Pertaining to this ever-growing and evolving segment, what are various ways in which airports can create and deliver value to their passengers, while building closer, more personal relationships with them?
To analyse this, #AirportMarketingX will be delving into opportunities such as ‘crowdsourcing’, ‘crowdfunding’, end-to-end mobile experiences and next-generation airport retail over a series of upcoming articles.
David McMullen and Shubhodeep Pal begin by exploring the harsh realities of the industry and suggest a number of new-age ways in which airports can make a name for themselves as traveller-friendly spaces. While this article seeks to broadly outline each of these opportunities, subsequent editions will dive deeper into each method, while offering accompanying case-studies and best practices as well.
Waking up to a new world
The traveller today has ever more access to the Internet, almost certainly carries a smart-device, and most likely uses one or more social networks. Consider, that on an A380, an average of 450 smartphones, 213 laptops and 207 tablets can be found.
Second, airlines and airports are aware that the age of one-way advertising is over. In fact, many have taken to building careful multi-platform social presences that interact with customers in various ways. Third, it is clear that airlines have a clear lead over airports in terms of social marketing strategy.
However, in the race to catch up, airports must not forget that their marketing strategies need to be focused on airport business objectives. Likewise, an airline’s success on social media need not be aped or, indeed, envied.
Trends and challenges for the aviation industry
On February 30, 2014, SimpliFlying’s vice president of airports, David McMullen, was invited to share the stage with senior figures from ACI, IATA & ACAO at the Athens International Airport ‘Airline Marketing Workshop’, to discuss the clear recovery trend emerging in Greece, partnerships and air service development.
One of the key questions discussed was: As the evolution of traffic reaches an all-time high, does connectivity deliver economic sustainability for airports? Quite clearly it does not.
IATA continues to stress the need for airlines to develop their ancillary revenue streams and ACI states that 70% of the world’s airports are loss-making. Whilst the industry faces even further challenges in the form of fierce competition and even capacity constraints, airports are in dire need to upgrade infrastructure.
The ACI-NA total estimate of airports’ capital development needs for 2013 through 2017, adjusted for inflation is $14.3 billion annualised. Around 54% of the development is intended to accommodate growth in passenger and cargo activity as well as larger aircraft; while 43% is intended to rehabilitate existing infrastructure, maintain a state of good repair, and keep airports up to standards for the aircraft that use them. Customer expectations are rising by the day with people demanding that Wi-Fi should be free.
The European Commission recently implemented new rules covering airport subsidies, which are designed to phase out billions in hand-outs for unprofitable airports around Europe derived from taxpayers’ money.
The commission claims that 42% of the continent’s 440 airports currently operate at a loss, whilst existing ‘operating aid’ to these airports is described as ‘technically illegal’.
Under the new rules, airports will have to submit business plans that demonstrate a route to profitability in order to qualify for subsidies, whilst governments will also have permission to grant subsidies for airports to make infrastructure investments, as long as ‘there is a genuine transport need’ and ‘demand for it’.
Opportunities in the connected age
Although the picture above might seem grim, our connected world is rife with opportunities. Over the last decade – especially the last five years – the new, connected traveller offers airports an unprecedented source of data and a willingness to contribute to the airport experience.
Accessible to thousands of people in his or her virtual networks, today’s passengers also use these networks to find recommendations, share reviews and photographs as well as share feedback – all while hopping between airports.
Not only do airports now have a dynamic communication channel with passengers, they can also understand what passengers want, like or dislike about the airport experience. The ability to provide real-time customer service open the doors to winning loyalty.
More than just a function of communications, airport marketing nowadays serves to attract passengers from nearby competing airports. In fact, several airports have been investing in innovative products and service initiatives to differentiate their airport experience in hope of becoming a preferred airport of choice to passengers.
Consider Manchester Airport in the UK. Its extensive #flymanchester campaign aimed to take air service development to the next level by directly promoting routes to a specific target market.
The purpose was to get travellers to fly Manchester instead of neighbouring airports like Heathrow and Gatwick. Airport marketing today has dramatically evolved.
Armed with this new-found knowledge, can the airport customer experience and service quality be improved not only for, but also with, customers? Here are some
of the ways airports can tap into the connected traveller market:
Crowdsourcing – This is the seeking of ideas and opinions from a large group of people with a specific purpose in mind. It provides airports with a great way to engage with passengers online, invite ideas efficiently and helps draw travellers closer to the airport brand. Helsinki Airport’s Quality Hunters initiative is a great example of crowdsourcing in an airport context.
Crowdfunding – The act of seeking funding from the public is booming in recent years. Movies, apps, games, consumer electronics are only some of the things that have been successfully funded by an online community interested in benefitting from them. This could potentially be extended to airports as well, especially in times when funding is hard to secure.
Re-thinking airport retail – There are a number of ways in which airport retail can be spurred: Changi Airport, for instance, offers an online shop for its duty free store, so travellers can simply shop, collect and fly. Frankfurt Airport, Gatwick and Delhi Airport have had QR code walls for passengers to do grocery shopping easily. Given how often passengers ‘check-in’ to airports, there is also an immense opportunity to send location-based offers within the airport.
End-to-end travel apps – Given how integral smartphones and tablets have become to travel, many airports now offer travel information such as flight times on mobile apps. Copenhagen even offers an interactive experience of the airport terminal online.
Other airports have leveraged on Google Street View to offer travellers a peek into their terminals. In the future, we will see apps catering for before and after travel. In fact, Milan’s airports already offers an innovative ‘door-to-door travel management app’.
In the light of the above, can airports make a name for themselves by creating memorable travel experiences that are shared and recommended widely by travellers on their online networks? The answer is, yes!