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Trinity Forum: The Non-Aviation Revenues Disruption

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Kian Gould, CEO at AOE, talking at Trinity Forum about Driving and combating disruption – positive and negative – in airport commerce through digital innovation.

The digital airport: https://www.aoe.com/en/knowledge-base/the-digital-airport.html
Presentation Video: https://www.youtube.com/watch?v=S8Pkkq84axs

Published in: Travel
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Trinity Forum: The Non-Aviation Revenues Disruption

  1. 1. The Non-Aviation Revenues Disruption Driving and combating disruption – positive and negative – in airport commerce through digital innovation Kian T. Gould (Founder & CEO)
  2. 2. Yesterdays Airport Parking Customers
  3. 3. Yesterdays Airport Passengers
  4. 4. Yesterdays Airport Advertising
  5. 5. 4.8 Bn. mobile devices but only 4.2 Bn. toothbrushes worldwide
  6. 6. Todays Parking Customers
  7. 7. Tomorrows Parking Customers
  8. 8. Todays Passengers
  9. 9. The disruption has begun - A look at Travel Retail
  10. 10. The 63 billion USD global Travel Retail Market is beginning to be disrupted AMERICAS 17.1% MS ___________ $10.9bn ↓7.5% SOURCE: TFWA Asia Pacific growth driven by Down-Town Duty Free +17.7% vs. Airports +1.5% - Global Airport Shopping +0.4% - Airlines -6.6% - Ferries -2.7% - Other Shops & Sales +7.3% EUROPE 29.7% MS ___________ $18.8bn ↓7.9% AFRICA 1.2% MS __________ $0.8bn ↓2.7% MIDDLE EAST 8.9% MS __________ $5.6bn ↓2.4% ASIA PACIFIC 43.1% MS __________ $27.4bn ↑10.4% Market Share 56.2% vs. 57.3% ↓ Market Share 3.9% vs. 4.3% ↓ Market Share 3.2% vs. 3.3% ↓ Market Share 36.8% vs. 35.1% ↑ 2015 - 2016
  11. 11. Urban Myth 1: You can‘t sell luxury cars online Alibaba sold 100 Maserati Levante in 18 seconds on Single‘s Day
  12. 12. Urban Myth 2: Some brands will never sell online Every day hundreds of Chinese shoppers buy luxury bags via WeChat
  13. 13. Retail Urban Myth 3: The personal touch is most essential to in-store sales Only 2% of high value shoppers spend after getting advice from Sales Staff
  14. 14. Moments of decision of Duty Free purchase At home before Leaving for the airport At destination before leaving for the airport On the way to the airport At the Airport In the Duty Free Shop After looking around After Getting Advice from Sales Staff (only 2% in high spender category) Importance of making in- store experience unique! After buying another category Ensuring digital full digital engagement prior to travel is essential to capture 65% of purchases 35% 6% 14% 10% 26% 7% 2% SOURCE: m1nd-set Research
  15. 15. Planned vs Impulse Purchase 71% 29% Planned in advance what they wanted to shop Bought on impulse 83% 79% 75% 44% 42% 40% Shopping behavior has changed radically SOURCE: m1nd-set Research
  16. 16. The need for extension of the Golden Hour SOURCE: m1nd-set Research PRE-TRIP ONLINE TOUCH POINTS AIRPORT ONLINE TOUCH POINTS 34% Search for / see information about DF shopping Online Make the decision to buy in DF before arriving at the airport 62% Book their flight directly online 83% Find mobile check-in to be the most convenient 70% Go online while at the airport (24% search info about DF) 40% Would like to do online DF shopping before the trip On DF visitors visit the DF shop on impulse Motivated to visit DF if receive offers/coupons on their smartphone 53% 47% 62%
  17. 17. The new Quaternity of Travel Retail INTEGRATED ADVERTISING Via Wifi, Smart-Panels and InfoTerminals offer unique abilities PARTICIPATION in the international e-commerce growth CUSTOMER INFORMATION Airports/Airlines know much more about passengers than most retailers do CUSTOMER EXCELLENCE Attractive digital offers and services form a unique customer experience DIGITAL DEVICES create new transaction and communication channels DIGITALIZATION of the travel journey creates new touchpoints
  18. 18. Todays and tomorrows passengers expect more!
  19. 19. Frankfurt Airport | 1 year later
  20. 20. Frankfurt Airport | Some early signs of success ↑ 50 % beyond business plan Customer Growth Rate ↑ 35 % Cross- & Up-selling 75 % Active User Rate YTD Plan 300 % Basket Value Increase
  21. 21. Frankfurt Airport | Some early signs of success ↑ 3,6 % Frankfurt Airport Q1 2017 Per Passenger Spend 14% Conversion from Webrooming Effect
  22. 22. All the research we conducted over the last two years shows that what AOE started at Frankfurt Airport is the future of Travel Retail! Peter Mohn, CEO m1nd-set research
  23. 23. But why E-Commerce at an airport
  24. 24. Why E-Commerce at an airport has a competitive edge RETURNSPRODUCT Immediate Product Availability Low Cost of Returns No Traffic Acquisition Cost TRAFFIC
  25. 25. The airport as a true digital marketplace
  26. 26. The future of „Unobstrusive E-Commerce“
  27. 27. Everything Mobile – Everything at your fingertips Shopping Services Payment Services Retail / Shopping Flight Data Hotels Loyalty Parking Valet Services Lounge Fast Track F&B Ordering Maps Rental Cars . . . Airport Marketplace Voice Mobile API Touchpoints
  28. 28. Key to a great Customer Experience and ongoing loyalty are DATA SERVICEPRODUCT Great Product Selection Great Product Data Great Services
  29. 29. Michael Madden (59), British - Travels Business - Lives in London - buys his wife Chanel - wears mainly Ralph Lauren - has 10,000 loyalty points - Drinks Double Espresso Raj Mahindra (49), Indian - Travels Business - Lives in Bangalore - Always uses Uber Black - Loves BOSE Gadgets - Buys Hugo Boss hsirts - No Loyalty member - Drinks Chai Latte Pen Liyun (38), Chinese - Travels First Class - Lives in Beijing - Buys 1 handbag each trip - Ususally orders to lounge - has 250,000 loyalty points - Drinks Earl Grey
  30. 30. Just in: OM³ is launching at Heathrow Airport early 2018
  31. 31. Q&A More questions? E-Mail me at kian@aoe.com

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