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Lightening the load for airlines – boosting ancillary sales with pre-ordering

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Since 2007 the sky has never been busier.  That year’s EU-US Open Skies Agreement fuelled the explosive growth in air passenger numbers in the UK and Europe and a change in the focus of the industry. Airfares became affordable to a wider population and new destinations opened up. Once the preserve of the rich and wealthy, air travel is no longer a niche mode of transport providing glamorous in-flight service to an appreciative customer base. Before, airlines competed with each other on the quality of their customer service. Now, as a direct result of Open Skies, open competition has seen the emergence of the low-cost airlines, which are keenly focused on low fares and “load factors”.

The well-established airlines have always recognised the primacy of the customer experience, continually refreshing their offer in order to maintain customer loyalty and grow their businesses. At one end of the spectrum this has meant large-scale investments in the newest aircraft from Airbus or Boeing, or the latest design in fuel-efficient engines from Rolls Royce or Pratt and Whitney. At the heart of these decisions has always been the need to ensure that the in-flight customer experience is setting new standards and providing market differentiation, whatever the cost.

The key challenge for the airline industry is to improve revenues so that they’re not coming from tickets alone. Ticket prices are competitively pitched in order to maintain economically viable load factors. Regardless of an airline’s profile or market sector, driving ancillary revenues is increasingly recognised as a key strategy for long-term growth. Against this backdrop, airlines are looking at ways of improving revenues from every stage of the customer journey in an effort to add high-margin ancillary sales to low-margin airfare income. An evident example of this is the charge low-cost airlines, in particular, have levied for baggage, seat selection and, in some cases, meals. This led to the realisation that there are further opportunities to generate additional revenues from merchandise both pre-flight and after landing.

As the crew cannot restock with additional supplies mid-flight, what is loaded onto the aircraft pre-flight determines and limits what the cabin crew can sell and what passengers can buy. The ideal solution is to capture passengers’ orders early in the journey cycle, and preferably pre-flight. As soon as customers have confirmed and paid for their tickets online, airlines have the perfect opportunity to engage with their future passengers and add real value to their in-flight experience. Given the finite storage capacity on board aircraft and the need to minimise weight in order to maximise fuel efficiency, the range and quantity of products available in-flight has necessarily been restricted.

Pre-flight however, on terra firma, airlines can sell a vastly more expansive range of food and beverages, merchandise, and duty-free. A number of airlines – including Qantas, Austria Airways and Alaska Airlines – offer a pre-flight pre-ordering service for meals on board, but these services often come with restrictions such as the departure airport and cut-off deadline. Crucially, they don’t include other, non-meal pre-ordering for duty free and other merchandise on the same platform, missing the opportunity to add all-important high margin ancillary revenue.

Preoday’s online app and web pre-ordering platform enables airlines to take customer pre–orders for any range of food & beverages, meals, merchandise and duty-free.

Customers can use the platform to place their orders on any internet-enabled device, from PC or laptop to any iOS or Android mobile device.

The Preoday platform is designed with an open API meaning that airlines can integrate the platform with their own customer-facing platform, and – potentially – ticketing system.

The platform’s versatile architecture means that the back-end management functionality is highly customisable, so airlines can maintain their own brand integrity on their platform. Changes to product range, pricing and special offers, for example, can be updated in real time.

Customer insights and management reports are a key feature of the Preoday platform. Data captured from customer profile and purchasing behaviour provide invaluable information for managing time-sensitive supply chain decisions, as well as opportunities for highly targeted and personalised marketing initiatives along the customer journey.

Capturing customers’ orders in advance allows airlines to better manage their supply chain, and so manage on-board stock levels and weight. More than that, customers who order ahead – particularly if there is a significantly broader pre-flight menu range featuring exclusive deals for pre-flight ordering – are known to spend 40% more than their cash counterparts.

The commercial benefits are clear to see. Increased revenue per customer for the airline and a customer who appreciates that they are getting a great deal and improved service – the perfect win-win situation for all parties.  Blue sky thinking indeed.

For further information about the Preoday pre-ordering platform, contact Dominic Hall dominic.hall@preoday.com

Other Blog Articles

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Since 2007 the sky has never been busier.  That year’s EU-US Open Skies Agreement fuelled the explosive growth in air passenger numbers in the UK and Europe and a change in the focus of the industry. Airfares became affordable to a wider population and new destinations opened up. Once the preserve of the rich and wealthy, air travel is no longer a niche mode of transport providing glamorous in-flight service to an appreciative customer base. Before, airlines competed with each other on the quality of their customer service. Now, as a direct result of Open Skies, open competition has seen the emergence of the low-cost airlines, which are keenly focused on low fares and “load factors”.

The well-established airlines have always recognised the primacy of the customer experience, continually refreshing their offer in order to maintain customer loyalty and grow their businesses. At one end of the spectrum this has meant large-scale investments in the newest aircraft from Airbus or Boeing, or the latest design in fuel-efficient engines from Rolls Royce or Pratt and Whitney. At the heart of these decisions has always been the need to ensure that the in-flight customer experience is setting new standards and providing market differentiation, whatever the cost.

The key challenge for the airline industry is to improve revenues so that they’re not coming from tickets alone. Ticket prices are competitively pitched in order to maintain economically viable load factors. Regardless of an airline’s profile or market sector, driving ancillary revenues is increasingly recognised as a key strategy for long-term growth. Against this backdrop, airlines are looking at ways of improving revenues from every stage of the customer journey in an effort to add high-margin ancillary sales to low-margin airfare income. An evident example of this is the charge low-cost airlines, in particular, have levied for baggage, seat selection and, in some cases, meals. This led to the realisation that there are further opportunities to generate additional revenues from merchandise both pre-flight and after landing.

As the crew cannot restock with additional supplies mid-flight, what is loaded onto the aircraft pre-flight determines and limits what the cabin crew can sell and what passengers can buy. The ideal solution is to capture passengers’ orders early in the journey cycle, and preferably pre-flight. As soon as customers have confirmed and paid for their tickets online, airlines have the perfect opportunity to engage with their future passengers and add real value to their in-flight experience. Given the finite storage capacity on board aircraft and the need to minimise weight in order to maximise fuel efficiency, the range and quantity of products available in-flight has necessarily been restricted.

Pre-flight however, on terra firma, airlines can sell a vastly more expansive range of food and beverages, merchandise, and duty-free. A number of airlines – including Qantas, Austria Airways and Alaska Airlines – offer a pre-flight pre-ordering service for meals on board, but these services often come with restrictions such as the departure airport and cut-off deadline. Crucially, they don’t include other, non-meal pre-ordering for duty free and other merchandise on the same platform, missing the opportunity to add all-important high margin ancillary revenue.

Preoday’s online app and web pre-ordering platform enables airlines to take customer pre–orders for any range of food & beverages, meals, merchandise and duty-free.

Customers can use the platform to place their orders on any internet-enabled device, from PC or laptop to any iOS or Android mobile device.

The Preoday platform is designed with an open API meaning that airlines can integrate the platform with their own customer-facing platform, and – potentially – ticketing system.

The platform’s versatile architecture means that the back-end management functionality is highly customisable, so airlines can maintain their own brand integrity on their platform. Changes to product range, pricing and special offers, for example, can be updated in real time.

Customer insights and management reports are a key feature of the Preoday platform. Data captured from customer profile and purchasing behaviour provide invaluable information for managing time-sensitive supply chain decisions, as well as opportunities for highly targeted and personalised marketing initiatives along the customer journey.

Capturing customers’ orders in advance allows airlines to better manage their supply chain, and so manage on-board stock levels and weight. More than that, customers who order ahead – particularly if there is a significantly broader pre-flight menu range featuring exclusive deals for pre-flight ordering – are known to spend 40% more than their cash counterparts.

The commercial benefits are clear to see. Increased revenue per customer for the airline and a customer who appreciates that they are getting a great deal and improved service – the perfect win-win situation for all parties.  Blue sky thinking indeed.

For further information about the Preoday pre-ordering platform, contact Dominic Hall dominic.hall@preoday.com

Other Blog Articles

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Lightening the load for airlines – boosting ancillary sales with pre-ordering

Since 2007 the sky has never been busier.  That year’s EU-US Open Skies Agreement fuelled the explosive growth in air passenger numbers in the UK and Europe and a change in the focus of the industry. Airfares became affordable to a wider population and new destinations opened up. Once the preserve of the rich and wealthy, air travel is no longer a niche mode of transport providing glamorous in-flight service to an appreciative customer base. Before, airlines competed with each other on the quality of their customer service. Now, as a direct result of Open Skies, open competition has seen the emergence of the low-cost airlines, which are keenly focused on low fares and “load factors”.

The well-established airlines have always recognised the primacy of the customer experience, continually refreshing their offer in order to maintain customer loyalty and grow their businesses. At one end of the spectrum this has meant large-scale investments in the newest aircraft from Airbus or Boeing, or the latest design in fuel-efficient engines from Rolls Royce or Pratt and Whitney. At the heart of these decisions has always been the need to ensure that the in-flight customer experience is setting new standards and providing market differentiation, whatever the cost.

The key challenge for the airline industry is to improve revenues so that they’re not coming from tickets alone. Ticket prices are competitively pitched in order to maintain economically viable load factors. Regardless of an airline’s profile or market sector, driving ancillary revenues is increasingly recognised as a key strategy for long-term growth. Against this backdrop, airlines are looking at ways of improving revenues from every stage of the customer journey in an effort to add high-margin ancillary sales to low-margin airfare income. An evident example of this is the charge low-cost airlines, in particular, have levied for baggage, seat selection and, in some cases, meals. This led to the realisation that there are further opportunities to generate additional revenues from merchandise both pre-flight and after landing.

As the crew cannot restock with additional supplies mid-flight, what is loaded onto the aircraft pre-flight determines and limits what the cabin crew can sell and what passengers can buy. The ideal solution is to capture passengers’ orders early in the journey cycle, and preferably pre-flight. As soon as customers have confirmed and paid for their tickets online, airlines have the perfect opportunity to engage with their future passengers and add real value to their in-flight experience. Given the finite storage capacity on board aircraft and the need to minimise weight in order to maximise fuel efficiency, the range and quantity of products available in-flight has necessarily been restricted.

Pre-flight however, on terra firma, airlines can sell a vastly more expansive range of food and beverages, merchandise, and duty-free. A number of airlines – including Qantas, Austria Airways and Alaska Airlines – offer a pre-flight pre-ordering service for meals on board, but these services often come with restrictions such as the departure airport and cut-off deadline. Crucially, they don’t include other, non-meal pre-ordering for duty free and other merchandise on the same platform, missing the opportunity to add all-important high margin ancillary revenue.

Preoday’s online app and web pre-ordering platform enables airlines to take customer pre–orders for any range of food & beverages, meals, merchandise and duty-free.

Customers can use the platform to place their orders on any internet-enabled device, from PC or laptop to any iOS or Android mobile device.

The Preoday platform is designed with an open API meaning that airlines can integrate the platform with their own customer-facing platform, and – potentially – ticketing system.

The platform’s versatile architecture means that the back-end management functionality is highly customisable, so airlines can maintain their own brand integrity on their platform. Changes to product range, pricing and special offers, for example, can be updated in real time.

Customer insights and management reports are a key feature of the Preoday platform. Data captured from customer profile and purchasing behaviour provide invaluable information for managing time-sensitive supply chain decisions, as well as opportunities for highly targeted and personalised marketing initiatives along the customer journey.

Capturing customers’ orders in advance allows airlines to better manage their supply chain, and so manage on-board stock levels and weight. More than that, customers who order ahead – particularly if there is a significantly broader pre-flight menu range featuring exclusive deals for pre-flight ordering – are known to spend 40% more than their cash counterparts.

The commercial benefits are clear to see. Increased revenue per customer for the airline and a customer who appreciates that they are getting a great deal and improved service – the perfect win-win situation for all parties.  Blue sky thinking indeed.

For further information about the Preoday pre-ordering platform, contact Dominic Hall dominic.hall@preoday.com

Other Blog Articles

Solving the airline customer experience challenge

Solving the airline customer experience challenge

Solving the airline customer experience challenge

Since 2007 the sky has never been busier.  That year’s EU-US Open Skies Agreement fuelled the explosive growth in air passenger numbers in the UK and Europe and a change in the focus of the industry. Airfares became affordable to a wider population and new destinations opened up. Once the preserve of the rich and wealthy, air travel is no longer a niche mode of transport providing glamorous in-flight service to an appreciative customer base. Before, airlines competed with each other on the quality of their customer service. Now, as a direct result of Open Skies, open competition has seen the emergence of the low-cost airlines, which are keenly focused on low fares and “load factors” as opposed to airline customer experience.

The well-established airlines have always recognised the primacy of the customer experience, continually refreshing their offer in order to maintain customer loyalty and grow their businesses. At one end of the spectrum this has meant large-scale investments in the newest aircraft from Airbus or Boeing, or the latest design in fuel-efficient engines from Rolls Royce or Pratt and Whitney. At the heart of these decisions has always been the need to ensure that the in-flight customer experience is setting new standards and providing market differentiation, whatever the cost.

The key challenge for the airline industry is to improve revenues so that they’re not coming from tickets alone. Ticket prices are competitively pitched in order to maintain economically viable load factors. Regardless of an airline’s profile or market sector, driving ancillary revenues is increasingly recognised as a key strategy for long-term growth. Against this backdrop, airlines are looking at ways of improving revenues from every stage of the customer journey in an effort to add high-margin ancillary sales to low-margin airfare income. An evident example of this is the charge low-cost airlines, in particular, have levied for baggage, seat selection and, in some cases, meals. This led to the realisation that there are further opportunities to generate additional revenues from merchandise both pre-flight and after landing.

As the crew cannot restock with additional supplies mid-flight, what is loaded onto the aircraft pre-flight determines and limits what the cabin crew can sell and what passengers can buy. The ideal solution is to capture passengers’ orders early in the journey cycle, and preferably pre-flight. As soon as customers have confirmed and paid for their tickets online, airlines have the perfect opportunity to engage with their future passengers and add real value to their in-flight experience. Given the finite storage capacity on board aircraft and the need to minimise weight in order to maximise fuel efficiency, the range and quantity of products available in-flight has necessarily been restricted.

Pre-flight however, on terra firma, airlines can sell a vastly more expansive range of food and beverages, merchandise, and duty-free. A number of airlines – including Qantas, Austria Airways and Alaska Airlines – offer a pre-flight pre-ordering service for meals on board, but these services often come with restrictions such as the departure airport and cut-off deadline. Crucially, they don’t include other, non-meal pre-ordering for duty free and other merchandise on the same platform, missing the opportunity to add all-important high margin ancillary revenue.

Preoday’s online app and web pre-ordering platform enables airlines to take customer pre–orders for any range of food & beverages, meals, merchandise and duty-free.

Customers can use the platform to place their orders on any internet-enabled device, from PC or laptop to any iOS or Android mobile device.

The Preoday platform is designed with an open API meaning that airlines can integrate the platform with their own customer-facing platform, and – potentially – ticketing system.

The platform’s versatile architecture means that the back-end management functionality is highly customisable, so airlines can maintain their own brand integrity on their platform. Changes to product range, pricing and special offers, for example, can be updated in real time.

Customer insights and management reports are a key feature of the Preoday platform. Data captured from customer profile and purchasing behaviour provide invaluable information for managing time-sensitive supply chain decisions, as well as opportunities for highly targeted and personalised marketing initiatives along the customer journey.

Capturing customers’ orders in advance allows airlines to better manage their supply chain, and so manage on-board stock levels and weight. More than that, customers who order ahead – particularly if there is a significantly broader pre-flight menu range featuring exclusive deals for pre-flight ordering – are known to spend 40% more than their cash counterparts.

The commercial benefits are clear to see. Increased revenue per customer for the airline and a customer who appreciates that they are getting a great deal and improved service – the perfect win-win situation for all parties.  Blue sky thinking indeed.

For further information about the Preoday pre-ordering platform, contact us hello@preoday.com

Other Blog Articles

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