Are you attending IATA’s World Passenger Symposium or World Financial Symposium in Istanbul on 5 and 6 November? If you are, we would like to draw your attention to our second Airline IT Vendor Distribution and Retailing Masterclass, as several airline IT vendor partners have approached us asking for a dedicated masterclass for the vendor community.

We are therefore pleased to announce that we will hold our next

Airline IT Vendor Distribution and Retailing Masterclass – exclusively for the vendor community – in

Istanbul on 4 November 2025

(the day before IATA’s World Passenger and World Financial Symposiums)
from 12:00 to 18:00. It will be followed by a joint drinks reception with finger food.

Our agenda includes sharing insights from our airline engagements, providing thought leadership and offering a forum for the vendor community to exchange ideas and discuss without airline participation:

12:00 Kick-off with a joint lunch
13:00 Status of the industry
13:45 Perceived challenges of the transition to modern airline retailing
    Views from an industry and airline perspective
14:45 What airlines are considering in their procurement processes
15:45 Break
16:15 Learnings from TiM engagements
17:00 TiM’s recommendations to the vendor community
17:30 Discussion and wrap-up
18:00 Drinks reception with finger food
20:00 Finish

The fee is CHF 1,750 per person, with a reduction of 15% for the second ticket and 25% for the third and any further tickets purchased by employees of the same company.

You may register here for this event.

We look forward to discussing and seeing you in Istanbul.

 

 

 

 

 

Rethinking Airline Loyalty Part II: Making Traveller Status Real

In my previous blog Rethinking Airline Loyalty: Why Traveller Status Could Be a Strategic Game-Changer, I posed a provocation: what if airlines could reward travellers before they ever flew with them, simply based on travel behaviour elsewhere? A “Traveller Status”. Since publishing that post, I have received strong feedback and comments. The enthusiasm for the idea was matched only by the question that inevitably followed: “How would we actually do this?”

Let us move from concept to action. Turning this idea into reality is more than perks and marketing. It touches data access, IT infrastructure, partnerships and even the politics of loyalty programmes. Here is how airlines can make Traveller Status real and the roadblocks they will need to navigate.

How to collect travel behaviour outside your ecosystem

The Traveller Status model rests on one foundational capability: access to travellers’ flight behaviour before they ever book with your airline. That requires both data sources and traveller incentives:

• Traveller-provisioned data: encourage travellers to share their past travel activity through opt-in mechanisms such as
  • Email parsing: tools that extract flight details from confirmation emails (e.g., how TripIt and Google Trips work)
  • Loyalty wallet apps: leverage platforms that aggregate loyalty accounts (e.g., AwardWallet, Point.me or Cardlytics)
  • Receipt syncing apps: allow users to upload travel receipts or sync with apps such as Expensify
• Corporate and TMC feeds: partner with TMCs and corporate travel platforms to analyse aggregated, anonymised behaviour of frequent business travellers
• Travel affinity signals: explore partnerships with data marketplaces or customer data platforms (CDPs) that use web cookies, bookings and cross-site behaviour to identify travel-intent users across brands
• Incentivising travellers to share data: travellers will provide their data if the value is clear. Practical motivators include
  • Status jumpstart: “Get Traveller Status by syncing your travel activity, no miles needed”
  • Gamification: “Unlock vouchers or perks based on verified travel behaviour”; “Gain wallet cash for each trip”; “Collect stamps in your digital travel book for discounts”
  • Loyalty match and upgrade: match their status elsewhere and instantly upgrade if they share proof of travel volume.

This turns data collection into a transparent, high-value exchange.

Who gets Traveller Status?

Once data is collected, airlines can define the segmentation logic for Traveller Status (e.g. 10 or more flights in the past six months, overlap with strategic routes, premium cabin or ancillary spend), using behaviour indicators that show acquisition potential.

How to reward the traveller

Most loyalty programmes today reward how much someone flies. But in the retail era of airline commerce, how they book and interact can be just as valuable, especially for Traveller Status. This opens the door to a more modern framework, where profitable, direct or high-engagement behaviours are rewarded.

Channel-based incentives: prioritise and reward behaviours that drive better margin or data ownership for your airline:

• Booking directly on airline.com or the mobile app: cash wallet credit, fee waivers, discounts or early access to sales or dynamic offers
• Engagement with owned channels: rewards for using the app (push notifications, wallet cards, in-app upgrades); perks for opting in to personalisation, alerts and fare tracking
• NDC-based purchases: incentivise bookings through partners connected via NDC, similar to booking directly

Profile enrichment: offer perks or Traveller Status credits for completing profile information, preferences or payment details. This strategy turns Traveller Status into a retail onboarding engine.

What are the IT and commercial implications?

This shift from reactive loyalty to proactive engagement will require investment, but it positions airlines for long-term commercial agility.

Deploying Traveller Status touches multiple systems, for which airlines must consider:

• CRM readiness to ingest and segment prospects based on external travel data
• Offer engine flexibility to personalise offers based on inferred value, not just loyalty tiers
• API infrastructure to allow integration with third-party data sources
• Consent management to comply with privacy regulations
• Customer identity resolution to link fragmented digital profiles, especially if a traveller has not previously interacted with the airline (e.g. LiveRamp, Acxiom)

It also touches the broader loyalty and commercial ecosystem, for which airlines must prepare:

• Alliance recognition: begin with benefits limited to your airline only, and extend as partners are ready
• Credit card partner reaction:
  • Use Traveller Status to highlight credit card offers tied to travel behaviour
  • Involve banks in status qualification
  • Enable credit card spending or travel-related purchases to contribute towards status
• Retail and travel partner participation:
  • Enable status based on partners’ tiers (e.g. hotel platinum or car rental gold)
  • Enable third-party partners to issue benefits for Traveller Status holders
  • Enable a shared “travel behaviour score” across your partner ecosystem
• Track performance and measure ROI:
  • Tie Traveller Status offers to unique promo codes or booking paths
  • Track redemption, upsell behaviour and lifetime value
  • Compare travellers who received offers against those who did not, but matched on behaviour

Can airlines start Traveller Status today?

The short answer: yes, but not at full scale. Current ecosystems are not built to support a fully open Traveller Status model. But airlines do not need to wait until 2030 for new architectures.

Low-risk, high-signal examples that could be deployed now include:

• Building a Traveller Status onboarding widget inside the airline app where customers can sync email receipts, add trip data manually or connect to a wallet aggregator
• Identifying fragmented travellers on high-yield routes and extending Traveller Status invitations
• Partnering with TMCs or SME travel platforms to spot multi-carrier frequent travellers, then offering Traveller Status as a conversion lever

Traveller Status reflects a fundamental shift in thinking, but it is also a test of commercial courage. For those who take the lead, the reward is significant: a smarter, faster and more direct path to building meaningful traveller relationships in a fragmented world.

Catarina Silva, Travel in Motion AG

This post has been published in collaboration with Terrapinn.

 

 

 

 

 

One of the key benefits of Modern Airline Retailing (MAR) is the ability to sell any product, in any place, at any time—from eSIMs and in-flight digital products to luggage pickup, insurance, hotels and attractions. It sets the path toward extending retail opportunities well beyond the flight itself and invites airlines to change their perspective.

Offer and Order Management Systems are the underlying technology that enable this change. While the technology may be new, the strategic principles driving this transformation are not.

This article looks at MAR through two lenses.

First, by drawing parallels between the branded fares era and today’s developments, we can see that similar strategic shifts are at play, only this time on a far greater scale.

Second, by examining how other industries faced similar transformation pressures, we can anticipate the operational and cultural changes airlines will need to succeed.

Across both lenses, three common shifts emerge:

1. From product unbundling to customer unbundling – moving from selling more discrete items to segmenting more precise customer cohorts
2. From branded fare options to new fare offers – evolving how new products are introduced, tested and scaled with customers
3. From fare structures to an Order-based architecture – redesigning the internal systems and workflows that support a modern commercial strategy

Branded fares were the first hints of what was to come. They showed airlines could reframe their offer structure, experiment with fare benefits and re-engineer front-end selling. But successful MAR will demand even finer customer insight, a deeper commitment to iterative product introduction and a complete rework of the system of record, taking lessons from industries like banking, telecom and ecommerce.

In the sections that follow, we explore each shift in turn: comparing MAR’s challenges to its branded fares predecessors, then looking outward to other sectors to envision what modern airline retailing could truly look like.

From product unbundling to customer unbundling

Branded fares brought unbundling, or product atomisation, as a response to changing customer demands. It enabled airlines to further differentiate their flight offers from competitors by treating tangible and intangible properties as price-driving components.

Modern Airline Retailing can be considered an extension of the same principle — enabling more price points to meet customer demand. The key difference is scale. MAR introduces an overwhelming number of possible combinations, far beyond what branded fares ever faced. It is this complexity that turns segmentation from a nice-to-have into a commercial necessity. To capture the additional value, airlines must break down customer segments even more precisely and tailor their offers accordingly.

To draw an example from another industry Sarah Tavel, Pinterest’s first Product Manager, refers to these fine-tuned customer segments as “cohorts”.

She argues that building a high retention product in a global marketplace requires focusing on specific geographies, user types and behaviours. In Pinterest’s case, a cohort might be users who signed up in a given week, or weekly returners who are active but not making pins, or customers who create multiple boards each month. While users may belong to more than one cohort, each group is slightly unique. Analysing these cohorts’ impact on commercial goals, along with the behaviours that set them apart, provides the insights that ultimately drive retention.

In the airline’s case, finer segments could look like customers who always select insurance when there’s more than one person in their booking, or customers who have changed their booking multiple times, or even something as specific as solo customers on three-day short-haul trips to destinations where a different language is spoken. By investing in technology that allows for further segmentation (i.e. based on behaviours), airlines can create as many cohorts as there are product combinations in Modern Airline Retailing. This is why segmentation must be an integral part to an airline’s journey to MAR.

From branded fare options to new fare offers

With a revamped branded fares product, naturally, airlines had to update the way they sold products on their customer-facing channels. Introducing these new products meant more price points, more information to display and more decisions for the customer to make.

Some airlines split branded fare introduction into domestic and international, while others went further by region. However, all went through a learning phase, using feedback to refine commercial strategies and respond to shifting customer behaviours. Customers also had to adjust. Suddenly, they had to start paying more attention to fare conditions, scrutinise fare benefits and decide if a seat, bag, cabin or flexibility mattered enough for them to pay extra for. This was by no means an instant change; it took time for them (us, as travellers) to adapt.

Modern Airline Retailing brings this to a new level. Neither airlines nor customers have ever had this amount of products available during the travel experience. Introducing new product lines will be a test-and-learn phase for both. Customers don’t yet know what they want, and no clear best practices exist. This is a golden window for airlines to capitalise on learnings from broadening their product portfolio.

Monzo, a popular UK online bank, is a good example of a company that has built and kept a large audience through excellent customer experience. It uses this scale to test new products within a solid experimentation framework, much like airlines can with Modern Airline Retailing. In the last two years Monzo has launched three new and complex product lines with a test-and-learn approach: investments, pensions and mortgages.

In 2023, Monzo introduced its Investments product, offering a limited set of funds to an early access cohort. In their first experiment they learned that users wanted plain-English explanations, transparent fees and a frictionless first investment. Instead of rushing to expand their fund catalogue, they honed copy, onboarding and education to ensure users could find and complete the investment journey without confusion. Monzo prioritised customer understanding before making costly platform upgrades, and by mid-2025 they had 300,000 investment accounts, with one third from first-time investors.

For airlines embarking on Modern Airline Retailing, not every product initiative will suit every customer. Many will address the needs of smaller, specific cohorts, such as tickets to special events, a selection of inflight Wi-Fi speeds or ground transport connections including shuttles, buses or trains. The revenue impact will not be immediate, and customers will need time to get used to the option of buying these products within their airline travel experience.

Each product launch should be seen as a series of purposeful steps rather than an one-off event. Step by step, these products will build familiarity, deepen customer understanding, reduce friction and create new sources of value for the customer. In this model, revenue follows learning, and success comes from tracking adoption as closely as revenue to unlock long-term growth.

From fare structures to an Order-based architecture

Branded fares brought a significant front-end overhaul, but not equitably in the back-end. Airlines continue to rely on the price-setting constraints of RBDs and the servicing limitations of the PNR, eTKT and EMD structure.

To unlock the potential of Modern Airline Retailing, it is essential for airlines to change the way they internally configure, record and account their products. The centre of this next stage of transformation is the Order object. An Order-based architecture has the flexibility, bundling potential and customer-centric structure that a MAR commercial strategy requires.

Telecom is an industry that faced a similar digital transformation challenge. One specific case is that of Orange in Europe whose enterprise customer needs started to required more complex products (e.g., security policies, cloud ramp-up, access points). Although it had a very long time to market, Orange could create and sell these products, but the downstream systems couldn’t keep up. Every product change produced a multiplicative effect on fulfilment, operations, servicing and many others.

To solve this, Orange set out to change their system of record to have a single Order object with multiple Offer items within (service offers, work offers, logistics offers, etc.). With this new structure, each department could process, change and fulfil offer items independently but still have everything tied to a single source of truth. Contracting, operations, billing, servicing, accounting — the whole ecosystem – could now rely on the same information, standardised states and error codes for their operations.

Orange achieved this by setting up a new and parallel technology stack to prove the end-to-end execution of new Order object and the governance across the platform. They configured and fulfilled a narrow number of use cases in the new system, while having the legacy system handled the rest. However, in the background they ran synchronisation processes between both tech stacks to maintain data parity during the transition period.

Like telecom, airlines face the need to change their system of record to enable their commercial strategies. The PNR object touches nearly every aspect of airline operations, making any change high-stakes. Lessons from telecom show that airlines could strive to achieve two objectives early on: prove end-to-end execution of the new systems and validate that its governance framework can scale. This governance sets the standards for data objects, integration patterns and operational principles that all future connections will follow. Internal systems will rely on it, and so will a wide range of external providers such as retailing partners and service providers. Achieving this milestone shortens the transition and reduces the risk and cost of running two platforms in parallel.

Jorge Velasco Azoños, Travel in Motion AG

References

Pinterest

• Lenny Rachitsky, 2025. The hierarchy of engagement | Sarah Tavel (Benchmark, Greylock, Pinterest). Lenny’s Newsletter. Available at: https://www.lennysnewsletter.com/p/the-hierarchy-of-engagement-sarah (Accessed 8 August 2025).
• Tavel, S. (2017) ‘Five lessons from scaling Pinterest’, Medium, 27 March. Available at: https://sarahtavel.medium.com/five-lessons-from-scaling-pinterest-6a699a889b08 (Accessed: 8 August 2025).
• Tavel, S. (2023) ‘Don’t Fall Into the Trap of Taking the Wrong Lessons from Others’ Success’, Sarah Tavel’s Newsletter, 14 July. Available at: https://www.sarahtavel.com/p/dont-fall-into-the-trap-of-taking (Accessed: 8 August 2025).

Monzo

• Monzo (2023) What we learned from 43 experiments in 12 months. Available at: https://monzo.com/blog/2023/03/28/what-we-learned-from-43-experiments-in-12-months (Accessed: 12 August 2025).
• Monzo (2023) How we launch new products at Monzo. Available at: https://monzo.com/blog/2023/
• Monzo (2023) Today we’re launching Monzo Investments. Available at: https://community.monzo.com/t/today-we-re-launching-monzo-investments/153181 (Accessed: 12 August 2025).
• Monzo (2025) Invest in what matters to you. Available at: https://monzo.com/investments (Accessed: 12 August 2025).

Orange (Europe)

• TM Forum. 2021. IG1133C Federated Catalogs for (Automated) Procurement — Orange Case Study. Available at: https://www.tmforum.org/resources/exploratory-report/ig1133c-federated-catalogs-for-automated-procurement-orange-case-study-r15-0-1/ (Accessed: 14 August 2025).
• Orange Business. 2025. Orange Business accelerates its digital transformation with leading technology partners to deliver simplified digital experiences for customers. Available at: https://www.orange-business.com/en/press/orange-business-accelerates-its-digital-transformation-leading-technology-partners-deliver (Accessed: 14 August 2025).
• Oracle and TM Forum. n.d. TM Forum: Attaining Agility. Available at: https://www.oracle.com/a/ocom/docs/industries/communications/tm-forum-attaining-agility.pdf (Accessed: 14 August 2025).

 

 

 

 

 

 

 

Airlines are risk averse. Everybody knows that, right? And rightly so – safety and risk management in the aviation industry is something that must be taken seriously. Ensuring safe operations is the single most important topic for any airline, and we as an industry collaborate to ensure that thousands of flights take off and land every day without incident – that is risk management (rather than aversion) at its finest. Part of ensuring safety in the air is having rock-solid IT systems on the ground that enable this – flight planning, flight operations management, weight and balance and so on. Indeed, airlines have historically been pioneers in running large-scale IT operations that could support a global business operating non-stop around the clock. But now, when we are talking about modernising airline IT, some of these airline applications look a bit, well… clunky. As with many that are pioneers, you often get overtaken by others that learn from your early mistakes. Or you reach a level of maturity that becomes costly and difficult to disentangle. As an industry, we have known this for years, probably decades – while we still have our monolithic reservation systems, the world of IT has moved on dramatically. Pretty much everything has “gone digital” – how we listen to music, watch TV, how we bank, how we shop, how we dress ourselves and even how we meet the love of our life.

How has this been made possible? Well, the advent of the internet helped of course, but more critically the way we build and run software applications has fundamentally changed. Cloud computing has enabled a degree of agility in building software that was not present ten, or even five years ago. Nowadays, a new digital services company can bring its product to market in a matter of months, sometimes even quicker. In the airline industry, sometimes implementing a new SSR can take longer. A new codeshare partnership? Let’s not go there. New cabin products? Ok, let’s stop with the scary examples J

While airlines have managed to “go digital” to a certain degree, the core is still old and clunky (some older and clunkier than others, but still in relative terms “old”). So, when we talk about changing these core systems, we realise that we maybe do not have the agility that other, younger industries may have. The monolithic nature of the airline IT landscape certainly does not make transforming easier, although here we come back to the topic of airlines and “risk aversion”. We spend a lot of time talking with airlines and vendors about transformation – where to start, what is the value, where is there least risk? How do we break down this “legacy” technology stack into manageable chunks? There is a perception that the airline retailing transformation journey is a path frought with danger, that it is something akin to the “knife-edge” PSS migrations that we all love to reminisce about (but wouldn’t want to repeat). Indeed, given that one possible (and, for some at least, desirable) outcome of the transformation is a more modular IT landscape, it is a clever tactic of some incumbents to paint this picture (“better the devil you know”). But is this really the case? Is the airline retailing transformation such a mammoth undertaking that it could threaten the commercial existence of an airline? (We used to say that if an airline was unable to operate for more than a handful of days, they would be out of business). While some may see it this way, I don’t think so – I think this is rather a case of us (as an industry) falling back to our “risk averse” way of thinking. Yes, there will be risks along the way, but the key to making the journey as risk-free as possible is having the right mindset. Risks should not stop us taking bold moves – we just have to play the game with careful consideration. Disentangling the legacy wiring of our industry will take years – we all understand this. But if we break this down into manageable, bite-sized chunks, we not only make progress more quickly but also reduce the risks as much as possible. We make small steps that have a low impact, manage this carefully, learn from the approach and repeat the exercise. Indeed, some airlines we work with are already on this journey – taking the first steps to bypass some legacy processes and tech to prove out the feasibility of their Offer and Order transition approaches.

So yes – airlines may be risk averse, however that’s not the same as being change averse. The airline retailing transformation will involve risk, but that does not mean the journey is something to fear — it’s something to manage, deliberately and thoughtfully. Just as we already manage risk every day in operations, compliance and safety, we can apply that same discipline to our commercial technology. The journey toward modern retailing is not a single leap, but a series of deliberate steps — tested, learned from and repeated. And many airlines are already on this path, bypassing legacy constraints to explore what’s possible in Offer and Order transformation.

If you’d like to explore how to take the first steps (or the next ones), we’d be happy to talk.

Nick Stott, Travel in Motion AG

This post has been published in collaboration with Terrapinn.

 

 

 

 

 

 

 

 

 

 

 

In a market defined by fragmentation, flexibility, and digitally empowered consumers, traditional airline loyalty models are under pressure. Frequent flyer programs today are struggling to keep pace with the modern traveller’s expectations and behaviour.

Here’s a strategic provocation: What if an airline offered loyalty incentives to travellers who haven’t flown with them yet? Not based on historical miles, but on demonstrated travel behaviour, regardless of carrier. A concept I’ll call: Traveler Status. 

It’s a radical twist on acquisition, loyalty, and data-driven engagement. But it may be exactly what airlines need to win the next generation of high-frequency, low-commitment travellers.

Airline loyalty programs were built for a different time. A time when corporate travellers booked weeks in advance, stuck to one alliance, and were easily incentivised by elite tiers, upgrades, and lounge access. But today:

• Many travellers prioritise convenience, flexibility, and price over brand loyalty.
• They book across carriers based on schedule logic, not allegiance.
• And they frequently use meta-search, OTAs, and fare alerts to optimise each booking.

Importantly, this group includes a large segment of high-value, high-frequency travellers, who remain largely untapped by traditional loyalty mechanics.

The core idea behind Traveler Status is simple: Reward travel behaviour, not airline loyalty.

Rather than requiring customers to prove their value over time, airlines can proactively identify and engage high-frequency travellers, even if those travellers haven’t yet flown with them. Here’s how it might work:

• The traveller opts in to share flight history (via apps, digital receipts, or travel aggregators).
• The airline uses this behavioural data to assess the traveller’s value and preferences.
• In return, the airline extends entry-level benefits (e.g., preferred seating, priority boarding, bonus points, dynamic fare offers).

It’s not about giving away the house. It’s about meeting the traveller where they are and giving them a reason to switch. From a commercial and customer acquisition standpoint, the model is compelling.

1. Data-Driven Prospecting: Traveler Status creates a new segmentation layer, verified, active travellers who haven’t yet entered your loyalty funnel. It’s precision targeting at the top of the funnel.
2. Competitive Displacement: By understanding where travellers are currently spending (routes, carriers, class), you can craft tailored offers designed to win share from competitors.
3. Accelerated Onboarding into Loyalty Ecosystems: Instead of waiting for behaviour to trigger rewards, this model reverses the incentive flow, encouraging new customers to engage meaningfully from day one.
4. Reinforcing a Retail Mindset: Traveler Status aligns with IATA’s modern retailing vision of personalised offers, dynamic bundles, and customer-centric experiences driven by insight rather than inertia.

Of course, introducing Traveler Status isn’t just a marketing initiative, it requires alignment across data, commercial strategy, and digital channels. Consider this:

• Privacy and Data Sharing: Clear opt-in mechanisms and trust-based value exchanges are essential.
• Offer Design: Benefits must be attractive enough to incentivize switching, but sustainable and scalable.
• Behavioural Analytics: Airlines will need robust tooling to analyse shared travel data and generate meaningful, contextual offers.
• Conversion Attribution: Linking Traveler Status offers to actual booking behaviour will be key to measuring ROI.

At its core, Traveler Status reflects a new philosophy: Don’t wait for loyalty. Create conditions where loyalty can begin. It recognizes that the most valuable travellers aren’t necessarily the ones who have flown with you before, they’re the ones who could fly with you next. In a world where competition is one click away and customer expectations are shaped by digital-native retailers, airlines must think like modern retailers too. That means rethinking loyalty not as a reward for the past, but as an incentive for future intent. The opportunity here isn’t just conceptual. It’s first-mover advantage. Traveler Status is a model that rewards strategic bravery. It requires airlines to challenge legacy program constructs in favour of smarter acquisition, deeper personalization, and long-term engagement. For the airline willing to go first, it could mean transforming the very nature of loyalty, from a backward-looking reward system to a forward-looking growth engine. Because in the end, the best loyalty programs don’t wait for customers to be loyal, they give them a reason to start!

Catarina Silva, Travel in Motion AG

 

 

 

 

 

Dear reader, you can probably guess how much, as a consultant in the travel industry, I am made to travel. Now, add to it a wife determined to discover all corners of the world, and you’ll understand why my body has got more used to an airplane seat than my own bed for sleeping.

This is all to say, I am a frequent traveller, coming with all the usual perks. I know to avoid having any luggage, my laptop bag fits neatly on top of my carry-on, and I have my perfect suite of gadgets for before, during and after the flight, which I have now perfected over the years (yes, that can be detailed in a future blog post).

We all know the airline industry is currently undergoing a massive transformation, leaving the legacy world of EDIFACT distribution and moving into a more customer-centric, Offer & Order world. And I cannot wait to see the Order part of said transition… take flight (forgive the pun).

Better servicing capabilities

The first reason I’m cautiously optimistic, is the new capabilities associated to the Order itself. Imagine landing after a delayed flight, fully aware that you’re too late for your next boarding, and immediately getting notifications containing rebooking options without even needing to go wait in a queue for an agent to handle this. This level of proactive, personalised service simply wasn’t possible in the old EDIFACT world, but it’s becoming the new standard as technology evolves. Also, airlines can now access a more complete view of each customer’s preferences and travel history, which means these rebooked services can be tailored to my preferences (how about offering me a window seat and wifi, as a way of apology for the stress caused).

Better door-to-door experience

A second major benefit is the potential for a true door-to-door travel experience. With richer data and integrated systems, airlines and their partners can coordinate everything from airport transfers to hotel check-ins, making the journey smoother and more seamless. No more juggling separate reservations or wondering if your ride will show up-soon, a single itinerary could cover my entire trip, with real-time updates and support every step of the way. For frequent travelers like myself, this shift promises to turn travel days from a logistical headache into a genuinely enjoyable experience, with a single place to manage all steps of the journey. And, going back to the servicing capabilities: should any delay happen in any step of the travel, that single place should be able to offer options to accommodate them.

Better tracking, leading to better advertising

I have spoken about delays a fair bit in the previous sections, but the fact is, I’m an “early arriver” at the airport. In fact, very often, I end up with at least an hour to wait within the airport, before my flight starts to board. With the new Order capabilities, the airlines will be informed at every step of my journey, including wait times. This should allow for personalised (based on historical data) advertisement, such as special shops and restaurant offers, lounge suggestions, etc… I look forward to receiving an advertisement for a lounge that also guarantees there is still room in said lounge. Like it or not, advertisements are everywhere, and on a personal level, I would rather have them tailored to me, rather than receiving a 5% discount on diapers that I will of course ignore.

The Geeky side

The idea of this transition allowing for a lot more features in an IoT (Internet of Things) concept is extremely interesting. Picture this: after passing the security gate, I receive the indication of where the lounge is, how full it is, and possibly a discount. Plus, while walking towards it, as I pass next to shops and restaurants, I’m getting information about what they offer. All these systems are interacting, sending information from one to another, and working together to offer a more streamlined and possibly personalised journey for the traveller. Oh, and if it can remind me that my wife’s journey is next week and that this duty-free store sells jewellery, all the better. Although one could wonder where to put the privacy boundaries…

The Dark Side

And that’s where this all leads: where is the line? Is it okay that airlines are now getting more efficient at tracking us, using our historical data, and interconnecting information to push better advertisements our way? I do not plan to get into the ethics of things in this blog post –  rather, I share my own views. I don’t mind all this if it ends up enhancing my overall experience. But, as with a lot of these systems, I still recognise that there is a strong need for transparency for the traveller as to what data is used, processed, stored… And the possibility, should the traveller wish it, to turn it off.

Airlines, I hope you are reading this. And I hope, as a traveller, that you will implement these features soon, making my future trips a better experience. We live in a world that has gotten used to being online 24/7, and it is high time that you make full use of it.

This post has been published in collaboration with Terrapinn.

Thibaud Rohmer, Travel in Motion AG

 

 

 

 

 

Amman. It’s 1800 on a Friday and I’m making my way to Bangkok for a conference after having a week holidaying. This is an unusual routing for me, and the chance to try out a new airline. However, I have a ten hour stopover, and even after working through the inbox after a week out of the office, there are still eight or so hours to kill before my departure at sometime in the middle of the night. Many of us have been in the industry years or decades and are seasoned travellers – we have our routines, we know how to kill time at the airport. Our experience though sometimes taints our way of looking at the world when travelling. Ten hours, though, gives a lot of time to observe the average traveller – those that maybe only travel once or twice a year, or are not so digitially savvy as some of use.

Looking around me, I see a lot of untapped demand. The airport is typically a place where airlines try not lose money (through delays causing missed connections, lost bags, overbooked flights and so on), while trying to offset this with maximum conversion prior to commencing the journey. Some will remember the excitement around the use of beacons around the airport, tracking passengers and bombarding them with offers as they strolled through duty free. However, that never really took off as the airlines, airports and ground handlers could never agree on “who owns the customer”. Now though, airlines are “going digital” and hoping to open up a world of possibilities to their passengers. So what would that look like, in real terms? For reasons well known, there is an enormous disconnect between the world of airline commercial retailing and the hard reality of life at the airport, particularly at the gate. But there are a lot of needs at the airport, and while the airline can’t fulfill all of these, some could be with a little more integration and joined-up thinking. I’d like to know where my bags are, for one thing. I’d like to be assured that those extra couple of kilos on my hand luggage are not going to cause me a problem. The lady rushing to the front of the plane upon arrival would have really appreciated some info on her connection (and later, on her bags too!). However, is there revenue in addressing these examples? Potentially, yes – directly (I would be happy to pay for extra kilos of hand luggage) and indirectly, through making the travel experience less stressful. Most airline mobile apps, with the exception of a few, are extremely commercially focussed – they are intented primarily as booking channels and also allow you to check-in. If I compare that with my banking apps, that is the equivalent of simply being able to scan a bill and pay an invoice. But my banking app allows me to do so much more – I can block cards if I think I have misplaced them, set up new accounts, change payment limits, usage locations and so on. In an older blog, we talked about airline super-apps and whether they could help airlines take more wallet share, and as a result own (or at least have insight into) more of the journey. The more an airline knows about you and why (and where) you’re travelling to as well, the more it can take informed decisions and interact proactively through channels such as the airline app. However, the elephant in the room of airline siloed data and the lack of realtime integration between airline IT applications remains. We still live in a world of “if only we could…”, which brings up the other elephant in the (rather large) room – the lack of integrated business processes and the organisations that own them. The shift to Offers and Orders aims to change this, however at the moment we (as an industry) have only added a layer of complexity on top (NDC) but this has not yet driven any change downstream. If Spotify were an airline, they’d be streaming to their subscribers from vinyl records – it’s a nice, shiny layer on top of something very outdated (but still dear to many people’s hearts!). Sometimes this is something that goes forgotten when we, as an industry, try to drive change. We can spend an eternity talking about PNRs, tickets, NDC offers and orders, but the end consumer doesn’t care about any of this – they just want the travel experience to get better. The Offer and Order transformation is a huge undertaking for all players, airlines and IT vendors alike, however sometimes we look at it as an enormous IT project rather than a chance to make something … better.

Because ultimately, isn’t that what digital transformation should be about? Taking friction out of the journey. Helping the traveller feel informed, reassured, even delighted rather than simply monetised. When we talk about retailing in aviation, too often the focus is purely transactional: how to push more ancillaries, how to improve attach rates, how to nudge up conversion. But true retailing is about relevance, timing and trust. It’s about putting the right offer in front of the right person at the right moment – and that moment might be during a long stopover, not just at time of booking.

Imagine an airport experience where your app knows your context. You’ve just landed, your next flight is eight hours away, you’re tired and a bit hungry. Your app suggests a shower room, offers you a discount at a lounge or lets you bid for a business upgrade that might help you get some sleep on the next leg. It tells you where your bag is, gives you real-time updates on your gate and nudges you when your flight is starting to board – not because a timer says so, but because you’re seated at the far end of the terminal.

These things sound simple, even obvious – but they require a level of integration and intelligence that we as an indus are still working towards. And yet, these small details are valuable. A less stressful experience means a happier customer, more receptive to offers, more likely to return. That’s how we start turning the airport from a source of cost and chaos into a place of opportunity – for both revenue and reputation.

So maybe the goal shouldn’t be just to “go digital”, or to “implement Offers and Orders”, or “modernise airline retailing”. Maybe the goal should be to make travel feel less like a test and more like a treat. And if we can do that – thoughtfully, collaboratively, with the passenger truly in mind – then maybe next time I’ve got ten hours to kill, it won’t feel like killing time at all.

 

Nick Stott, Travel in Motion AG

 

 

 

 

 

The Importance of Airline Payment

Airline payment remains a prominent topic of discussion within airline commercial and financial teams.

As McKinsey[1] summarised back in 2022, airline payment costs sum up to USD20 billion annually, representing up to three percent of airline revenues – a significant value in an industry that often only achieves a very low profitability. The volume is huge, with about three billion transactions per year facilitating a turnover of about one trillion dollars.

It is too easy to view airline payment simply as a cost factor. The handling of payment is an important part of the customer experience, and McKinsey also assumes that up to USD12 billion in additional revenues can be achieved for airlines annually if consumers can make payment more easily and efficiently in numerous ways.

Of course, the true values of these numbers can be discussed, but it is obvious that airlines need to focus on their capabilities to receive payment in an easy, inexpensive and safe way.

Airline Payment as an Enabler for an Airline’s Strategy

To achieve this, airlines often implement “payment strategies”. Personally, I am struggling a bit with the term “strategy” when it comes to airline payment. After running numerous airline payment engagements, I believe that there is no “airline payment” strategy per se. Payment need to contribute and be embedded into an overall airline commercial strategy and is a key business enabler ideally increasing conversion while reducing cost and risk.

Airlines’ overall strategies can be fundamentally different, such as if the airline follows a full-service carrier (FSC) business model or, at the other extreme, that of a pure low-cost carrier (LCC) with no frills. This has direct implications for airline payment and needs to be assessed case by case.

In addition, there might be shorter term airline strategies that have an impact on how to run payment. An airline may decide to enter a new market and therefore focus on high conversions by taking a higher payment risk, as well as for instance enabling local APMs, leading to higher complexities.

In essence, these approaches are defined by the airline’s strategy and not by the payment process. Therefore, they cannot be regarded as solely a payment strategy since airline payment is “only” the enabler of the overall strategy.

However, how is a payment set up embedded into the overall commercial strategy? Let me share a real-life step-by-step project approach, which has delivered the desired results.

 A phased Approach to embed Airline Payment

First, we analyse and audit the current payment setup, by taking a closer look at the balance between conversion, risk and cost. It also makes sense to investigate the organisational setup of the payment team, e.g., does it reside in finance, e-commerce, distribution or even sales? Addressing other questions such as how the payment architecture looks, who are the main payment suppliers and how they are governed, is also essential. By benchmarking the results, airlines will often be able to gain some tactical quick wins.

In the second step, the overall airline commercial strategy is taken into consideration. What are the guidelines and requirements for payments to enable the overall commercial strategy? What would a strategically fitting payment setup look like? What are the gaps between the desired state and the status quo? How do we get there?

Thirdly, the exercise should focus on implementation and execution. With the view on the current set up, the desired state for payment fully supporting the airline commercial strategy, a detailed roadmap to close the gaps can be established and executed, through change management. At this stage several questions can be addressed such as organisational structures, make or buy decisions, vendor and partner selections, just to name a few.

Of course, there is no recipe that fits all airlines when it comes to their payments. But with the overall approach summarised above, airlines can enhance their payment process through enhancing conversion while reducing cost and risk, with the ultimate goal to be the enabler for the airline’s commercial strategy – payments are there to support, but they are not a strategy by themselves.

[1] McKinsey Sep. 2022 – Airline retailing: How payment innovation can improve the bottom line

This post has been published in collaboration with Terrapinn.

Boris Padovan, Travel in Motion AG

 

 

 

 

 

 

 

 

I know, I know. Yet another article on AI. Believe me, I am as fed up with these as you, but bear with me a second, as I truly believe this is an important topic to be discussed. In short: AI is here. Whether you’ve used it to generate an image of a panda bear riding a bicycle on the moon, for work purposes, or read AI-generated text, chances are, you have already interacted with it many, many times.

Similarly, chances are, you are at least a bit familiar with airline processes. And of course, the airline industry is also subject to change, due to all these new AI practices.

In this article, we will focus on Airline Distribution, from the shopping, to the servicing of airline tickets. In other words, if you came here to read how AI is going to replace pilots, sorry, but you’re in the wrong place.

1. Selling, upselling and servicing through AI

Offer Generation

As with any new IT-based technology, the first focus for AI has been increasing sales. As such, AI is now being shoehorned into dynamic pricing and dynamic offer solutions, allowing for better, more granular customer segmentation and ensuring a more relevant offering to be presented to the end customer. Due to its massive power on data analytics, including customer preferences, booking history and market trends, airlines can dynamically adjust their shopping responses to better fit the requests, thus increasing conversion rates and total revenues. This approach also allows for more automation, making the airline’s fare filing more lean, allowing for fewer rules updates and less granular fare management.

Customer Care

Airlines intend to be more customer-centric. At least, that’s one of the main buzzwords we hear at the various conventions we attend. Part of this comes from the airline’s tailored offerings, as mentioned earlier, while next comes the handling of said customer. We all have wasted hours of our life, listening to a five-second music loop, waiting for a customer care agent to finally hear our complaints. Airlines intend to solve this by re-introducing chatbots, now AI-powered. These chatbots allow for guidance on the exchange or cancellation of tickets, ancillary sales and general questions an end user may have regarding their booking. Natural language processing is getting better and better, including multiple languages, allowing for airlines to serve a larger set of customers. One example of this approach is LivePerson, which already provides such capabilities for Azul Airlines, even allowing for upsell through a chatbot interface. Naturally, this does not remove the need for actual customer care agents, but allows for a “first filter”, replacing that oh-so-annoying music with actual discussion and letting agents focus on relevant use cases.

2. AI Agents

AI-ready API

More and more airlines nowadays provide an NDC API to interact with their content. AI agents are a new technology, capable of interacting with APIs. The first examples might seem small, such as being able to order an Uber by asking Gemini. These AI-based agents learn API interaction through various manners, one of which is machine-readable documentation. For a smoother integration, airlines should ensure all documentation is up-to-date with detailed examples, as these allow AI agents to be quickly trained and to interact with your NDC API.

Convin is one such example, offering voice-based search and flight reservations. But do not mistake voice recognition and AI: AI agents can also be triggered by text-based inputs, and chatbots are now being reinvented with AI to better understand requests and search through airline offerings.

3. The impact… Shopping volumes and OTA impact

Airlines have recently discovered what it means to be an API provider, through NDC. One of the constraints that come from offering APIs is that the airline is not always in control of API usage. In other terms, that dreaded look-to-book ratio is an important factor to consider when providing a shopping API to agencies and aggregators.

AI will now bring a new spin to this, as these AI agents will go through the web for every single search, greatly increasing costs associated with API management and, yes, look-to-book ratios.

The combination of airlines wanting to provide dynamic, tailored offerings, and AI agents scouring the web will result in an increase of look-to-book that few airlines are prepared for today.

While we are here focusing on the airline view of these AI agents, OTAs have been taking a close look at them as well. PhocusWire has a great article, presenting their risks for OTAs: https://www.phocuswire.com/ai-agents-future-of-online-travel-agency .

In short, the airline industry is now entering (willingly or not) a new era of distribution. AI agents scouring the web, looking for AI-created offerings and end-users being served by AI-based chatbots will soon become the norm, and, ironically all with the intent to become more customer-centric. Airlines that do not have AI-ready APIs may end up not integrating properly in AI agents’ search results, potentially leading to revenue loss through missed sales opportunities. And the ones that are not ready for the surge of search request created by these agents may see a huge increase in associated costs. So, airlines…

AI is here. Are you ready for it?

References and great reads on the subject:

• LivePerson, Take flight with AI: https://www.liveperson.com/blog/airline-digital-transformation/
• The New Stack , It’s time to start preparing APIs for the AI Agent Era: https://thenewstack.io/its-time-to-start-preparing-apis-for-the-ai-agent-era/
• Play, AI Agent APIs: A Comprehensive Guide: https://play.ht/blog/ai-agent-apis/
• Convin AI Voice Agents for Flight Search: https://convin.ai/blog/flight-ticket-booking-online
• Cognigy, AI Agents for Customer Service: https://www.cognigy.com/solutions/airlines-travel

 

Thibaud Rohmer, Travel in Motion AG