Adding personal touches to the flight experience, such as priority boarding, customized menus, and prompt services, can create a memorable journey. Loyalty programs are essential to increase the stickiness of airline customers and maintain a brand’s customer base.
Studies emphasize the value of loyalty programs, with returning customers spending 67% more than new customers. Additionally, personalization can increase revenue by 15% for services offered. These statistics highlight the importance of a strong airline loyalty program. For instance, a Middle Eastern carrier was ready to invest millions in acquiring the loyalty program of an India-based airline without purchasing the entire airline.
The evolution of loyalty programs for airlines
Airline loyalty programs have evolved beyond traditional perks like complimentary services and upgrades. They currently emphasize personalization, aiming at specific customer groups and offering cross-industry experiences customized to individual preferences. They use extensive customer data for targeted marketing and curated loyalty offerings that resonate with many travelers.
Airlines are adopting interoperability, which allows different systems and loyalty programs to work together and share data, expanding their loyalty programs. Partnering with banks, credit card providers, and entertainment companies enables them to collect valuable customer data. This data-driven approach enhances program value, encourages traveler engagement, and boosts loyalty and profitability.
Ways to build interoperability: Strategies and Methods
Organizations within and outside the airline industry can achieve interoperability to facilitate operations across multiple geographies. Here are some ways to establish interoperability:
1. Strategic alliances:
Airlines should establish partnerships with others to expand their loyalty programs.
For instance, Star Alliance, with Air India, United Airlines, Lufthansa, Singapore Airlines, Air China, South African Airways, Air New Zealand, and 17 more, personalizes experiences for global travelers.
2. Add-on benefits:
Airlines should build ecosystems that extend beyond flights, offering services like visas, entertainment experiences, airport pick-up, and hotel drop-off.
For instance, Etihad Airways offers exclusive packages for the Abu Dhabi Formula One Grand Prix, and Qatar Airways sponsors multiple sports events with exclusive offers for loyalty program members.
3. Unified platform:
Airlines should develop a common platform or app that allows customers to access all services and products seamlessly to increase the stickiness of airline customers.
The approach meets the needs of travelers who value speed and convenience in their travel experience, with interoperability as the key to unlocking numerous opportunities.
Morphing loyalty programs into a universal currency
The benefits of loyalty programs are clear, and when it becomes a universal currency, it has a significant impact. Instead of creating separate points programs, airlines form alliances with businesses across diverse industries. This process expands the loyalty program’s benefits to a broader range of partners, such as banks, retailers, hotels, and cab operators, all within the same alliance.
For instance, the Alaska Airlines Mileage Plan program lets customers earn loyalty points from the airline and various retail partners. These partners include top brands like Sephora, Adidas, FedEx, Disney, and Jimmy Choo. Partners can use the loyalty platform to promote and advertise their products/services.
The airline enjoys an enhanced brand image and gains free word-of-mouth advertising on social media. This program extends beyond flight services to other aspects of the overall experience. It also increases engagement, where customers open the app at least once daily to track activities and services.
Listed below are a few recommended practices where loyalty points can become universal currency:
Making the ecosystem interoperable:
Interoperability helps airlines invest wisely in loyalty programs and gather valuable customer data to execute targeted marketing campaigns and audience segmentation.
Customers can use their loyalty program points as ‘miles’ across the ecosystem, creating a seamless and effective user experience.
Interoperability grants airlines access to a rich database of marketing insights from alliance partners, helping in customer acquisition and retention strategies.
Customer engagement:
Achieving success in loyalty programs hinges on creating memorable, emotional customer experiences.
For instance, Delta Airlines utilizes universal currency by implementing a shared loyalty program within its partner ecosystem.
Delta Airlines employs a biometric system and automated security screening to provide efficient access to Sky Club for members who’ve submitted biometric data.
Delta’s Sky Club members with Clear memberships enjoy a better and hassle-free experience, accessing the locations using their fingerprints.
Mobility-as-a-service:
Mobility-as-a-service is a strategy to transform loyalty points into universal currency, making them usable across multiple services.
For example, the Kotak Indigo 6E Rewards credit card provides perks like add-ons, seat preferences, in-flight meals, lounge access, and discounted convenience fees.
Airlines can leverage these credit cards to tailor discounts and offers on gym memberships based on individual customer profiles.
The alliance partner ecosystem can utilize these customized offers within the shared database.
Mobility-as-a-service: a forward-looking value proposition to increase the stickiness of airline customers
Loyalty programs are undeniably becoming vital in helping airlines expand their wallet share. For instance, customers typically spend more on their trips than just tickets. Yet, through the loyalty program and seamless interoperability, customers now perceive the airline as their comprehensive solution.
Creating partnership ecosystems in travel enables airlines to increase customer revenue while enhancing their overall experience with added value, convenience, and comfort. Mobility-as-a-service offers numerous benefits, including:
Hassle-free, end-to-end convenience: It caters to customers’ egos and emotional satisfaction, increasing the likelihood of retaining them with the same airline.
Comprehensive services: From doorstep services to chauffeur and concierge services, it offers the utmost convenience.
Acceptance of premium services: In the current scenario, crafting personalized loyalty programs and providing an all-in-one solution is highly effective, with speed and convenience taking priority over costs.
Win-win arrangement: A mutually beneficial arrangement benefits program not only the airline’s loyal customers but also those of its partners, fostering opportunities for valuable partnerships.
Enhanced Brand Visibility: When customers share their travel experiences on social media, it attracts more attention, expands brand visibility, and brings in new customers through positive recommendations.
These trends are indicative of the future of airline loyalty programs. A technology partner like Robosoft can enable airlines of all sizes with the technology capabilities required at the backend to develop these platforms and open access to data and intelligence. Airlines can then focus on loyalty strategies for high-value customers and leverage customer relationships and alliances to increase profitability.
An airport is no longer just a temporary home for passengers in transit or those making their way to scheduled flights. Airport users can spend their waiting time between flights at any of the retail outlets, food courts, gaming arena or lounge areas for infotainment/recreational experiences.
However, as more airports get privatized, they’re under pressure to show profitability by increasing their overall revenue with an emphasis on generating more revenue per customer. Considering the change in the nature of the airport experience, airport operators have the opportunity to transform the airport from a point of transit to a destination in itself. As a result, they can grow revenues by enhancing the emotional connection with customers and enabling a superior experience they would want to repeat – by crafting relevant digital solutions.
The Airports Council International shared an interesting overview of the airport economy:
Passenger satisfaction can be achieved in two ways at the airport – by ensuring seamless transit or by keeping them engaged during their time at the airport. In recent years, technology has proved to be the differentiator between a nightmarish or boring experience, and a memorable experience they would eagerly repeat. As illustrated below, there are infinite touchpoints at the airport where technology can help airport management design a welcoming and intuitive experience for passengers.
The need for a unified and seamless experience for airport users
Many airports offer a fragmented customer experience as they force passengers to crisscross different touch-points from the point of entry through to parking, check-in, baggage, navigation, food and recreation, boarding, immigration, and so on. Often, they lack a single source of information and don’t have digital means to pre-book or check availability of certain services such as lounge area etc. In specific cases of first-time travelers or elderly flyers, navigating through busy, large airports can be overwhelming and disorienting.
However, through technology interventions, airports can go a long way to provide a more unified and harmonious experience for airport users. For example, they could develop a mobile-based app or website that integrates the passenger’s journey at various touch points and enables a single point of information for all their needs from the time they arrive, transit, and depart from the airport.
Here, we illustrate the different possible ways in which technology can intervene to enable a unified and seamless airport experience.
Many airports, including the best, busiest, largest, and popular ones, are implementing some of these digital solutions. Here, we present some of the innovative use cases that are emerging as a result.
Simplifying the passenger experience through technology
#1 Smart parking – Airports can integrate a parking solution on their app/website that allows passengers, especially those who are hard-pressed for time, to reserve spots in advance. They can use their allocated QR codes to pay for this service and enjoy the benefits of knowing exactly where to park and plan their travel/commute accordingly. This can address the stress points and improve efficiencies for airport authorities and passengers as well.
#2 Easy navigation enabled by Augmented Reality (AR) – Passengers can use AR guided navigation on their phones to find their way through vast airport spaces, avoid crowded spaces, find the least congested lounge areas or restrooms, and get to their destination gates faster, especially when they are running late. The UK’s Gatwick airport has invested in beacon technology in the form of 2,000 battery-powered Bluetooth Low Energy beacons for this purpose. Also using beacon technology at United Airlines’ Newark airport hub, its app users can pin their location inside the airport and be guided to their boarding gate, ATM, restroom, dining area, waiting areas and more. This is drastically reducing travel day friction for the airline and its passengers at the airport. Other approaches being developed in this area include built-in mobile sensors and cloud-based AR that superimposes user-centric digital content over physical objects.
#3 Information and navigation with robots as guides can provide flight-based information to help passengers navigate through the airport unhampered. British Airways has invested in autonomous robots who interact with passengers at Terminal 5 in multiple languages and keep them informed with real-time updates. Also at Heathrow’s busiest terminal, self-driving luggage vehicles are being used to trim down lengthy waiting lines. The future for robots at airports looks promising with other airports including Seoul, Munich, and New York’s LaGuardia also trying out autonomous machines on their premises. Robots will take over check-in processes by the end of the decade predicts a 2020 report by Vero Solutions.
#4 Wheelchair assistance using AI & ML – Clever implementation of AI and ML can help those with mobility challenges or sensory impairments who need to be assisted through airport procedures including check-in, security, baggage claim etc. An innovative example of this is being implemented at India’s Sardar Vallabhbhai Patel International Airport in their AI-based surveillance desk that will serve senior citizens, infants and other passengers seeking timely wheelchair assistance in case of an emergency.
Enhancing leisure and entertainment at airports
The convenience industry is growing significantly as people expect everything to be delivered wherever they are. Digitalization is enabling this along with time saving, cost-saving benefits for the airport authorities who need to deploy fewer staff for various processes. For passengers, the biggest advantage is less time spent at the airport as they don’t have to come hours in advance to the airport to complete checking in before boarding their flights. But there are times when passengers are forced to have long layovers especially, in international travel. Here, the airport management knows that real value comes from offering premium services in ways that make users feel the premium-ness of the experience.
Airports are using several technology deployments to create a premium leisure experience and increase their non-aeronautical revenue.
#5 One-stop-shop for all travel-related info, especially when traveling in countries where passengers don’t understand the local language, having a single app can smoothen their transit with timely notifications to move from point A to B and so on seamlessly. If their layover is lengthy, they could also benefit from local travel suggestions, and personalized offers and recommendations for leisure, entertainment, food as well.
#6 Gamification opportunities at the airport – Authorities at Cochin’s International Airport introduced interactive video games to inform passengers of first-aid principles for heart disease. Gamification will allow new-age travelers who have long layovers to entertain or distract themselves. There could be a competitive element introduced by offering players discounts or airport-specific reward points that can be redeemed at retail or duty-free outlets. Airport authorities can also draw more attention to certain portions of the premises such as lounges and direct people towards these in order to decongest other parts of the airport.
#7 Using geofencing/ beacon technology and location, airport apps may be able to push targeted offers and messages to people at the airport. For example, the Miami International Airport app sends offers and recommendations to travelers prompting them to patronize food and retail outlets.
The age of the digital airport is here
Technologies like AI/ML, AR/VR are holding sway in the market as they continue to disrupt, enable, and engage passengers with the power of digital experiences at airports. These digital solutions offer benefits to the airports, airlines, and travelers alike and the opportunities that they open up, are truly infinite.
Using these solutions innovatively, airports certainly have significant potential to grow non-aeronautical revenues while strengthening ecosystem relationships and addressing some of the inherent complexities and pain points in the industry. These possibilities are captured in the visual below.
Nevertheless, the new-age traveler still expects the human touch to an extent. Therefore, airport authorities must refrain from blindly investing in technologies, which can be costly and ineffective. Instead, they need to take an iterative approach to digitalization and create a clear blueprint of the right technologies and tools that retain enough of the physical aspects to make the digital airport experience real and memorable.
UX design has been a critical aspect of aviation for a long time, from the creation of cockpit systems to the development of cabin design and passenger experience. With the introduction of more refined UI and new technologies like AI/AR, and Biometrics, airlines are continuously looking at ways to enhance UX in Aviation. These exciting new technological advancements in the aviation industry are being enabled by robust new user experiences.
From the past, airlines have already been making significant efforts in improving the passenger experience from varied seating choices to chef-designed meals. Aircrafts are now also able to access real-time data directly from the ground, improving situational awareness and increasing control capabilities. Mobile devices will also gain access to wider navigation information and improved passenger services, ensuring that users of their devices will better understand why they’re using it.
However, improving customer experience is a never ending process and even now passengers tend to report that they are left looking for more in terms of improved UX. In a world where customer is king, it falls on the aviation industry as a whole to tackle its UX challenges and find CX improvement areas. Only then it may be able to appeal to the next-generation of customers.
Some UX Challenges and CX Improvement Areas in the Aviation Industry
According to McKinsey, the overall traveler satisfaction level hasn’t seen any kind of decline post pandemic. In fact, many have found the travel experience to be better than it was before the pandemic.
Source: McKinsey
But these surprising numbers in customer satisfaction are mostly derived from leisure travelers who maybe just feeling happy to be on the road again. There are still major UX challenges and improvement areas like flight cancellations, delays, rebooking hassle, compensation merry-go-round, loss of time and money among others.
These are just a few examples of the vast majority of UX challenges generally faced by customers while traveling via air. Some major challenges and improvement areas in customer experience journey are:
#1 Non-uniform travel experiences
Till now aviation companies were looking to continuously improve only the in-flight passenger experiences while somewhat disregarding the other touchpoints for passengers. But now there is a need to improve the customer journey in all aspects of their travel by working towards an omnichannel experience. This will provide a seamless end-to-end customer experience by airlines from booking tickets to arriving at their destination.
The new generation of customers are driven by seamless smartphone experiences and seek for the same everywhere. A big step to achieve this is by providing important notifications via normal text or via app notification. Airlines are now expected to be able to provide pre- and post-flight information, timely updates and assistance to customers.
#3 Longer processing time
Earlier, the check-in experience was already a tedious task, now add new norms after the pandemic and you got a steep challenge to keep your wits end together. The new health check regulations have undeniably added more minutes to the long waiting time of passengers patiently waiting for their turn to check-in.
#4 Undeniable influence of Online Travel Agencies (OTAs)
While OTA websites drive most of the traffic, the actual purchase is generally made on the airlines’ own website/app. Still, when it comes to easy website navigation and other UI/UX features, airline websites lose the battle. Even in today’s time many travelers find booking a ticket very stressful and confusing from airlines’ own website.
#5 Increase in CX while maintaining operational costs
FSC or LCC carriers used to cater to very different class of passengers who were either driven by flight experience or price. As it is becoming a challenge for aircraft carriers to attract new set of passengers, they are looking for ways to attract both these set of customers without compromising much on customer experience.
In our article on digitalization effects on leisure and travel industries, we pitched a Right Price Model for airline business which tackles the important CX initiatives while maintaining operational costs.
How New Technologies are Boosting UX for Airlines [with examples]
One of the main enablers for improved UX is the emergence of newer technologies and their applications in aviation industry. These technologies are digitally transforming the aviation industry and paving the way for a customer centric airline industry.
Some of these technologies and their real life examples are listed below –
#1 Blockchain Technology
Using blockchain technology helps airlines to securely maintain user data and privacy across multiple touchpoints via a digital ledger. The technology can find its use in identity management & record keeping, cross integrations for seamless travel experience, building robust data security systems and airline maintenance.
Air France deployed blockchain technologies to create a COVID-19 test verification system via a mobile app during the pandemic. Singapore Airlines uses blockchain technology for their frequent flyer loyalty program using KrisPay. It also offers promotions to customers along with the program.
#2 Augmented Reality and Virtual Reality (AR & VR)
AR and VR technology when used correctly can not only enhance the UX but also help in improving the customer experience of navigating through the airport or aircraft. The obvious uses of AR and VR technologies can be seen in airports. For e.g. AR/VR can show the passengers cabin experience on VR headsets, provide a digital tour guide, show fastest route through airport, etc.
The Gatwick airport uses AR to help passengers navigate the complex layout of the airport, and London City Airport has installed AR tech to help air traffic controllers with the vital job of keeping planes safe.
#3 Artificial Intelligence (AI)
AI integrated with machine learning, and predictive analytics can help immensely in providing a connected and customized experience to the flyers. Further, AI also has the potential to ease out various operational processes of airlines like revenue management, managing ticket pricing, etc.
Shenzhen airport in China uses AI for AI airbridge allocation as well as for AI turnaround times. Air France implemented the specialized AI platform called Sky Breath that collects data from the flight, performs in-depth analytics, and helps identify fuel-saving opportunities and increase efficiency.
#4 Biometrics
Biometrics is not new to aviation. All the major and minor airports started implementing it since 9/11 to improve their security details. But over the years it has found use in improving passenger experience as well by improving the time and speed of check-in and other operations. In fact, use of facial recognition has been proposed for airports to cut down on flight delays by 80 percent.
Fraport in conjunction with Zwipe have agreed to trial their biometric solutions to boost security at Frankfurt airport. Miami International Airport and US Customs and Border Protection (CBP) started rolling out biometric technology with a few airlines back in 2019. MIA is now seeking a huge biometric push by 2023 that will serve multiple purposes.
#5 Internet of Things (IoT)
The airline industry is using IoT to build a integrated ecosystem combining the organizational functions to increase efficiencies and provide a seamless experience to their customers.
Virgin Airlines have implemented IoT in its Boeing 787. Every single element on the plane is attached to a wireless airplane network, providing real-time IoT data on elements like performance, maintenance, etc. EasyJet’s Mobile Host at London’s Gatwick Airport combines the traveler flight details with live data from the airport’s Google indoor maps. This allows the airline to deliver updated check-in reminders, gate updates, and even personalized directions.
#6 Mobile Solutions
Airlines are using the mobile platform to connect with their customers throughout the passenger journey starting from booking a flight to deplaning it. Airlines can send real time alerts and notification on and off the airport.
Almost all airline carriers nowadays send real-time flight notifications from post booking to deplaning. These include self check-in, flight delay notifications, feedback, etc.
#7 Hearable, wearable & Voice Technologies
These technologies have increasingly found various usage in aviation from internal communication between flight attendants, voice searches, voice bookings to voice check-ins. These are also used in conjunction with in-flight connectivity which provide a real opportunity to drive conversion, upsell items on flight.
#8 Advanced Data Analytics and Big Data
Aviation companies collect traces of customer data from each stage of their travel journey, be it planning, research, reservation, stay, or post-travel review of their experiences. They can use insights from this data and advance analytics to provide a high degree of personalization to the travel experience which in turn could help in building customer loyalty.
These technologies have the potential to revolutionize air travel as we know it. The airline industry is on the precipice of a breakthrough, and most of the credit goes to the wave of digital transformation across the industry with CX as center.
Technology in each step of airline customer journey
As you can see how much of a bigger role technology plays in designing the UX of travelers. Let us further break down the whole customer journey into 5 different stages and discuss how technology plays a vital role in each step.
1. Pre-booking – Airlines can offer a digital tour guide powered by a personalization engine to show destination highlights based on individual customer preferences. Airlines use data analytics telemetry based pattern identification to drive loyalty management programs and offer dynamic rewards while booking.
2. Booking and Check-in – Airline companies can use geolocation based service and marketing apps to offer transportation services, bot assisted agent or self service changes. Geolocation also allows display of local language and currency on website for familiarity and convenience while booking and payment.
3. Airport Experience – Use of IoT baggage tags providing real-time tracking, self-tagging and activation. Biometric enabled check-in and security check. A combination of AR/VR enabled mobile computing, AI, robotics, Big Friendly Data (BFD), Intuitive UX, and wearable technology to help users in self-service check-in to intimate boarding experiences.
4. In-flight experience – Taking help of big data and hearable, wearable & voice technologies to enhance in-flight experiences with traveler loyalty services, communications, and purchases.
5. Post-travel – Mobile solutions to assist in un-boarding and baggage claims. Also, sending customer satisfaction surveys post travel for better personalization in upcoming travel plans.
How Airlines are Ensuring a Highly Personalized Experience for Customers
Introduced in 2012 by IATA, the NDC airline standard is now helping airlines break away from over-reliance on GDS intermediaries. Airlines can now offer more differentiation, push new offers right away on their website, and provide high class personalization to their customers.
The NDC standard ensures each ticket seller stays up to date with each airlines’ newest offers and products. Other benefits of NDC includes:
i) Direct access to upgrades, exclusive packages, or limited-time offers even when customer is booking from a third-party.
ii) High personalization according to individual preferences across customer journey.
iii) Advance level of comparisons for all airline options, including their different services, products, promotions and of course, prices.
iv) Speed to market while distributing products widely across third-party agents or sites.
v) Same content across airline website and travel agent sites.
In short, NDC allows airlines to take control of their purchase and distribution when dealing with customers. This ensures a high level of customer experience from the airlines.
Possibilities for Airline Industry
As new technologies find ways to integrate themselves across various industries, customer expectations are growing higher and higher. Technology is now playing a major role in UX design for the whole airport and airline experience for customers. Today, what looks mind boggling due to technology may become standard norms in near future.
It is very important for the aviation industry to keep evolving with the growing trends in CX and UX. In times to come the airline travel experiences are set to become more personalized, valuable, and memorable for the flyers.
The airline industry has always struggled with profitability – the lockdowns and travel restrictions imposed by the Covid-19 pandemic put them in even tighter shackles of debt, and labor challenges squeeze the margins further. Despite cutting operating costs by 35 percent compared to pre-crisis levels, airlines amassed a huge debt of over $650 billion that they need to recover. The rising prices of fuel, maintenance, and infrastructure pile up, especially with airports also looking to recover losses from airlines. Meanwhile, as airlines seek to make a comeback, they must make investments in employee welfare or competitive salaries. These accumulating costs take chunks out of the bottom line, which was already slim, to begin with.
International travel, the main source of revenue for airlines had come to a full stop during Covid-19. Even as vaccinations progress and countries open their borders, the road to recovery is slow. In 2021, overall travelers were only 47 percent as compared to 2019. Corporate travel may not go back to the glory days; the hybrid model of working is here to stay, so budgets will reduce. Leisure travel encourages the industry, but travelers remain cautious. IATA expects this to improve, recovering to 111% by 2025, but until then, airlines will find profitability a challenge, with multiple players competing for the smaller pool of travelers.
To increase profitability, airlines must critically examine the business model
To increase profitability, airlines must critically examine their business models. The post-Covid-19 scenario is an opportunity to re-imagine new models beyond the silos of low-cost, ultra-low-cost, and full service.
Low-cost travel is often conflated with low price but cost and price should be considered separately. LCCs tend to lower price by reducing frills and conveniences. This is an inconvenience to the passenger and back-fires in realizing the benefits of being a low-cost carrier. FSCs, on the other hand, charge a higher price to accommodate the services they offer. To retain the experience and yet offer a competitive pricing, they need to manage their costs.
Cost management and price determination should be separate activities. Lower cost should be an outcome of reimagined business processes, and increased efficiencies across the operations. Digital technologies hold the promise of lowering cost. Arriving at the pricing should be an analytical assessment of the common facilities and conveniences sought by travelers.
With data available, airlines can determine such conveniences and include them as standard ones in the base price. For instance, one can determine the number of bags most commonly carried in each sector, whether passengers have seat preferences, and other commonly required facilities and conveniences. Similarly, data can assist decisions related to seat selection, meals, and other parameters on whether to be included as standard or priced separately. Keeping customer experience as the prime factor in pricing decisions will result in better customer stickiness and make it the airline of first choice.
Introducing the Right Price Model founded on digital
With changing passenger preferences and the potential of data and technology, there arises a new model that can lower costs on one hand and arrive at the right pricing on the other – The Right Price Model.
The way forward for airlines or indeed any enterprise in the travel & leisure domain is not about low price or full service, but about getting the price right. Profitability lies in the Right Price Model – one which disrupts the traditional notions of FSCs and LCCs. In the Right Price Model, airlines can use the three pillars: revenue, passenger experience, and cost to arrive at the right price – one that ensures superior passenger experience and delivers profitability in the process – all anchored on data and technology.
Revenue – In addition to revenues from ticket sales, digital technologies can open new avenues of revenue generation as well as new ways of offering current services to generate alpha on the revenue. Airlines can adopt a broader strategic focus to monetize adjacent areas of customer convenience in the first and last mile, such as taxi or food delivery, parking, passenger assistance, etc. They can also provide a category of services that generates an alpha over the regular set of services, such as a redefined business class. Digital technology can be leveraged to create a configurable business class – based on the demand, available seats may be released for economy class or added to the business class. Physical differentiation on board can be created by moving the separators. The notion of business class can be redefined with digital and personalized services such as lounge access, priority boarding, SMS luggage tracking and alerts, and other similar digitally enabled services.
Passenger experience – Adopting a passenger-centric approach helps to create a competitive edge, and strengthen the brand, establishing strong emotional connections with the passenger. A digital-first approach with a pleasant look and feel, and easy discoverability helps overcome key emotional inhibitors, and short and easy booking journeys help convert users. The flying experience can be enhanced into a networking experience using digital technologies such as digital multi-player games, assistance, and notifications across the journey.
Airlines can also use data to optimize the experience for sets of passengers, based on the timeslots and routes. For example, if it is predominantly catering to tourists, then the experience can be customized for them.
Costs – Airlines need to optimize their operations to be lean, agile and efficient. For this, they can rely on digitalization of operations and automation of customer touchpoints using state-of-the art technologies like RPA, AI, ML, as well as interactive technology such as biometrics, virtual reality and apps. Not only does digitalization connect carriers to the customer’s expectations, but it is also the secret weapon behind the efficiency of operations. From ticket booking to route optimization, aircraft maintenance, or fleet management digitalization can help implement a lean operation resulting in cost savings, accuracy, and safety.
Digital technology enables a new model of profitability for airlines – The Right Price Model
Digital technologies play a role in optimizing operational costs, creating new revenue streams, and creating memorable passenger experiences. The past few years saw airlines increase their confidence in technology, successfully deploying contactless passenger processes from parking to check-in and luggage drop, tech-led security, and document processing. Automating workflows and enabling self-service through biometrics, chatbots, and virtual and augmented reality offers passengers a digital experience that delights them and reduces operating costs. In fact, SITA’s 2021 Air Transport IT Insights reports that CIOs are betting on technology to support the recovery, with planned IT spending on mobile-based services such as automating vaccination and health verifications, self-service, unassisted check-in, luggage tracking, boarding gate notifications, etc.
Digital can also be leveraged to improve customer experience and add new revenue. While the primary offering is flying, airline carriers can add revenue streams through a range of services along customers’ end-to-end journeys. Whether first-mile, in-flight, or last mile, digital assets, and technology systems can smooth customer touchpoints, automate processes and facilitate new revenue streams. Once mapped out, they can be leaned on to make the services complimentary, enhance customer happiness, or deploy them as part of personalization campaigns. These services can be built into the price, based on data-led scenarios around the customer or managed as additional add-on paid services.
Creating a new path to profitability, paved with passenger delight
Firmly on the route to recovery, International Air Transport Association (IATA) predicts that passenger numbers will reach 4.0 billion in 2024, exceeding pre-pandemic levels by 103% from 2019. This is a good time for carriers to study macro-trends and add digitalize their processes or use the potential of data and analytics to inform them about customer preferences.
Digitalization is a path for airlines that has solutions on every aspect of the business, whether cost optimization, passenger experience, or pricing and route planning.
Digitalization can automate passenger experiences to reduce the dependency on staff, streamline their own operations and reduce costs. Artificial intelligence (AI) and machine learning (ML) can play a strong role in determining pricing strategies, and with an agile operation, these strategies can also support changes in travel preferences. Airlines can also deploy technology to fulfil sustainability goals to arrive at data-driven flight paths and fuel efficiency.
With high-tech, the age of low-cost and full-service may have come to an end – the time is right for airlines to now move to the Right Price Model. Enabled by digital technology, airlines can now re-shape the economics of the industry, and re-invent the passenger experience to form a new path to profitability.
When the first commercial flight took off over a century ago, carrying 1200 passengers in a short span of 4 months, little did we know that the airline industry is going to change the way people travel forever. Back then, it was a mode of travel only for the elite; the first air ticket ever sold was purchased for $400 (a sum that would be equal to $10,000 today). Today, air travel has become accessible to most and carries a humungous 3.7 billion passengers per year. The airline industry has not just seen an avalanche of passengers but also an immense shift in the way it operates, thanks to the new and exciting technologies impacting the airline landscape.
The industry was firmly on cruise control when suddenly it crash landed in 2020. As the COVID-19 pandemic took over the world, one of the major industry to get hit severely was the aviation industry. The profits for airline carriers were at all time low and many private carriers shutting shop due to heavy losses. The total cumulative losses for aviation industry between the period of 2020-2022 is estimated to be $201 Bn.
But thanks to the ever-changing dynamics of the industry owing to the technological revolution and the ever-evolving nature of consumer behavior, the airline industry has managed to recover well from the unforeseen challenges and is on a trajectory to regain its earlier status. There are however still prevalent challenges pre-pandemic that have become major concerns for all airline organizations.
Some of the challenges that the airline industry has continuously been facing even in the pre-pandemic era are:
#1 Operational efficiency
#2 Declining workforce
#3 Increasing CX while maintaining operational costs
#4 Increasing fuel prices
#5 Maintaining quality service in wake of high customer demands
#6 Volatility in certain geo markets
In our article: How technology is giving flight to customer experiences in the airline industry, we detailed the way some challenges mentioned above impact the airline industry and how technology is helping them address these. We have also pitched for a new pricing model – Right Price Model, for airline business which tackles the important CX initiatives while maintaining operational costs.
Taking the discussion further, in this article we will look at the emerging technologies which are digitally transforming the airline industry and paving the way for the future of a digitally transformed and customer-centric airline industry.
1. Blockchain Technology
A blockchain is a distributed database that maintains a shared list of data or records.
Blockchain technology started out as one of the revolutionary solutions in financial sector. But the recent years have shown that this technology has many uses across multiple industries, including airlines.
The operation of the airline industry has a lot of moving parts and requires data sharing at multiple touchpoints from booking to arrival and even after that amongst multiple players including airlines, online travel portals, airports, immigration so on and so forth. Any leakage of the data through the entire cycle has the potential to not only diminish user experience and affect revenue but jeopardize passenger safety and security as well.
Benefits of blockchain technology in airline industry:
Identity Management & Record Keeping – Blockchain technology enables a hassle-free remote identity management system for airlines as compared to the laborious current biometric system. It can also help in safely keeping records of critical information such as passenger details, baggage onboarding, flight path, tracking down a lost entity, etc.
Cross Integrations for Seamless Travel Experience – Blockchain technology can help airlines turn the miles offered to the flyers into a more valuable asset that customers can use beyond the flying. It can integrate with other aspects of travel industry like ticketing, loyalty programs and non-airline logistical industries like transportation and hotels to create a unified seamless experience for travelers.
Building a robust data security system – With so many passenger records to maintain it is an uphill task for the airlines to manage and maintain the sanity and privacy of this data. Blockchain technology with a security wrapper can help in creating a unique and secure way of sharing and managing this information through the use of authorized access requirements.
Airline maintenance – Airlines have to deal with a humungous amount of data including cumbersome databases and sometimes manual binders when it comes to keeping a log of maintenance records. Blockchain can help the industry to ensure that these records are virtually recorded. Ensuring that all information regarding the procurement of the parts of the aircraft, the maintenance history, the person who has handled the maintenance, modifications that were done, etc. are recorded in real-time, virtually, and is accessible to relevant people when the records need to be accessed. All these details available at the right time without the chances of any error can improve the practice of maintenance, security, and safety to new levels.
Examples of blockchain technology uses in the airline industry:
– Air France deployed blockchain technologies to create a COVID-19 test verification system via a mobile app during the pandemic.
– British Airways and Zamna are working towards facial recognition features using blockchain.
– Etihad Airways partnered with Winding Tree for their blockchain travel platform.
– Singapore Airlines uses blockchain technology for their frequent flyer loyalty program using KrisPay. It also offers promotions to customers along with the program.
2. Augmented Reality and Virtual Reality
Industries like retail, healthcare, etc. are seeing a lot of uses of the AR/VR revolution. The airline industry is also following suit. Right now one of the most obvious applications of these technologies can be expected to be seen in the airport arena. AI can not only lessen the burden on human resource but increase satisfaction when used for customer service in airports.
Examples of AR/VR uses by some airports to delight their customers:
– The Gatwick airport uses AR to help passengers navigate the complex layout of the airport, and London City Airport has installed AR tech to help air traffic controllers with the vital job of keeping planes safe.
– Vodka brand Grey Goose created a multi-sensorial interactive AR experience at Heathrow Airport to engage with customers. As part of this experience, the customers can unveil three new flavors of the brand with simple hand gestures.
– Istanbul Airport created a virtual character called CiGA through AR technology that’ll accompany passengers around retail stores. The character presents special offers from participating retailers and directs them within iGA Istanbul Airport International Arrivals Bosphorus area.
– Another example of AR technology enhancing the airport experience is San Jose International Airport partnering with the Google Tango team for a trial of augmented reality technology in wayfinding, through airport retail promotions and even AR billboards displaying destination information.
According to Jonathan Vaden, lead of the project “Once augmented reality technology becomes ubiquitous, we will see many new and creative ways in which airports around the world begin taking advantage of its capabilities.’’
– Airlines are also starting to use AR/VR technology to create delightful customer experiences for their customers. Qantas is one such airline that has launched a VR app that provides its passengers with immersive, engaging, and experiential videos of the beautiful Australian destinations.
– Together, American and Microsoft are applying the power of AI, machine learning and data analytics to reduce the taxi time for flights, giving connecting customers extra time to make their next flight while also saving thousands of gallons of jet fuel and decreasing CO2 emissions for the American Airlines fleet. Built on Azure, American’s intelligent gating program provides real-time analysis of data points, including routing and runway information to automatically assign the nearest available gate to arriving aircraft.
3. Artificial Intelligence
AI is gaining traction in present times and becoming more and more equipped to understand human interactions. Many industries are using it to upgrade customer experience at every touchpoint. From chatbots to voice-based AI tools there are umpteen use cases of AI being utilized.
AI integrated with machine learning, and predictive analytics can help immensely in providing a connected and customized experience to the flyers. Further, AI also has the potential to ease out various operational processes of airlines like revenue management, managing ticket pricing, etc. A lot of forward-thinking airlines understand the impact AI can have in multiple areas of the industry and are already investing in the same.
Examples of AI technology uses in the airline industry:
– Shenzhen airport in China uses AI for AI airbridge allocation as well as for AI turnaround times. Another application of AI in airports can be found in autonomous airside operations.
– UK-based EasyJet uses AI predictive analysis to make sense of all the available customer data and use these insights to create offers and services personalized for individual travelers. The airline also has a recognition tool that reads passports and fills out all the information for flyers—easing the data entry and data management tasks more manageable.
– Air France implemented the specialized AI platform called Sky Breath that collects data from the flight, performs in-depth analytics, and helps identify fuel-saving opportunities and increase efficiency.
– Delta Airlines installed four self-service kiosks at the St. Paul International Airport that used facial recognition technology to verify customer identity by matching customer faces to their passport photos.
4. Beacons technology
Beacon technology has seen a lot of success when it comes to retail. Given the fact that GPS or Global Positioning System is dependent on the low ranging indoor satellite signals, there is a huge potential for the airline industry to use Beacons in making navigation easy for travelers between different terminals at the airport. Further, Beacons can help airports and vendors at the airport premises to know where passengers are and then send them personalized and relevant information accordingly. These updates can be about boarding gate number, baggage carousel, flight status, or also about the shops and eateries around the customer.
Examples of Beacons technology uses in the airline industry:
– MIAMI International airport is already leveraging Beacons on its premises to create a personalized experience for travelers. The app provides information about the entire airport as travelers navigate through various places on the premises. Further, they are also updated with relevant information depending on their individual journey, e.g. gate numbers, flight updates, baggage collection details, etc. Additionally, with the ‘blue-dot’ functionality, map rotation, turn-by-turn directions, ‘walk times’, and a ‘near me’ feature, they allow passengers to quickly locate virtually anything inside the airport.
– Central America’s one of the largest regional commercial operators, Aeromexico Connect, are trialing Beacon platform for key maintenance bases for a few months. The beacon will be assisting all maintenance operations and accelerate an aircraft’s return-to-service time. Further, it will integrate the platform into the airline’s stations to include their on-call maintenance providers as well.
When we talk about use of robotics in aviation, we normally refer to manufacturing process of an airplane. As you know robotics help in various tasks during manufacturing such as drilling and fastening, welding, sealing and dispensing, inspection, rigid manufacturing, and transportation of parts.
However, the airline industry has also been using robotics in assisting various manual tasks at the airports. These include baggage handling, car parking, assisting with passenger check-in, temperature testing, or security, etc. Now, the implementation of robotics has gone beyond previous mentions as a customer-facing technology at airport terminals.
Examples of usage of robotics in aviation:
– The introduction of KLM’s socially aware ‘Spencer Robot’ in 2016 created a lot of buzz. This robot has been equipped with the capability to deal with social situations between people and can ‘see’ and analyze people nearby with his sensors. Spencer can also distinguish between individuals, families, and larger groups, and also learns about and then complies with social rules, ultimately acting in a human-friendly way.
– Airports like Glasgow Airport and airlines like Japan Airlines, EVA Air, etc. use robots as customer-service agents.
– Kansai Airport in Japan has deployed two security robots since 25 October 2021. These robots autonomously navigate and patrol routes, use a laser sensor to identify their locations and capture images with built-in cameras. They are programmed to stop and stand guard at their designated positions once their other tasks are finished.
– The robot named Pepper, launched by EVA Air, scans boarding passes to provide departure details, gives passengers weather updates for their destination, and informs them of duty-free special offers and airline promotions. Pepper can also play games, shake hands, dance, and pose for photos with travelers.
Biometrics is not new to aviation. All the major and minor airports started implementing it since 9/11 to improve their security details. But over the years it has found use in improving passenger experience as well by improving the time and speed of check-in and other operations.
Adopting Biometrics Technology at airlines and airport touchpoints is an attempt by the industry to add value to customers by delivering a delightful experience. For e.g. Delta Airlines launched the world’s first self-service biometric-enabled baggage drop to “free up more Delta people” to deal with customers.
The advantage of using biometrics at bag drop is two-fold: it helps in saving time for passengers and creating a visual record of the actual passenger dropping the bag – not just someone who might have picked up the suitcase owner’s boarding card.
Some examples of Biometric technology use in airports:
– Fraport in conjunction with Zwipe have agreed to trial their biometric solutions to boost security at Franfurt airport. The biometric data will not be stored in any centralized location which decreases the chance of a large security leak. Also, the use of contactless solutions decreases the chance of any spreading of germs or viruses in wake of the pandemic.
– Miami International Airport and US Customs and Border Protection (CBP) started rolling out biometric technology with a few airlines back in 2019. MIA is now seeking a huge biometric push by 2023 that will serve multiple purposes. Quoting Ralph Cutié, MIA Director and CEO here:
“We look forward to elevating our passenger experience with this state-of-the-art boarding solution. MIA is now the busiest U.S. airport for international travel and continues to set new records each month for passenger growth. Biometric boarding is one of the major steps we are taking to pave the way for additional growth in the years to come.”
Some of the critical locations where biometrics can be used are
Check-in
Bag-drop
Security screening
Duty free
Airline lounge
Border control
Self-service boarding gate
Destination immigration
Wearable technology
The wearable devices market was valued at $14.6 billion in 2019 and is expected to reach $85.6 billion by 2027, growing at a CAGR of 24.8%.
Initially designed to supplement the healthcare and fitness industry, wearables have found usage across other industries like retail, banking, and insurance to manufacturing and travel as well.
Airlines have started to use wearable technology in various ways to do more than improve customer experience on flights.
Some of the examples of airlines using wearable technology are:
– Hamad International Airport (HIA) has implemented the use of robotics and advanced thermal helmets in the post COVID-19 era as part of new measures being taken.
The Smart Screening Helmet is a wearable intelligent helmet, which is portable, safe and effective, and enables contactless temperature measurement.
– Japan Airlines use Microsoft’s HoloLens for training its new crew members and engineers. Using HoloLens, the mechanics can be trained in engine mechanics akin to the experience they will have working on an actual plane.
Microsoft has also demonstrated earlier that HoloLens can help in designing airport terminals by providing designers with imagery of the new terminals even before starting the construction.
– EasyJet and British Airways are among the airlines that have created apps for the Apple Watch, enabling passengers to store boarding passes and receive real-time updates on their wrists.
EasyJet has also introduced wearable uniforms for its crew and ground staff. The suit is fitted with hems and LEDs on the shoulders and can provide visual guidance to passengers. It is also equipped with built-in microphones to enable direct communication with passengers. Additionally, the uniform also has a LED-based scrolling ticker, on the lapel jacket, which displays basic information such as the number of the flight, the flight destinations, and lighting guidance in case of emergencies.
– Another, example of wearable devices being used to improve flight experience is the SkyZen app launched by The International Air Transport Association. The app is connected to the Jawbone fitness wristband and enables flyers to view their activity and sleep patterns throughout the flight and creates personalized insights based on their sleep and activity patterns.
8. Internet of Things
The objective of industries adopting IoT is to create a seamless and integrated ecosystem connecting organizational functions with the end consumers. The airline industry plunged into the IoT revolution with the same agenda – building a seamless and integrated ecosystem integrating the organizational functions to increase efficiencies and provide a seamless experience to their customers.
According to the FTE:
‘’Over the course of the next decade, it is likely that all “things” onboard will be connected and the health of everything, from engine performance to the IFE system, will be monitored in real-time. Sensors will automatically detect and report faults to maintenance teams on the ground, removing the need for the crew to manually report faults. Moreover, the addition of sensors to aircraft seats will enable the crew to monitor individual passenger health and wellbeing, and to proactively respond to their needs.’’
Examples of IoT in aviation industry:
– Virgin Airlines have implemented IoT in its Boeing 787. Every single element on the plane is attached to a wireless airplane network, providing real-time IoT data on elements like performance, maintenance, etc.
The airline is using the deluge of data that it is collecting through these flights to improve the efficiency of the aircraft and also be proactive. For example, a jet engine that is performing poorly mid-flight is relaying that information to ground staff throughout its journey, and when the plane lands, airport engineers can then be ready to look into the issue.
– Another example of the implementation of IoT by airlines is EasyJet’s Mobile Host at London’s Gatwick Airport. In this pilot, travelers’ flight details are combined with the live data from the airport’s Google indoor maps. This allows the airline to deliver updated check-in reminders, gate updates, and even personalized directions.
Though the implementation of a 360-degree implementation of IoT systems by airlines still has a long way to go, the process has definitely started on the right note.
9. Big Data
In a digitally connected universe, consumers leave their digital footprints at every touchpoint. Airlines can drive valuable insights by analyzing this data to create delightful experiences for travelers. E.g. Airlines can use this data to understand customer preferences in real-time based on data of their purchase history, travel itineraries, etc., and provide them with customized offers.
Some examples of Big data usage in aviation industry:
– United Airlines uses a smart ‘’collect, detect, act’’ system to analyze around 150 variables in the customer profile including their previous purchases, preferences, etc., and provide tailor-made offers to them. United Airlines has seen a YoY revenue increase of 15% after the implementation of this system.
Further, this data can also help in increasing operational efficiencies through predictive analytics. Predictive analytics can pre-empt any delays that might happen due to the weather forecast and in turn, inform the airline staff about it to keep their customers updated. Further, during any flight, a huge amount of data is generated with regards to pilot reports, incident reports, control positions, warning reports, etc. This data can be used in improving flight efficiency and safety.
– Southwest Airlines has partnered with NASA to indicate potential safety issues. By using machine-learning algorithms, they have built an automated system capable of crunching vast data sets to warn about anomalies and prevent potential accidents.
10. Mobile solutions
Today, smartphones have become an integral part of people’s life. With people spending a huge amount of time interacting with their devices, it has become increasingly important for industries to connect with their customers through the mobile platform.
Airlines have started venturing into the world of mobile solutions and are using this platform to connect with their customers throughout the passenger journey starting from booking a flight to deplaning it.
Examples of mobile solutions implementation in aviation:
– Delta Airlines recently started providing their passengers virtual boarding passes 24 hours before their journey through their mobile app, easing out the check-in process for their passengers.
Airlines not just are using mobile apps to make the entire process of booking flights, check-ins, etc. easier for travelers, they are also using apps in innovative ways to provide awesome in-flight experiences to the customers.
In our article, we take a detailed look at how Airlines are using the mobile platform to create delightful customer experiences.
5 ways how technology solutions can transform your Airport Facility Management ready for any pandemic level contingency
#1 IoT connectivity across user touchpoints
IoT enables the integration of data, systems, IoT connected tools, and mobile devices to create a unified platform to operate on. It detects data patterns left behind by customers and then translate the data into actionable insights. The insights act as recommendations and help detect problems before they occur.
IoT can be applied across various touchpoints of passenger journey from parking and departure to arrival and baggage claim.
Airport restrooms are using IoT equipped flush and urinal valves, faucet alerts for leaks and clogs, water usage monitoring and vacancy indicator lights – all these aid combine together to provide a streamlined experience for travelers.
Other aspects of airport operations, like retail revenue, luggage tracking and efficient terminal navigation can all be enhanced by IoT software.
#2 Touchless facility offerings
The coronavirus pandemic has been one such unprecedented event which forever changed our perception towards cleanliness and hygiene. The multitude of passengers coming and going from airports make them a prime hub for bacteria and pathogen transmission. Hence, the impetus is on airports to provide a touchless service across the whole journey of any passenger. According to Airport Council International, 89% of airports plan to implement touchless check-in self-service initiatives by 2023.
Major airports have already implemented touchless equipment upgrades across their facilities for both passengers and their employees. These equipment laced with features like biometric facial recognition and thermal scanning operations are making the airways a much safer way to travel.
#3 Smart restrooms across the entire arena
Restroom experience play a major role than anticipated in customer satisfaction when it comes to airports. Restrooms also act as an ideal place to gather real time data around restroom cleanliness and overall experience. Feedback devices placed around restrooms can notify facility management regarding immediate action required and save untimely cleanliness issues.
Devices and apps like autonomous floor scrubbers, attendant communication apps and automatic mobile alerts for faulty equipment help in providing a cleaner restroom experience. Also, some smart restroom apps can direct crew members to specific gates and times to respond to a specific day’s air traffic.
#4 Intelligent platform for airport operations
Airports can combine cutting edge technologies like AI, beacons, and mobile devices to optimize and streamline passenger experience.
Beacon technology can be used to help deliver real-time results like work order statuses, team member locations, audit results and other operational data. AI combined with beacons can provide real-time proximity data to mobile apps and drive airport cleaning efficiency, automatically dispatching the nearest team member to support emergent work orders.
Adopting up to date innovations and big data creates opportunities for airports to elevate passenger experience while optimizing operational efficiency, cost savings and resource management.
#5 Centralized control center
The fast transmission of coronavirus across international borders through air passengers have showed the importance of having a centralized data point and information center. Airports now find a routinely collected information about arrivals, departures and passenger counts more important than ever.
Airports can build a centralized dashboard and control center to have a single data source collected in one place to help airport teams make informed, long term, less reactive decisions. It can also help in having ultra-efficient labor management, data driven metrics to determine the macro effects of facility services and integrated predictive analytics. Also, a centralized data center can assist in proactive trend identification like passenger forecasts and seasonal peak models. These in turn help build proactively predictive models in case of potential surge.
In conclusion:
The course of travel industry was changed when Wright Brothers introduced the world to the flying machine. Today a century later the airline industry has grown by leaps and bound. Digital technologies are changing the landscape of every industry and the digital revolution in the airline industry has just begun. In times to come the airline travel experiences are set to become more personalized, valuable and memorable for the flyers.
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