Building New Ancillary Revenue Solutions for a New Era in Air Travel

For the past 18 months, we have been developing a new technology platform to solve for three critical airline sector challenges:

1. Increasing effectiveness of onboard retailing
2. Achieving higher ancillary revenue throughout the “day of travel”
3. Delivering a better passenger experience

Across the industry, we have watched inflight sales stagnate, with the exception of a few outliers: some carriers outperformed other airlines by extending their onboard retail offerings to the entire day-of-travel. This shift is both significant and critical for an airline industry where only 7.5% of passengers make onboard purchases – a conversion rate that has not improved in years, despite higher ancillary revenues overall (largely from fare unbundling).

During the product research phase of building the new platform, we surveyed airline professionals to get their feedback and found that:

• 84% of airline professionals believe the new platform will at least double their conversion rates
• 86% believe the new applications will increase ancillary revenues
• 94% are confident the system will improve passenger experience

In late January 2018, we officially launched the commercial release of our airline commerce platform, with several new airlines signing on as launch partners as well as our customer base of 25+ airlines being migrated to the new platform.

You can read more in the press release here.

Committed to Innovation: Yesterday, Today and Tomorrow

Starting with our very first product launch in 2002, Guestlogix has been developing new ways of ‘selling in the sky’ and committed to continuously delivering new – and better – ways for airlines to drive the highest ancillary revenues while providing an excellent inflight experience to their passengers.

The traditional market for onboard retail consisted of point-of-sale (POS) hardware that could process orders and payments, but largely disconnected from passenger systems. This was an outdated business model in today’s travel sector where everything is shifting to mobile, and passengers increasingly expect to do anything and everything on their smartphones.

You can read more about the connection between PaxEx and ancillary revenue in our report here.

Passenger-centric retail analytics is uncharted territory in the airline industry – this is what sets the Guestlogix platform apart from competing point-of-sale solutions. With a mobile-first platform for airline commerce, carriers can significantly increase onboard sales but also develop any other ancillary revenue opportunities they can imagine throughout the day of travel, including advertising, sponsorship, inflight entertainment and destination activities. This is what we call the “untapped goldmine” in air travel.

Through our commerce platform, airlines can now reach their mobile-centric customers and have the easiest to use, easiest to implement solution on the market for “day of travel” revenue, onboard retailing and ancillary merchandising, through three main components:

• Management Console: The management console makes it easy for flight crews and sales and marketing teams to monitor sales performance across flights and run personalized, data-driven campaigns based on predictive analytics – giving them deep business intelligence on what individual passengers want or may need.
• Flight Attendant POS: With smarter inventory and order management based on the platform’s retail analytics engine, flight crews have more time and attention to up-sell and cross-sell, and they also have sophisticated point-of-sale software to complete purchases quickly and conveniently.
• Passenger Experience App: The passenger experience app serves as a “digital concierge” that makes it easy for passengers to browse inventory, place orders and make payments. Airlines can add any kind of inventory to the catalog (not just food and beverage) and passengers can make purchases before, during or after the flight (seat upgrades, “jump the line” privileges, destination activities).

Over the coming weeks, we’ll be sharing a series of posts exploring the airline commerce platform’s capabilities in more detail, as well as a deeper dive into retail analytics and day-of-travel ancillary revenues.

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