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Reinventing the Airport Ecosystem a New Airline Industry Report Contents Reinventing the Airport Ecosystem A new airline industry report Contents Executive Summary 4 Research Methodology 6 1. Macro Trends and Impacting Factors 7 2.4 Identifying passengers in the airport 1.1 Political factors 8 environment 26 > Open skies 8 2.5 Communicating with passengers 26 > State capitalism 8 2.6 Additional developments to enhance the 1.2 Economic factors 9 airport experience 27 > Economic outlook 9 > Create a ‘sense of place’ 27 > Global growth 9 > Personalisation 27 > Wealth distribution 9 > Sustainability 28 > Centre of power 9 > Non-aeronautical revenue generation 28 > Economic globalisation 9 > Airline profitability 10 3. Industry Drivers Shaping Ecosystem 1.3 Social factors 11 Architecture & Strategies 35 > Global population 11 3.1 The importance of non-aeronautical revenues 35 > Passenger numbers 11 > Airports 35 > Ageing population 12 > Airlines 36 > Global middle class 12 > Airlines/airports revenue sharing 37 1.4 Technological & Scientific factors 13 3.2 New approaches to finance investment 38 > Evolution of personal mobile ecosystems 13 > Turning owned assets into rented services 38 > Delivery of information & communication > Auctions 38 to the mobile device 13 > Crowd sourced financing 38 > Use of social media 13 3.3 Enhancing the passenger experience 38 > Connecting communities 14 > On the security front 38 > Passenger attitudes to technology 15 > On the sustainability front 38 > How airports will adapt and accommodate 3.4 New approaches to operations 39 the future 15 > Collaborative decision making 39 > Technology infrastructure 17 > New terminal design 39 1.5 Environmental factors 18 > Fuel price volatility 18 4. Mapping Strategic Direction for the > Environmental sustainability 18 Next 20 Years 40 1.6 Legislative factors 19 4.1 Adopting a long term perspective? 40 > Global regulation 19 4.2 Defining the ecosystem architecture 40 > Airline alliances 19 > Conceptual model 41 > Infrastructure model 42 2. Passenger Perspective on the Future 20 > Revenue generating model 42 2.1 What causes passengers stress in their journey? 20 > Customer engagement model 43 2.2 What factors would contribute most > Service delivery model 43 to passengers’ wellbeing? 20 > Financing model 44 2.3 Rethinking the passenger journey over the next 5 years 21 > Airport interconnectivity 21 Conclusion 46 > Check-in 22 Contributors 49 > Baggage handling 23 About Amadeus 51 > Security, immigration & border control 24 About Fast Future 51 > Boarding 24 Reinventing the Airport Ecosystem 3 Foreword Twenty years from now, the airport environment will be unrecognisable The aviation industry has always been a leader in development and innovation. Over the years, as the industry has matured and grown, a finely balanced ecosystem has been built through constant activity, growth, change and advancements. This ecosystem, which is comprised of all the players present in the airport environment, has supported tremendous growth in low-cost travel and has met the needs of an ever increasing and diverse number of travellers. For the major players of this ecosystem, the last decade has shown not only how interconnected their operations are but also how closely their fortunes are intertwined. Like any ecosystem, the key is to continually examine how we can all work more closely together to meet the needs of our customers and, ultimately, the end traveller. The next 10-20 years hold great potential for airports and all those involved in air travel. We expect a rapid pace of development as social change and new technology propel the airport from its current focus of serving passengers for air travel to encompass a far wider existence that provides a greater breadth of services. The airport has long been a primary point of service delivery for travellers undertaking a ‘total trip’ which encompasses a wide variety of stages from booking to destination. In this research 43% of travellers told us they wanted to reestablish the ‘wonder and magic’ that was historically associated with air travel. If this is to be achieved then we need to think differently. Every player in the airport ecosystem must re-examine exactly what tomorrow’s travellers will demand and begin to plan to meet those needs, not in isolation, but in conjunction with other companies and organisations. The report provides an independent, expert, perspective about future strategies and models which will help determine the way airlines and airports can deliver a streamlined, stress free and holistic service to their customers. The good news is that travellers have told us they will be willing to spend more time and money at the airport, but only if the airport experience comprises inspiring leisure options and a competitive, enticing retail offer. The ideas and predictions contained within leave me with great optimism that the airport experience will remain relevant and that airport operations can achieve improved levels of profitability for all organisations that support them into the future. We hope this report provides you with valuable insight into how advances in travel technology will affect passengers, and also the importance collaboration plays in the future of the aviation industry as it helps to reshape travel in the next decade and beyond. We look forward to participating in the ongoing discussion we hope and anticipate this paper will generate. Julia Sattel John Jarrell Senior Vice President, Airline IT, Amadeus VP and Head of Airport IT, Amadeus 4 Reinventing the Airport Ecosystem Executive Summary The observations from this report originate from primary How will advances in travel technology affect field research, conducted in interview format with key passengers? representatives from major travel and technology business sectors, and then tested against a large sample of global Today, we see biometrics in use at passport control and bio- travellers. The aim of this report is to understand which future mimicry principles driving aircraft design. Five years from now, strategies and models will help determine the way airlines space travel could feasibly be a reality, with super jet planes and airports can provide a competitive response to managing flying into earth’s lower orbit. They would of course take off a streamlined total trip experience. Active engagement with and land from state-of-the-art spaceports sporting natural user passengers and collaboration with all the various players interfaces at passenger touch points, intelligently in sync with present in the airport ecosystem will help secure business each customer’s unique preferences and purchasing behaviour. sustainability and profitability in the years to come. The passenger perspective on the future Macro-environment influences on the aviation sector What is the passenger’s take on the pursuit of an efficient and The airline ecosystem is a fascinating hive of constant activity, unified airport ecosystem? From the traveller perspective, a change and advancement. As a sector, the aviation industry is stress-free passenger experience is the number one priority. very susceptible to influences from the macro environment, and This will require more automated processes which offer speed, effectively represents a microcosm of the political, economic, convenience and ease of use, all of which are possible with social, technological, environmental and legislative trends that advancements in customer-centric technologies (remote shape both developed and emerging economies. check-in, NFC devices, electronic passports/bag tags). However, the trade-off is relinquishing some control over data ownership The industry plays a major role in national and international in order for airlines and airports to more accurately track and governmental policy-making: the undeniable impact aviation manage passenger expectations. has on our environment, border controls, ‘Open Skies’, changes in the pattern of wealth distribution and GDP growth, all place the business of airlines and airports at the top of the political A window of opportunity for non- aeronautical and economic agenda. revenues How the industry operates now and in the future is largely There is also anticipation that ongoing investment in airport determined by social change and technological evolution retail, leisure and dining facilities will generate substantial which we are witnessing on an unprecedented scale. non-aeronautical revenues for airports and their serving Population growth forecasts will drive route openings, an aging airlines, transforming landside and airside space into a hub demographic will lead to new levels of service personalisation, of diverse activities. Imagine an airport where the retail and with 85% of the Earth’s population now receiving mobile experience is so impressive you choose to shop there without coverage, global availability of personal mobile technology will even flying! Or how about taking a pre-flight swim and change forever the way aviation players interact with and sell sampling some local cuisine sourced from the airport farm? to tomorrow’s traveller. No time to shop - then just use your in-flight app to make purchases in the air which you pick up on the ground? These concepts are all just around the corner! However, collaboration between airports and airlines to forge non-aeronautical, revenue-sharing agreements will be essential for this strategy to succeed. Reinventing the Airport Ecosystem 5 Innovation, collaboration, engagement - the keys to The future airport models a successful ecosystem Twenty years from now, the airport
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