22 Jul Inflight retailing: Let’s get digital!
The age of digital inflight retailing is upon us! Airlines across the spectrum, from full-service legacy carriers to the newest and leanest ultra-LCCs, are adopting new solutions that enable passengers to browse, select, and pay for product and services – whether to be enjoyed onboard or for post-flight fulfilment – from the comfort of their seats and using their own trusted devices.
We spoke to three companies that are actively developing solutions in this increasingly competitive space about why the concept is finally gaining real traction, and how they’re each supporting airlines in the race to digital supremacy.
Our respondents are:
- Nicole Grainger, Cabin Marketing and Strategy at Collins Aerospace
- Michael Raasch, CEO at Omnevo
- Vimal Rai, EVP Global Sales and Marketing at AirFi
What are some reasons why the old way of doing onboard sales is no longer fit for purpose?
Nicole Grainger, Collins: We’re experiencing advances on all sides of the aviation experience, evolving IFE, seat design, aircraft efficiency etc, however the actual methods of onboard service haven’t adjusted to meet either the improved cabin product, or the expectations of the digital, connected passenger. The traditional trolley service for food and beverage, as well as duty free, was overdue for a refresh to help passengers self-serve and reduce strain on the already overworked crews.
Michael Raasch, Omnevo: The buying behaviour of customers has changed completely, digital shopping has become the norm. Passengers want a more personalized shopping experience and offers that are relevant to them. The classic channels have many limitations and thanks to e-commerce and the expansion of the F&B and product range, passengers have more choice and less operational risk for airlines. Choice is indeed one of the most important factors. A 60 SKU in-flight selection can simply not compete on any level with a 40.000 SKU online selection as we offer it at some airports and airlines in our customer portfolio.
Vimal Rai, AirFi: Three simple perspectives: space, time and value! Onboard retail has traditionally suffered in all three domains, particularly with the onset of e-commerce and the scale of choice and convenience it afforded. Space will always be a premium inside aircraft that continue to shrink in size. These days nobody, least of all cabin crew, wants to see or buy anything off carts, with limited inventory and choice. Time continues to become increasingly precious; e-commerce has shortened the distance from discovery to comparison and finally transaction, to just a few clicks on one’s device. Last, but not least, value; there have been too many “value extractors” in the traditional onboard sales value chain. The end result has been a retail offer that lacked attraction and relevance to passengers.
What is your solution to this?
Omnevo: We design, develop, and implement end-to-end solutions that make airlines, airports and hospitality providers into true omnichannel commerce marketplace operators. We have many standardized product solutions that customers can test and implement in under a quarter. Our focus is on ancillary revenues for F&B, duty free and virtual products that we offer through our platform concepts.
AirFi: The solution is greater passenger recognition and customer empowerment. This is as simple as putting the power of discovery and choice in the hands of every passenger. Customer empowerment is when you give your customers the information, tools, and capabilities that they need to make decisions. By giving them resources and options, you’re providing them with a much better buying experience and allowing them to determine the kind of experience they’d want to have with your brand.
Collins: We worked with our airline partners to identify their pain points related to offering ancillary service, looking at how we can remove or significantly improve these areas of friction. This activity led to the creation of the Electronic Cabin Bag (eCB) solution. eCB delivers not only the functionality expected from an onboard retail solution, but also live payment authorisation and onboard inventory management.
Who should be leading the charge into digital retailing at the airline level, and what are some ways they can build a persuasive business case to make it happen?
AirFi: This ought to be a C-level initiative. If not, then it has to be led by whoever is ultimately accountable for ancillary revenues in the airline. There are many ways to build a persuasive business case, but perhaps the most impactful one begins with the realisation that digital retailing is a subset of the overall brand and customer experience that needs to be delivered sustainably over the long-term.
Collins: For the airlines, it makes sense for digital retailing activity to sit within an ecommerce team or form part of an omni channel customer journey. Onboard is just another facet of customer engagement for the airline, so there should be consistency in not just the look and feel, but also user preferences, and personalization. Building a persuasive business case should be viewed in the same way – as part of the total customer value. Looking at the cost to serve the customer across all stages of their engagement with the airline, considered against their level of contribution/value etc.
Omnevo: We are seeing that some airlines are now restructuring to orchestrate all of their retail activities. These are new departments that will develop concepts and make decisions across the entire organization and value chain. Digitization is cross-department, and it is therefore important to set the right course here. Almost all airlines have confirmed to us that ancillary revenues have to contribute to a significantly larger part in the future and many have to be digitally driven.
How cabin technology help overcome apathy towards inflight retail on the crew side?
Collins: Inflight retail causes a significant time impact on the cabin crews when you take into consideration the manual processes to set up and open the retail service, face to face passenger ordering, delivery, and payment collection, etc. eCB offers a way for passengers to self-serve, using their personal devices to access a familiar digital ecommerce experience. Reducing this friction for the passenger can improve the associated per passenger contribution and improve the onboard experience. Reducing the friction for the crew can decrease the level of apathy related to inflight retail and improve the quality of service they are able to deliver.
AirFi: Apathy is a result of disinterest and irrelevance. Technology needs to be intuitive, attractive, and fun to use. It needs to take on the repetitive and effort-intensive aspects of the inflight retail proposition. There’s an art and a science to designing the first page of the onboard shopping application on the crew POS, for example. We have designed ours to reduce scrolling AND have an uncluttered GUI for crew. Signing in needs to be a breeze, as does reconciliation. On average, crew who use our systems for the first time can get started in less than five minutes.
Omnevo: Technology supports the crew in many ways. Where we see a big change here, is to network the crew directly with the passengers on board. this results in completely new forms of communication and a change in the ordering process towards greater personalization and individualization of the service. Advanced features such as allergen management, sustainable sourcing and waste management contribute significantly to all process on- and off-board.
Stay tuned for part two of this roundtable where we delve into the role connectivity plays in digital inflight retail, why caterers should be excited about these solutions, how to make the experience “sticky” and more.