How travel tech start-ups can sell more to airlines Travel Tech News

How travel tech start-ups can sell more to airlines

According to senior technologists from American Airlines, who flew to Dublin recently to meet representatives from Ireland’s fast-growing cluster of travel technology companies, there are two issues that currently preoccupy airlines: How to get passengers to the airport more efficiently, and how to generate new revenue opportunities when they arrive.

Spencer Kaiser, principal architect for emerging technology at American Airlines, and Kyle Lloyd, the innovation manager for the airline, addressed an event co-organized by Enterprise Ireland, the trade and innovation agency, in conjunction with the Dublin chapter of Travel Massive.

How to sell into the world’s largest airline

The purpose of the event was not just to showcase the breadth of global travel technology companies in Ireland, but to provide insights to travel tech start-ups about how to sell more effectively into one of the world’s best-known airlines. American Airlines is the world’s largest airline by any metric—fleet size, revenue, passengers, kilometers flown, and destinations served.

Ireland is an established hub for travel technology across a range of subsectors. Established players include companies like Datalex, a leading provider of eCommerce and retail software solutions to airlines such as Aer LingusDeltaJetBlue, and Virgin Atlantic.

Hostelworld is the world’s leading hostel-focused booking platform, with 30,000 in 180 countries. Personalization platform Boxever uses data and artificial intelligence to help companies such as Ryanair and Viva Air Group to make smarter customer interactions. Specialist room revenue agency Revanista provides solutions to hoteliers across Ireland and the UK.

Currently, more than 3,500 people are employed in the sector, creating a talent pool that has attracted more than 100 travel technology companies to base their operations in Ireland. In addition, Ireland is also the world leader in aviation finance.

How American Airlines tackles innovation

It’s an innovative environment that should prove attractive to American Airlines, famous for supporting innovation internally through initiatives such as its annual hackathon. Some 1,000 of the airline’s designers, developers, and IT experts travel to Austin, Texas for a 24-hour event where they are charged with ‘forming, storming and norming’ new apps of benefit to both customers and staff.

But the airline is also open to working with new technologies coming from outside the company. In all cases, the innovation team has a simple rule: “Save money or make money. Anything with those as its big focus will have eyes on their idea,” said Lloyd.

Currently, some of the most interesting applications the airline is looking at are aimed not necessarily at the travel space but in analogous industries, they said. Those pitching solutions, however, will find it’s not just their technology that will be evaluated, but themselves, including the strength of their business and their experience in what they are building, delegates heard.

The team, their depth of industry knowledge, and whether they are driving development themselves or outsourcing are all key considerations. Critical, too, is an assessment of whether or not they have the financial runway to stay the pace. Deal cycles with the airline are famously long.

“Have they raised enough money to cope? It can take a very long time, so really it’s about evaluating the companies as much as evaluating the technologies,” said Lloyd.

The speed and efficiency with which American Airlines is engaging with companies is improving. The airline currently has 20 internal teams with the word ‘innovation’ in their title and is developing its own innovation practice. Part of this is around ensuring greater understanding internally of the power of core, adjacent and transformative innovation, said Lloyd.

How to deal with an airline as a start-up

Helping the airline’s innovation shows what the world looks like to a start-up, something which many of them have no experience of, is helping too. Dealing with any airline means working with numerous stakeholders. To make it easier for the airline you are selling into, provide structure around what you are building and providing, make it easier to work with you by providing a contact, facilitate the process by being accessible.

“And above all, be patient,” said Kaiser. “If the airline is not ready, don’t push it. Give the process time, otherwise, it will not end well.”

Make sure you really understand the process and all the stakeholders involved. Understand that American Airlines has 140,000 people across the business. Accept the fact that there are many stakeholders, and tons of different people will be involved in what you are doing. Be patient, trust the process. For certain, do not attempt to bypass the system by going around a stakeholder who has already agreed to champion you.

The airline will work with certain start-up accelerators in strategic areas, including Dublin and Toronto, said Lloyd. The appeal of these regions is that they offer a model wherein the government, through working with Enterprise Ireland, academia and the corporate sector all work closely with start-ups to help them succeed.

Opportunities for travel tech in the airline sector

Meeting attendees learned that the commercial opportunities for travel technology in the airline sector are enormous, with the fact that unaccompanied teenagers must still walk around with lanyards around their neck being a simple case in point.

“We’re far behind as an industry with the whole digital experience,” said Kaiser. “Digitizing processes will not just boost efficiencies, but potentially drive new revenue opportunities for airlines too, including in the provision of new services.”

Airlines are particularly keen to cover the complete travel journey, from the home to the airport and on arrival, “what they do when they get there,” said Kaiser.

All along the way opportunities exist where current procedures remain paper-based, or where infrastructure needs digitizing, such as cameras at gates. Whether it is through providing computer vision or tracking events, or anything from logistics, to data, to efficiencies in terms of how aircraft—and component parts—are moved, are all areas of opportunity right now.

Customer experience is another area the American Airline’s innovation team is giving its attention to, including apps that can provide passengers with information about their flight and directions to their gate as soon as they arrive at the airport.

“Basically, anything that focuses on making the details of the user experience more pleasant—before, and during, booking, before and during check-in, and while in the air,” said Lloyd. “WiFi service, which would allow customers to browse and allow the airline to make a little extra money too, is definitely something we are looking into.”

Future trends in travel tech

In terms of wider future trends, the rise of megacities will be a major factor driving future innovation. Simply getting to the airport is already becoming increasingly challenging. Airlines will be looking for solutions to make the trip to the airport faster.

“That’s definitely an area we are looking into and which is quite urgent,” said Lloyd, pointing out that, perhaps surprisingly, one of the newest competitors on the Austin-to-Dallas route is a plush bus service. “It’s eating into our market share. Getting people to your gate is an area we’ll see the biggest changes in.”

From a technical perspective, it’s all about IoT, biometrics screening and increasingly contextual data, explained Kaiser. “Passengers will see more of the right data being presented at the right time. User preferences will get better and provide more of the information travelers want, when they want it.”

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