managed centrally.
The probably best-known use of blockchain technology is cryptocurrencies. I must admit that the volatility of values, stored in and managed through cryptocurrencies does not impress me – it even makes me suspicious. But cryptocurrency is just an application that uses blockchain technology and it is probably the best proof point that the underlying blockchain technology really works.
So, what does this mean for commercial airline IT systems? Our ecosystem can also be characterized as an environment where participants are globally distributed, representing different interests with a need to cooperate, and where values are shifted through digitalized channels, requiring the highest security and traceability. Doesn’t this ring a bell? Aren’t these the characteristics that also describe the advantages of blockchain technology? Blockchain is exactly a technology that meets the requirements described above. The issue is only that these requirements already existed long before blockchain became available – and not only that, also these requirements have already been solved long before blockchain appeared on our radar screens. So, is blockchain a wonderful technology that addresses issues which have already been solved in our industry? I think there is an element of truth in this. Replacing legacy technology and processes for the sake of using modern technologies has always been a big challenge and an issue in our industry. Or in other words, while blockchain promises a lot and has also proven to deliver what it promises from a technological standpoint, what are the potential areas of use in our industry? What are the killer use cases for blockchain technology in commercial airline IT? In settlement process? Or distribution perhaps? Or perhaps even a combination of NDC; offer and order management together with blockchain – doesn’t this sound more like a nightmare to some of us?
But as of today, most of us still feel that blockchain is a technology that is rising and becoming more mainstream, but we do not yet know how it will be utilized and what impact it will have. Therefore, I come back to the point mentioned earlier in this blog. We at Travel in Motion are not yet confident enough to take a definitive position. This time we need your help: how do you see blockchain in commercial airline IT? Where do you see a value add? Where do you see use cases? We are looking forward to receiving your thoughts!
Breaking down the mindset barriers holding back the widespread deployment of Artificial Intelligence-driven solutions requires nurturing a high-performance team from the start. Clear communication and reassurance across IT and business teams, defining common KPIs and goals focused on agility, accuracy, and performance. Businesses need to make clear to all employees that, far from replacing the human workforce, AI is simply changing people’s jobs for the better through intelligent automation, helping teams reduce repetitive administrative tasks in favor of more strategic decision-making and enhancing their ability to make better decisions and drive business performance.
Similarly, senior business leaders must commit to ensuring the right alignment between business use cases and the latest AI techniques to unlock new levels of performance. Equally, they must understand the roles they have to play in setting a company culture in which their organization seizes new opportunities, experiments with new technologies, and is not afraid of taking risks.
AI has the power to transform airline operations, unlocking new levels of data insight that can enhance profitability and the customer experience while enabling airline industry analysts to turbocharge their effectiveness, giving commercial teams that harness it a major edge over the competition.
When it comes to realizing this potential, however, the travel industry is still on a journey.
To realize the full power of AI, early adopters across industries have already realized – and demonstrated – the significant business benefits the technology can deliver.
Businesses that have remained reliant on legacy technologies now find themselves desperately playing catch up, prompting a surge of investment into AI-based solutions. According to a September 2022 article by Simple Flying, 82% of airlines are now looking to invest in AI.
While it will take work, industry mindsets can be shifted toward digital-first practices for commercial decision making. Let’s explore the steps that will enable this to happen and the opportunities around pricing and revenue management this could offer the aviation sector.
AI barriers for business stakeholders
There are certain mindsets that exist across the travel landscape that may hold back the industry’s adoption of AI.
Fear of the unknown, or the dreaded “black box” idea, makes some hesitant to adopt technology they cannot fully understand. If the analyst or manager cannot see the calculations being run, how do they know they’re correct? A lack of trust in the science behind AI can cause hesitancy to adopt new technology.
Employees must also be reassured that AI technology is not a stepping stone to replacing their roles, while those with extensive experience with legacy systems can often be reluctant to embrace new and unfamiliar business technology solutions.
Businesses can also face challenges around the lack of usable data and support infrastructure, and accessing valuable knowledge and skills can also prove challenging.
How to realize potential
Breaking through these potential obstacles requires clear and consistent communication and buy-in across all levels of the organization. Analysts should be reassured that, rather than replacing their jobs, AI will enhance them by allowing them to automate time-consuming and repetitive tasks, freeing them up to focus on better decision making on key flights and routes. Analysts will be able to work with AI to act on information beyond the recorded data, such as upcoming schedule changes, new routes, or competitive opportunities. Technology still requires human insight to adopt and fine-tune strategies.
Senior leaders must commit to understanding how the new solutions can unlock greater optimization across the business and create a culture of experimentation and data-driven decision-making. Organizations must be willing to try AI on a small scale and gradually increase its adoption, instead of using a big-bang approach.
It’s also important for companies to redouble their efforts to gather clean data. Maximizing productivity and unlocking new insights relies heavily on having reliable, decision-influencing data readily available, and business leaders must foster this data-gathering capability in their organizations.
Aviation industry opportunities
These shifts can unlock huge opportunities for the aviation industry. The adoption of AI-driven solutions can prove critical to maximizing overall revenue, boosting commercial performance, and – perhaps most importantly of all – improving the customer experience.
The aviation sector has historically been held back by the limitations of legacy systems, which have merely enabled analysts to look for year-on-year patterns. The problem with this, especially in today’s volatile travel environment, is that there simply isn’t enough data on a specific flight at a given point in time to support accurate forecasting in a volatile environment.
AI-driven solutions overcome this problem thanks to technological advances like Deep Learning. These algorithms, trained by sifting through vast amounts of historical and contextual data – including bookings, searches, events, promotions, and competitor prices – enable forecasts which aid in truly informed decision-making. Commercial systems, powered by Deep Learning technology, allow airline teams to finally realize total revenue optimization – maximizing all sources of revenue to the airline.
FLYR is dedicated to generating win-win situations in which airlines become more profitable across fares, cargo, ancillaries, offer and order management, and retailing, while customers enjoy a superior experience. Moreover, with AI-powered commercial decision-making capabilities in The Revenue Operating System®, airlines can provide more personalization through every stage of the customer journey. Equipped with high accuracy and dynamic load and revenue forecasts, airlines are better able to direct marketing spend and energy toward higher-yielding results and adapt to the ever-increasing velocity of change to more quickly accommodate customers’ needs.
To learn more about how FLYR Labs is bringing AI to the travel industry, check us out.
Article by Christian Merkwirth, Technical Product Owner, Lead AI Scientist, FLYR
The Christmas holiday break is a testing time for all airlines, and there’s an inevitability to news of festive delays. In the last two storm-filled weeks of the year, over 15,000 Southwest flights were cancelled. Some 1.5 million customers had been affected. Yes, this is a more extreme example of recent disruption event, but are other airlines doing anything better when it comes to technology investments?
The unfortunate situation with things going spectacularly wrong for Southwest Airlines in the final days of 2022 is more common than we would like to believe. 80% of all airlines globally rely on manual or semi-manual procedures when it comes to disruption or crew management supported by outdated software long overdue. Has anyone stopped to think what a tremendous effect this has on customer loyalty?
Now the Christmas decorations are down and we’re back at work, what should airlines – big and small – take from Southwest’s experience?
When the storms hit, systems crumbled
Southwest have always prided themselves on their staff, and rightly so. It will come as no surprise that, when the storm hit and flights began to be grounded, Southwest’s struggles to cope was not the fault of its people on the ground.
Indeed it’s been reported that hundreds of Southwest’s own pilots and crew members slept in airports next to passengers. Some stuck with nowhere to go. Others in a heroic effort to keep the wheels turning. As Captain Casey Murray, the president of the Southwest Airlines Pilots Association, said to CNN, “It’s phones, it’s computers, it’s processing power, it’s the programs used to connect us to airplanes – that’s where the problem lies, and it’s systemic throughout the whole airline.”
No, while short-staffing undoubtedly played some part in Southwest’s ability to recover, Southwest’s pre- Christmas failure was caused by an IT system unable to adequately respond to the level and severity of disruption that hit the airline over those first few stormy days.
The airline is now on the verge of a major technology evolution, serving as a prime example to others to lead the modernization and overhaul of operations tech stack.
Growing complexities, growing expectations: a perfect digital storm for airlines
It is a cautionary tale for airline CIOs across the US and beyond. Moreover, while the media has no doubt been hard on Southwest, the outside world’s patience with airlines is only getting shorter.
The complexities involved with operating an airline are constantly growing. But customer expectations of what they should expect from their air-travel experience are growing faster.
In particular, post-Covid, customers are increasingly expecting a far more holistic digital experience, covering all touch points at every stage in their journey, all through their own devices.
If their journey has been disrupted, they expect to be informed and helped instantly and seamlessly. And if this doesn’t happen? Airlines live in a world where one bad experience can be beamed to millions across the airwaves through the power of social media. It’s a tough gig.
If the airline can offer an element of surprise about the quality of extra-care, offer customers a choice of an overnight stay and implement personalization, customer loyalty will only grow higher.
SaaS: the secret weapon for staying up to speed
One piece of good news for airlines, though, is that the digital technology available to them is better, and more implementable, than ever before. Crucially, airlines no longer need to develop and support their own customized software (and should be wary of IT partners insisting they do).
Instead, airlines now have the option to choose reliable SaaS products available off the shelf in the cloud.
Implementation in weeks not months
One effect of this new wave of SaaS tech for airlines is that digital upgrades are no longer projects to be feared. Implementation times have been cut from months to often between 4 to 8 weeks depending on the scale of the upgrade. While this new generation of SaaS technology is also able to offer end-to-end services, powered by automation, that overcome the gaps that inevitably emerge when legacy structures are patched up and added to.
Modern SaaS technology for airlines can automate +80% of the operations required in crew planning and allocation even during times of disruptions and offer an easy communication channel to the crew through connected super-apps. Similarly, present-day technology can help eliminate airport chaos and long queues for stranded passengers, offering self-service solutions directly on their devices. It can deliver personalized options for a hotel stay near the airport, transfer service, refreshment vouchers, and information on the re-booked flight – all in one place for passengers while delivering the highest level of data and cost transparency back to the airline.
The right time to upgrade your technology is… all the time
All this is too late to save Christmas. But new storms will come. Disruptions will happen. The summer holiday season is soon upon us with more passenger volumes than ever before. Digitalization is the single most significant investment opportunity in the immediate future of airline travel.
It’s also a journey not a destination, with Digital tech a constant upgrade in progress – something SaaS technology is making possible. The sooner airline CIOs & CXOs can work together to implement this new wave of digital technology, the safer they are from being the next bad-weather casualty.
To learn more about how digitalization is changing the airline industry for good, as well as more about what airlines need to know, download our free white paper on MAXIMIZING RECOVERY: THE FUTURE OF THE AIRLINE INDUSTRY IS DIGITAL.
Article by Luca De Angelis, CEO, HRS Crew & Passenger Solutions. As the CEO of HRS Crew & Passenger Solutions, Luca De Angelis works today with multiple airlines to enhance their service and crew management operations.
I keep reflecting on the concept of customer centricity in the context of airline passengers. For a long time, I only saw it from the perspective of an airline loyalty programme, because having a particular status meant I got extra benefits to make my trip more comfortable (sometimes). Over the years, however, I have come to realise that this has little to do with the concept of customer centricity, but rather is used as a vehicle to bind a customer to one particular airline (or group of airlines). It is a one-way street that lures the customer in with the promise of benefits and privileges that are actually becoming less and less valuable as airlines reduce the level of service in order to reduce costs. Indeed, I can often get most of the common airline loyalty benefits with a branded credit card.
As an airline, when it comes to judging the loyalty of a customer, there are many factors that need to be considered beyond the simple mechanism of miles or segments flown. Am I really only judged as “important” to an airline if I flew a lot with them within a fixed timeframe? This is a potentially flawed assessment, particularly considering that, regardless of how much I paid for those flights, I might not actually have paid for them myself if I travel a lot for business. In this case, the “customer” may be the company paying for the travel, however “customer centricity” still focuses on the individual travelling. How should lifetime value be measured and assigned between the customer and the traveller when these are not identical? What about my changing needs and behaviours as a traveller, particularly as airlines evolve their product offerings? The airfare for a journey may be optimised to generate the highest possible revenue, but total spend is often not considered. Ancillary products such as more bags and seats typically have higher margins, however loyalty is often only rewarded on the fare paid or distance flown. The view of measuring loyalty over an arbitrary time period may not be the right way for all customer segments. If I only travel a lot every other year, is my total customer lifetime value not worth anything? By stripping benefits through the loss of a status level, airlines run the risk that customers may be less inclined to remain loyal to the airline, rather than recognising that loyalty spans more than a period of 12 months and providing incentives to keep wallet share even when customers are not flying.
My reasons for travelling are usually different for each journey – even if there are similarities. However, the service I receive (as a loyal customer) is almost always the same. While airlines cannot read my mind, does it always have to be the same service I receive when my needs are constantly changing? There may be clues in my travel patterns and behaviour that can be used to give direction when trying to become more customer centric. However, picking up on these subtle hints can be difficult and actioning them even more so. Maybe, as a result of my status, I get to take a second bag on a short business trip. While I may appreciate the extra luggage if I’m travelling long-haul for two weeks, I don’t need two heavy bags when traveling alone and using public transport upon arrival at my destination.
Recognising such situations is not difficult, but usually airlines do not take time to join the dots and figure out what I might really appreciate. The needs of every traveller are unique, and my needs are different almost every time I head off on a journey. However, there are patterns that are not necessarily common to me as an individual traveller, but rather to my demographic (“segment” or “cohort” if you prefer). Through tracking decisions and actions taken (or not taken), airlines can begin to make sense of a collection of seemingly random data points. If we then apply some machine learning to this and ask the right questions of this data, perhaps things become a little less hazy. When airlines begin to action some of these findings is when I will start feeling that the airline is focussing on my needs. Then I will finally start feeling the customer centricity, and can choose the additional services according to my needs. These needs may, or probably will, be specific to each journey. I may want to forgo the lounge because I prefer a short transit time to get to my destination faster. I may want to take two carry-on bags so I don’t have to go to check-in or risk the bag not arriving. I always want the option to upgrade my flight with miles or for cash if there is space on the flight – I always ask, so why do airlines not ask me, especially if there are premium cabin seats available and I have sufficient miles? Having to wait until I get to the gate only to be told there are not enough meals loaded is neither customer centricity nor good business sense. I am not unique with having these same behavioural patterns, but if we never look for patterns, we will never find them.
Travel is a journey rather than a flight between two points, and as a traveller, I make dozens of decisions along the way. I decide how I get to the airport, how I take my luggage, how comfortable and pampered (or not) I’d like or expect to be on board, where I stay when I get to my destination, how I get there. I make decisions about what I buy and what I don’t buy. And very importantly, I decide on whether I was satisfied with what I bought or whether my needs were not met. Did the airline ask me how I found the service on board or how the booking and check-in process was?
There is a vast ocean of data available on every single airline customer which can be collected from the time of shopping for flights and throughout the customer’s journey. Many customers will be happy to share even more data with airlines if it is used for their benefit and not just for maximising revenues for the airline. This is a call-to-action for airlines to rethink their customer-centricity processes, their availability of the related data, and for the airlines to collect and use the data to improve customer service and create personalised or tailored product offerings.
While I understand that airlines constantly have to balance customer centricity with operational and financial efficiency, a lot can be done with presumably manageable effort and investment. However, unless all organisations within the airline agree on what the airline’s goal and business model is, will there ever be agreement on what customer centricity means?
As consumers, we encounter applications of AI and machine learning almost every day. Self-driving cars on the road, type-ahead search results, and recommended shows on your favorite streaming service are just a few of the ways artificial intelligence is embedded into our day-to-day lives. And it’s no secret that modern companies employ this technology to build and maintain a competitive edge.
In the back office, many industries seek to adopt AI-based solutions to improve operations, enhance commercial decision-making, and drive better outputs. While the aviation industry initially may have been cautious to adopt, matured AI-powered solutions – specifically deep learning – have unlocked incredible new opportunities for commercial teams who have long relied on tools and techniques of the past.
Overcoming Constraints of Legacy Systems
Most airlines rely on historical flight data to form the basis for forward-looking forecasts, which typically end up as inputs into pricing optimization. While this may have been successful in the past, the volatile nature of the current demand environment largely invalidates the applicability of past years’ data on predicting the future.
To counteract this, many airlines try to rely on historical data from a year they believe is most representative of the current time, often focusing on 2019 to determine 2022 decision-making. There are obvious limitations to this. First, the demand environment among consumers is fundamentally different post-pandemic. Second, airlines are operating vastly different networks with differing routes, capacities, and competitors than they were three years ago. Additionally, there is no responsiveness in a forecast that cannot decompile the inputs that drive demand. In all cases, airlines often struggle to confidently predict the arrival of bookings, which hinders a range of commercial functions.
Deep learning algorithms represent an opportunity to break free from these limitations. While no human can comprehend and understand the individual context of billions of data points, deep learning thrives with vast amounts of data – from bookings and searches to events, promotions, and competitor prices. When trained and deployed effectively, these models empower analysts with predictive and responsive forecasts that guide strategic decisions across commercial functions.
Aligning Cross-Functional Decision Making
Due to the often siloed nature of airlines, data and reporting that support decision-making either come from a disparate team or are internal to the division. In both cases, humans often manipulate raw data from expectation, experience, or intuition. As that information is passed downstream to other functions, teams are only as confident as the resource before them. This “multi-step metrics” approach means trust must exist universally – and often blindly – across teams and functions. When that trust breaks down, metrics are either ignored or manipulated to match expectations, rather than actually supporting decision-making.
This doesn’t detract from the value that human experience brings to the table. Rather, it highlights the value of new AI-powered solutions that enhance decision-making abilities by replacing a need to rely on instinct with one grounded in data and modern science.
Consider a scenario within airlines: revenue management, network planning, and marketing typically rely on their own forecasts to answer commercial decisions. With a single source of truth for forecasts, cross-functional collaboration advances from reconciling expectations to managing decisions in alignment amongst teams. An RM analyst that notes higher-than-usual final forecasts can not only correct their inventory strategy but also empower network planning to consider additional capacity.
The Human Element
Think about how the introduction of computers to airlines replaced much of the manual, repeatable, effort that came from processing reservations and ticketing requests. These “task manager” systems, far outdated by today’s standards, still represent the core principle of many of today’s tools – take repeatable “if-then” tasks, and complete them as fast as possible.
Deep learning solutions flip the paradigm. Instead of telling a computer what process to follow, human experience, captured through data, helps train deep learning models to complete complex tasks, much like onboarding a new hire to the industry or teaching a young student in school. Put another way, rather than relying on computers to repeat mathematical equations, deep learning models are akin to teaching the computer how math itself works, and through training, the model itself will learn the optimal way to solve any equation, regardless of if it was explicitly shown how to do so.
While previous generations of technology improvements justify why airline analysts may be weary of machine learning models replacing their roles, the reality is that deep learning models allow teams to deploy AI as an omniscient analyst, one who individually understands and recalls the contexts of billions of decisions made in past years, something far beyond the scope of human knowability. Analysts are now more than just analysts; they are teachers, providing guidance to systems meant to support even the most complex decision-making.
Lastly, human analysts will always be able to see around corners to act on information the data itself can’t see, such as schedule changes, operational considerations, natural disasters, or breaking news that changes consumer demand and sentiment. Helping convey and “teach” deep learning models the impacts of these events pairs the wisdom of a hivemind AI with real-time human intelligence. This future of AI-equipped commercial teams within airlines is already here, and we suspect it will continue to grow in ubiquity as the airline industry writes its next chapter.
Article by Benjamin Tumbleson, Manager, AI Customer Delivery, FLYR Labs
Visit Skift to read more on this topic from Alex Mans, founder and CEO of FLYR Labs.
There is a lot of talk about customer experience, customer centricity, net promotor scores and the like amongst the airlines. Seemingly more now than ever before. But where and when does customer centricity come into play? And more crucially, why is it not working – or at least, not the way the customer feels it should?
What is Customer Experience?
To get us all on the same page, we should define what we mean by the term “customer experience”. Basically, we are talking about how an airline engages with customers in any form – through personal contacts at a counter or on board a flight, through digital means such as an airline website or mobile app, through visual means such as airport signage and onboard materials or through communication such as emails, phone calls, chats, and others.
A good customer experience instils trust, is easy and quick, provides clarity, and focuses on the customer’s need and should be (where possible and feasible), in the customer’s interest even if that clashes with the airline’s. Now, that doesn’t mean that a good customer experience results in an airline always giving in, but it does mean the airline finds a solution.
Also, what may be perceived as a great customer experience for me because it is all digital and self-service does not mean it is a good customer experience for my grandmother.
Let’s start with the customer journey to get a better understanding of where and when the customer experience really comes into play. This is fairly simple: the experience encompasses everything from the first interaction with an airline until well after any trip I take. That was easy, wasn’t it? Well, perhaps we can break it down a bit more to get a little more insight.
First, let’s consider the inspiration phase where the airline is sending promotional mails, or a customer is hunting for prices and destinations on an airline website. In this phase, the airline should focus on an initial understanding of the customer – who is asking, and why? Sometimes the airline will know quite a bit about certain customers, in others they know very little. In such cases, creating a meaningful mail or putting the right products and destinations on the website can be done by applying segmentation and sampling logic.
During the shopping phase, very much like in the inspiration, the airline may or may not know the customer. However, the contents of the shopping request and the meta-information related to the request (e.g., what time and which weekday was it made, which channel etc.) can help in figuring out the intent of the customer and give some context. And in the cases a customer is known, previous behaviour and purchases (or the lack thereof) can help.
In the pre-travel phase, which are the days and hours leading up to the event and can be somewhat emotional, and stressful, for many who do not travel often, some guidance can help. While many airlines send emails, these are seldom helpful or focused on a specific customer or journey. But hey, it really isn’t that hard to get the context and content right. I don’t need the weather for 10 days if my return flight is two days later. Or instead of a generic, text-only email which is nearly two pages long, how about a mail which is simple to understand, focused on my journey and my travel class, and has links if I need to know more? Has anyone ever asked the customers what they want to know?
At the airport, the biggest challenges are often the signage, and the lack of control over many processes such as security and managing crowds. However, where an airline should be able to take influence is in their staff, or the representation through the ground handlers. The often-heard stories of customers who know more about flight delays than staff should be long gone and shows the lack of a communication strategy within the airline. Better pre-flight information via email or the app can help and simplifying the search for relevant information through enhanced chat and FAQs would serve customers well.
Each flight experience and airline is different. In flight, there are of course many aspects of customer experience we could talk about, from levels of service to staff friendliness and onboard facilities, however this would be enough to cover a blog post itself. Most airlines do a really good job and hats off to them.
Perhaps one of the biggest areas in which improvements can be made is when the need for changing travel plans arises, be that willingly or not. Or, when during a journey, unexpected things happen – because they inevitably do. How do we communicate and interact with the customer? How much information do we share? Can we be proactive in suggesting smart alternatives and solutions?
After the journey, a simple follow-up mail with a thank you would work wonders. I have rarely received one. And when things didn’t go to plan, how about an apology mail? I have never received one of those either. I don’t expect more – I don’t need miles or vouchers – at least not if the disruption wasn’t drastic. But not receiving a “thank you” or “we’re sorry” basically shows that for the airline, the journey is somewhat “fire and forget”. Does the airline even know or care how my journey went?
Well heck, why doesn’t it work?
I have a theory. and will turn this theory into a call to action. First and foremost, I wonder how many C-Level airline executives, VPs and directors actually travel, well, like travellers would travel. In my experience, none. They have staff tickets and people who book for them. They never follow the customer’s path. When missing a flight, they can easily no-show, knowing they can go-show on the next flight. Sure, they sometimes have to deal with being a “passenger available for disembarkation”, however they can also get insight into booking figures or call duty travel to rearrange flights, often with other airlines with no cost to the “customer” at all. Why don’t designated decision makers search, book, rebook and travel like the 99% of people sitting on their aircraft? Why don’t they use the apps to check-in or try to change their bookings like a consumer would? That could result in some eye-openers, I’m certain. Most likely it would also lead to a better understanding of the Net Promoter Score (NPS). Oh wait, you don’t measure that? Or you do, but don’t analyse the results and take action?
Surveys such as NPS are a great means to understanding satisfaction. However, it is not enough to conduct a survey. Two airlines we have worked with over the past years had task forces in place to evaluate NPS surveys and create action plans for improvement. These were very structured processes, with a dedicated team and empowerment to influence the different departments in the airline to constantly improve customer service. The issues, actions and improvements were presented twice a month at executive level, with buy-in from all departments within the airline. In both cases, NPS scores increased, and while the increases were only marginal in the first six months, they grew considerably faster once the improvement team and the processes were established and the first “quick wins” identified and implemented.
We suggest that airlines start doing two things if you do not already:
Make sure that decision makers can travel like customers a few times each year. Make them book online or via the app – or even with a travel agency. Travel like the masses – don’t call in for privileges, sit in the back, book non-flex tickets.
Measure and act and get help doing so if necessary.
Why are we asking you to do this? Well, as an industry, we have moved so far towards this vision of retailing and customer centricity. All the talk is about systems and technology, about retailing and customer data, about segmentation and creating personalised offers. That is all great, and we share the vision here at Travel in Motion. However, there is more to it than a vision of airline retailing with offers and orders, or other buzzwords like NDC, ONE Order, Dynamic Offers, Continuous Pricing and what have you. At the end of the day, the customer has to be happy.
Three ways selling miles is driving record-breaking growth for airlines
Over the past couple of decades, airline reward programs have made significant strides in shifting their reputation from cost centers to profit engines for their parent companies. As the effectiveness of these programs grew, so did member appetite for points and miles. So much so that loyalty currency retailing—the sale of points and miles directly to members—now ranks as the second largest revenue driver for most loyalty programs globally.
Who knew selling points and miles packed such a punch? Here’s three reasons why mileage retailing is a key factor in building a profitable loyalty program:
1. Members who buy miles are more valuable
Members who buy points and miles will go on to fly more and engage more within their program lifetime—taking up to five times more revenue flights over the following 12-month period, and redeeming 6-10 times more points than non-purchasers.1 For cobrand card members, their card spend also increases by 37 percent in the three months post-purchase.
2. Mileage sales bolstered airlines and hotels during the pandemic
When travel came to a standstill during the global pandemic, loyalty programs became a crucial touchpoint for airlines to maintain member engagement and brand relevance.
Even without immediate travel plans, members were buying miles, highlighting that mileage sales are more than just a needs-based activity. The desire to travel is an insatiable itch, and members want to have the points and miles they need to travel better, sooner, and with more perks. Data from Points, the world’s leading provider of loyalty solutions, revealed that some loyalty programs even experienced record-breaking points/mileage sales in the height of the pandemic.
3. Selling miles speeds up the member earn-burn cycle
Buying miles emboldens members to top up their balances on their own terms—decreasing the time between onboarding and redemption and speeding up the all-important earn-burn cycle which is critical to fostering lifetime loyalty. Highlighting this program utility with a data-led marketing strategy ensures mileage promotions are customized down to a member level in order to nudge them towards the next step of their consumer journey all while maximizing mileage yield.
It has been a challenging summer for passengers. Booming consumer demand faced off against staffing shortages, ultimately leading to flight cancelations and a huge demand for customer support.
New research from data analytics firm Beyond identified key pain points for consumers, as well as trends in how well airlines responded online. This analysis translated into the company’s proprietary Actual Promoter Score (APS) ratings can deliver a view of how well airlines are meeting their passengers’ support needs and help drive adjustments in policies or staffing to react.
The Actual Promoter Score is derived from net sentiment analysis of online conversations about an airline. All data from across social media, review sites, news feeds and message boards are passed through both a positive/negative analysis and through a taxonomy analysis, that has been developed specifically for the airline industry. This approach allows for a deep analysis of passenger sentiment across all touchpoints from flight booking, through check-in to baggage reclaim and all the experiences onboard the aircraft.
Three key areas of customer frustration reviewed for the company’s latest research cover Flight Cancellations, Refunds, and Contacting Customer Support. As passengers return to the air, the research shows how flight cancellations become the flash point for a chain reaction that can easily overwhelm a customer support team. It is vital to have the technology and passenger strategy to protect the resilience of a customer support function to enable it to flex up during periods of high demand and keep online conversations focused on the positive messages that drive sales.
The findings from the 2022 Summer of Travel Discontent include high praise for airlines that were able to develop and deploy self-service solutions for passengers to handle rebookings. Self-service customer support technology is not the entirety of the solution. Companies must still have human support specialists available to resolve passenger issues.
This research has been produced by Beyond using in-house tools and extensive secondary research. Beyond can also help airlines optimize the inflight service experience, delivering happier passengers – and higher Actual Promoter Scores – with expertise reinforced by data.
You will find Beyond at the World Aviation Festival in Amsterdam, stand 12.89. They are looking forward to discussing this piece of research and how combining cutting-edge technology with innovative product design, and powerful data services can help monetise your passenger journeys and enhance your service efficiency.
When the Travel in Motion team was brainstorming about what the subject of our next blog and TiMCAST should be, I proposed the topic of the future of Departure Control Systems (DCS) in the context of order management. Our partner Daniel Friedli looked at me, smiled and said: “This will be our shortest ever blog, because there is no future for today’s systems of departure control”. As so often within the team, an interesting and energized discussion started, confirming that this an important topic. In the end, we agreed not to agree on the outcome related to the future of departure control systems, and here is why.
With the changes in the airline industry related to commercial business processes and the underlying technology systems, almost no areas remain untouched. That also goes for the DCS applications. These systems drive the “over the wing” passenger check in and boarding processes, and in addition very often the “under the wing” weight and balance of the aircraft. While the “under the wing” utilisation of DCS is mainly an airport operational process with (hopefully) no influence on the passenger experience, the “over the wing” components of DCS are key to the passenger experience and to many airline processes before, during and after the journey.
Over the past years, progress has been made allowing airline commercial systems to transform towards retailing and customer focused solutions as opposed to the flight related transactional legacy systems the industry. The New Distribution Capability (NDC), ONE Order, dynamic offers, the future of interline, and Settlement with Orders can all lead to process simplification should the airlines chose to embrace them. From a technology perspective, the implementation of these systems and the related potential new solutions will, at least partly, replace substantial parts of the traditional airline Passenger Service Systems (PSS) into which DCS is often embedded, or which feeds a third-party DCS with the relevant passenger and trip-related data.
To date, in the traditional environments, the reservation and ticketing components of the PSS would feed the DCS, either directly through interactive data exchange (especially if the DCS was a component of the PSS) or through forms of offline data exchange via a method often in EDIFACT-based legacy formats and teletype. In essence, the DCS was designed to support the passenger process for checkin and boarding in a very rigid and legacy-driven way. This demonstrates the potential to modernise this process, especially as leveraging passenger touch points for ancillary sales, improved passenger experience and learning about passenger behaviour was not core to the processes supported by a DCS.
The challenge for “over the wing”
As mentioned, the “over the wing” part refers to the actual check-in of the customer and related baggage, government data exchange, seat assignments and the boarding process. Currently, this solution is often a part of a traditional PSS or a stand-alone system if the PSS does not include this or if, for example, operational or regulatory reasons mean the PSS DCS cannot be used. By its legacy system nature and its lack of focus on the passenger experience, business opportunities such as the upsell of ancillaries during these airport processes is very often a challenge. The challenge can be characterised by the overly complex process of selling services and collecting payments during checkin. In addition, there is the lack of a 360-degree view of the customer to provide individual and dynamic services. This also leads to an inconsistent customer experience, driven by different system environments, best manifested at numerous different touch points, such as check in desks, kiosks, and self-bag drops at the airport. To make matters worse, the same airline could use different vendors’ solutions at different airports, all with differing levels of capabilities.
With the advent of ONE Order, or the concept of the order in general, the value of legacy DCS – as an IT solution, not the business processes and practices it addresses – is put in question. And, while the need for such systems will remain for years to come, the industry will witness a transition to more interactive and retail-focused solutions which will rely on the interaction with the order as a single source of truth.. The DCS of the future might basically be a user interface on any device which interacts with the order management solution to query which customer is about to travel, what the individual’s needs could be and dynamically propose ancillary services, trigger the exchange of data with governments and update information received. Further, the “check-in status” will be recorded in the order directly, as will information such as baggage tag numbers, seat assignments, advanced passenger information status and other relevant travel data. But the order will be the one and only master record as a single source of truth, allowing various transactions from different system to simultaneously update the order in real-time. Through this the customer will be individually identified at every single touch point during the check in, boarding process and upon arrival. By accessing the order, as well as the customer profile, individualised offers and tailored services can be created for the traveller. This can greatly enhance the customer experience as well as the airline’s servicing and sales opportunities, and greatly streamline airline processes, increase their revenue, and increase customer satisfaction.
The need for a system that supports the passenger airport process will remain. Not only legal and regulatory requirements such as advanced passenger information demonstrate the need for such systems but also the inherent capability to “register” a customers readiness to travel. However, the facilitation of these processes will be integrated into the airline’s order system more and more, should the airline choose to enter this strategic path. In these cases, we will see a merge of the traditional DCS capabilities into Order Management Systems (OMS). Albeit for years to come, many airlines will remain on legacy PSS, and specific airport environments will dictate a legacy DCS as we know it today.
So, in essence there is no clear “yes or no” answer about the future of DCS – it is the famous “it depends”. While the need for “under the wing” operational support systems such as weight and balance systems will remain, the future of the “over the wing” depends on the path an airline takes: will its commercial operations be based on full offer and order, what are the requirements of the local airport environment and, last but not least, how big is the appetite to innovate and transform?
But there is at least one consistency: within the TiM Team we had another enticing discussion. And, even if we were not all completely aligned, we did agree that we, as avid industry observers, will closely follow the developments and continue assessing the need and feasibility of the DCS as it is today.
Separating Speculation from Situational Awareness in the Aviation Threat Landscape
Aviation as a Target
As passenger numbers recover from the pandemic, companies are dusting off investment plans in their digital infrastructure in an increasingly hostile threat landscape. Prior to the pandemic, roughly $899 billion was spent on air transport worldwide, amounting to $2.7 trillion in global economic impact. Likewise, global commercial airlines reported $865 billion in revenue, a potential gold mine for malicious actors.
The introduction of global lockdown measures to thwart the spread of the novel Coronavirus caused an unprecedent collapse in global mobility, resulting in a 74% plummet in international tourist arrivals, a loss of an estimated 62 million jobs worldwide, and a $4.5 trillion drop in the Travel and Tourism sector’s contribution to global Gross Domestic Product (GDP).
The key role Aviation plays in economic security, passenger travel, and global trade in conjunction with its status as an industry which collects, transmits, and hosts vast amounts of Personally Identifiable Information (PII) and financial data, marks the aviation sector as an enduring high-value target to both state-sponsored and criminal actors.
Depending on the sophistication, scale and frequency of attacks, cyber incidents in this space have the potential to compromise or expose passenger or employee data, disrupt critical services, damage or destroy highly specialized equipment, and may ultimately result in the loss of human life. Simply put, the stakes couldn’t be higher.
The challenge is amplified by the range of services and companies that are part of the supply chain for the airline and transport industry. With travel companies, airport logistics, cargo, in-flight entertainment, catering services extending the attack surface available for attackers to probe for potential weaknesses.
Today, the rapid adoption of new ‘seamless’ technologies into the ecosystem of the air transport sector is giving way to an emerging extension of a global landscape that is already under siege. Defending digital territory of this magnitude takes actionable insight.
Whether the services are provided by wholly owned subsidiaries or key suppliers, the customer data which flows through the ecosystem to provide a seamless customer experience need to be secured and monitored to ensure a breach does not disrupt passenger journeys, damage passenger confidence, or incur significant fines.
Staying Airborne During the Pandemic
To keep the collective industry afloat, individual nation-states devoted more than $243 billion to support the preservation and advancement of their respective air transport enterprises and chosen national champions. Meanwhile, the global air transport industry sought out new digital solutions to adapt to new health and safety standards.
To reduce restrictions on travel impeding the recovery of international tourism, the aviation industry accelerated the fielding of new Digital Travel Credentials (DTCs) to enable passengers to securely authenticate, store, and communicate valid travel documents and vaccination requirements. Likewise, to personalize passenger experiences and directly deliver targeted content to consumers, airlines embraced the rapid proliferation of new carrier specific new distribution capabilities (NDCs).
Ready to take full advantage of developing technology in the industry, malicious actors orient and adapt attack techniques to exploit emerging trends. In the case of Digital Travel Credentials, between January 2021 and February 2022, IBM X-Force uncovered more than 100 doppelganger webpages impersonating authentic National Public Health Authority (NPHA) websites issuing COVID-19 DTCs. The actor-controlled sites imitate government Ministries of Health, and similar NPHAs from over 10 countries, harvesting user credentials and generating fraudulent certificates.
IBM X-Force Research- Dredging the DarkWeb
Dredging the Darkweb, X-Force uncovered several instances where criminal actors posted enticing advertisements containing links promising access to application downloads related to Departure Control Systems, Flight Management Computer, and Flight Management Systems. The posts proclaim to have information regarding cargo flight timetables covering international air, as well as Codeshare information. Those that take the bait do not land on the app, but instead find themselves on a SecureFiles page, leading to a “Download” button, likely enabled to harvest credentials.
In the almost-anonymous non-indexed space, criminals bring their data to sell (or make freely available) on file-sharing sites, forums, and underground markets. Researching the new NDC apps in the air transport environment, X-Force unearthed potential log sales for at least 6 International Air Transport Association (IATA) accredited level 3 and 4 organizations, as well as databases for airlines providing charter domestic, international passenger, and cargo services. Further searches yielded more furtive aviation-related data such as cockpit recordings, flight records, information regarding directors of flight operations, and licensing information for individual air transport pilots- all potentially posing a significant risk to airlines.
While our IBM X-Force team researchers monitor the dark recesses of the internet for evidence of breach and emerging threats our IBM security consultants are supporting clients around the globe in securing their infrastructure, applications and workforce. Using the principles of ZeroTrust when migrating critical data and services to the cloud, transforming and accelerating application development by implementing DevSecOps practices and tooling to build security in at the beginning, and transforming the culture and awareness of security from the board room to the check-in desk. As a key transformation partner helping our clients secure their Hybrid Cloud journey IBM has unique insight into the challenges facing the industry and services and solutions to support them.
To hear more about the threats and challenges facing the airline and travel industry please join IBM at the cybersecurity panel: “How can we increase cyber resilience and reduce the business impact of cyber risk in the aviation industry?”
The event takes place at 12:35 on the 6th of October within the World Aviation Festival Event. You’ll get a look into the cost of a data breach in the aviation industry, learn how to assess, reduce, and manage industry risk, and learn about your peers’ experiences with building resiliency to mitigate impact and cyber risk.
How Can Airlines Maximize Revenue From Existing Visitors?
Improving the sales performance across direct digital channels is a key objective for any modern airline. But with an army of users online at any one time, each looking for a flight or holiday specific to their individual needs, how can the aviation industry present the most relevant information to every single user?
Converting more users is a key target for most e-commerce sites, but maximizing revenue from each visitor is equally important. And to do that, you need to connect with your customers on a one-to-one level.
Traditionally, airlines have segmented digital audiences with business rules. If people fulfilled certain criteria or acted in a particular way, they would be targeted as part of a segment. When an airline’s sales pace was slow, strategy often relied on offering vouchers or incentives to drive bookings to broad segments.
Whilst such offerings would improve booking pace, it was ultimately diluting the revenue taken by the airline by providing discounts or value adds to people who would have booked without any incentive. Segmentation simply can’t account for the varying motivations of individuals, treating everyone in the same group exactly the same way.
The challenge for airlines was set: how can they better profile – on an individual basis – every user to drive higher revenue through strategic sales-led initiatives, avoiding revenue dilution whilst achieving higher conversion goals?
Machine learning is the key to understanding individual online users in real-time and at scale. By implementing a personalization platform, a customer-centric approach is able to form the basis of every sales and marketing decision.
Utilizing real-time customer-level signals throughout the user journey, technology can respond automatically to shopping behaviors. At BD4, we call this ‘Human touch e-commerce’ – and our work within the aviation and travel industry proves that individual-level modeling works.
Ensure effective allocation of incentive funds and optimize budgets
With a deep understanding and connection to customers, airlines are able to present individually tailored messages which are relevant to each person within their broad audience profile. Deploying automated AI allows airlines to offer digital interventions at the most appropriate stage of the booking process, removing the risk of revenue dilution for customers who were already determined to book.
To prove the effectiveness of a targeted approach, multiple tests under transparent control periods are run, from the initial Learning phase (as we know every airline and indeed every company has nuances in their audiences), to a Training period. This is followed by a Test and Control period, highlighting the impact of the tailored interventions, before implementing the optimized solution across the site. Driven by AI technology, the platform continually learns and improves the algorithms to ensure airlines are always adapting, and moving forward with their audience.
The latest AI-driven interventions for airline customers focus on providing intelligent incentives to drive bookings – intelligent in a way that only those users who needed an incentive to be converted saw a discount campaign. The individually targeted incentives have shown up to 6% uplift in revenue per user, and saved more than USD 1 million versus a more traditional, scatter-gun segmented approach to distributing vouchers and incentives. All this was achieved with a significant return on investment – up to 8 times! Read more about this specific project in our case study .
Helping airlines form meaningful connections with their customers
At BD4, we work with multiple airlines and well-known holiday brands, including easyJet holidays, Royal Air Maroc, and Etihad Airways.
The different stages of the digital buying journey enables a multitude of use-cases to connect with customers on a personal level. By interacting with customers on a one-to-one level, technology is able to humanize a company within the digital realm. And it’s this human touch e-commerce that helps companies maximize the value from each customer.
Discover more about BD4 online or visit them on stand 12.610 during the World Aviation Festival 2022.
The 2022 CarTrawler Yearbook of Ancillary Revenue published by IdeasWorksCompany, is a comprehensive analysis of the ancillary revenue performance of 75 global airlines. Released this week, the report breaks down ancillary revenue performance from 2019 to 2021, investigates how airlines have recovered since the pandemic, the new or expanded ancillary products they’ve introduced to accommodate changing customer needs and behaviours, and much more.
Responding to a crisis
The airline industry has certainly had a tough time over the last two years, and the aftershocks are not over yet, with staff shortages due to illness still impacting travel. However, there has been strong recovery, thanks in part to the airlines’ ability to pivot and respond not only to changing mandates, but to changing customer needs and behaviour.
Ancillary products and their revenue have been a key driver of the airlines’ path to recovery, and The2022 CarTrawler Yearbook of Ancillary Revenue shows promising results from the 75 airlines covered. Due to the pandemic, the yearbook is comparing 2021 to 2019 rather than 2020, to give a more accurate view of ancillary revenue performance after the pandemic.
Recovery is happening
In 2019, the global estimate of ancillary revenue was $840 billion. In 2021, that estimate is $462 billion – a significant decrease – although still a 32% increase on 2020’s performance ($350 billion), showing strong recovery, despite ongoing obstacles. While some markets (Asia and the South Pacific) are still not travelling at the same rate as pre-pandemic, most markets have shown strong travel increases from 2020, with MENA at 102% YOY in 2021, Europe at 84.3% YOY and North America at 79% YOY.
Many airlines saw significant increases in ancillary revenue from 2019 to 2021, including Wizz Air, the top performing airline whose ancillary revenue accounts for 56% of total revenue, an increase of 10 percentage points from 2019. Please see article here to learn more about Wizz Air’s ancillary revenue.
All carrier categories saw their ancillary revenue increase from 2019 to 2021 with low cost carriers seeing the highest increase at 36.3%.
Ancillary revenue per passenger also increased significantly with the top performer, HK Express, now having a per passenger revenue of $88.21 – an increase of $60.36 from 2019.
The five largest US airlines (Alaska, American Delta, Southwest, and United) generated $16.4 billion from their frequent flyer programs in 2021 – down from $19.5 billion in 2019, however, when this revenue was measured on a per-passenger basis, the result for 2021 was $30.88 per passenger up from $25.71, a 20.1% increase. This shows passengers may be flying less, but spending more.
Changes to increase conversion
Airlines have continued to optimise their ancillary products to drive conversion, and accommodate changing customer needs and behaviours, following two years of very little travel. Some expanded product offerings include large carry-on fees, extra legroom zones, subscription-based benefits, price freeze, and prepaid change flexibility.
To see a complete breakdown of 75 airlines’ ancillary revenue performance in 2021, insights into how to better optimise products to increase conversion, changes that airlines have made or are planning to make to their products and much more, download
The Third Horizon of Opportunity – High-Performance Retailing
The event season is a great time of year to lift our heads from the busy day-to-day and look at what is on the horizon, at the trends shaping the airline industry. The funny thing about horizons is that you never really get there, but it’s where new eras dawn. Accelya’s Tye Radcliffe, SVP of Product Strategy for the Order group, gives his perspective on the market as the industry emerges into the third horizon of value. Tye will be talking to people about this topic while ‘on the circuit’ over the coming weeks. So, what does it mean?
The first horizon
The first horizon was operational – getting passengers from A to B. The industry depended heavily on big, monolithic mainframes that enabled just that – and very successfully. Then the internet arrived. Airlines began investing in their digital direct storefronts so customers could start making bookings from their computers. Customers began to want and expect more. Plus, airlines wanted to be more innovative and directly service the needs of their customers! It was a frustrating time for many.
The second horizon
Airline frustration with the status quo made way for the second horizon characterized by airline-controlled distribution with NDC – and the freedom to create offers. The industry’s new rally cry was one of ‘retailing!’. Airlines would use data and rules to tailor core offers, ancillaries, and bundles. The offers would be made according to the customer’s wants and what’s right for the airline business – at that time.
The third horizon
Replacing monolithic with modular, and embracing ONE Order and science rather than rules, brings us into the third horizon of high-performance retailing.
ONE Order collapses data into a single order record. People or technology can access the data anywhere across the retailing and travel experience. This new accessibility makes way for a seamless interdependence between offer creation, order management, payment, fulfilment, and settlement. If an element in the experience changes, voluntarily or otherwise, a high-performance retailing platform adapts as a result. For example, suppose someone’s interline flight segment is cancelled while they are at the airport. Data science models and flexible, best-of-breed retailing technology could step in to power a better experience. Ancillary purchases could be automatically rolled into a new flight option. The customer could be offered half-price lounge access from a third-party provider to compensate for their wait. This offer could be made at any touchpoint from airport operations crew to a message to their phone in real-time. All this would happen without disruption to downstream processes such as accounting and revenue integrity.
The interdependence of best-of-breed retailing components, acting in unison according to changes in the retailing or travel experience, would create a perpetual motion of value to customers, the airline, and its partners. That is high-performance retailing.
This scenario may be on the near-term horizon for innovators and visionaries. But if your airline is not there now, how can you prepare for high-performance today? Think A to F.
A to F
A – Accounting and Finance: Prepare downstream processes for retailing
B – Bundles and Ancillaries: Introduce dynamic retailing of products such as premium seats, meals, WIFI, lounge access, and bundles
C – Core Offers: Add more agility to your revenue management processes by using more data sources such as competitor data
D – Distribution: Control your channels with NDC and encourage channel adoption with distinctive offers
E – Enrich: As you get more sophisticated, consider enriching your retailing strategies with data science to finetune offer creation and optimization
F – Freedom: Break free from legacy constraints by swapping monolithic with modular and embracing best-of-breed.
If this topic interests you, join me at the World Aviation Festival for my roundtable on October 5 at 11.20 am.
Article by Tye Radcliff, SVP Product Strategy (Order Group)
If you would like some fresh thinking about airline retailing, then check out Accelya’s Air Transformation Lab. This is where we ask a fundamental question: when it comes to the path to distribution freedom and high-performance retailing, where is your airline on this route? Join us on this exploration into airline retailing from various vantage points to inspire your journey ahead.
Airports must include parking in their development plans as the aviation sector experiences ongoing growth. One of the most significant non-aeronautical assets of airports remains to be parking, although the emergence of new technology and travellers’ choice of multimodal transportation in many locations continue to challenge the industry.
In this context, parking is not only a crucial asset for the airport’s bottom line but also a strategic tool to attract and retain passengers. As such, airports are increasingly focusing on this area to optimise the value of their assets and develop a sustainable business model. It is indeed important for airports to diversify their revenue streams to reduce the reliance on aeronautical revenues and alleviate airport congestion.
2. What are the main challenges facing the airport parking industry?
The main challenges that the airport parking industry is still facing include the fact that media portrayal of airport parking is almost always negative. Unfortunately, coverage of the industry is usually driven by events such as companies failing or negligent team members.
This makes it hard to communicate the benefits of off-airport. This perception must be changed.
The reality is that long-stay parking, as an alternative to “Kiss & Fly” drop-offs from family or friends, has a substantial role to play in lowering carbon emissions by minimising car trips to and from airports.
Long-term parking is also a much less expensive alternative to “Kiss & Fly” drop-offs and can be very convenient for families who wish to avoid driving long distances.
If more people could be convinced to park their cars at the airport, it would help relieve traffic congestion and pollution in city centres, as well as reducing parking charges in some locations.
Another major issue is making sure that the customer feels confident while leaving the car during their travels. If a customer is not confident in the security of their vehicle, they will be less likely to use long-term parking.
The most important issues for customers are how safe the car will be and whether it will be returned in the same condition. To provide customers with confidence, many parking lots have 24-hour security, which ensures that their vehicle is always secure. But the idea of parking on-site at the airport is still perceived as more convenient and less stressful. A recent survey of travellers found that they still prefer to park on-site at airports, but will consider off-site parking if the price is right.
3. Off-airport parking
While on-airport parking is the most convenient option for travellers, it can also be the most expensive. Off-airport parking options are often more affordable and can help relieve some of the pressure on airports during peak travel times.
Since comparing platforms is not limited to off-site airport parking but can be used for services in general, the opportunities for expansion are endless, especially for airlines and travel agencies. If a business wants to expand into new markets, it can just create a profile on our website and share its own unique offerings with travellers.
4. How Parkos approaches it
At the busiest airports, high-quality off-airport shuttle and valet services are
well-established, provide convenience for travellers, and are more affordable. People who prefer not to travel through congested and frequently confusing airport roads prefer off-site options.
According to Parkos, the best way for airports to continue profiting from parking without the hassle of setting up a reservation management system is to focus on expanding their reach. Airports will be able to offer parking to a larger group of travelers if they are available on comparison platforms. In this way, the capacity will be monitored constantly and the pricing will be set according to demand and capacity.
We “Parkos” also provides airport managers with real-time data regarding their revenue, user numbers, and parking space availability. This information can help them decide whether or not to expand their parking structure and make important investment decisions accordingly.
5. How will technology help make airport parking more efficient in the future?
How can airports solve these problems? New parking technologies are helping airports address some of these issues. With a growing number of travellers each year, Lyon-Saint Exupéry Airport for example, has been struggling to keep up with the demand for drop-off points close to the terminal. In an effort to improve the situation, Stanley Robotics recently introduced autonomous parking robots at the airport.
The robots, which are about the size of a small car, will park in designated spots and then shuttle passengers to and from the terminal. This will free up space near the terminal for other vehicles and should help reduce congestion.
6. The green future of Airport parking
Airport parking is a major source of emissions. In order to reduce its environmental impact, many airports are turning to green solutions such as electric vehicle charging stations and solar panels.
Electric vehicles are becoming increasingly popular, and as a result, more and more airports are installing charging stations. This is the opportunity for off-airport parking to convert to electric shuttles to reduce carbon emission as well.
Solar panels are another way that airports are reducing their emissions. By harnessing the power of the sun, solar panels can provide a clean and renewable source of energy.
In conclusion, airport parking is an important aspect of the travel industry that will continue to grow and change. Many of the changes will be driven by new technology and sustainability. The key to success, as in any industry, will be the ability to adapt. The travel industry is constantly changing, and airport parking is a big part of the travelling experience. Airport managers must take advantage of new technologies to improve their businesses and serve their customers better by looking at comparing platforms as allies, in the pursuit of achieving a greater level of satisfaction in their parking experiences.
5 reasons why LCCs are best placed for advanced retailing
For many organizations and industries, the word ‘change’ often carries with it a negative emotional reaction: fear, anxiety, resistance. We understand that Low-Cost Carriers are often the exception that proves the rule – embracing change and turning it to their advantage.
LCCs accept and embrace the idea that change is inevitable – it’s a case of ‘when’ and not ‘if’. We’ve witnessed firsthand the way they’ve proven time and again their ability not only to adapt and evolve to the world around them, but to actively drive innovation and disruption within the airline industry.
This desire for progression and growth has driven LCCs to push the envelope and they’ve already set off on the journey to a retail-powered future of offers and orders. But we believe that even greater opportunities lie ahead. Opportunities to continue to think differently and build on existing capabilities.
What do those opportunities look like for LCCs?
In the future, we see huge possibilities for LCCs to more easily and economically extend indirect distribution, as well as broaden the types of ancillaries that are being retailed today. In addition, access to advanced data analytics such as AI/ML will enable LCCs to create and retail more personalized and contextualized offers, improving conversion and boosting revenue opportunities.
At Sabre, we’re committed to accelerating and leading industry change – in partnership with our customers – with a scalable yet modular solution. We’re enabling airlines to build the solutions that best meet their needs, at a pace that matches their transformation ambitions.
Here are 5 reasons why we believe Low-Cost Carriers are ideally placed for advanced retailing that would see them grow market share and revenue:
1. It’s in their DNA
Challenging the status quo is what LCCs were built to do and disruption has been key to their success.
2. LCCs know how to exploit an opportunity
Blazing their own trail in search of progress is how they first identified a better way of operating an airline business.
3. LCCs are the masters of upselling
A strong focus on selling air ancillaries that boost margin and add choice/value to travelers makes advanced retailing a logical extension of what LCCs are already doing today.
4. LCCs are tech savvy
By already utilizing more modern technology than most FSCs, they’re primed for growth and can implement change quickly and effectively.
5. LCCs are agile
Adaptability and a ‘test and learn’ mentality makes them ideally suited to a future world of advanced ML (Machine Learning) and experimentation
Of course, we recognize things won’t change overnight, but we believe that for LCCs the prospect of a rapid transition to more scalable technology should instill a sense of opportunity; a clear chance to gain competitive advantage against those less willing or less able to embrace change so readily.
If LCCs bring their air ancillary ‘upsell’ mentality into the future – a future with greater possibilities to forge new partnerships, retail a broader variety of ancillaries from third parties and create more personalized and compelling offers – there’s the potential to really shake things up within the industry.
At Sabre, we’re innovating to power the future of our industry. We’re here as your trusted and reliable resource for solutions that enable you to take advantage of a future open with possibilities. Learn more at sabre.com/open
Airlines Face Challenges of Service Disruption with Digital Staff Optimization a Key Opportunity for Improvement
As the airline industry recovers from the downturn of the Covid-19 pandemic, the negative headlines of cancelled flights take the sheen out of the summer season. The impact of staffing shortages at airports and airlines, with the loss of personnel in the aviation industry resulting from the extended shutdown, is a growing concern.
Policy hasn’t helped, particularly in Europe, where what the International Air Transport Association (IATA) has dubbed the “premature return of 80/20 slot rules” force airlines to schedule more flights than airports are perhaps ready to handle due to a ground crew shortage and staffing shortages at border control check-points.
It’s a lose-lose proposition for all involved. No one in the aviation industry, landside or airside, wants to be in the news for failing to deliver service to the passengers who rely on them.
But there are long-term systemic issues that we also need to face, including the attractiveness of the industry to new hires, particularly digital-native (Gen Z) recruits, and our ability to retain talent in a demanding marketplace. Long before the COVID-19 pandemic, IATA, Boeing and others were already warning of a considerable staffing shortage across the board, ranging from a pilot shortage to cabin crew, ground staff, skilled maintenance and more. Proposed solutions then included a greater adoption of platforms for training and staff management.
Imagine a Platform Designed for People Who Love Aviation Enough to Dedicate Their Lives to It.
Those predicted aviation staffing shortages have only become more immediate and more severe. And emerging decentralized business models, like platforms, remain the best option to address the gap between the supply and demand of skilled personnel.
“The industry is expected to increase employment further this year, continuing to rebuild the workforce following the significant decline observed in 2020,” IATA writes in its June 2022 Airline Economic Performance Report. “Total employment is nevertheless expected to remain below the pre-pandemic level for some time. The time taken to recruit, train, and undertake the necessary security checks and other requirements before staff are ‘job-ready’ is presenting a challenge for the industry in 2022. In some cases, employment delays may act as a constraint on an airline’s ability to meet passenger demand. In countries where the economic recovery from the pandemic has been swift (V-shaped) and the unemployment rate is low, tight labor markets and skill shortages are likely to contribute to upwards pressure on wages.”
Collaboration for The Future of Flight: The Benefits of Platforms
While the aviation industry works on a defined framework of rules and procedures, the nature of work is evolving in the world around us. The way in which we work must keep up, without sacrificing safety practices. It may sound like a tall order, but platforms make it possible.
Just looking at the IATA Labor report alone, we can see that the industry is already maximizing labor capacity under the current aviation working model, with productivity recovering, despite a reduced labor force, and the costs of labor remaining low.
But is that the best we can do for ourselves and for the people who work in aviation today? Will it be enough for the people we’d like to have working in aviation tomorrow?
The simple answer is: no. The metrics of productivity illustrated in this helpful chart from IATA are based on work performed with legacy systems, with communication and collaboration still happening by telephone, fax, notes, and memos distributed on paper, and of course, the record-keeping required by regulators.
Communication and collaboration in many corners of aviation are far from optimal. Imagine how much more productive the people of aviation would be if they were collaborating with modern tools. Platforms optimize knowledge management, providing a shared brain, a central point where the organization can review issues in context and collaborate to resolve them, at the same time sharing know-how.
Ensuring a free flow of information, across time zones, across functional areas, and across generations would boost the productivity of aviation significantly— we estimate at least 20%—and bring the aviation workspace into a modern era. This is not only essential for organizational efficiency. It will also make the aviation workplace more attractive to a fresh generation of GenZ working professionals who may have other expectations rather than using printers, fax machines, or emails, and who will think of telex communication as an urban legend.
From Recruiting to Upskilling and Beyond: The benefits of digitalization
The International Air Transport Association (IATA) has published recommended measures to prevent greater loss of staff and to recruit new staff. The Association has recognized that digital tools can play an important role in staff optimization and training.
While the most recent statement addresses the ground handling shortage the principles apply to recruiting and retention for all key operational functions of the industry. They are, in essence, an extension of human resource and training priorities IATA has previously stated for other operation-critical functions.
Speeding-up the training processes through competency-based training, assessments and online training formats
Increasing the efficiency of staff utilization
Digitalization and Modernization
Digitalization of aircraft turn around
Modernization of equipment and processes
“Harnessing data to improve safety and efficiency is crucial,” said Monika Mejstrikova, IATA’s Director of Ground Operations, speaking at the 33rd IATA Ground Handling Conference (IGHC), in Prague at the end of 2021. “The overall aim is to be able to make data-based operational decisions that will cut costs, improve performance and contribute to the industry’s net zero commitment.”
The sphere of aviation maintenance has similar needs. The highly-skilled individuals who keep planes operating safely are also in high demand, and face pressure to accomplish more. Technology must empower them, improve knowledge exchange and communications resulting in better collaboration to boost efficiency. With empowered maintenance professionals and data driven insights suggest: the invisible can be made visible, the aviation industry can minimize downline effects or avoid the disruptions of grounded aircraft, and gain a more effective life-cycle management of the global aviation fleet.
There is an opportunity for a new era of empowered apprenticeship in aviation, one in which recruiting is simplified and new hires have the confidence that senior-most experts will have an open platform to advise them, even if they work in different hangars and in different countries.
As a team who deeply understands and respects the experience, resourcefulness and know-how of our industry, we’ve committed ourselves to offering aviation the platform to keep flying.
Phygital: How Cognitive Technology Drives Smart Airline Operations
Global air traffic is set to grow to nearly 10 billion travelers per year by 2050, according to the Waypoint 2050 report of the Air Transport Action Group. While the forecast from the current count of nearly four billion travelers is extremely encouraging as we recover from the pandemic, it is a troubling foreshadowing of likely congestion at airports, leading to delay or cancellation of flights. The airline industry should take the opportunity now to augment physical facilities with digital technology to chart a sustainable growth trajectory, in an effort to mitigate growing pains of the future.
Artificial Intelligence (AI) and cognitive technologies provide tailwinds to flight operations and workflow management by extracting value from unstructured data; detecting motion, anomalies, and patterns in video images; and enabling autonomous capabilities. While conversational assistance in natural language is a widely adopted AI use case in travel and hospitality, it now embodies technical and business processes.
Cameras equipped with computer vision, IoT sensors, biometrics technology, and self-service applications provide a rich repository of visual, textual, and contextual data. These datasets provide insights into passenger demographics, behavior, intent, and purchase patterns, as well as diverse operational activities. Airlines can now utilize cloud-hosted, AI-driven analytical solutions that leverage data for seamless convergence of physical and digital systems. A converged ecosystem can improve landside and airside operations, covering both above and below the wing services, as well as ancillary and ground support services.
Automates landside operations
Since June 2018, IATA Resolution 753 has mandated tracking of each baggage item at four critical points during the customer journey: (1) passenger handover to airline, (2) loading to the aircraft, (3) delivery to the transfer area, and (4) return to the passenger – and such tracking data should be shared with interline partners as well. AI-powered luggage handling systems automate tracking and communication. These systems share real-time baggage status with stakeholders, including passengers. In addition, computer vision-powered smart cameras detect unsafe and prohibited baggage items accurately, which enhances the efficiency of baggage inspection.
Smooth flow of baggage and passengers is the barometer of terminal operations. Face- and iris recognition technology allows airlines and ground handling agents to deploy self-boarding gates. Biometrics enable contactless identification of passengers at airport touchpoints and automate scrutiny at security checkpoints. The immutable identity authentication accelerates passenger screening, passport verification and immigration clearance. In 2018, Miami International Airport implemented facial recognition screening for inbound travelers, which facilitated screening of ~10 passengers per minute, and significantly decongesting overcrowded arrivals facilities.
AI systems with visual sensors are the ‘eyes on the ground’ – monitoring everything from passengers and employees to cargo and concourses. Smart surveillance from the drop-off curb to the aircraft provides critical operational inputs, such as the volume of originating and terminating travelers, and dwell time at screening stations. Real-time data empowers managers to take timely decisions related to addressing curbside requirements, managing passenger throughput, and transforming the experience for passengers as well as airline crew and airport staff. This also enables airport operators to identify chokepoints in the passenger terminal flow and quickly work to remove them.
Tracking of the volume and movement of travelers optimizes queue management and boosts productivity of resources. However, AI-driven efficiency transcends seamless flow during peak travel season. Airlines using self-service solutions and automated kiosks to streamline traveler facilitation services and baggage handling can integrate the data with core service databases and airport management systems to reduce overheads and optimize arrival / departure operations. Further, machine learning models and analytical solutions draw on IoT sensor data and video footage to predict peak footfall and issues during the period, which can be used to enhance self-service processes, contactless mechanisms and in-flight interfaces.
Streamlines airside services
AI platforms enhance the in-flight experience by mitigating technical and logistical issues that disrupt travel. Algorithms synthesize real-time data for clockwork accuracy in coordination of services, such as in-flight catering, ground support equipment handling, handling passengers with disabilities, water supply, and air conditioning. Cloud portals assimilate sensor data spanning diverse parameters – from air quality in the cabin to food supplies, which helps accelerate aircraft turnaround times and improve safety.
Analytical solutions correlate real-time data feeds with aircraft-specific standardized metrics and historical data to detect issues and notify anomalies, including safety issues and delay in ground servicing activities. Further, AI systems augment technical support by providing recommendations that enable maintenance and engineering teams to troubleshoot and diagnose events for managing incidents proactively and refining emergency planning.
Unplanned maintenance causes flight delays and cancellations, which increases overheads, including compensation to travelers. Carriers deploy predictive maintenance applications to significantly reduce equipment failure. Real-time data from IoT-enabled aircraft machinery and onboard health monitoring sensors offer insights into the current technical condition, pinpoint malfunction, and flag potential failure. It empowers maintenance crew and field technicians to undertake physical inspections faster and more effectively. Notably, predictive maintenance improves aircraft reliability. Delta Air Lines, for example, previously partnered with Airbus to implement a predictive fleet maintenance program that reduced maintenance-related flight cancelations from ~ 5,600 to only 55 within an eight-year period.
The scheduling teams within an airline are responsible for seamless operations of thousands of daily domestic and international flights, and should factor in independent, dependent, and mutually exclusive variables for routing and scheduling purposes. For instance, the experience of pilots and flight attendants could be mapped with the flight route and aircraft model – as some airports in Central America require additional airport-specific training qualifications in order for pilots to perform landings. As expected, all crew schedules must adhere to complex labor (union) agreements and government regulations – which vary between workgroups.
This summer has been a very challenging one for airlines everywhere, as they struggle to operate with limited staff of their own and operate at major airports where local staff are also severely limited which cause further costly disruptions to airlines.
AI models optimize crew and schedule management by taking into account operational constraints, regulations, resource availability, maintenance schedules, and costs. Significantly, machine intelligence addresses qualitative issues such as jetlag and fatigue. Smart models help mitigate health risks due to long-haul flights or change in time zones and integrates datapoints into the rostering system. Most important, AI systems optimize aviation fuel consumption for route planning. Maximizing fuel efficiency is a business imperative as well as an ethical practice.
Cognitive systems provide a smart interface between the aircraft, airfield and landside operations. Advanced data science enhances operations, while providing a superior experience for travelers and operators.
Infosys is an associate sponsor at the World Aviation Festival 2022 on 5-6 Oct at RAI Amsterdam, where we will have our booth #12.562 showcasing innovative solutions that solves today’s business problems powering technology and moderate a rich roundtable with top CXOs on ‘‘The convergence of Phygital mechanism to optimize operations above and below the wings, landside and airside. – via usage of camera, sensors , AI etc.’