“The word ‘survival’ seems to be ever present whenever crisis management is discussed. That is not a state to aspire to.” This quote from book author Louai Al Roumani offers astounding insights into what airlines and airports can learn from crisis management in Syria and why this is important for future strategies. Roumani directed strategy at Syria’s largest private bank, BBSF, throughout the current conflict – including IS blowing up his bank branches, frequent mortar attacks and constant kidnap threats. He knows how to think in a real crisis. As we survey the diverse reactions seen across the airline industry, perhaps we could take his advice and shift our perspective a little?
Roumani’s book on his experiences – ‘Lessons from A Warzone’ – (published 2 April, Portfolio Penguin), shares his extraordinary story and, from reading a pre-launch interview (The Times, London), I think it could help every company leader.
There are two pieces of advice he shares that really resonated for me in relation to the stunned response of the airline industry to the COVID-19 crisis:
For many airlines, Roumani’s lessons need to be learnt from the COVID-19 crisis – just as they perhaps should have been learnt from earlier crises – particularly as the fault lines in the traditional ancillary revenue model become ever-more apparent whenever new pressure is inflicted. Right now, that outdated model is parked up alongside the grounded planes – going nowhere, delivering no revenue.
It doesn’t have to be that way. Even passengers grounded and isolated can continue to provide a revenue stream. Forward-thinking airlines such as Singapore Airlines and Lufthansa have adopted Omnichannel approaches that are continuing to drive ancillary revenues right now, creating revenue and maintaining the customer relationship.
Customers want an Omnichannel experience that is available 24/7 on their mobiles and laptops. They want a seamless experience that meets their need for pre-planned purchases, leading brands across a hugely expanded range of product categories, personalized offers, convenient delivery options, etc. Before the next crisis, more airlines must respond by developing as lifestyle brands that reach their customers in more ways, delivering these needs and driving revenue and loyalty.
By integrating digitally into their daily lives, the airline transforms its revenue opportunity from a fleeting, vague opportunity that is tied to the ‘Golden Hour’ of the passengers being in their seats to a 24/7 opportunity.
When the next crisis hits – and it will – the Omnichannel strategy cannot provide total immunity from the fallout, but at least it creates the opportunity for the airline to think well beyond ‘survival’.
A three-part series of blogs showing how LCCs of any size have a proven, low-cost entry option to seize the digital initiative in driving their ancillary revenue recovery.
After 20-months of Zoom sessions it was amazing to be out in the real world again this month, flying the globe and actually meeting industry colleagues in person! Following the World Aviation Festival (WAF) in London I moved on to Future Travel Experience (FTE) in Las Vegas and it was so encouraging to find that these two major industry events, 8,000 km apart, echoed the industry’s increasing buzz around the digitalization of ancillary revenue. Sadly, I’ve now been brought back to earth by the latest twist in the crisis as Omicron looks to inflict yet another challenging phase. However, after two years of disruption the aviation industry knows it has to adapt to each new challenge and strengthen its ability to respond just as long as governments finally realize that locking down borders is a very short-sighted approach (unless you are an island state) and haven’t stopped any of the previous 4 COVID waves in any meaningful way. If the last two years have taught us anything, it is that airlines, like governments, will need to think a lot more globally than locally.
December’s World Aviation Festival in London was a great opportunity to bring the industry together and, although attendance was inevitably lower than normal, there was a strong conference program that carried a mood of guarded optimism. Best of all, I was delighted to see just how strongly the focus was on real action to drive ancillary revenue and recovery. Much of 2021 has been spent waiting for a recovery to be established and many airlines have understandably been hesitant (or unable) to commit to new investment or major change in their customer operations. The long hoped-for recovery has been impossible to forecast accurately and many airlines opted to simply ‘hunker down’ and wait until a clearer path can be seen through the storm. That strategy carries deep risks. We now face a new phase of crisis as Omicron sadly develops its global presence but the fact is that the world will continue to turn, people will continue to travel, the crisis will eventually recede, and traffic will return. Airlines need to be preparing right now to create the customer experience that the recovery will demand. Yes, the picture of how the 2022 travel market will look in recovery is still blurred right now - but the key point is that we do already know exactly what the returning customer looks like and what they want. We have a clear understanding of the experience they want - and we have the digital tools to deliver that experience.