In-Flight Connectivity. A Lucrative, Loyalty Building Opportunity
The In-Flight Connectivity (IFC) market is set to double in the coming decade.
As people have become reliant on being connected at all times, IFC represents a huge opportunity for airlines.
Ancillary revenues
IFC represents a vast opportunity for ancillary revenues amongst airlines. In 2019, the London School of Economics predicted that Wi-Fi in the cabin would generate $30 billion in additional revenue for airlines by 2035.
More and more airlines are offering passengers free access to their Wi-Fi with imposed limitations. For example, a time limit after which access to the Wi-Fi must be paid for or the ability to stream videos for a price.
One airline making a concerted effort to capitalise on these IFC ancillary revenues is Qatar Airways. With Qatar hosting the 2022 FIFA World Cup in November, the Doha-based national carrier is preparing for 36 million passengers to go through Hamad International Airport this year.
This month, Qatar Airways announced the expansion of their partnership with Inmarsat. Akbar Al Baker, Qatar Airways Group Chief Executive, said:
“as the 2022 FIFA World Cup approaches, Inmarsat is the perfect partner we need to ensure Qatar Airways can offer unrivalled inflight connectivity to each and every passenger.”
The Super Wi-Fi enabled by Inmarsat’s GX Aviation will enable passengers to stay up to date with match scores and livestream games during the flight, for a price.
Loyalty
IFC also provides airlines with an opportunity to generate loyalty. Currently, passenger take-up rates of IFC remain low due to concerns with reliability of service, fees, availability, and concerns with data safety. This provides a huge opportunity for brand differentiation between airlines, and with it, loyalty.
The ability to establish loyalty with business customers through a strong, stable connection to the internet is self-evident. However, IFC also provides a unique opportunity for airlines to connect with Gen-Z.
In a report focused on a group of mostly younger travellers, 12% of those who were uncommitted to any airline loyalty programme said they would be willing to switch their allegiance in favour of high-quality inflight Wi-Fi. As a major question in the industry at the moment, this year’s World Aviation Festival will be exploring how to establish loyalty with the emerging generations.
At this year’s World Aviation Festival a panel will also be discussing “How can a digital-retail mindset help airlines to unlock the true commercial potential of inflight connectivity?”
Article by Jess Brownlow
