All good things must come to an end

We hope you enjoyed the blog and that you found interesting and valuable insights. As Horizons 2008 edition is now over it is time to say goodbye.

Thanks for visiting the blog.

Five trends to watch in online travel space

by Siew Hoon, Horizons´ master of ceremonies

Couple of key learning points I picked up at the Amadeus Horizons 2008 conference held in Bangkok late last month on travel distribution.

1. It’s about servicing, not selling online

John Lonergan, general manager-direct channels of Qantas, said that online had become more about servicing than selling for his airline. He said there were hidden costs in the online channel and the biggest single cost of sale on Qantas.com.au was call centre charges.

“It is better for us not to sell online but to service online.”

What’s working in the online channel? Loyalty programmes. Up to 80% of redemptions are booked online, said Lonergan.

“Servicing online is not about reducing costs – it’s about the right content to the right customer at the right time.”

In the end, he said, “Some will book direct, all will fly.”

2. It’s about being personal, and being everywhere

Last year, BA generated 1.5 billion Euros in direct revenues from its website. Up to 38% of passengers in the UK book online, compared with 27% of passengers globally.

Carsten Willert, General Manager, E-Commerce, BA, said its Executive Club had become a 100% online programme – a one-stop shop for selling, servicing and loyalty.

Features BA is working on – personalization, dynamic packaging – allowing BA to earn ancillary revenues (there’s that word again) and customers to book non-airline products, enhanced redemption capability.

And ba.com, he said, wants to be everywhere – gadgets, mobile, the works.

3. Low cost may be here in Asia but Asians still want some level of service

Ed Nicol, Chief Information Officer of Cathay Pacific, believes that Asian consumers are less tolerant of poor quality and bad service than their Western counterparts.

“The trend towards self-service will not go as far as it has in the Europe and US,” he said.

And in future, he said, we will see the full suite of aviation services being made available in Asia – from aircraft manufacturing to services to technology.

4. From fees to ads

Online Travel Agencies are trying out new models of partnership – Expedia has signed a hybrid model agreement with InterContinental Hotels that is as much about transaction fees as media space.

Cyril Ranque, vice president, Asia Pacific, Partner Service Group, Expedia said, “It’s a good trend for the future.”

5. Metasearch beyond price

Bezurk is working on search features that will allow customers to choose features beyond price – for eg, by types of hotels, said CEO Martin Symes.

Continuous innovation key to future growth

by Chris Clarke, event blogger

For me, there was a marked contrast between Horizons 2008 in Bangkok and Horizons 2006 in Dubai. 

The last two years have fostered increased confidence across the sector.  The relentless focus on cost cutting (not just as good business practice but for business survival) was replaced by a renewed optimism about the future.  But this increased confidence and optimism hasn’t brought complacency.  Instead, it is clear that the industry that has emerged post-2001 is focused in equal measure on reducing costs and complexity as well as exploring new avenues to growth.
 
The conference demonstrated how technology plays an important role on both these fronts.  What was striking at Horizons 2008, was the number of airlines talking, not just of their hopes and ambitions about technology investments, but about the results they are seeing.  At the same time, it was refreshing to hear about the unique technological and cultural considerations involved in such major IT projects and business transformations.

At the closing of Horizons 2008, David Jones, Executive Vice-President, Commercial, Amadeus, pulled together some of the key learnings from the conference and offered his perspectives on the future. 

He talked about the need for continuous innovation as the single unifying challenge both to Amadeus as well as the industry at large.  Innovation not just in terms of technology but also in terms of business agility. 

He said the next few years would require airlines to make many difficult decisions in the face of competing pressures and trends.   In today’s hyper-connected world, he talked of the need for balance.  The balance between the wisdom of crowds and the segment of one.  The balance between indirect distribution and direct channels.  The balance between embracing the new functionalities offered by web 2.0 applications whilst not losing sight of the basics of online commerce.

But above all, he encouraged airlines to be bold.  To embrace the future.  To make the most of what new technologies are able to offer.  But importantly, not just to consider what technology can deliver today but to dream about what it will be expected to deliver tomorrow. 

With an eye to the next Horizons in 2010, he offered a glimpse of web 3.0, the connection of all devices, machines and information sources.  He predicted that Amadeus would not only be talking about web 3.0, but it would be delivering real applications that would turn the concept into reality. 

We look forward to Horizons 2010, which David promised would be both ‘exotic and relevant’.  For a shortened version of David Jones’ closing presentation, please view the video.

 

A view from the top: Air France/KLM

by Chris Clarke, event blogger

I managed to catch up with Leo van Wijk, Vice-Chairman of Air France/KLM and Chairman of the SkyTeam, who provided an interesting perspective on where the market is heading and how global alliances will evolve in the next few years. In this interview he looks at the drivers behind the anticipated market consolidation as well as why alliances will need to make more effort at delivering a better customer experience across member airlines.

An update to ‘Balancing the potential of web 2.0′

by Chris Clarke, event blogger

The theme of the conference Airlines 2.0 was given a futuristic twist by Philippe der Arslanian, Global Director of Airline Direct Channel at Amadeus, with interactive demonstrations of future mobile travel applications and insights into how tomorrows’ travellers will demand more from airlines (see post below).  In this interview, he is joined by Tehmton Cooper, Head of e-Commerce at Etihad, to look at the role that web 2.0 will play in the future as well as what can be achieved today.

 

A view from the top : Cathay Pacific Airways

Chris Clarke, event blogger

The perspectives shared by some of the world’s leading airlines at Horizons provided valuable insights for delegates.  In this interview, Edward Nicol, CIO, Cathay Pacific Airways, talks about the differences between the Asian traveller and those from other regions and the role that technology can play in meetings the different needs of travellers both now and in the future.

 

Interview update to ‘A new way forward in GDS distribution’

by Chris Clarke, event blogger

Last week at Horizons, David Doctor presented the Amadeus Airline Retailing Platform (A new way forward in GDS distribution). In the interview attached he talks about what the platform means for airlines and how it is transforming indirect distribution.  He also looks at how Amadeus is working with low-cost carriers to support their continued growth and evolution. David is Director of Airline Distribution and Low Cost Carriers at Amadeus.

 

Interview update to ‘A brave new world’?

by Chris Clarke, event blogger

Following the introduction of Airlines 2.0 as the theme of the conference (A brave new world?) , we have an interview with Frédéric Spagnou, Vice President Airline Business Group, Amadeus. In it, he talks about how new technologies such as Web 2.0 are empowering customers and how airlines can respond to this and increase brand loyalty.

Focus on the future but don’t forget the present

by Chris Clarke, event blogger

The Horizons 2008 global forum for airlines in Bangkok is over.  Everyone is making their way back home, whether home is Europe, North America, Latin America, Asia-Pacific, the Middle East or Africa. 

 It is a good time to reflect on the last couple of days. 

I hope you all enjoyed the conference.   With over 600 delegates and over 140 airlines represented, the gathering was the biggest so far.  It really has become an industry event not just an Amadeus event. 

For me, the conference highlighted a major shift in the sector.  It has highlighted how far the industry has come in the last seven years.  How airlines have not only come to terms with a rapidly changing market but have embraced it. 

We heard a lot about the future.  We heard about how airlines must relate more effectively to their customers if they are to build loyalty, increase yields and secure future growth. 

Focusing on the future is critical for any business.

But we also heard about the need for airlines to get things right now.   The basics must not be forgotten.  We heard how airline websites must get better at servicing and not just sales; we heard about next generation customer management systems and how they can improve efficiencies as well as improve the customer experience; we heard about how LCCs (and full-service carriers) are adapting their models to remain competitive in today’s world. 

And this focus on reality is important too.  When I was working at one of Europe’s leading brands, we used to refer to having our head in the clouds but our feet on the ground.  And this is as true for airlines as it is for any other business.

The focus of the event, and from all speakers, wasn’t on the technology for the sake of talking about technology.  It was about what can be achieved with the right technology.  Superior technology is not, and can never be, an end in itself.  Its value only lies in what can be done with it. 

What was evident throughout the event, was the increased confidence of those that work across the sector.  Instead of focusing on survival it was on growth and potential.  That isn’t to say that the sky is free from clouds.  Just that there is the confidence, the know-how and the ability to deal with those clouds. 

What is exciting about this sector, and what Horizons demonstrates every two years, is the pace of change.  With that in mind we look forward to the next Horizons. 

Will further consolidation have taken place?  Will customers be buying tickets using their iPod?  What new and innovative segments will airlines be catering to above and beyond traditional business-leisure?  Will the LCC model have evolved even further?  I could go on.

I hope that you enjoyed the last two days as much as I did. 

At the beginning of next week, we will also be uploading a number of videos interviews conducted during the conference.  Hopefully, you, or your colleagues that were unable to make it to Bangkok, will find some time to revisit the blog and view the interviews. 

My ambition is that the valuable conversations started in Bangkok don’t stop when you step off the plane. 

Balancing the potential of web 2.0 with current priorities

by Chris Clarke, event blogger

Philippe Der Arslanian offered a glimpse of the future.  Through a series of demonstrations he painted a picture of what is, and what will be, possible with web 2.0 in the not too distant future.  (If you want to learn about web 2.0 in under five minutes, Professor Mike Wesch’s video gives a fun tour of how it’s being used at the moment).

Exciting developments included new ways of shopping online to create a more intuitive user experience and convenience. 

It is clear that web 2.0 functionality offers airlines boundless opportunities to innovate in how they relate to customers.

Nonetheless, online selling, merchandising and servicing still remains a priority for airlines.  John Lonergan when charting the progress of Qantas.com expressed it’s not all about the sale.  Just as important is being able to service customers online beyond the purchase.  It is here that big opportunities exist to deliver a consistent experience to customers, build loyalty and get to know customers and their needs better. 

To hear more about how airlines can meet the needs of both the ‘digital natives’ and the ‘digital immigrants’ listen to the interview we will be posting with Philippe Der Arslanian, Global Director, Airline Direct Channel at Amadeus and Tehmton Cooper, Head of e-Commerce at Etihad.  (Currently the uploading function on youtube is not working and hasn’t been for the last few hours, I could continue to vent my frustration but i’ll spare you all!)