APEX Insight: With Wi-Fi to become widespread on the Finnair fleet by 2018, the airline plans to increase ancillary revenues with route-specific onboard offerings – starting with the Asian market. “On business trips to Asia, it’s all about gifts,” says Juha Järvinen, CCO, Finnair.
Technology is key to increasing airline revenue, Finnair’s chief commercial officer, Juha Järvinen, told attendees at the World Low-Cost Airlines Congress in London.
“Digital transformation for us is going through the whole customer journey, making sure that we can actually stay in touch with the customer from the dreaming phase all the way to the end of the journey,” Järvinen says, and “utilizing technology to our advantage to actually service customers better and generate more revenue.”
Finnair is about half way through its present digital transformation. The scheduled launch of the airline’s A350 XWB aircraft will include a fully outfitted in-flight entertainment and connectivity system, part of a $33-million investment to connect most of its fleet by 2018, which according to Järvinen, will “be a game-changer.”
Finnair, having released an Apple Watch app last month, has plans to update its website and mobile platforms next year. But keeping step with leading digital trends in other consumer retail industries outside of aviation, is key staying ahead of the industry.
“The airline industry has been sleeping for years,” Järvinen says. “We’ve been pushed by the consumers to find a new way to actually benefit from the possibilities [of new technologies]… I think airlines, especially in IT, have a tendency to find limitations rather than opportunities. I think it’s critical that we bring people from outside of the traditional airline world to actually enable that change.”
Using technology to promote shopping opportunities on board allows Finnair to offer passengers a valuable service, without overwhelming them with sales pitches or irritating those who want to rest and relax on a flight. It also removes the pressure from cabin crew to sell.
“That’s why we’re using technology, the IFE, the portals we have. So that, if you want to shop, we enable that through the technological platforms we have onboard,” Järvinen says. “We shall not increase the number of trolleys going back and forth in a corridor. That’s what you don’t want. The IFE technology and the Wi-Fi platforms enable you to do your shopping on your iPad when you want, at your discretion.”
Like other European airlines, Finnair has made Asia a key focus of its long-haul strategy, capitalizing on Helsinki’s location as a practical hub to Europe and onwards to the Americas. The airline has designed its onboard product, service and in-flight dining to suit the tastes of Asian consumers, as well as its European customers, and plans to do the same with its digital onboard retail strategy.
“Asian consumers, have different needs for shopping,” Järvinen says. “On business trips to Asia, it’s all about gifts. Ideally, you have very small gifts, because you don’t want to carry too much.”
For the airline, the key is tailoring the shopping experience to meet the specific needs of the traveler. Järvinen believes that onboard technology makes that tailored retail experience possible, and is working with his team to customize the airline’s new digital retail platform on various routes.
“With the Wi-Fi access, we’ll have [to decide] what kind of shopping, how extensive our platform should be… and how we customize for the consumer onboard. We don’t have the final answer yet. We are currently doing the analysis on the in-flight portal; what we do in-house and what we do through a partner, but we have decided to have a route-based selection for the goods.”