American takes merchandising to the next level with new mobile applications

American Airlines is laying the groundwork to take the airline industry’s evolving merchandising business to the next level by offering product upsells to passengers via their mobile phones.

The carrier was the first out of the box in offering a mobile application for the iPhone, and now features a variety of functionality for iPads, Android phones, Blackberries, Windows Phones and e-readers such as the Kindle and Nook, “which are not traditionally heavy app oriented”, says airline CIO Maya Liebman.

American aims to build on its current mobile offerings that include boarding pass accessibility, flight check-in, parking reminders and terminal maps to create a deeper experience for the passenger while at the same time expanding the sales streams for expedited security clearance or preferred seating. During the last few years the unbundling and selling of certain aspects of the travel experience has translated into hefty returns for carriers that help create a shield against wildly fluctuating fuel prices. American’s rival Delta Air Lines has outlined its goal to achieve USD1 billion in ancillary revenue in 2013, aided in no small part by new product merchandising initiatives being undertaken by the carrier.

For American the next level of sales opportunities can be found in utilising mobile technology to offer those products to customers live during their travel experience. Leibman explains American’s customers have indicated they would value an ability to purchase expedited security or a better seat on their mobile devices, and those are items the carrier will be ultimately rolling out on its mobile platforms.

It is tough to pinpoint the exact timing of the new offerings as Leibman explains that “every month we have a series of upgrades on each of the platforms and so it may take several months to fully develop the functionality”. But she expects the accelerated security and preferred seating options to be available within a year.

American has also conducted trials with mobile applications that would allow customers to pre-purchase items on the carrier’s buy-on-board menu. The trials were targeted to specific areas in the US. Leiban explains the testing entailed alerting the passengers to the items available for purchase on a upcoming flight.

In outlining the benefits of the mobile buy-on-board application Leibman states the offering allows American to ensure it has the correct catering inventory levels for a given flight while providing useful information to passengers. “Sometimes they get to the gate and they don’t know exactly what the flight will have in terms of buy onboard,” Leibman remarks. “Should they buy something at the airport? Should they bring something from home? It just arms them with greater information that makes them feel more connected to the airline.”

She says expansion of the onboard purchase of food is “another one of the items on the list to get to”, in terms of boosting American’s mobile offerings.

American is also examining ways to improve some its existing mobile capabilities including offering “much deeper functionality around booking and changing existing reservations”, Leibman explains. “All of these things we have to varying degrees, but those areas are example of things that are on the slate to continue to evolve.” Another potential upgrade under consideration is improving mobile mapping functionality so customers could determine the number of miles they’re accruing for a particular trip.

As technology evolves to keep travellers constantly connected through their various electronic devices, “mobile will continue to grow in importance”, Leibman declares. “What happens is you want to be out there on all these form factors and you have to prioritise and choose which components of the overall process are most important to be on.”