Standards set in other industries fuel airline passenger expectations

June 11, 2012

Comfort, Multimedia, Services

Virgin America small MK Standards set in other industries fuel airline passenger expectationsExpectations of airline passengers are not only shaped by how well an airline performs versus its direct competitors, they are also fuelled by standards set by other industries. Innovative products and services in one industry can raise the bar for all industries, including commercial aviation.

Ron Verweij, manager development galley equipment at Driessen Aircraft Interior Systems, says: “The benchmark for customers is not only the experiences they have with airlines and at airports. The benchmark is set by the likes of Apple, Amazon and Zappos, who are centred around staging the best customer experience over and over again and who have lined up every detail in their organisation to deliver simple, consistent and burden free experiences over every channel and touch point. This means airlines and airports need to tune into the customer from a holistic perspective when designing passenger services, so they operate more from the outside-in.”

An example of an airline that has embraced this ‘holistic service design’ approach is Cathay Pacific, which states “customers do not view experiences via a single lens. Their expectations are constantly evolving and are viewed relatively, as they expand beyond the category and are shaped by cumulative experiences. Consumers have access to information via the Internet anytime anyplace and as product life cycles are becoming ever shorter, ‘new and improved’ quickly becomes an ‘expected’.”

So how can airlines learn from industries such as automotive, retail, hospitality and consumer electronics to improve the passenger experience?

AUTOMOTIVE

A challenge that the airline and the automotive industry share is that companies in both industries aim to offer travellers a comfortable and safe journey, while Beijing restricted by the amount of available space. A good example of a project in which an airline has adopted the expertise from the automobile industry is British Airways. In developing its new first class, launched in 2010, BA’s in-house design team collaborated with Forpeople, a British design agency that was born out of ingeni, Ford Motor Company’s global concept design centre. Forpeople had been working with Ford’s luxury brands Aston Martin and Jaguar for years, and has been responsible for the overall look, feel and styling of BA’s new first-class cabin, as well as all aspects of the brand, product and service elements.

According to BA, the design of its first class is inspired by classic British luxury car brands, featuring dark blue leather seats with a cream leather trim around the headboard, while “a silver-coloured knob, that looks as if it should be on the dashboard of a Bentley gives the passenger precision control over the seat position.”

BA design manager Peter Cooke says: “We felt we needed to play catch-up with a lot of automotive interiors – it was important to replicate some of those amazing trims and finishes you get in expensive cars. The customer shouldn’t feel they are stepping out of one experience into a lesser one.”

RETAIL EQUATION

As ancillary revenues have become a major revenue source for airlines – if not the lifeline for many – airlines are thinking of more ways to derive revenue from all phases of the customer journey. Ancillary revenues specialist Collinson Latitude sees three phases in the development of ancillary fees: The first ‘product unbundling’ phase is about introducing fees for services such as ticket booking, baggage check-in, and seat selection. In the second ‘product enhancement’ phase passengers can purchase paid extras such as priority security, lounge access and inflight Internet, while the third stage is a ‘repackage / rebundle’ phase in which airlines rebundle paid services in packages.

Travel retail solutions provider Datalex believes that airlines have only reached the tip of the ancillaries iceberg, as their opportunities for growth include selling a much broader range of products and services before, during and after the flight. Datalex CEO Cormac Wheler says, “The airline industry is rapidly evolving to become retail-focused and airlines will have to reinvent themselves as retailers. Airlines could learn a lot from retail chains like Wal-Mart and Tesco, especially when it came to offering the right product to the right customer at the right time.”

For example, says David Doctor, director distribution marketing at Amadeus, “Airlines should learn how to display an airline product on their websites so customers are shown not just the difference in price between two offers, but what they get for the higher-priced fare. The key is to customise, to understand how travellers make decisions and how they want to shop. Retailing is paramount.”

According to Doctor, Amadeus is replacing the traditional focus on distribution, which is driven by efficiency, with a focus on retailing in order to facilitate the growing number of airlines that are making their ancillary services available through the global distribution systems (GDS). Says Doctor, “Increasingly we’re thinking of ourselves not as global distribution systems but as global retailing systems. Perhaps in five years’ time we will all be talking about the GRS.”

Several airlines, meanwhile, have started to hire people from retailers instead of traditional airline people. Delta Air Lines, for example, a few years ago hired Bob Kupbens, who had been responsible for e-commerce at US retailer Target as VP of marketing and digital commerce.

On board aircraft, airlines are also adopting tricks from the retail industry in efforts to increase ancillary revenues per passenger. Virgin America – which lets passengers order and pay for food, beverages and merchandise via its RED IFE system – has introduced a so-called ‘open tab’ function on its seatback system. With the open tab feature, passengers only have to swipe their credit card once per flight to the items they want. The tab stays open until a passenger closes it, or until the aircraft descends and reaches 10,000ft at which time it will automatically be closed.

HOSPITALITY

An obvious industry that airlines can learn from is the hospitality industry. Although for both airlines and hotels the attitude and professionalism of their staff is a key area of differentiation, many airlines can still learn a thing or two from luxury hotels in terms of treating passengers like real guests. A telling example is that few airlines – Virgin America and Abu Dhabi-based Etihad are two of the exceptions – refer to their passengers as guests. Another exception is Switzerland-based PrivatAir, which operates business class-only flights for Lufthansa, SWISS and KLM. PrivatAir’s cabin crew receive part of their service training from the world-renowned Lausanne Hotel School.

Airlines such as Singapore Airlines, Cathay Pacific and ANA, which are also known for their high service standards, add small and personal touches often seen in the hotel industry to their onboard service. Cathay Pacific and ANA crew, for instance, welcome passengers onboard with a small handwritten note, while passengers travelling in Singapore Airlines’ first-class suite find a small card that says “This suite has been specially cleaned and dressed by …” in their private cabin.

This is not to say that other industries cannot learn from the service expertise from airlines. Cathay Pacific, one of the few airlines in the world that have been awarded a ‘5 star’ status by Skytrax, has published a book – called “Service in the Sky” – in which it shares its expertise in training cabin crew.

According to the airline, passengers expect more when they fly than when they travel on other modes of public transport, and while the book is largely related to the airline’s operations, the underlying principles can easily be applied to other service-related industries. “Service in the Sky” has been written by training instructors from Cathay’s Inflight Services Training & Development department and includes 24 real case studies depicting difficult situations and recommended approaches, articles on different aspects of Cathay Pacific’s service beliefs, and its cabin crew training modules and job requirements.

Besides learning from the hospitality industry, airlines can also incorporate tangible products developed by hospitality brands into their onboard experience. For example, a few years ago United Airlines teamed up with Westin Hotels to provide Westin’s so-called ‘Heavenly Pillows & Blankets’ to passengers on its transcontinental ‘premium service’ (p.s.) flights. The cooperation between the hotel and the airline – which was terminated recently – also saw Westin open ‘renewal’ lounges inside United’s Red Carpet Clubs at New York JFK, Los Angeles and San Francisco airports.

On a similar note, Japan Airlines has commissioned Tempur – a brand known for its quality mattresses that mould to the body and recover when the weight is removed – to custom make the beds’ mattresses for its First-class suite. Passengers can also opt for a pillow made by Tempur.

CONSUMER ELECTRONICS

Another reason for airlines to team up with companies from other industries is that product developments are going to fast in order for them to keep up. This is especially true in the area of inflight entertainment, where passengers want to have access to electronic devices and connectivity options akin to those available on the ground.

This development has led several airlines to opt for commercial off-the-shelf technology as inflight entertainment instead of proprietary systems. American Airlines now provides First-class passengers on its Boeing 757 and 767 aircraft with Samsung Galaxy Tabs. And, realizing the existing IFE system on its fleet of Boeing 777-200s was outdated, British Airways last year offered first-class passengers an iPad during several months, before the aircraft would undergo refurbishment. According to BA, the iPads resulted in an increase of the passenger satisfaction with the overall entertainment offering by 30 percent.

LEARN, COPY, COLLABORATE, INTEGRATE

In order to meet the demands of demanding travellers – whose expectations are shaped by experiences in a wide range of industries – airlines should look sideways in order to understand how standards are being set by other industries, as well as learn from the expertise from companies operating in other sectors. Furthermore, to meet these expectations, a growing number of airlines are realising that instead of developing elements of the passenger experience themselves, it makes more sense to team up with well-known brands that stand for quality in a specific field instead.

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About Raymond Kollau

Founder of independent industry and consumer trends research agency airlinetrends.com which monitors the global aviation industry for commercial innovations in response to changing consumer behaviour. Quoted as an industry expert in publications such as CNN, MSNBC and The New York Times.

View all posts by Raymond Kollau
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