A panel at the Aviation Festival in London agreed digital advances would permit brands, particularly the new generation of low-cost airlines, to become one-stop travel centres selling a whole range of products direct to consumers.
Wow Air chief executive Skuli Mogensen said airlines could learn from other sectors, such as the gaming industry, which has become adept at selling add-ons to customers using mobile devices.
The Icelandic airline’s average ancillary sale, he said, was $57.
“I would like to see that going up to $100, but it won’t happen by charging more for sandwiches.”
He added: “I don’t think we can make more money selling higher economy fares, so we have to find new ways to make money.”
He said there were “many ways to go beyond the travel experience”, and asked: “Should we define ourselves as an airline? I’m not sure.”
Steven Greenway, president of new Canadian ultra low-cost airline Swoop, said one carrier, Florida’s Spirit Airlines, now earned more in ancillary revenue than through its base fares, adding this was the start of a change in the industry. He said: “The mantra is act like a digital retailer that happens to fly places.”
Some aviation brands such as British Airways’ parent company IAG and New York’s JetBlue have invested in technology “incubators” to develop new digital capabilities.
JetBlue chief executive Robin Hayes said: “When you think about buying travel, it should be as easy as buying on Amazon, almost like a shopping basket that you put things into. But the industry is based on PNR.”
He said travel brands had a wealth of untapped data to mine once the capabilities were available.
“If I was a high-street retailer, I would kill for the amount of data airlines have on their customers,” he said. “Eighty per cent of our customers are leisure and a lot fly just once a year, so the opportunity is how can we make JetBlue relevant to them in between? We are at the beginning of that.”
