The vision of a fully consistent passenger journey
How to close the “digital gap” in the customer journey at minimum cost
Airlines sales is driven by direct channels (web, mobile, kiosk, contact centre, etc.) and indirect channels (agency, travel management companies, online travel agencies, global distribution systems, or metasearch).
The indirect channel, in particular, has many limitations with respect to product differentiation via rich content and dynamic bundling of ancillary services. In order to improve the indirect sales IATA has launched their new distribution capabilities initiative (NDC) to enable XML based data exchange in future.
However, the direct sales channel also has limitations. The flight phase, for example, still lacks a modern digital experience and is basically an offline scenario on the majority of domestic flights worldwide. Those Wifi services which are available on board are not fully integrated into the airlines eco-system (e.g. loyalty based payment, personalized information, etc.) and are thus far away from what digital millennials would expect on their journey.
The good news is that, there are technologies available to close this digital gap even without investing millions into an expensive satellite connectivity program. One of the channels available are the portable IFE solutions that can be speedily rolled-out and which are STC-free.
These systems are able to provide LTE data exchange on the ground and also gate to gate connectivity based on LEO (low earth orbit) satellite constellations (e.g. Iridium). By using STC-free passive window antennas, data rates of 350 kbit/sec can be achieved and it is anticipated that LEO satellite constellations (Iridium Certus, OneWeb, etc.) will provide much higher capacities in the future.
Another trend is to open up IFE(C) platforms for third party application hosting (mostly realized via virtualized Docker containers), so that an airline can select and choose from different services and applications (similar to the Google and Apple app stores). In other words, formerly proprietary Wifi IFE(C) systems are developing into open multi-purpose platforms that provide standard API’s for data- & communication services, flight information, payment services, and hosting space for third party applications and micro services.
Lufthansa Systems concept also includes a highly developed continuous deployment concept (orchestration) ranging from a cloud based development environment for third party developers and a fully automated loading process for new applications and services including quality assurance and the rapid deployment of new services to the aircraft. Several mechanisms for monitoring, reporting and administration need to be part of any open platform solution, very similar to the operation of cloud applications on the ground.
Bearing all this in mind, airlines should no longer regard the inflight experience as in any way detached from their other communication channels. There should be no more offline POS payments, catalog and trolley shopping and disconnected mobile devices during flight.
Let us have a look at how we envision the future of the inflight touchpoint based on the assumption that it should be an integral part of the airlines eco-system by offering the same experience throughout the passenger journey. The mobile app of any airline should become the central companion of the customer journey.
Vision 1: Personalization and tailored services
Airlines more and more personalize their product and services by splitting bookings into modules like: seat only, classes, hand luggage only, additional luggage, more leg room and many more. One of the services could also be premium content access or free connectivity usage on board. With an offline aircraft that only supports LTE connectivity on-ground it is a difficult challenge to recognize who is allowed to access the premium content on board. It is usually achieved by an uncomfortable voucher concept.
However, through a low bandwidth connectivity solution we could identify passengers (e.g. via the airline app login) and thus recognize the service that he has purchased on ground (e.g. free connectivity, free premium content). The system on-board will then simply let the passenger connect to the premium content package. This would also increase the acceptance of the mobile channel by making the airline app an essential companion for every traveler on his journey.
Vision 2: Drive conversion by simplifying airline payment
Through their loyalty programs many airlines already issue own credit cards or store credit card data usually in combination with the loyalty status of a particular passenger. The stored credit card/loyalty data can be used to implement a one-click pay experience and the dynamic use of loyalty credits throughout the customer journey including the inflight touch point by using a payment infrastructure that can flexibly aggregate PSP, acquirers, banks or merchants and offer the same payment experience on every partner site. The affordable low bandwidth communication can release airlines from the low floor limits that they are facing with any offline POS solution.
In other words the goal of this technology is to create a barrier-free payment communication between multiple platforms, businesses, and end-customers. Watch this video if you want to learn more about the implications of a flexible payment infrastructure on ground and on board:
Vision 3: Build a consistent eCommerce experience to boost ancillaries
Having reduced the payment barriers in-flight, it becomes obvious that the shopping experience should also be digital and no longer based on catalog or trolley shopping. By using an open platform, airlines can run and integrate professional shop software on-board (e.g. Shopware, Intershop, SAPhybris, etc.) that can be fully integrated into their CRM system to run campaigns and dynamically place special offers per flight, per destination or season.
Even low bandwidth connectivity is able to support gate- and airport pick up concepts. This could release airlines from carrying and administrating duty-free trolleys. Modern shops systems can tell a story on the destination offers, inspiring passengers travelling in different contexts (business, leisure, family, kids, etc.) thus increasing the ancillary revenues for airlines significantly.
Vision 4: Targeted advertisement and sponsored content
It is the vision of many airline CFO’s to operate Wifi platforms on-board as profit centers. Besides eCommerce and simple payments, advertisement and sponsored content may also play a significant role in achieving this goal.
Every user interface running on an aircraft should at least support IAB and VAST ad-industry standards to place banner and video advertisement. We are using ad-decisioning servers that can insert advertisements by destination, gender, age, etc. and are connected to ad-booking platforms on ground that also report the parameters (views, click through rate, etc.) of a particular campaign in close to real time. With the use of server side ad-insertion, we make sure that advertisement cannot be blocked by passenger browsers and that advertisers receive reliable, auditable reports of their campaigns and thus increasing the value of the ad space sold by the airline. APEX has recently launched an Advertising Delivery Working Group (ADWG) that is focusing on a joint approach of the industry. The aim is to standardize technology and to increase the value and reach of inflight advertisement over all platforms. It is of crucial interest for IFE providers and airlines to align by bundling the available ad-space and become a visible player in the out of home advertisement market.
By using a web based agency portal and a programmatic solution connected to 170 DSP (Demand Side Platforms) we are able to make inflight advertising a premium space for advertisers. More complex campaigns including e.g. a shop link or a detailed micro pages can be realized and booked through our direct sales partners.
To get a better understanding on our programmatic approach please watch:
In particular cases when an airline is interested in a fully sponsored solution we work with partners who not only use the digital platform (communication service, flight data, deployment service, payment, etc.) but implement their own user interface optimized for destination based sponsored content and retail. Some of these solutions are able to target passengers even without personalization by profiling them based on their first one or two clicks. The artificial intelligence (AI) then triggers pushing more other sponsored content of interest to the passenger. With this kind of highly targeted, appealing content our partners can generate at least a $ 3 – 5 profit per user on the platform allowing them to fully finance the portable IFEC system.
Vision 5: Messaging services
Messaging (eMail, WhatsApp) is by far the most requested service by passengers both on-board and on-ground. This thesis is supported by nearly 2 billion WhatsApp users worldwide.
By using a partner solution and the new BoardConnect Portable we are able to provide free messaging services through the airline app that can be used to send email, WhatsApp and SMS. This service can also be used by airlines to send irregularity- or other important flight information to crew members and passengers.
Vision 6: Internet of things (IOT)
In addition to the more passenger centric use cases above, the airline industry is also looking into process and operational use cases. The usage of Bluetooth low energy sensors that report engine data, telematics data of business class seats or monitoring temperature data of highly critical pharmaceutical cool containers and many other parameters are believed by many to be the next big thing in the industry. Therefore digital platforms must be able to receive, store and analyze larger amounts of data (at least several Terabytes) and recognize any irregularities contained therein. Even on a low bandwidth connectivity the system can then inform ground staff in advance to prepare the maintenance of a service or aircraft component. There is definitely a lot of potential in IOT. GE reports 56% decrease in unscheduled engine removals and a 15% decrease in overhauls. Passengers will appreciate the 30% reduction in delays and cancellations that were recently reported by Honeywell and Cathy Pacific based on first implementation of IOT technologies.
The vision of a seamless customer journey is no longer a vision that can only be implemented by large Tier 1 carriers or on long haul fleets. The next generation of portable digital platforms in combination with low bandwidth connectivity, can be a game changer and foster the digitalization throughout the airline industry exponentially. Especially short haul operation can benefit significantly by implementing the concepts covered here at low cost and help airlines to implement a consistent digital strategy ranging from passenger experience to operational savings.
A consistent eCommerce concept, barrier free payment and personalized services can be realized even at low bandwidth rates. Airlines will become the trusted travel retailer for their passengers if additional service can be booked as conveniently as on familiar retail sites like Amazon.
LEO constellations will continuously improve and prices are expected to decrease significantly over the next 5 years. With this in mind, now is surely the time to realize minimum viable product projects (MVP) and prepare for the future of the connected aircraft.