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My presentation today at the 10th Ancillary Merchandising Conference in Barcelona focused on airline merchandising and retailing techniques. During my preparation for the speaking slot, I began thinking about the upcoming Sonar electronic music festival that takes place here in Barcelona in June. Sonar’s headliners include standout acts like Boys Noize and New Order, and the festival attracts 80,000 music fans from pretty much every continent in the world.
This got me thinking: what if an airline recognised your interest in music festivals because you are a regular at Sonar or the Roskilde festival in Denmark? And what if they took that insight and offered you a ‘Music Festival’ bundle of services? A bundle could include discounted tickets, a special fare for transporting large luggage such as your tent, and a seat with extra leg room. On the return journey, exhausted from the late nights, you might be interested in lounge access to relax for a couple of hours before your trip, safe in the knowledge that your favourite exit row seat will be maintained even if the flight is disrupted. Conveniently these offers would be delivered directly to your mobile device. This is exactly the direction that Amadeus is moving with Anytime Merchandising combined with advanced personalisation capabilities.
These merchandising techniques will be key to continue to drive airline profits –and quite significantly in fact. A year over year comparison (2014 vs 2015) of the 50 best-performing Amadeus customer airlines’ digital business has shown that in terms of revenue growth, we have seen a yield increase of 8.8% in addition to the growth in overall PNR volume of 15.2%.
When combined, this growth translates into a weighted 25.4% yearly revenue increase across the sample of 50 airlines. This goes some way to demonstrating just how staggering the digital growth is and how critical merchandising capabilities become for the whole airline industry. To put it in context, in 2015, all PNRs created by airlines through Amadeus e-Retail solution accounted for 34.9 billion euros in revenue, which is roughly equivalent to two weeks full trading volume of the London Stock Exchange.
What’s made all this possible? Well, airlines are increasingly successful in defining and executing their business growth strategy. On our side, we keep perfecting our multi-channel retailing and merchandising solutions to enable their ambitious objectives. This includes customer experience on all touchpoints, personalisation, shopping, and dynamic offer management. This growth is further fuelled by the core scalability and reliability levels of our platforms.
But what really gets me excited is the future potential of merchandising; where airlines can further provide new levels of personalisation to their travellers to enrich their experience, while unlocking new merchandising opportunities – at any time – throughout their journeys.
This will help airlines to make a difference to their travellers by delivering the relevant individual offer, through the right channel, at the right location, and at any moment throughout their trip. Whether you’re travelling to the Sonar festival or to the next Merchandising Conference, watch out for airlines’ attractive offers, which seem designed just for you!