02 Aug Inflight retailing: Let’s get digital! Part Two
Last week we shared the first part of a thought-leadership roundtable featuring thought-leaders from three companies providing digital inflight retail solutions to the airline sector.
Our respondents were:
- Nicole Grainger, Head of Cabin Marketing at Collins Aerospace
- Michael Raasch, CEO at Omnevo
- Vimal Rai, EVP Global Sales and Marketing at AirFi
In last week’s post, each of our interviewees provided candid insight into why the old way doesn’t work anymore, who within an airline should drive a move to digital inflight retail and how we can overcome crew apathy towards selling.
This week, we tackle a few more questions about this hot topic.
Many Aircraft cabins are still not connected. Does this matter?
Michael Raasch, CEO at Omonevo: Connectivity is important to support the touchless and seamless shopping experience on board. Many airlines have a fragmented infrastructure, different providers and solutions within the fleet which can make this a challenge to support a consistent experience, but we have a variety of solutions to support that. The most recent example is Singapore Airlines, where we partnered with Panasonic and Thales/airfree in order to bring Omnevo fully into the cabin as well.
Vimal Rai, EVP Global Sales & Marketing at AirFi: Not one bit. Show me one airline that’s proudly proclaiming how inflight connectivity has raised onboard retail revenues. I’m not saying connectivity isn’t important or desirable. I’m just saying that right now, it’s often an expensive smokescreen for the fact that the overall onboard retail proposition remains lacklustre and irrelevant for passengers. If anything, connectivity is going to make the situation worse as passengers are going to dislike the limited onboard proposition even more than before.
Nicole Grainger, Head of Cabin Marketing Strategy at Collins: There are increasing levels of value and efficiency that can be achieved through connecting the aircraft, however there are eCB modules that can be deployed in an un-connected environment. In order for passengers and crew to experience the digital retail environment onboard and make use of the core onboard elements of the eCB service, having an onboard Wi-Fi network is required. This supports the communications between the passengers and crew, enabling orders to be placed, received, and acted upon.
Why should caterers be excited about digital inflight retailing?
AirFi: So many reasons! First, the fact that “digital” anything is likely to result in much more data being generated, data that could be used to drive operational costs down, revenues up, and understand customer behaviour and consumption patterns better. Second, remember that caterers remain the only authorised service provider to provision the aircraft on the ramp, so digital retailing offers them an expanded range of services and potentially even products to manage on behalf of the airline.
Collins: For caterers, digital inflight retailing offers a more robust data access method. Having more timely access to trend data, what is selling, which routes, which types of passengers etc, will help to support their own business and value chain activities. Data access assists in a number of ways including waste reduction. It helps to better predict how many meal options are requested in-flight vs pre-orders and recommendations on required quantities from the caterer.
Omnevo: For catering companies this is a huge change, since mostly the front-end systems are not connected to the back end systems. This offers new possibilities for integration and the implementation of branded concepts. In addition, real time is an important factor in making the ordering processes even more flexible. Airlines want the flexibility to switch between different concepts, whether complimentary, buy on board or pre-order. All of this should run on one platform without operating different systems, which saves high integration and running costs.
What kinds of passenger data can we feed into the onboard retail experience, and what can we take out of it? Then what?
Omnevo: Airlines already have all customer data and information. these data points are used across our system to personalize and expose relevant products based on these profiles. What has become the norm in modern e-commerce retailing is still largely untapped opportunity when it comes to airlines. Omnevo is also an Adobe Gold partner and our capabilities into omnichannel campaigning and merchandising are quite unique in the industry. We believe personalization, cross and up selling offer enormous possibilities and we have proven to triple conversion and quadruple revenue with our existing customers.
AirFi: The most obvious is Loyalty and FFP data, but there’s a treasure trove of other travel, demographic and even behavioural data that can be leveraged to improve the onboard retail experience. And most of this – with the exception of loyalty data of course – can remain largely anonymised and non-personally identifiable. To what end? Well, an example based on a classic behavioural science truism: it’s easier to get a paying customer to buy more than it is to make a non-customer buy anything at all. We have used this truism to design multiple promotions around retargeting highly-engaged passengers from one flight to the next.
Collins: During flight, the portal can learn based on the passenger interactions and serve adjusted content. If the aircraft is connected, via satcom for example, then any API can be supported to help personalize and improve the inflight experience. If the passenger is a repeat customer, then personalization and recommendations can be taken from their existing account/profile. Post flight, not only can transactional data be exported, compared with any prior historical data, but also behavioral information can be extrapolated from the portal, understanding the user flow following various purchase paths.
What’s next for this market segment?
Collins: Given the pandemic, the push to digitalise the onboard retail service has been accelerated to promote a more touchless cabin environment. Next, I think we’ll see more data aggregation across the airline value chain with collaboration between various stakeholders within that chain, to help drive improvements and enhancements to both the passenger journey and contribution of cabin retail revenues!
Omnevo: We are seeing an increasing tendency that full-service carriers are repositioning some of the offerings in combination with their loyalty programs to become lifestyle brands and leveraging on their customer data and loyalty programs. This makes sense as they compete against other shopping platforms for excursions, products, services, and F&B along the journey. With low-cost carriers the approach is slightly different, as they by nature have had a strong ancillary focus as part of the business model, here we see a strong move into digitalizing operations and processes wherever possible primarily with the focus to reduce cost and waste and increase revenue.
AirFi: We like to call it the “Mall in the Sky”. That’s our vision. It’s going to be digital, omnichannel and highly relevant to passengers’ needs, in a way and at a time that empowers them unlike ever before. The future will see more connected aircraft, but the real el dorado is in having that direct-to-passenger connection via their personal devices. The AirFi platform will offer multiple applications and microservices offering unparalleled freedom of choice to every passenger in the palm of their hand, at 30,000 feet.