Beyond Buzz: Airline Heads Discuss the Profits of Digital
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APEX Insight: During the Aviation Festival in London earlier this month, four top airline executives shared why digital transformation is more than fluff and buzzwords. While each airline’s use of digital varies, the panel shared an eagerness to bring their companies into a modern digital landscape – and remain at the cutting edge. At the intersection of airlines and technology, these leaders find profits.
EasyJet CEO Carolyn McCall Says: “Use Big Data & Make Digital Self-Service Simple”
EasyJet CEO Carolyn McCall has developed a technology and innovation culture at easyJet. “We don’t see ourselves as an airline when it comes to digital. I always see ourselves as an e-commerce platform,” she said. “We have half a billion visits to our digital channels, which gives enormous amount of data; e-mail contact, text contact, etc. We can do an enormous amount with what we have, but our core proposition is always about making it the easiest it can be for our passengers. Whether that’s to buy or to upgrade or to change … to do everything.”
“When you do it yourself, you feel much more in control of a situation.” – Carolyn McCall, easyJet
Travel disruption in Europe has a big impact on customer service and also on airline costs, with generous passenger compensation regulations for delays and cancellation. EasyJet alleviates the strain by making self-service simple. “So, if there’s an ATC strike in France, what we want to do is rather than our passengers queuing for hours trying to change their flights, [they can use] the phone in their hands. They can just go online, go to the next flight, rebook and off you go. When you do it yourself, you feel much more in control of a situation like that,” McCall said.
Jayne Hrdlicka, CEO Jetstar Group, Describes Digital as Diverse
Jayne Hrdlicka, CEO of Jetstar Group, described digital as the best way to reach Jetstar’s varied customer base: “We really have to invest in smart digital because the users in our market are very savvy.” Jetstar is actively engaged with over 12 million social media followers through digital promotions and storytelling. “We can’t take old approaches when we think of communicating,” Hrdlicka explained. “We can’t take a standard approach to our brand. For example, in Japan we have a mascot, Jetta panda, and we do a series that revolves around who he is and his family. He does adventures to all of our destinations.”
“We want to really target a mix of things which can enhance the travel experience and deliver value.” – Jayne Hrdlicka, Jetstar Group
But digital channels are also essential to the airline’s sales and ancillaries strategy. “We want to sell a whole spectrum of things to our customers. We want to really target a mix of things which can enhance the travel experience and deliver value,” said Hrdlicka.
Tim Clark, Emirates President, Talks Digital Disruption & Operations
Tim Clark, president of Emirates, supports front-end customer-facing digital improvements, but believes the greatest benefit of digital disruption is to back-end operations. “Digital disruption, whether it be in the airline business or any other business, is staring us all in the face. You ignore it at your peril,” he said. “It’s not just about the customer-facing systems. We’re fairly adept at changing out and reaching consumers through our digital systems. But what about the back-of-house systems? What about the distribution systems, as they stand?”
“We’re fairly adept at … reaching consumers through our digital systems. But what about the back of house systems?” – Tim Clark, Emirates
A new digital disruption team, headed up by former Malaysia Airlines and Aer Lingus CEO Christoph Mueller, will see the multiyear efficiency program through to its conclusion. “This digital disruption will come along and redesign the digital platform, which will streamline what we do by as much as 50 percent,” Clark said. “It will allow us to be far more efficient about the way we go about to our back of house as well as to the front of house.”
Clark is also keen on the future of blockchain technology. “In the end, blockchain will drive everything we do in the next five or 10 years. Make no mistake about it,” Clark said.
International Airlines Group CEO Willie Walsh Wants Digital Innovation for PaxEx and for Profitability
To Willie Walsh, CEO of International Airlines Group (IAG), digital systems are essential for controlling costs and increasing profitability. He also believes that it’s up to airlines to keep up with the pace of change in technology. “There are people out there who are looking to disrupt our business, so we should be looking to disrupt our own business, for our own benefit,” he said. “We’re looking for innovation that makes our business better. That means making it better for our customers, but we want innovation to improve our profitability.”
“There are people out there who are looking to disrupt our business, so we should be looking to disrupt our own business.” – Willie Walsh, AIG
“I’m in the business of moving passengers and freight, people and cargo, for profit. I make no apologies for that. That’s what the shareholders demand. That’s what the Board has demanded. Anything that’s likely to enhance the performance of our business – and digital will give us opportunities in many different ways – we’ll pursue,” said Walsh.