EyeforTravel North America 2018

October 2018, Las Vegas

Understand how data, digital and partnerships can make your marketing work again

Up and away: the changing path of inflight entertainment

In an exclusive two-part Q&A with an expert from Lufthansa Systems, we hear how the airborne passenger experience is evolving

Ever been a frequent long-haul traveller and noticed that the same films turn up on different airlines time and time again?

There is a reason for that, says Michael Childers, Chief Consultant, Content & Media Strategy at Lufthansa Systems, who also sits on the board of directors of the airline passenger experience association (APEX), and chairs its technology committee.

Childers, who will be speaking at EyeforTravel Las Vegas on a panel with Erin Gilmore, head of travel & mobile app partnerships at Twitter, explains that Lufthansa Systems is not to be confused with the German airline. In fact, it is an IT company and a subsidiary of the wider Lufthansa Group, delivering IT services to its airlines that include Lufthansa German Airlines, Eurowings, Brussels Airlines, SWISS and Austrian. It also provides services to commercial airlines, as well as in other markets like hotels, ships, trains and buses.

Ahead of the Vegas event, Childers shares insights into how the air travel passenger experience is evolving. Watch out for Part 2 next week, where he reveals how airborne passengers are using personal mobile devices, the opportunities for blockchain in air travel, and even takes a peek into the crystal ball.

EFT: Airlines are often accused of being highly commoditised. Today, however, passengers are demanding a lot more in the way of content. How are airlines differentiating today?

MC: This has always been a major challenge in inflight entertainment (IFE) - how to differentiate your offering from everyone else while also booking the most popular content. In reality, every month most airlines end up licensing the same four or five Hollywood films. Movies are not licensed exclusively in IFE, so it comes as no surprise when everyone books the same blockbusters. Today, this means that airline differentiation with respect to content most often comes from secondary rather than primary content—art house movies, content of local origination, classics or themes.

EFT: So, giving customers a much wider range of options?

MC: Actually, one of the characteristics of the commoditisation of content is the increase in volume of content. The theory has been that the more content available, the greater the choice to the passenger. But the volume is often overwhelming. The real key to improving passenger choice in the future may be the ability of the airline to personalise the experience and to ensure that there is content onboard that can be shown that is of interest to each individual passenger.

One of the characteristics of the commoditisation of content is the increase in volume of content

EFT: In your opinion, what will the IFE systems of the future look like?

MC: Ours will have the ability to recommend content to passengers based on what we know about them. And, that same data analytics will give airlines the ability to target advertising to passengers based on their interests and needs. This may reduce the overall volume of content, and will surely reduce the volume of advertising. As airlines get to know their passengers better through data analytics they can provide a more personalised experience.

EFT: With airlines now actively harnessing customer data what do you see as some of the positive outcomes, and what are some the challenges?

MC: Clearly, the ability to personalise and customise the passenger experience is dependent to a large degree on the ability to capture and analyse customer data. But recent regulations such as the General Data Protection Regulation (GDPR) that became effective in Europe in May [2018] are strict, so the challenge is to obtain passenger consent to use this data responsibly. Some of the big names in travel, like Expedia, have studied ways to do this in a non-intrusive way.

However, if data analytics is used wisely, airlines can, for example:

  • Limit the ads that are delivered to passengers to those that are truly relevant
  • Recommend specific content for viewing based on what they know of passenger preferences
  • Personalise food and beverage services
  • Recommend merchandise, airport shops, and offer coupons that a passenger is more likely to use.

EFT: As recognised thought-leaders in the aviation and travel technology space, what in a nutshell do Lufthansa Systems aim to deliver?

MC: We aim to provide cutting edge digital platforms that support both inflight entertainment and connectivity systems, and we see these services becoming increasingly integrated. We also provide wireless inflight entertainment systems that use personal entertainment devices - whether passenger-owned or airline-owned - as the client side of the network.

EFT: But according to a recent Inmarsat survey, only around one-in-four planes currently in service offer some form of WiFi onboard…

MC: One of the concerns that airlines have brought to APEX on this matter is that installing onboard connectivity is expensive, but the ways of measuring the quality of service vary from supplier to supplier such that it is difficult to compare competing systems. Of particular concern is that many of the measurements offered are at an aircraft level versus a passenger level, making it difficult for an airline to understand what quality of service they are investing in for their passengers. In response to this, the APEX Technology Committee, which I chair, created a Connectivity Working Group. This working group chaired by Stephan Schulte of Lufthansa Technik aims to address the airlines’ concerns. Representatives from Inmarsat and Boeing aided in launching this group and activities are already underway. (More here in What inflight Wifi needs for take-off - EyeforTravel August 28, 2018).  

For more insights from Michael Childers join us for EyeforTravel Las Vegas (October 18-19)

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