2018 has been another impressive year for the aviation industry. There was a record 39 million flights worldwide over the course of the year, and more passengers took to the air than ever before. While profits were down on 2017, the industry still raked in close to $34 billion, one of the four years in aviation history when profits exceeded $30b. But it’s also been a year of aviation challenges and change too.
We’ve seen new legislation affect how operators work and airlines struggling to adapt to an ever more digital world. At Conztanz, we’ve been closely following these aviation challenges over the course of the year, tracking how they impact on airlines, while also looking at how the industry as a whole can adapt.
Here are 5 of the most important challenges the aviation sector faced in 2018 – and how Conztanz helped airlines overcome them.
1. EU laws changed how carriers had to collect information
On May 25th of this year, a new piece of EU legislation (the EU2016/681 directive) came into effect and immediately impacted airlines and the aviation authorities of member states (read our full article here). The directive was intended to help tackle violent crime and terrorism by requiring airlines to share information on all incoming passengers with the authorities in the destination country.
Airlines were required to forward all Passenger Name Records (PNR) to the destination country’s Passenger Information Unit (PIU), where the authorities would check passengers off against a database of suspected criminals and terrorists.
A good idea, in theory, making the directive work, in reality, is a huge technical challenge for airlines and national aviation authorities. It requires sophisticated systems to forward data in real time – and many airlines and authorities still struggle to make the system work.
How Conztanz helped
With our API – PNR solutions & services, we were able to help many airlines and authorities to rapidly aggregate PNR data. For instance, our EU gateway, launched in partnership with the Luxembourg State provides a secure line of communication, allowing real-time data flow between airlines and EU authorities, thereby giving the most up to date information about who is entering a Member State. The gateway is already implemented within the state of Luxembourg which succeeded to rapidly comply with the new legislation – read the full story here.
2. Airlines felt the pressure to make more of their data
There have been growing calls for the aviation industry to adopt the standards of connected/internet native business such as proposing personalized offer or providing immediate information and services linked to the travel context. But to do so, airlines have to develop smart use of their data. Nonetheless, for many airlines the challenges of doing so still haven’t been resolved:
- Data is stored in multiple siloes
- It’s extremely difficult to centralise and match up information from different databases
- Collecting some data in real time could also be an extreme challenge
All the same, consumers are now used to their favorite brands knowing who they are, what their preferences are and that they will provide tailored services to them. And they want a personalized experience (for those who don’t, GDPR rules protect them) . Unfortunately, in 2018 most airlines still cannot offer even the most basic personalization due to the way they manage data.
How Conztanz helped
This year, we pursued the development of our Travel Data Agility Platform (learn more here). The platform provides airlines with a powerful tool to support their passenger personalization efforts. It allows them to:
- Match up data from different siloes to get a full picture of each passenger through extensive use of APIs or our user interface.
- Get a better understanding of customers, their journeys and profiles
- Push this information into any relevant applications. To automatically push notifications to staff and targeted passengers for instance (e.g. special promotions or messages when there are delays)
3. Digital transformation remains one of the major aviation challenges
‘Digital transformation’ is an umbrella term which conveys a wide range of activities intended to help an organization use digital technology to enhance productivity, boost operational efficiency and increase profits. For one airline it might mean digitizing paper processes to smart devices and apps, for another, it might mean adding a social network as new channel for customer interaction. There’s no strict definition of what digital transformation should look like, but it requires airlines to focus on using digital technology to keep improving their offering.
Nonetheless, making digital transformation a reality remains a challenge for many airlines, especially those without major IT budgets to splash on custom-built technology. As a consequence, for smaller airlines, in particular, there’s a real threat that larger competitors who have invested in digital transformation will have a major advantage over them in the years to come.
How Conztanz helped
Throughout the year, we’ve been using our blog to explore (and inspire) what digital transformation means – looking at the airlines and industry players that have begun putting their own digital transformation strategies into place. We’ve also been leading numerous discussions with major Airline IT players (Sabre, PROS, SAP, Travelaer) to understand needs and gaps in the ecosystem.
As a consequence, number of enhancements have been identified for our Travel Data Agility Platform, ConztanzOne – such as new API, new connectors – to give airlines a platform that fully integrates with their IT environment and therefore ease the launching of their own digital transformation journey.
4. Customer Experience became a battleground for customer loyalty
2018 was quite possibly the year of customer experience in the aviation industry, with airlines across the globe looking to make their offerings more personalised and unique to the needs of individual passengers. However, the aviation industry is still behind the curve when it comes to passenger personalisation, as our CEO Bertrand Kientz explained in his interview with Forbes.
For decades, airlines have focused on operations – getting the aeroplane, baggage and passengers from A to B – and not on creating personalised and unique customer experiences. Where once that would have been enough, expectations of personalisation are increasing, and so the airlines which can make their passengers feel special will almost certainly come out on top.
How Conztanz helped
During 2018, we worked hard on analytics enhancement in our OneProfiling module which intelligently captures data from multiple databases to build customer profiles. New algorithms have been introduced to enrich profiles of all an airline’s individual customers, providing new “experience tags” such as “most delayed customers” or “behaviour tags” such as “high-spender / low spender”.
Our data scientists have also developed powerful clustering techniques to identify groups of customer with similar attributes. This helps the airline segment their customers, and learn more about them – which can be used in operations, sales, marketing and even in website experiences. To learn more about OneProfiling, read our introductory blog here.
5. The vision for NDC remains a vision for most
Once implemented, the IATA’s New Distribution Capability (NDc) standard will
improve and enhance how customers make bookings. A passenger booking flights with Airline X through a travel agent will now also be able to choose seats and ancillary options while still using the travel agent’s website, for instance.
This is all good news for the industry, yet so far NDC implementation has lagged due to a lack of tractionand technical challenges in its implementation.
How Conztanz helped
In October we were invited to a panel discussion at the IATA’s Airline Industry Retailing Symposium in Rome where Hélène Millet, our Head of Consulting & Airline Products, explained how airlines can develop a best-of-breed strategy for deploying and integrating NDC. Read more from the panel discussion here.
An important year for Conztanz
2018 has been an important year at Conztanz, and we’ve seen some major developments and product launches to support out wider strategy.
- We were featured on the front page of Forbes magazine in May, where our CEO discussed aviation challenges facing the industry
- We continue to develop our Travel Data Agility Platform (TDAP) in collaboration with others IT players – download our TDAP e-book here
- A range of enhancements enriched our OneProfiling module- see details
- We launch the EU API-PNR gateway in partnership with the state of Luxembourg
- And we are in the process of conducting studies into how we can support the new European ETIAS and EES visa system
We’re looking forward to 2019 too – with many new product releases on the horizon, and a new website too.
At Conztanz, our vision is to help the airline industry overcome aviation challenges by making the most of its data to better serve passengers and improve profitability. To learn more about any of our individual products, contact us today – or sign up to our newsletter to keep up to date with our work.