Dreaming up solutions for Heathrow's problems of tomorrow. This was done as an exercise only. No part of this deck has been sanctioned or reviewed with London Heathrow airport representatives.

1. New Revenue Streams
Heathrow Airport - Planning for 2025-2030

2. Heathrow Overview
Let’s get to know UK’s Global Gateway

3. Heathrow by the numbers

4. Heathrow is One of World’s Largest Airports
and Hubs, Consisting of Five Terminals
T2 T3 T4 T5 T1
Year
Built/Renovated
2014 1961/2007 1986 2008
1968[2015-
closed]
Passengers (M) 16.5 17.7 9.5 31.9
Flights 118,425 91,327 48,137 213,179
Latest Reno Costs
(£M)
2,300
106;
22 in security
100 4,200
Main areas of
investment
New Terminal
Passport control;
Baggage claim;
CX - Check-in
Ambience;
Design
New Terminal
Size (m2) 40,000 98,962 105,481 353,020
• Since 2003, £11B invested in improvements;
• £900M invested in baggage systems
• 1.7 million metric tonnes transported

5. Heathrow’s Revenue Comes Mostly From
Airlines and Retail
Aeronautical:
Retail:
• 81 distinct retailers
• Variety of vouchers and loyalty bonuses
redeemable at select retailers; Select airlines
partner for extra points and incentives
Region Count of Airline Percent of Total
Europe 57 34%
Asia Pacific 37 22%
Middle East 33 20%
Africa 20 12%
North America 13 8%
Latin America 6 4%
UK 3 2%

6. Heathrow aims to satisfy travelers with better
care and sustainable programs
High Level Goals:
• Satisfy customers, partners and
neighbors
• Expand operations in a
sustainable, responsible and
profitable way
• Emphasize customer service and
ensure continued customer
satisfaction

7. Heathrow is among the Top 10 airports
consistently, but is often overshadowed by Asian
counterparts
1. Singapore (SIN)
2. Seoul, South Korea (ICN) – best staff
3. Tokyo Haneda, Japan (HND) – cleanest
4. Hong Kong (HKG) – best transit
5. Doha, Qatar (DOH)
6. Munich, Germany (MUC)
7. Nagoya, Japan (NGO) – best regional
8. London Heathrow, UK (LHR) + world’s best airport terminals T2-2014 & T5-2008
9. Zurich, Switzerland (ZRH)
10. Frankfurt, Germany (FRA)
Source

8. International Climate: Prepared for Brexit and
Ramping Up Operations in Asia
• Heathrow officials optimistic about LHR’s global
connected future even in the face of Brexit
• Trade growing, especially in China
• 2.2% trade growth expected
• 3% of exports sent to China from UK
• 7% of imports into UK are from China
• UK is lagging behind in China trade compared to its
European neighbors
• $84 Billion for UK-China trade vs. $211B in
Germany-China trade
Source 1
Source 2
Source 3

9. Air Travel Landscape 2019-2034
Market trends, competitive landscape and what to do to succeed in the air travel of
tomorrow

10. APJ Passengers will eclipse North America by
2034
• Avg passenger growth of 4.6-4.9%
from 2014-2034
• Asia Pacific to lead the world in traffic:
Heathrow wants to capture this
market as middle class and
consequently ability and desire to take
trips increase
Source

11. Air Travel Innovations Will Impact
the Airports of the Future
• Larger (double decker) airplanes will need new
airport accommodations
• Boom Supersonic airplane projected to have a
plane by 2025
• Planes that can half travel time (~700mph)
• Potential increase in passengers
• Need to develop supportive infrastructure – fueling
etc.
• Japan Airlines already investing
Source
• Circular Airport design
• Endless 360 degree runway
• 3 planes can land/take off at once
• Reduces noise by increasing approaches/pathways of
airplanes
Source

12. 5 Strategic Initiatives
Taking advantage of existing competitiveness and future developments

13. Dreaming Up
the Airport of
Tomorrow

14. The Best Solutions Will Tackle Heathrow’s
Biggest Future Challenges
• Staying Competitive Among Other “Hubs”
• Weighting recent updates vs new
• Residential area, local rules & regulations
• Shifting International Environment
• Brexit, new trade routes, new travelers
• Improving Customer Experience
• Serving existing segments vs. developing new segments
• Ensuring success across a variety of segments
• Facing Technological/Environmental Changes
• New planes (Boom Supersonic)
• Environmental measures and conservation efforts
Internal
Revenue
Market

15. Heathrow will get ahead by tackling challenges
strategically
1. Improve customer experience
2. Improve technical infrastructure
3. Focus on existing partners
4. Invest in largest customer segment
5. Expand international horizons

16. Heathrow will get ahead by tackling challenges
strategically
1. Improve customer experience
2. Improve technical infrastructure
3. Focus on existing partners
4. Invest in largest customer segment
5. Expand international horizons
Internal Revenue Market
Strategic Impact

17. Heathrow will get ahead by tackling challenges
strategically
1. Expand international horizons
2. Focus on existing partners
3. Invest in largest customer segment
4. Improve technical infrastructure
5. Improve customer experience
Proactive Terminal Expansion:
• Existing expansions and changes have been a
hit and attracted new business – more
expansions would mean better ratings from
businesses and customers
Internal Revenue Market
Strategic Impact

18. Heathrow will get ahead by tackling challenges
strategically
1. Expand international horizons
2. Focus on existing partners
3. Invest in largest customer segment
4. Improve technical infrastructure
5. Improve customer experience
Build a New Landing Strip:
• Investing in new designs/strips will make LHR
at the forefront and prepared for
environmental, regulatory and technological
changes ahead
• Certain design helps dilute noise and keep
neighbors happy
Internal Revenue Market
Strategic Impact

19. Heathrow will get ahead by tackling challenges
strategically
1. Expand international horizons
2. Focus on existing partners
3. Invest in largest customer segment
4. Improve customer experience
5. Improve technical infrastructure
Invest in needs of international leisure travelers,
such as improved connections services, more
support staff, linguistic guides and security to
streamline the transfer experience
Internal Revenue Market
Strategic Impact

20. Heathrow will get ahead by tackling challenges
strategically
1. Expand international horizons
2. Focus on existing partners
3. Invest in largest customer segment
4. Improve technical infrastructure
5. Improve customer experience
Bring new retailers / expand existing
partnerships and create a fast, omni-channel,
brick and mortar and digital experience
Internal Revenue Market
Strategic Impact

21. Heathrow will get ahead by tackling challenges
strategically
1. Expand international horizons
2. Improve customer experience
3. Improve technical infrastructure
4. Focus on existing partners
5. Invest in largest customer segment
Cater to Asia-Pacific travelers by expanding
partnerships with Asian airlines and create a
global rewards program targeting this travel
segment and expand to sister airports for
continuity
Internal Revenue Market
Strategic Impact

22. Expand Focus on Asia-Pacific
Case for International Diversification and Ballpark Figures for an
International Sister Network of Airports and Rewards Program

23. APJ Segment Contains a Lot of Opportunity
for Heathrow
Aeronautical:
• APJ airlines are the 2nd biggest segment: 22% of LHR’s airline routes are from APJ
(6% are from China)
• APJ Airlines to have fastest passenger growth and very fast economic and trade
growth
Retail:
• APJ is currently the 4th largest segment at Heathrow but projected to have fastest
growth at 5.7% in next 20 years
• 14% of passengers and retail revenue comes from APJ travelers – this number can
be increased

24. Step 2:
B2C
How to Strengthen Heathrow’s APJ Presence
Goal: Develop relationships and presence across the Asia-Pacific region to
become the key partner for trade and travel for the growing region of
international business and leisure travelers through a B2B incentive program
and a B2C rewards program targeting Asia Pacific travelers
Create an international rewards program to
attract and retain Asia Pacific travelers
• Increase the 14% of current retail revenue that
comes from passengers on APJ routes
• Create a business and leisure rewards programs
for targeted segments of travelers that choose to
come to LHR and its “sister” airports
Create a Network of Sister Airports Targeting
Asia Pacific Business and Travel
• Attract remaining 8 major Chinese passenger
and trade cargo airlines and expand to other
regions
• Establish a strategic airport “sister” program
• Seek out airports in areas with Chinese,
such as Africa, Eastern Europe and
Middle East
• Leverage existing partnerships to grow
the APJ segment.
Step 1:
B2B

25. £33M (9% of segment
revenue): Investment in
new Partnerships
(Incentives and Rewards
Program)
Upfront Investment in Capturing the Asian
Market Will Position Heathrow for the Win
2020 2025 2030 2035
£ M
Incentives
+
Passenger growth: 5.7%
Trade growth: 2.2%
APJ incentive reduces; LHR part of
new travel and trade routes
Incentive allows LHR to deepen
relationships and dominate the
booming market
*Exact details of incentive to be discussed and might
include experimentation and further validation to
provide the best ROI

26. Incentive and Rewards Program ROI
Total Retail Revenue (2018 in M) 520
Retail Revenue Per Passenger (M) 8.59
Passengers from APJ (count in M/%) 8.7 / 14%
Total Retail Revenue for APJ Passengers (M) 75
Total Aeronautical Revenue (2018 in M) 1307
APJ Airlines (count / %) 37 / 22%
Total Aeuronautical Revenue for APJ (M) 288
TOTAL Revenue from APJ (M) 362
Retail Program: Est. Investment (5% revenue from overall
segment) in M
18
B2B: Est. Reduction b/c of 4% Off Incentive (Avg of Growth) 14
TOTAL investment in M 33
Target growth - retail 20%
Target growth - airlines 10%
No Incentive
(M)
Incentive
(M)
Projected Passenger
Growth
6% 79 86
Projected Trade
Growth
2% 294 315
ROI on program
(Retail/B2C)
4x
ROI on incentive
(Retail/B2B)
21x
RetailAirline
B2BB2C

27. Why Does This Idea Work?
Feeds on growth in APJ in the next 10 years
LHR would become proactively entrenched in the new airline map system and
become the APJ hub in Europe
Initial investment is fairly low with high rewards on top of high market growth
Builds on work already started in 2018
Improves customer experience for a growing segment of customers

28. The Process

29. From Ideas to Research to Facts
Client Research:
Goals, Segments,
Revenue
Client Market
Research: Competitive
& Industry
Identify Main
Challenges &
Oppportunities
Concrete Idea
Generation
Concrete Idea
Validation

30. Questions?

31. Appendix

33. Ideas – Consumer & Market Trends
1. Leisure passengers
2. Business passengers
3. Transfer passengers
4. Trade: Cargo passengers + Int’l
development
5. Int’l vs domestic passengers
6. Upcoming big social events
7. New tech: Electric vehicles ;
emissions trading
8. Expansions
9. Retail: leverage most popular items
to increase even more sales