Fly Me To The Moon, sang Frank Sinatra, a mere 50-or-so years ago. It’s pretty amazing to think this is close to being a commercial reality.
With Start’s diverse portfolio of partnerships in the aviation sector – alongside Virgin Atlantic, Virgin Galactic, EasyJet, Transaero, Jet Republic, Hamad International Airport and Dubai Airports - we touched down at the Aviation Festival. Here, we’ve streamlined two busy days into seven trends to watch.
1. Flying taxis are coming soon(-ish)
The world’s first dronecopter was officially unveiled last year by Volocopter, backed by parent company Daimler AG and the UAE. They’re claiming that app-hailed private drone flights will be a reality in the skies of Dubai by 2022.
It’s a crowded development space. Airbus is busy with its own version and Uber announced its intention to launch Uber Elevate - a flying car - and a more familiar ride-sharing version, UberAir, by 2023. It’s currently working with NASA to create an air traffic system.
2. There’s no such thing as an airline company
Air Asia is changing, “from a travel company to a tech company that happens to own an airline”. Jeurgen Keitel, group chief director of Air Asia’s global affairs & development put his cards on the table pretty early.
Scandinavian Airlines evp of marketing, Annelie Nassen, says they’re already more than halfway through their digital evolution into a “lifestyle company”, all the better to drive revenue in ancillary sales. To bolster their proposition, they’ve created ‘Turi’, an AI travel assistant who can help with everything from packing to booking.
3. Beat the aggregators with better experiences
Sebastian Pichon, travel industry manager at Google, warned that passengers are shifting their loyalties to aggregators, or their search channel of choice. “Invest in the experience of the brand,” he counselled, citing Hilton Hotels’ app as a best-in-show example that lets guest control their room temperature and even order room service before they check in.
Or, think like the opposition, advised Avi Golan, chief digital officer at Air New Zealand. They’ve created their own digital team in Silicon Valley to inject start-up thinking directly into the organisation’s bloodstream and to protect against the usual suspects - Google Flights and Facebook - and their ambition to steal traditional carriers’ customers. “Airlines must create compelling value propositions, alongside improved physical products and services, if they’re to become the first stop for consumers,” Golan insisted.
Campbell Wilson, senior vice president of sales and marketing for Singapore Airlines was even more brutal. “Standing still is moving backwards,” he warned. Singapore Airlines has always focused on service, as it’s embedded in their national culture. However, they’re still innovating and investing in what they do best - using machine learning to identify top performing cabin crew and using this data to improve training and hiring.
4. Reinvent yourself for future passengers
“Airlines need to reinvent themselves to thrive in a more competitive marketplace. Customers are spoilt for choice and loyalty is diminishing,” warned Sebastian Pinchon, quoting stats that only 28% of UK passengers felt loyal to any one airline in 2016 - down from 35% in 2011.
Jet Blue might be relatively youthful, at only 20 years of age, and still struggles for routes against the legacy airlines, but chief executive (CEO) Robin Hayes explained how they’ve succeeded by doing things differently. “Even a value carrier can be a pioneer,” he stressed. They’ve created a new market in the long-haul sector with their low-cost business class offering, Mint.
Similarly, Saudi Arabia’s Flyadeal began operating a mere 12 months ago, has seen huge growth, not by stealing share from rivals, but by tapping into the youth market. Con Korfiatis, Flydeal CEO, explained how they designed everything with a mobile-first, social media-loving audience in mind - with every seat back fitted with device holders and USB power as standard.
5. Hyperpersonalisation must deliver value
With AI commandeering a large section of the programme at the festival, it’s clear airlines are feeling the heat from outside the industry to better deploy the data at their disposal - whether that means predicting the alcohol you’ll most likely request, or what content you’re inclined to consume.
Akira Mitsumasu, vice president of products and servicing for Japan Airlines, warned that there can be too much choice for the flyer. In their quest to hyperpersonalise, they’re looking to UX mapping and design thinking to create new value propositions. Airlines have to “be more Amazon”. In other words, to revolutionise, rather than just make incremental improvements.
6. Embrace innovation
Innovation labs are now commonplace. With the bigger players, they often contain start-up nurturing programmes to help them get a stake in future disruptors, although younger airlines, are better placed to translate new technology into their businesses.
Campbell Wilson, SVP sales and marketing for Singapore Airlines, vividly summed up the incredibly complex internal systems airlines run on. “It’s like a big tank of spaghetti and it takes a long time to carve it up.” To avoid this messy challenge, they’ve created a sub-brand value carrier, Scoot. A cloud-based airline, it’s perfectly pitched for the digital native consumer.
7. Reincarnate inflight retailing
Fewer than 10% of passengers buy anything inflight. With this figure falling year-on-year the big three US carriers recently announced they’d be pulling the plug on inflight duty free.
Stepping into this gap in the market is Airfree, a duty free shopping app, that won the Festival’s Innovation Dragon’s Den, as judged by SAS, Virgin Atlantic, Finnair and Air New Zealand. White labelled by airlines, Airfree can make offers bespoke to individual customers’ profiles and itineraries. It delivers a simple and convenient commission-based click-and-collect service and totally removes the need for a the unweildy perfume-stuffed duty-free trolley of old.
With new entrants to the market and more competition from aggregators and alternative modes of transport, aviation brands are having to put significant effort into catching up with the sky-high customers expectations being set - and met - by non-travel brands. Combine that with global economic and geo-political turmoil - even natural disasters and pandemics - and we can expect volatility in the travel landscape for some time to come.
Kate Barker, business development director, Start Design