Airlines: a long haul to digital transformation

Historically airlines have been innovators, quick to adapt to analytics-based inventory control and price optimization and roll out loyalty programs, but for some digital transformation is proving a long haul.

At the Aviation Festival 2015 in London, which brings together global airline and airport CEOs, airlines said they were now reaching the halfway mark in their digital transformation programs.

Shannon Kelly, director of e-commerce for United Airlines said it was providing an internet service that enables passengers to stream content to any device. Kelly admitted that it isn’t all about inflight connectivity and that the airline plans to be smarter with the data it collects from customers to enhance interactions.

Embracing digital

Many airlines are looking to get an advantage through digital transformation. Ryanair, for example, knew it had to embrace digital, but needed to start from the very beginning to provide its customers with personalized online experiences. It had previously been seen by many as a technological luddite, thanks to its cumbersome online presence.

Speaking at this year’s Adobe Digital Marketing Symposium, Dara Brady, Ryanair’s head of digital experience said 18 months ago “digital” specifically didn’t exist in the organization. The company put in place Ryanair Labs, a digital team dedicated to building a new platform twelve months ago. “We have gone from a zero starting mark to over 50 in a digital sense,” he said.

Ryanair recently launched a personalized website which centers round customers signing up and using its ‘My Ryanair’ portal.  Currently six million people have registered to use it. Ryanair said response to the new platform has been positive with users finding it “easier and faster to book”. It is set to roll out new features on and a mobile app over the coming twelve months.

Ryanair has made no secret of the fact that it would like to extend the airline’s online proposition to provide additional travel services. Speaking at the launch of Ryanair’s new customer charter, Kenny Jacobs, chief marketing officer at Ryanair said the airline “is essentially going to be a travel retailer that specializes in flights. It’s an ambitious statement but that’s the ambition that we have when it comes to innovation in the category.”

Ryanair has taken the bull by the horns when it comes to digital transformation and it is paying off. Ryanair’s October 2015 traffic grew by 15% to 9.58 million customers. Last year it flew over 82 million passengers. This year the figure could hit 100 million.

Focus on analytics

Air New Zealand is also looking to become one of the leading digital airlines globally.  The airline is taking its mission so seriously that when Julie Raue leaves the airline this month her CIO role will not be replaced.  Instead, it will be part of a newly-created Chief Digital Officer role.  This is central to the next phase of digital transformation for the organization.

Earlier this year Air New Zealand and Aimia, a Canada based data-driven marketing and loyalty analytics company jointly purchased 11Ants Analytics. This acquisition forms a core part of the airline’s digital strategy.

“Businesses have a lot of information about their customers’ buying behavior but often don’t know how to use it to improve the experience for the customer or the performance of their business,” commented Hamish Rumbold, General Manager Customer Value at Air New Zealand. “In an increasingly digital world customers expect the businesses they frequent to provide them with a personalized experience. 11Ants Analytics’ technology enables businesses to listen, understand and act with a much deeper understanding of their customers.”

Farming out change

Virgin Atlantic has opted to farm out its digital transformation program to Tata Consultancy Services (TCS). The airline has signed a multi-year partnership under which TCS will set up a private cloud for Virgin Atlantic and provide services including Infrastructure-as-a-Service, End User Services and Application Support Services.

“In order for Virgin Atlantic to maintain and build on our position as market leaders, it is vital for us to simplify our IT processes and create a technology landscape that is more agile and responsive to our growing business requirements,” explained David Bulman, CIO, Virgin Atlantic Airways.

Change in the cockpit

It isn’t only passengers who are benefiting from digital transformation – change is also happening in the cockpit. Gulf Air, the national carrier of the Kingdom of Bahrain, has recently achieved paperless flight operations, using Jeppesen FliteDeck Pro as its electronic flight bag (EFB) solution. Jeppesen provides digital navigation and flight information for Gulf Air, delivered through an iPad.

“Equipping Gulf Air’s flying crew with iPad EFBs on-board gives them a paperless way to manage in-flight data further streamlining our operational performance and giving our team greater capabilities and efficiencies,” commented  Captain Nasser Al Salmi, Gulf Air Chief Operating Officer.

All of these example show that digital transformation is having an effect right across the airline industry and the airlines that have embraced change are already seeing the results. Any that don’t could find themselves flying into turbulent times.

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