The airline industry has grown to meet the needs of a globalized world. The volume of air passenger traffic continues to grow, and interactions between the virtual world and tourism activities are increasing significantly. Today travelers search for post-worthy experiences and quality services, with increasingly high expectations that the industry has to meet.
Industry reports are predicting strong demand for passenger travel (+6.9% in 2016, expecting to reach 3.8 billion pax) and economic growth (2.5% in 2015 to 2.7% in 2016 ). This setting is advantageous for both - air transport and air travel related passenger services. Airlines must be ready to take full advantage of sales opportunities these amenities bring to the market.
The past five years have seen the online environment become the preferred and influential choice for travel customers searching and looking to book their trips. This also has enabled growing ancillary and optional services revenues which are a major contributor to airlines earnings and commercial success. Ancillary revenue contributed $31.5 billion in 2014, with a projected increase of $59.2 billion in 2015 (7.8% of the global revenue of $763 billion). These numbers were generated by service activities such as onboard sales, checked baggage, premium seat assignments, early boarding benefits, commissions earned of services and frequent flyer miles program partners.
IATA forecasts that airlines will post a net profit of $36.3 billion in 2016 . Airlines must adopt best practices to take their share from this revenue pool and not only by filling seats but also offering added value services to passengers.
We find that travelers have become more proficient and more technically apt, able to utilize a multitude of data sources, search dynamically for different products and services and actively seek good deals. From travel planning and research, to offer comparisons, customized itineraries, virtual payments, airport services, in flight services and destination services. Travel prosumers are growing rapidly in comparison to the last few years.
With IFE expanding rapidly, further mobile leverage will include Bring Your Own Device (BYOD) for in-flight entertainment and onboard services as well as digital wallets and other payment methods. All of which opens new opportunities for airlines to excel flight & ancillary sales efforts. According to OpenJaw 2016 Insights and Predictions Report this also highly relies on the effective application of IATA's NDC adaption that will help airlines boost the sale of ancillaries, Omni-channel retailing and a personalized shopping experience helping to build customer loyalty and encourage engagement.
In order to exceed customer expectations and grow market share airlines must focus on their strategic marketing and technology investments. Those that will strengthen their online and mobile channels and branding, bring their customers a more personalized travel search and shopping experiences and ensure the airlines e-commerce platforms can underpin a competitive edge will be the ones to succeed.
50% or the world’s population is under 30
By 2017, mobile traffic will have grown 13 times in just 5 years
In the next year, there will be more connected devices than people on earth
By 2019, the number of mobile payment users will reach 69.8 MM
For this purpose advanced travel technology solutions play a critical role in the equation. Helping airlines to control and manage its Sales Offer creation and distribution relying on its vendor partner like if it was its own technology. Flexibility and agility are essential to empowering the different facets of airline operation.
This white paper serves to explain how airlines can increase their flight and ancillary revenues by using the latest innovative travel tech solutions, while embracing the full meaning of e-commerce.
Airlines that flexibly define, manage and distribute their products within a customer centric personalized experience have no doubt got it right. The data presented in this white paper was aggregated from a variety of sources, including airlines, annual reports, travel associations and agencies, ANIXE and Vayant Travel Technologies, and Gulf Air’s proprietary database.
About Gulf Air
Gulf Air, the national carrier of the Kingdom of Bahrain, commenced operations in 1950, becoming one of the first commercial airlines established in the Middle East. Today, Gulf Air is a major international carrier serving 43 cities in 24 countries spanning three continents. The airline operates one of the largest networks in the Middle East, with double daily flights to more than 10 regional cities, from its hub at Bahrain International Airport. Gulf Air serves all its destinations with a combination wide and narrow body fleet totaling 28 modern aircraft.
Renowned for its traditional Arabian hospitality, evidenced by the airline’s signature family and business friendly products, Gulf Air is committed to being an industry leader and developing products and services that reflect the evolving needs and aspirations of its passengers.
Gulf Air connects Bahrain to the world and, as such, is a key national infrastructure asset, serving as a powerful driver for the economy and supporting the Kingdom’s on-going economic growth.
ANIXE integrates multiple reservation systems and payment providers into one powerful booking solution for speed, quality improvement, and cost reduction. The company’s goal is to empower travel industry through worry free, future ready SaaS technology.
ANIXE provides fully customizable and scalable, end-to-end Internet Booking Engines with ancillary and merchandising options and API’s for partners, hotel aggregation, distribution and cache data generation to improve the conversion.
ANIXE open tailored solutions can be further integrated with any required systems, are compliant to law regulations and designed with a deeply customized look & feel to enhance customer experience.
All platforms are hosted in house and can easily handle gigantic volumes of traffic with an up-time of more than 99.98% each year.
From 1997 ANIXE has implemented over 300 SaaS projects which are the core of the business of airlines, tour operators and online agencies all over the world.
About Vayant Travel Technologies
Vayant Travel Technologies provides airfare search solutions to the airline and wider travel industry. Vayant solutions enable efficient and optimized revenue driven airfare pricing & shopping, customized sales offer creation and instant multi-channel distribution, shopping inspiration, speed & flexibility for unique search experience and retail merchandising.
Vayant cost effective, efficient and fast to deploy solutions give full control and complete freedom to airlines and online travel sellers to get closer to their customers with targeted offers and promotions, presented intuitively across every online channel.
Vayant solutions are today powering giant airlines and agencies on a world-wide bases.
Vayant is IATA NDC – Level 2 Capable.
All Vayant solutions are NDC standards compatible enabling airlines to take even more control of their pricing system environment and sales strategies.
Gulf Air customer-oriented business model
Gulf Air operates a customer-oriented business model that assumes constant growth and innovations to surpass customer’s expectations.
The most important objective the project fulfills is having an enhanced platform that supports the airline’s drive to strengthen its online and mobile channels, adding dynamic shopping and booking capabilities to give clients a more personalized travel experience. It was a critical requirement that the new platform is available at least 99,7% with response times up to 3 seconds.
The joint solution should be 100% reliable and available in real time. Another challenge was to integrate it with the Redemption Booking Engine (RBE) and make it scalable for future growth. An online booking engine (B2C, RBE) should also be fully automated and seamlessly connected to a payment gateway provider.
Unifying the booking engine to enable Gulf Air to reach its online targets more cost-effectively for all categories of bookers.
The enhanced platform should be flexible and easily evolved for future requirements.
New system should support mobile channels.
ANIXE reviewed the requirements as well as inherent risks and provided alternate handling methods to address the challenges. ANIXE and Vayant collaborated and tailored existing solutions to provide customized innovative shopping engines to improve the airline’s e-commerce website for customers booking flights and purchasing various travel add-ons.
ANIXE - Vayant joint solution
The joint solution empowered Gulf Air through a lightning fast, unified booking engine, replacing three separate systems. The new solution serves different categories of bookers from individual and corporate to loyalty scheme redemption travelers. The platform allows to reach Gulf Air’s online targets more cost-effectively, and with the flexibility to develop in the future.
ANIXE’s solution improved the speed and quality of search and reduced the number of host system transactions, which translates to better conversion rates and cost effectiveness. Optimizing response times is a thorough and painstaking process geared towards the same end goal, higher booking conversion.
ANIXE created tailored travel experience with unified look & feel across all channels, with special focus to mobile users needs (mobile first). The platform stands out with a deeply customized front end tailored to Gulf Air needs. The dynamic display for coach and business class has been created to allow to book and price fare families in exactly the same way as any other fare type. With complete visibility over what’s included in each fare family, airlines can provide complete transparency to their customers in order to build trust and drive loyalty.
ANIXE integrated Gulf Air’s platform to Amadeus Loyalty Solutions and launched redemption booking engine allowing passengers to book flights while redeeming their collected miles.
The ANIXE solutions meet top industry standards. Each year the PCI DSS Payment Gateway standard compliance is verified to ensure the highest security of credit card payments as the system supports all credit card providers including the most popular for Gulf Air passengers local debit card provider - Benefit. The platform has been also integrated with Fraud Prevention services and 3DSecure and is also compliant with government regulations, including APIS data collection.
To significantly improve booking conversion and customer retention, ANIXE developed Dynamic Currency Conversion to allow customers to see the exact amount their credit card will be charged in the respective local currency.
The ANIXE-Vayant solution operates independently of the host reservation system for fare and availability searches for up to a full year across all fares and flight combinations. It is connected with Gulf Air’s current reservation system for seamless booking creation.
Vayant has provided Gulf Air with a fully customized and personalized, NDC compliant, core technology solution to empower the airline’s E-commerce website with a new generation pricing & shopping platform.
Vayant OneSearch product provides live airfare pricing & shopping engine delivering fast, accurate and comprehensive flight sales offers. Vayant solution handles industry standard data such as ATPCO schedules, IATA-ICer and ATPCO Loaded ancillary & optional services. Designed to deal with ample volumes, the engine core produces real-time calculations in line with the present multichannel distribution environment.
The Vayant core engine is extensively customizable through a dedicated business rules engine and enables the airline to set its own search and booking criteria, fully control price diversity and determine combinability. Additionally Vayant provides re-pricing capabilities and historical pricing functionalities.
Vayant solution enables Gulf Air to integrate its proprietary data (inventory, net-fares, and ancillaries) into the core pricing & shopping engine. Thereby Vayant provides a search environment that gives the customer a first-rate search and shopping experience with a single query. The diversity of results can be displayed and sorted by price range, booking class and travel period, enabling the airline to unify a customized interface across all distribution channels that responds to live searches based on input parameters.