Post on 13-Dec-2014
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transcript
“Little Big 10” WIT Middle East Lecture #1:
Trends Changing Airline Distribution
Timothy O’Neil-Dunne
Managing Partner T2Impact/Co-Founder VaultPAD Ventures
2004• Janet Jackson had a wardrobe
malfunction• The Tsunami hit• Britney was the Bride of the year• Airlines were bleeding
• Esp in USA• Dynamic Packaging was the hot
topic• EC enacted Regulation 261• Reagan & Arafat died• Oil broke $50/pbb barrier (Oct)
WIRED 2004
And in Singapore..• A former journalist
and writer started a small meeting on the topic of electronic travel commerce.
2004 VS 2014 Competition?
X X X X X
X
Timothy’s Global Top 5
• Retailing. • NDC and Dynamic Pricing• Personalization • Bye Bye Boomers• LCCs Mature, FSCs become profitable
Retailing
• Travel is not so special any more – retailing is a mind set that has been alien to supply side but the consumer (Amazon trained) expects to have a conventional experience
• Warning Mobile Commerce for Travel is very very different. Profile, behaviour etc
• Social does not exert as much influence as people think.
MobilePayments in EU-5
Airline tickets WAY down the list
Is Travel eCommerce Topping Out?
NDC and Dynamic Pricing
• True Dynamic Pricing – real time direct pricing unique
• NDC – a realistic bridge too far or….• …Not enough and too late?• Why unconstrained Cache is hurting
everything
Traditional vs Dynamic Pricing
Today’s Pricing ModelsTraditional Direct Holistic Including Indirect
Next Generation Personalization
• Personalization and tools to help from ideation to selection – it is all about ME!
• Contexualization understanding the context and situation to create relevance for consumers
• Taking personalization to the next level...It’s really all about me now
Bye Bye Boomers
• The changing of the guard – Boomers exit – Millenials enter
• Changing Characteristics of the consumer• The issue of Trust
Who is the Consumer?• Millenials will be the
majority of air travellers• A fundamental shift from
traditional business/leisure to leisure and only important business.
• Their characteristics are very different
• #NOgreyhairedwhitedudes
LCCs vs FSCs
• Different models • Airlines want differentiation• Low Cost Carriers and Full Service Carriers
come closer together and mix.• LCCs add back frills (A kinder gentler Ryanair –
now back in the GDS – but what a deal)• FSCs make profits• Can the two meet?
The Evolving Airline Model
Economics• ROCI 7%+ (DL’s15%!)• Higher Density• Segmentation• A return to Robert Ayling’s
British Airways?• Maxing out the LCC model• Why First Class is uneconomic
Passenger/Brand Experience• Selling a broad brand in a
differentiated market• De-commoditizing a commodity
product• True Personalization/Retailing• Understanding the purpose of
connections• A la carte products tailored to
each individual customer
17
THANK YOU
Timothy O’Neil-DunneT: +1 425 785 4457
T:+44 7770 33 81 75 E: timothyo@t2impact.comE: timothyo@vaultpad.com
TW: @ProfessorSabena