Despite acknowledging the power of innovative technologies to enable new ways to sell, a majority of Asia-based airlines surveyed by Sabre admit to falling short of their ideal ancillary sales vision.
Sabre Corporation recently surveyed 30 Asia-based airlines, and the results indicate that carriers are re-evaluating their strategic focus as they think creatively about new ways to generate revenue and increase yield.
Close to 70 per cent of the airlines who participated in Sabre’s study indicated that two main factors are influencing change: technological advancement and increasing traveller expectations.
With travellers expecting unique, targeted offers from their shopping experience, over half of the survey participants (53 per cent) believe that leveraging data intelligence, whether to gain insights into market trends or passenger behaviour, is a top growth area for their airline.
Yet, 80 per cent of the airlines surveyed claim to not have achieved their desired ancillary sales, and only one in five respondents have identified product differentiation as their airline’s strategic focus.
The results, which were announced by Sabre last week at STX Singapore, demonstrates a significant opportunity for Asia-Pacific airlines to create a personalised retail experience for the traveller as a means to differentiate their products and drive incremental revenue.
“With consumer trends evolving as fast as the markets they serve, airlines have the potential to generate significant growth by efficiently channelling their content with innovative technology solutions that harness artificial intelligence and machine learning,” said Rakesh Narayanan, vice president, air line of business, Sabre Travel Network Asia Pacific.
“Our Beyond NDC programme drives collaboration with airlines and agencies to help them create rich personas and micro-segmented offers using rich data that support their business objectives.”
Ancillary sales have increased by 88 per cent year-on-year in the region, but reports show the same top ancillary requests appear across all markets: baggage, seat selection and meals. While in-flight Wi-Fi is increasingly featured in the top three most popular ancillaries, accounting for a quarter of business traveller requests in Asia-Pacific, there remains room for airlines to partner with technology leaders to help them up the ante on competitive differentiation.
Sabre opined that successful retailers understand that the key to delivering curated experiences lies in tailoring offers to distinct buying personas, requiring a robust data-sciences approach to maximise individual consumer engagement as well as end-to-end profitability.