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Cost per mille. Digital out-of-home. Pre-roll. This is the type of jargon that comes up in conversations about in-flight advertising. But what do these terms mean? APEX’s Airline Advertising and Ancillary Revenue Committee is here to tell you that you’re not the only one wondering.

It’s not uncommon for passengers to stream airline-provided content on their devices using an aircraft’s Wi-Fi connection. However, industry professionals commonly misunderstand what the term for this type of setup – wireless in-flight entertainment (wIFE) – actually refers to. Some believe that wIFE is equivalent to having access to the Internet on board, which in the above scenario isn’t necessarily the case. Wireless IFE refers only to the streaming of content from a hard drive that’s installed in an aircraft cabin or stowed in an overhead bin. That content, such as a newscast, may be updated once a day, but it’s not instantaneous. Internet access can only be granted to passengers if the aircraft is equipped with an antenna that is communicating with a satellite or air-to-ground tower. So if giving passengers the ability to browse the Web or video-chat with a friend is what you’re after, then the term you should be using is in-flight connectivity.

“Everyone kind of speaks a different language when it comes to advertising related to aviation. If we can cut down the explanation time across multiple departments, it could lead to faster deployment and revenue.” – Kim Creaven, Global Eagle

Confusion over jargon, acronyms and even basic terms such as Wi-Fi is so prevalent in the industry that APEX’s Airline Advertising and Ancillary Revenue Committee (ARC) issued a glossary of more than 300 terms in May to set the definitions straight. With the glossary, the committee is hoping to reduce the time it takes for airlines, suppliers, agencies and advertisers to understand one another. A meeting about selling media on a wIFE portal, for instance, might be interrupted to explain the difference between live streaming versus cached streaming; and in a po-tay-to, po-tah-to situation where different names are being used for the same thing, such as a forced-view ad versus a roadblock, the conversation must be paused to calibrate everyone’s understanding of a term.

“I’ve talked to several companies that have trouble explaining what they’re trying to build in terms of ancillary revenue and advertising experiences,” says Kim Creaven, vice-president of Advertising, Sponsorships and Partner Marketing at Global Eagle, and chair of ARC. Without the right vernacular, there’s a higher chance of miscommunication that could lead to project delays. “Everyone kind of speaks a different language when it comes to advertising related to aviation. If we can cut down the explanation time across multiple departments, it could lead to faster deployment and revenue,” says Creaven.

“It’s hard for an advertiser to take the revenue opportunity seriously when ad inventory data is available on just two aircraft. That’s not something that they are really interested in.” – Susan Tran, Signal Lamp Entertainment

WHEN ADS FLY
Breaking down language barriers is just the first step to overcoming the real setback to a thriving in-flight advertising marketplace: a lack of awareness among media agencies and advertisers. According to the World Advertising Research Center, in-flight advertising makes up a very small percentage of the more than $618-billion global annual spend on advertising. Creaven says the lack of awareness is partially due to in-flight advertising being put in the category of out-of-home advertising (which includes highway billboards and bus stops) when it could fall under digital out-of-home advertising with a few changes. One improvement could be to provide proof of performance. But this is currently unavailable for in-flight advertising, leaving ad revenue on the table.

“Advertising with airlines hasn’t always been an obvious choice for brands, and therefore many are unfamiliar with the industry and the specifications we work with. That said, it does mean we get to go in and educate brands, from the ground up, on the value of advertising with airlines,” says Mary Rae Esposito, media sales director, US, Spafax. “And though that is an exciting opportunity for us, it’s important that people like Kim, myself and the industry as a whole are aligned on the terminology we’re using, otherwise we run the risk of causing confusion and, worst-case scenario, losing out on viable opportunities.”

Those on APEX’s ARC – a mix of hardware, connectivity and content providers – believe there would be a greater demand for in-flight advertising if the industry banded together on the issue: “The budgets of all of the advertisers are large. They have the money, but we don’t have enough inventory yet,” says Nicolas Devos, managing director of IMM International. This is a loss, he adds, because travelers tend to spend. “To reach a passenger flying to a specific destination, or in first or business class, would be a dream for most advertisers,” Devos says.

“It’s important that … [we] are aligned on the terminology we’re using, otherwise we run the risk of causing confusion and, worst-case scenario, losing out on viable opportunities.” – Mary Rae Esposito, Spafax

On the other hand, some airlines are investing in content and connectivity portals with little idea that the cost of their investments can be offset with advertising. Or they only think of advertising after the IFE system has been developed, making it much harder to implement. “Typically,
an IT team within an airline will work with an OEM [original equipment manufacturer] to build an IFE or Wi-Fi portal with a great user experience. Once that’s done, it gets to the airline’s marketing team. They want to display advertising, banners and pre-rolls – those aren’t built into the system. It requires going back to the drawing board. And that could take months, years or maybe never work out at all,” Creaven says. “The point is, if we all understand the process of planning for these user experiences and the language around in-flight advertising, we can make generating revenue a seamless part of the experience, instead of being an afterthought.”

REPORTING LIVE
For the most part, ad reporting today comes in the form of an affidavit from an airline specifying that an ad was played on an IFE system, or a snapshot of it appearing on the IFE screen. This is not so different from the tear sheets advertisers receive as proof that their print ad was run in an in-flight magazine, for example. Compared to the type of reporting that is available for digital advertising on the ground, there’s still a lot of catching up to do. “Advertisers are accustomed to receiving reports with impressions, timestamps, etc., and for a long time we simply could not supply our brand clients with that kind of in-depth analysis. That adds an extra challenge for those selling the media, but the good news is that it is slowly changing as the industry increases its focus on in-flight connectivity and data,” Esposito says.

Some of the newer IFE systems can facilitate more advanced analytics, increasing the detail of reporting through cost per mille, cost per click and cost per acquisition, which may sound a lot like mumbo jumbo, but are key to understanding whether an advertiser is getting return on their investment. “Metrics have always been a big one in discussions with customers,” says Susan Tran, director, Marketing and Sales Operations, Signal Lamp Entertainment. However, the main challenge is getting a comprehensive overview of the ad space availability and aggregate datasets across the different in-flight entertainment and connectivity systems on an airline’s fleet. “It’s hard for an advertiser to take the revenue opportunity seriously when ad inventory data is available on just two aircraft. That’s not something that they are really interested in,” says Tran.

“To reach a passenger flying to a specific destination, or in first or business class, would be a dream for most advertisers.” – Nicolas Devos, IMM International

Given that airline passengers are “captive” and could be sitting in front of a screen for up to 19 hours, they are considered a high-value audience segment. But without the best practices that ARC is proposing – to improve on ad delivery time (deadlines), reporting, pricing, targeting and to educate the airline industry about programmatic ad buying – in-flight advertising will continue to be a difficult sell. Any level of connectivity accelerates these best practices, but it could also hinder them if the parties involved don’t realize that it’s the HD-quality video ads, for example, that are bogging down the Wi-Fi speed, resulting in unnecessary latency.

“One of our goals is to make sure the industry understands what the real connectivity performance is going to be,” says Blane Rockafellow, vice-president Digital Solutions Technologies, SmartSky Networks. “We have to set expectations that if all advertising is streamed, the in-flight network performance will be affected. You have to make sure the right priorities for digital advertising are in place for network loading. If you can improve and understand how different digital content affects the network, then you can make the overall passenger experience better. And ultimately, that’s a better experience for advertisers because their ad gets delivered quickly and viewed by more eyeballs.”

“If you can improve and understand how different digital content affects the network, then you can make the overall passenger experience better. And ultimately, that’s a better experience for advertisers because their ad gets delivered quickly and viewed by more eyeballs.” – Blane Rockafellow, SmartSky Networks

COMING TO TERMS
Creaven says that there will be a bigger focus on ancillary revenue and in-flight advertising at the upcoming APEX TECH conference taking place January 29-30 in Los Angeles. She would like to host another working session and bring in expertise from adjacent industries and different regions in the world. ARC, which last met at APEX EXPO in September, also wants to create a road map to help those who are new to in-flight advertising begin making a profit from their IFE and connectivity systems. The road map will identify the key players in the ad delivery chain and answer basic questions, such as who buys and sells the ads, who submits and approves the creative and who ensures correct ad insertion.

But not everyone on the committee agrees there is a linear path or even a way to distill all the different opinions into a single strategy. They do, however, agree there is a mutual benefit to openly discussing their internal challenges. “Although everyone wants to maintain their competitive advantage, there is a collective understanding that we must work together so the technology and processes can be improved for a better digital ad future,” says Tran.

The glossary is just a starting point to build momentum for ARC’s mission. Having been in the industry for over 20 years, Creaven knows that it will be up to industry experts and those on the committee who understand aviation and media to spread the word. But once everyone is on the same page, they’ll be able to start talking.

“Spread the Word” was originally published in the 9.5 December/January issue of APEX Experience magazine.