Data for 2 million flights from the Bureau of Transportation was analyzed, and a newly released 'Places to Travel' report concluded that from January 2023 to February 2024, passengers lost a staggering 2,100,140 hours and 43 minutes, equivalent to 240 years of travel time, due to delays. Some airports experience delays in 30-40% of flights. The aviation industry is at a critical juncture where the need to enhance passenger experience and boost revenue is more pressing than ever. As airports continue to evolve, the integration of artificial intelligence (AI) presents unprecedented opportunities to transform operations, passenger engagement, and revenue streams, especially during delays. At Tern, we believe that AI is the key to unlocking the future of air travel.
A new report from JCDecaux, "First Class Advertising – The Enduring Magic of Airports," sheds light on how today’s airport shoppers may be engaged by stakeholders. According to the figures, the typical flyer profile today includes people aged between 25 and 44, who fall within a higher income index. While 85% of these travelers reported making a purchase at the airport in the past year, 65% stated that they do not pre-plan their shopping. The majority also agreed that the airport itself maintains an allure as a shopping destination, with 71% describing the airport as important and a unique experience, and 68% defining it as part of the holiday experience. With travelers already having an intent to purchase, leveraging AI to provide personalized suggestions and targeted promotions can convert this intent into actual sales. This strategy has the potential to increase airport revenue by up to 30%.
Smart Assistants and Chatbots: AI-driven assistants can offer personalized itineraries, real-time updates, and seamless communication in multiple languages. This enhances the passenger experience from check-in to boarding, and especially during delays. For example, Munich Airport implemented a “plan-your-trip”, which site uses cookie data to present relevant deals, increasing associated revenues by 7% annually.
Behavioral Insights: By analyzing passenger data, AI can predict needs and preferences, offering tailored suggestions for dining, shopping, and other amenities.
Predictive Maintenance: AI systems can monitor equipment health and predict maintenance needs, reducing downtime and operational costs. For instance, Amsterdam Airport Schiphol's use of digital twins and predictive maintenance technologies has helped streamline operations and reduce costs.
Resource Optimization: AI can optimize staff deployment and resource allocation based on real-time passenger flow and demand forecasts.
Dynamic Pricing and Promotions: AI algorithms can adjust prices for services like parking and lounge access based on demand, maximizing revenue.
Targeted Marketing: AI can deliver personalized promotions to passengers, increasing retail and service revenue through higher conversion rates.
For instance, Hong Kong International Airport has implemented advanced technologies and personalized e-commerce strategies to enhance passenger experiences and boost non-aeronautical revenue streams. These strategies include geo-targeted offers and personalized promotions, which have improved engagement and increased sales.
Effective growth in airport e-commerce relies on a deep understanding of personalization and its broader impact on passenger experiences and intent. This entails addressing specific pain points, ensuring comprehensive platform accessibility, and implementing journey-based personalization strategies.
Currently, digital touchpoints manage to engage less than 7% of passengers. Even among those who do interact, many offers lack sufficient personalization, often failing to resonate effectively with users.
