Now arriving: the in-flight storefront
With airlines netting millions from onboard sales of everything from food to travel packages, expect shop-as-you-fly options to soar.
The New York Times
Seeing a flight attendant trudging down the airplane aisle peddling boxed meals, or perfume off the duty-free cart, reminds me of a movie image: Mia Farrow as the cigarette girl lugging that tray of smokes through a nightclub in Woody Allen’s 1987 movie “Radio Days.”
Of course, the main responsibility of flight attendants is safety. But in recent years, airlines have been adding a lot more duties to the flight attendant’s job, including increased responsibilities for selling things in the aisles, among them food.
There is a financial reason. According to data cited by GuestLogix, a company that sells in-flight merchandising technology, global airlines will raise $46 billion this year from ancillary revenue — revenue other than from basic fares. About half of that will come from selling frequent-flier miles, mainly in deals with credit-card companies. Checked bag fees account for 20 percent. But the other 30 percent is derived from onboard sales, including purchases of food and drink, retail goods, Wi-Fi and in-flight entertainment, as well as revenue from travel package deals with hotels and others.
At the Airline Passenger Experience Association’s annual trade show recently, there was a lot of industry optimism heard about expanding in-flight sales, with airplanes as virtual “storefronts.” This is driven by the spread of in-flight Wi-Fi linked to passengers’ own smartphones and other devices, as well as increasingly sophisticated entertainment systems at the seat.
The good news for overworked flight attendants, I suppose, is that such optimism is driven partly by the rapid growth in consumer acceptance of self-service payments on the ground, from supermarkets and stores to swipe-your-card payment systems at parking lots, airline check-in desks and hotel lobbies. The perhaps not-so-good news is that at least from the airline perspective, there may be a whole lot more in-flight selling going on in general.
“Some airlines are looking at not only having the flight attendants as the retail channel, but also starting to look at in-flight entertainment systems as retail channels,” Ilia Kostov, the executive vice president for retail sales at GuestLogix, said in a panel discussion at the trade show in Anaheim, Calif.
Sophisticated in-flight entertainment networks “entertain passengers, but also engage them as consumers,” he added. “And they will open their wallets.”
Of course, the industry — and Kostov’s company — have a lot riding on seeing the airplane as a storefront selling food and drink, retail goods, movies and TV shows, and even “destination-based content” like hotels, rental cars and package trips. I’m a little skeptical, since the only thing I usually want on an airplane is my cup of apple juice and the opportunity to have some peace and quiet. Buying perfume or a necktie is not on my agenda.
On the other hand, my most recent business trip was to Los Angeles, and I did use the opportunity to go to a Dodgers game, as well as spend a few hours at the wonderful dinosaur exhibit at the Natural History Museum of Los Angeles County. So I might have been receptive to a carefully focused in-flight sales pitch for Dodger Stadium tickets or museums, through smartphone technology that already knows my schedule and has some idea about my tastes.
JetBlue and other airlines are already actively expanding such marketing opportunities in ground transportation, hotels, restaurants, theater, concerts and leisure activities. “For the first time, airlines are selling destination-type content on board,” Kostov said. “There is a lot of money being made selling attractions and ground connections.”
For every dollar passengers spend on airfare, “they spend two dollars for the things they do after they get to the destination,” he added.
Enhanced by the real-time ability to evaluate credit card information and the increased use of so-called chip-and-PIN cards to reduce fraud, self-service technology is creating that onboard storefront, Kostov said. “Flight attendants have been going up and down the aisle with carts and their handheld point-of-sale devices. But some airlines are now looking at not only having the flight attendants as the retail channel, but also looking at in-flight entertainment systems as the retail channel.”
David Pook, the director of applications for Thales Avionics, a major supplier of cabin entertainment systems, said, “The key here is to take the flight attendant’s role out of every step of the process and allow the passenger to take it as far as they can take it on their own” — at their own pace, not just when the cart comes by.
So it would seem that the flight attendant’s lot might become easier. After all, for much of the process, “the flight attendant isn’t involved, up till the point that the transaction is completed,” Pook said. For many new transactions, he said, “all the flight attendants need to do is deliver the goods that have been ordered.”
Come on, flight attendants. You knew there was a catch.