Posted on: 17 September 2015 by Ross McSweeny
For years, we have spoken about the challenges facing the aviation industry, but this year we really get to discuss the opportunities, Daniel Boyle, conference director told delegates to the Aviation Festival in London.
Opportunity was a theme pervading the morning session of Day One of the conference, and indeed reinforced throughout the subsequent panel discussions.
Against the backdrop of falling fuel prices, increased capacity and an ongoing digital revolution, Bloomberg’s Guy Johnson individually quizzed the heads of three airline (LFA) leaders – Vueling, Ryanair and Wizz Air, before inviting all them to an open discussion.
“If anyone didn’t have a good summer this year, they probably need to do some restructuring” proclaimed Alex Cruz, CEO of Spain’s Vueling.
With the airline now fully integrated into International Airlines Group (IAG), Cruz highlighted how innovation is keeping Vueling at the forefront of digital. “We’ve hired people with digital DNA already in them,” he said, before describing how the company’s culture encourages the approach. Alluding to the likes of Google or any Silicon Alley-based firm, Cruz said the company did not place web-restrictions on staff. “If you saw our staff you might think they’d be working in a trendy office in San Francisco. Vueling is not a place that defines heavy web-browsing policies. We define objectives and whatever you do from there is your choice.” The objectives and results are lower costs and improved passenger experience.
The IAG Digital hub helps innovation in the group by assessing concepts from its airlines for implementation, but on the question of ancillary revenue, Cruz stressed each airline developed its own policy for what was offered. Emphasising the need to distinguish between service-orientated and punitive ancillary revenues, Cruz made the first introduction to big data. Conversion of an offer into a sale, he said, was based on “capturing the needs of the individual at a particular time.”
Stepping into the world of emotional response, Cruz warned that misidentifying that moment and making an inappropriate offer “shows passengers that we don’t know anything about them.” In one simple move, you can shatter the trust and relationship so hard won.A bullish Kenny Jacobs, CMO at Ryanair outlined its digital ambitions. With headroom to grow in Europe, Jacob explained the drivers beyond the company’s new website, set to launch in October.
Presenting a different look, and with features and functionality previously unseen in the industry, Jacobs said the intent was to provide a better booking experience, reducing the process to the “fewest number of clicks”. The site has been built to work across all device platforms – smartphone, PC and tablet – mirroring the experience of users to retail sites, especially Amazon, which Jacobs says the company aspires to be within the aviation world.
In the world of big data, Ryanair is hungry for information on its customers. However, Jacobs admitted that like other airlines, in the past the company had data, but didn’t understand it or what to do with it. But being a “third or fourth mover” in the digital sphere, Ryanair was now able to leverage inspiration from others and develop a smarter strategy. Part of this is a Tinder-like app, which will allow passengers to promote destinations to other passengers, based on user-generated content.The website will offer higher levels of personalisation both for the individual and regional. “The website in London will look different to that viewed in Madrid, and different in Catalonia.”
When pressed if Ryanair now saw itself as an airline or retailer, Jacobs responded “You might think of us as a travel company specialising in flights”, nodding to the fact that the lines between the two are getting blurred (Jacobs also referenced the airline’s publishing activities).
Wizz Air CEO József Váradi, continued on the theme on innovation, returning to basics on the question of passenger experience. “I’ve always said a smile doesn’t cost money.”
Image (l-r): Guy Johnson, Bloomberg, Alex Cruz, CEO, Vueling, Jozsef Varadi, CEO Wizz Air, Kenny Jacobs, CMO, Ryanair
Alexander Preston, editor, Inflight / Inflight-Online.comLondon, UK