It’s now a case of when not if airlines embrace the modern retailing revolution, delegates at the Amadeus Alititude25 conference heard.
Meg O’Keefe, senior vice president of airline product management, told the GDS and tech giant’s conference in Lisbon last week that carriers can drive at least a 35% increase to their bottom line.
She said there are many paths to transformation but added all the evolutions and enhancements that airlines make to their retailing abilities must be future proofed to “optimise potential going forward”.
O’Keefe said Amadeus itself is embracing a strategy of complete transformation with its Nevio modern retailing platform to maximise the advantages in the long term.
“We think it’s worth it,” she said adding that the legacy Altea PSS [Passenger Service System] is capable of delivering retail value to full-service airlines.
But she said: “At the same time we have been spending some time buildings new capabilities to be able to extract additional value from our systems.
“Unless we make that next big leap across the chasm into the new world it will be difficult to stretch the systems of today to unlock that new value.”
There are two separate parts of the transformation that aviation is facing, the first being Order, Offer, which is a current focus, and then Settle, Deliver.
O’Keefe said the pace and scale of this digital transformation depends on a number of factors including appetite for change, the starting point and ecosystem they operate in.
Airlines will be able to drive “savings through cost efficiencies” as well as “sustainable revenue growth” by “delivering best-in-class travel experiences”.
Airlines have been asking Amadeus to make sure the solutions of the future offer “the flexibility to make the choices that fit your business” and to be “ready to adopt on the fly”, said O’Keefe.
“Nevio is hinged on travel centricity. If you are going to be a very good travel retailer you are going to need to have travel experiences at the heart of the system.
“It will be possible to commercialise any new product. It will be able to stretch your commercial product in the market. More range, more reach. And it will be able to implement these things very quickly.
The shift will see a move away from traditional filed fares to something more dynamic and open, to less complex systems and will optimise pricing based on conversions.
“Since this is designed for conversion, it will be able to create a modern user record which is created as the contract that is then cascaded across the ecosystem.
“It becomes a single source of truth to link systems together to provide a single experience. Simplicity, automation of your business. It will allow that step towards 100% self-servicing.”
The 35% value to the bottom line can be realised in the next two years with 30% coming from cost savings and 70 from revenue growth, claimed O’Keefe.
“We are focussed on scaling that because there is a lot to do in a short amount of time. Our systems are live today.
“Not all of them, but we have order management, dynamic air and ancillaries, we have transition capabilities line and in production.
“We have the ability to have digital channel offer order ready and enabled to activate.”