GuestLogix has put together an interesting list of predictions for 2011, to see how Asian airlines will fare in comparison to airlines from other regions.

 

 

According to IATA, as the airline industry approaches the end of 2010, passenger demand is 5% above press-crisis levels and Asia outside of Japan is barrelling towards high speed growth. However, we need to bear in mind that airlines’ operating results could easily be sideswiped by higher fuel prices, weather, natural catastrophes, fluctuating currency rates, and other developments beyond an operator’s control. As such, the biggest challenge will still remain sustaining profitable revenue growth. 

 

With capacity utilisation running at an all time high, cost control and transformation will yield less and less going forward. Airlines will need to focus on meaningful ways to enhance service while growing new revenue streams and continue their push to grow ancillary revenues. The cabin will surely emerge as a focus for sustainable and profitable revenue generation next year. 

 

 

In surveying travellers globally, GuestLogix found that more than half of them would take advantage of destination-related offers aboard a flight. GuestLogix expects items such as tickets to entertainment, ground transportation, attractions, tours and other offers that add immediate value to a trip to be in demand, not just in Asia, but around the world. 

 

In response, leading onboard duty-free concessionaires will evolve their business models to include broader shopping categories with the convenience of home delivery. This will represent the next wave in onboard innovation that will usher other important changes in the onboard experience.

 

 

As the use of credit cards and other payment methods penetrate the industry, there will be greater demands placed by the payment industry for operators to achieve security compliance in Asia. Airlines will need to upgrade their existing POS systems to meet the more stringent payment standards globally. As connectivity slowly takes its place onboard aircrafts, payments will incorporate real-time credit card authorizations to support higher-valued transactions.

 

 

Carriers are seeking new ways to interact consistently with their corporate and leisure customers through all travel touch points in the travel continuum. By staying better connected with their passengers throughout the entire journey, airlines can establish new and meaningful ways to support their customers, invigorate their brand loyalty, and sustain ancillary revenue growth. By doing so, they can extend the access to their onboard store to all travel touch points.

 

 

Each year, nearly 100 million travellers use smartphones onboard US-bound flights, and this trend will gain momentum in Asia in 2011, home to some of the fastest growing mobile broadband markets in the world. Travellers today can use their smartphones to book their airline tickets, track their flights, hold their boarding pass and more. They have also begun to rely on their smartphones for their virtual check-in and travel concierge.

 

The airlines will focus on monetising more travel touch points with their customers.

 

 

Airlines will focus efforts that benefit all customers as most flyers are affluent and highly predisposed to spending. Onboard retail technology is now such that operators can differentiate offerings to appeal to their most valued customers on any given flight. There is also the potential to allow passengers to upgrade meals and seating. This virtualises the traditional fare class structure, and with shopping onboard, they can present different offers based on frequent flyer status.

 

 

According to GuestLogix’ duty-free partner, In-flight Sales Group Hong Kong, the top performing category has been electronics, particularly those related to the iPhone and BlackBerry smartphone. We expect this trend to continue with the introduction of new product models. Skincare has been strong across all North and East Asia countries, but especially strong in mainland China. Jewellery has also experienced strong performance and a marked return recently to higher priced products and premium positioned brands. Bottom performers are tobacco and colour cosmetics.