together, let's build airline industry retailing · 17.2 the new industry baseline. ndc live...
TRANSCRIPT
Together, Let's Build Airline Industry Retailing!
23 – 25 October 2018, Rome, Italy
AIR Symposium I 23 – 25 October 2018 I Rome Italy
Digital Marketing WorkshopPassenger Acquisition Strategies
and How Marketing Investments Affect Distribution Costs
AIR Symposium I 23 – 25 October 2018 I Rome Italy
Digital Marketing Workshop
Marc HeinickeAssistant Director Marketing
IATA
AIR Symposium I 23 – 25 October 2018 I Rome Italy
NDC Update
Claude MullerHead New Distribution Capability
IATA
Together, Let’s Build Airline RetailingNDC Program UpdateOctober 2018
NDC Basics
What’s the market problem?
Airlines
• Don’t have the freedom to distribute their products across channels without being commoditized
Travel Agents Customer Experience
• Can’t easily access many airline products that are available on the airline direct websites
• Is not consistent depending on where they search for travel and not rich when shopping through travel agents
What do airlines want?
Revenue opportunities:• Differentiation (product description)• Merchandizing (ancillaries, fare
families)• Personalization (based on loyalty,
preferences)• Dynamic Offers (based on
personalization and other features)
Cost savings: • Innovation & Competition
• To modernize the way air products are being retailed to travel agents, corporations and travelers
• A travel industry supported program for the development and adoption of a new data transmission standard
• Full-service and low-cost airlines
• Content aggregators and travel agents
• Corporate Buyers and travelers
Together, Let’s Build Airline Retailing
Why NDC? What is NDC? Who will benefit from NDC?
Global Distribution
Systems
Faresvia 3rd party
TravelAgents
(TMC | OTA | Independent)
Airline
Schedulevia 3rd party
AvailabilityAirline
e-commerce engine
Travelers
(Business | Leisure)
How Flight Distribution Worked
Airline
Content Aggregators
(GDS | New Entrants)
TravelAgents
(TMC | OTA | Independent)
Airline
AirlineOffer & Order
ManagementSystem
Travelers
(Business | Leisure)
Content Aggregation
NDC
NDC
Airline Retailing Works
Compare airlines mainly on price and schedule
Source: Expedia 27th November 2017
Today’s shop interface
Enabled by NDC
Full airline products seen by consumer via travel agents Tomorrow’s Shop Interface
Tomorrow’s shop interface
Information here is purely for illustration purposes.
Enabled by NDC
Comparison shopping capability
Information here is purely for illustration purposes.
Tomorrow’s shop interface
NDC Program Update
A new structural baseline
Industry feedback:
• A robust standard as a new baseline
• Provides functionalities to go for critical mass
• A solid base to invest in
17.2The new industry
baseline
NDC LiveImplementations-
65NDC Certified Deployments
Level 3 Airlines as of 17/10/2018
Aegean AirlinesAer LingusPJSC AeroflotAir AustralAir CanadaAir ChinaAir FranceAmerican AirlinesAPG AirlinesAustrian AirlinesAvianca AirlinesBritish AirwaysBrussels AirlinesCathay Pacific AirwaysChina AirlinesChina EasternChina SouthernColorful GuizhouCondorCORSAIRDelta Air LinesEmiratesEtihadEthiopian Airlines
Shandong AirlinesShenzhen AirlinesSichuan AirlinesS7 Siberia AirlinesSilkAirSingapore AirlinesSunExpressGermanySunExpressTurkeySWISST’way AirTaca International AirlinesTAP Air PortugalThomas Cook Airlines ManchesterTurkish AirlinesUnited AirlinesVirgin AtlanticVueling AirlinesWestJetXiamen Airlines
EVA AirFinnairFlybeflydubaiFlyEgyptGOLJiangxi AirHainan AirlinesHong Kong AirlinesIberiaIberia ExpressInselAirKLM Royal Dutch AirlinesKorean AirLufthansaNorwegian Air ShuttleOlympic AirOnur AirQatar AirwaysQantas AirwaysRotana JetSaudi Arabian Airlines
System Providers certified & capable to date-
62• 46 IT Providers - Capable• 16 Aggregators - Certified• Includes 5 Start ups
Aaron Group
Airlines Technology
AirGateway
AirSkyInformation
Amadeus
APG
ATPCO
AtriisTechnologies
Beijing Asia Technology Co
BirdresTechnologies
Conztanz
Caravelo
Datalex
DXC Technology
Farelogix
HitchHiker
Hitit
IBS
Indra
Infiniti Software Solutions
Sabre
SAP Customer Experience
Shanghai Aqueduct Information Technology
Shree Partners
"Sirena-Travel" JSC
SITA
Skyscanner
TOPAS
TPConnects
Travelfusion
TravelNDCTechnology
Travel Planet
Travelaer
Travelport
Travelsky
VerteilTechnologies
WTMC
WinteliaTechnology Co
TravelgateX
Information Systems Associates
InteRES
ISO Software Systeme
ITA Software by Google
Iween Software Solutions
JR Technologies
KAYAK Software Co
Maureva
Marco Polo Technology
Navitaire
Nemo Travel
On Travel Solutions
Openjaw
Polarium Co
Pribas
PROS
QuadlabsTechnologies
Reserve
• Certified Level 3 in July 2018
• Certified Level 3 in September 2018
• Certified Level 3 in December 2017
GDSs have become Level 3 NDC aggregators 2018
Sellers certified to date-
AL Maghseel International LLCChina Air Service Ltd.Chongqing Yunshang International Travel Service Co.,LimitedClick TravelClub TravelCorporate Travel ManagementCtrip.com International Ltd.DnataFlyazmeel.com (Azmeel International Agency Tours & Travel)Hogg Robinson GroupJebsenTravel LimitedLogitravel GroupSerko LimitedSuperior Tracks Travel & Tourism –Zeeyarah.comTravelCCTravel PlanetTripadvisor, LLCViaflight.com (Talent Travel & Tourism)WTMC
19NDC Certified
ImplementationsIncludes 6 TMCs
Latest industry announcements
Business Travel engagement
Corporate Buyers also see opportunities with NDC
• Customer experience - Segment traveller types and personalise their trip
• Content - Improved, rich content, to match brand.com
• Cost - Greater visibility of fare types & ancillary costs
• Control – Could encourage the traveller back into the chosen channels
• Total management: TMCs taking a more strategic role
• Real-time: TMCs leveraging the combination of deeper supply chain relationships, more dynamic technology & better data to support the corporation & buyer along the journey, in real-time
• The power of personalization: Personalization applied at corporate & individual levels to improve engagement & service satisfaction
Corporate buyers envision the future of the TMC
• Customer service: To help them be more customer focused
• Efficiency: To make selling airline ancillary products more efficient
• Competitiveness: To better compete with airline websites
Travel Agents see NDC as an enabler
Travel Agencies have their reference architecture
Objectives1. For TMCs to think about their future
IT (from small to large TMCs) 2. For IT providers to identify technology
needs and build solutions 3. For airlines to better understand the
TMC mid and back office implications
The road to 2020
NDC Roadmap set with IATA Board
The NDC Leaderboard is growing
NDC Tools & Comms Channels
NDC Certification Registry• Up-to-date list of all companies that are considered NDC
Certified/Capable
Dedicated NDC Microsites• For Airlines, Business Travel and Developers
Change Readiness Guide for Airlines• A support tool for airlines planning their NDC enablement
from defining the vision and strategy to initiating the program
Info tab on iata.org• To access white papers, dedicated microsites, case
studies and guidelines around the NDC standard
For more information subscribe to the NDC Hubwww.iata.org/publications
AIR Symposium I 23 – 25 October 2018 I Rome Italy
The Lines Between Marketing and Distribution Are Blurred
Pablo CaspersChief Air Supply Officer
Odigeo
1
eDreams Odigeo
Rome, 25th October 2018
2
We are a leading player in Europe, with more than anybody else
European flight revenueEstimated Long-tail of other OTAs (not-exhaustive)
339
c. 190
c. 100
c. 1501
SOURCE: Industry Research; Amadeus MIDT data1 Including acquisition of eTravel SA
Scaleadvantage
3
2
2
1
1 1
1
2
1
European OTA flight market share
eDreams ODIGEO: the leading flights retailer in Europe
#1# Market
position
CoreExpansion
SOURCE: Internal analysis; Amadeus bookings data; Phocuswright European Travel Overview Thirteen Edition
eDreams ODIGEO is the leader in the European online leisure travel market
Scaleadvantage
30%27%
2016 2017
4
Overall our technology has significant scale and allows us to offer
customers the best experience
Our
platform is
built forscale
1 billion
monthly searches
120,000
peak searches per second
8 billion
pricing calculations per hour
80 million supplier
searches per day
Scaleadvantage
35
SEM bids per second
SOURCE: Company Information
245
Websites both desktop and mobile
43
countries with eDO presence …growing
> 600 airlines
> 155.000 flight routes
> 1.700.000 hotels in 40.000 destinations worldwide
88% faster results
Through machine based learning proceses
8 billion daily automated predictions
through machine based learning
5
Benefits for airlines working with OTA’s
Key points
Marketing: Requires enormous technical scale, reach, skills and
experience.OTA’s core competency.
Cost efficiency: OTA is a pure online booking specialist - it is cheaper for airlines to leverage OTA’s specialization rather than
every airline re-inventing the wheel
Opportunity: International presence, new and faster
developments, benchmarks and big data identifies important
opportunities for collaborating carrier
Revenue: OTA traffic, increases revenues as airlines can partially
not access to this audience.
M a
r k
e t i
n g
R e v e n u e
C o s t O p p o r t u n i t y
6
Benefits for airlines working with OTA’s
Key points
Marketing: Requires enormous technical scale, reach, skills and
experience.OTA’s core competence.
Cost efficiency: OTA is a pure online booking specialist - it is cheaper for airlines to leverage OTA’s specialization rather than
every airline re-inventing the wheel
Opportunity: International presence, new and faster
developments, benchmarks and big data identifies important
opportunities for collaborating carrier
Revenue: OTA traffic, increases revenues as airlines can partially
not access to this audience.M
a r
k e
t i n
gR
e v e n u e
C o s t O p p o r t u n i t y
7
Marketing approach & scale
8
We have a market-leading performance approach to marketing
Customer Acquisition managed on profit
Marketing and pricing actions based on micro level insights
Automate and leverage technology and capabilities always at highest actual level
▪ Marketing spend is based on profit not cost▪ Every system, decision and algorithm is based purely on optimizing
profit, rather than spend. All partners benefit from this approach
▪ Bidding systems built around propensities to understand at a micro level the marginal and full costs, and marginal and full revenues of each search and product. Steering can be done with great precision
▪ This allows us to optimize marginal and full profit per transaction
▪ Use our scale to automate and leverage technology as a competitive advantage
▪ Matched with highly analytical skills and capabilities that we can afford to employ to help steer the business on a daily basis
▪ Cost-free technology benefit for all partners who can never reach this level of capabilities or only at very high cost
9
In SEM, our unrivalled scale and technology capabilities allows us to tailor strategies for each local market
+325mnKeywords monitored
+63%Mobile click share on Google FL campaigns
5.8bImpressions per year
+200mnClicks per year
Managing incredible scale…
…underpinned by world-class technology and data usage…
+1mnBid changes every day
Proprietary toolsTo automate campaign management and reporting (SEMBox)
35 Bids per second
1.5 TBDatabase to support bidding
…to deliver tailored strategies for our local markets, customers and their preferences
36 markets Multi-product Including flights, hotels, cars
5 brands
2 business
modelsOTA and Meta
Multi-engineGoogle, Bing,
Yahoo, Yandex
Multi-deviceIncluding mobile
optimisation
…able to identify and attract all demand in the market
…granularity allows us to bid more efficiently than others
…we give our partner access to customers across technologies, markets and devices
10
Leading SEM capabilitiesOur distinctive capabilities
▪ Automated bidding based on real-time feed of micro costs and revenues▪ 1 Mio. Bid changes every day, 35 bids per second
▪ Dedicated SEM technology team▪ Able to customise every part of the journey incl. landing pages, mobile, ad copy
▪ Significant scale allows faster A/B tests, delivering better results▪ Multiproduct campaigns: Flights, DP, Hotels, Cars, HP, Brand▪ Multi engine: Google, Bing, Yahoo, Sapo, Yandex▪ 36 markets, 6 brands, 2 biz models (OTA & Meta)
▪ Built proprietary tools including SEMBox for better visibility and forecasting▪ Keyword A/B ability on hour by hour bases▪ Enables ROI or volume steering
▪ One of Google largest flights clients worldwide▪ Exclusive access to Google Data▪ Of the few companies worldwide participating in Google pilots
11
We are running and further building market-leading SEO capabilities
▪ Landing page technology that allows to test and optimize at large scale in short development cycles
▪ Large scale, with millions of landing pages tailored to different customer needs▪ Top organic positioning in the travel industry for most European markets
Market-leading capabilities
▪ Internal linking algorithm to match site architecture to user behavior. Creates higher conversion, thus volumes to our airline partners.
▪ Content marketing increasing external links using proprietary user-generated data (e.g., best airports, best airlines). Also increases steering capabilities.
▪ Strength in mobile based on overall leadership in mobile bookings. Creates important channel knowledge to our partners.
Airline landingpages and customerreviews increase our SEO strength
Airline landingpages and (airline) route pages allowscollaboration with arilines to benefit from our scale and SEO capabilities
12
Mobile is gaining share progressively in the market and we are best positioned than anybody else in that marketMobile bookings continue to grow
Mobile bookings for flights%
SOURCE: Company information, Phocuswright's European Online Travel Overview Thirteenth Edition, AppAnnie
▪ 87% of total industry growth from 2017-2020 will come from mobile
▪ Continue to accelerate, making mobile our largest source of traffic in FY19
▪ 34% of flight bookings via mobile in Q4 FY18 (vs. 24% for rest of industry)
+10pp+9pp
+5pp+7pp
Industry Average
24%21%17%13%10%
High APP ratingsUpdate:
37%
13
Manage audiences, not just channels Anticipate customer needs
We focus on audience management and machine learning scale to drive ongoing improvements
ConversionRepeat business
AUDIENCES MOMENTS
CONTENT
▪ Differentiation for key strategic audiences throughout their journey, across all touch points
▪ Create coherent experiences▪ Optimise variable costs▪ Incremental and new audiences
for airlines
▪ Timing, frequency of interaction tailored to customer journey & preferences
▪ Medium used adapted to customer’s preference
▪ 360º presence at choice
▪ Machine learning output used to make product offering systemically relevant
▪ Commercial pressure, product visibility, product offering driven by propensity to book models
▪ Allows specific product offering and steering to our partners
Moving customers across channels and across products: increase lifetime value
14
Benefits for airlines working with OTA’s
Key points
Marketing: Requires enormous technical scale, reach, skills and
experience.OTA’s core competence.
Cost efficiency: OTA is a pure online booking specialist - it is cheaper for airlines to leverage OTA’s specialization rather than
every airline re-inventing the wheel
Opportunity: International presence, new and faster
developments, benchmarks and big data identifies important
opportunities for collaborating carrier
Revenue: OTA traffic, increases revenues as airlines can partially
not access to this audience.M
a r
k e
t i n
gR
e v e n u e
C o s t O p p o r t u n i t y
15
Value creation for airlines
16
Transaction feesCustomer Service
Cost of fraud
Traffic acquisition
25-36€
SOURCE: Airline and OTA annual reports, industry benchmarks
Additional investment also required for technologyand infrastructure to support these transactions
OTAs present a 50% cheaper means of indirect customer
acquisition for airlines
Estimated acquisition cost per booking (indirect traffic), EUR
1 Spend includes sales commissions to agencies, computerized distribution expenditure, and associated advertising and sales promotions. Based on airline annual reports and industry benchmarks.
2 Traffic acquisition based on Expedia, lastminute.com and Priceline results. Customer service and transaction fees based on Expedia results, cost of fraud based on internal estimates.
0*-20€
vs
Internal acquisition2External acquisition(via OTA)1
Airlines
DeveloperIT Infrastructure
* DCC scenario
17
Schematic SEM cost structure to generate incremental volumen on SEM
Average SEM cost
per booking
Bookings
▪ Marketing costs are not linear with volume
▪ Attracting incremental bookings (eg., to compensatevolume loss in agency distribution) requiressignificant sacrifices in spend efficiency
▪ This will drive up marketing cost per booking
…and marketing cost are highly exponential for generating incremental bookings
18
Scaleadvantage
This scale means we are best placed for online sales development and to serve the mobile travel customer
Mobile developer capability comparison, European OTAsFTE Dedicated mobile
IT
~70
400+
~50
~40~20 ~20
~40
OTA EOTA C
~30
OTA BOTA A OTA D OTA F
~60
OTA G
Scale and dedication enables speed, innovation and excellence for our product building, which positions us with
a huge advantage vs. competitors and airlines
19
Product buildingOur scale is balanced by a high level of agility to execute on ideas rapidly and cost efficient
Scaleadvantage
of top development talent
50+agile teams
Features released in last year1
6,177
Best case deliverytime from development to code live
15minutes
+330% A/B tests y.o.y. and therefore better insights
A/Btests
Users participating in testing monthly inCutting edge User Lab
300-500
SOURCE: Company Information(1) FY 2018
16
20
Benefits for airlines working with OTA’s
Key points
Marketing: Requires enormous technical scale, reach, skills and
experience.OTA’s core competence.
Cost efficiency: OTA is a pure online booking specialist - it is cheaper for airlines to leverage OTA’s specialization rather than
every airline re-inventing the wheel
Opportunity: International presence, new and faster
developments, benchmarks and big data identifies important
opportunities for collaborating carrier
Revenue: OTA traffic, increases revenues as airlines can partially
not access to this audience.M
a r
k e
t i n
gR
e v e n u e
C o s t O p p o r t u n i t y
21SOURCE: Amadeus IT Group, 2016 analysis
The demand an OTA brings to an airline allows them to improve
their yield management
Amadeus analysis on LCC booking data.
Each incremental 1% of
demand is worth an extra
0.8% revenue
to the airline and
increases load
factor by 0.4pp
Airlinew/OTAdemand
Airline
Airline has to sell more seats at cheaper prices with lower demand
Extra demand allows an airline to close cheaper fare seat categories earlier,
and therefore charge higher rates for the same seats
Airlines
22
OTA Customer Value proposition & partner advantages
choice & comparison vs. specialist
- Sales steering- Data & benchmark
- Constant growth- Large volumes
- Growth focus- Reduced seat-only competition
- Global scope, 43 countries- Reach, 12 bio searches p.a.
- Airline mix, virtual interlining- New schedule creation
- Excl. user group, high yield- Frequent traveler
23|
Thank you.
Thank you.
AIR Symposium I 23 – 25 October 2018 I Rome Italy
The Alliance Perspective: On the Runway to Airline Retailing
Mauro OrettiVice President Sales & Marketing
SkyTeam
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IATA Airline Industry Retailing Symposium - Rome, 25 October 2018
MAURO ORETTI, VICE PRESIDENT OF SALES, MARKETING & CUSTOMER
EXPERIENCE – SKYTEAM
The alliance perspective: on the runway to airline retailing
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SkyTeam20 member airlines
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Facts & FiguresSkyTeam by numbers
Destinations 1074
Countries 177
Daily Departures 16,609
Number of Lounges 600+
Annual Passengers 730 million
FFP members 200 million
Interline passengersTransfer passengers
28 million8.5 million
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Will we all be Amazon of the air?
• SkyTeam’s member airlines are evolving along with the new reality in the value chain, taking into account the shifting Distribution landscape (NDC, Offer/Order, i-EMD…) and the new opportunities this entails
• As an alliance, SkyTeam is developing technology to enable its members to cooperate in this new environment
• And, help its customers solve common pain points
How SkyTeam is refocusing on customer and technology
Customer Technology
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5
Identifying customer pain points
Research commissioned by SkyTeam* identified a lack of digital seamlessness in retailing one of the top travel gripes
• 60% of travelers have experienced and been inconvenienced by a lack of a complete ancillary offering across multiple carriers
• Two-thirds of business travelers identified choosing a seat on all flights as being ‘very important’
• 7.5 million, the amount of customers that are expected to benefit annually, from the improved online experience offered by SkyTeam’s new Seamless Seats & Ancillaries program
*Source: Atmosphere Research Group - 2017
Research – what our customers expect and need
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Addressing basic customer expectations
When it comes to buying ancillaries in a ticket involving more than one airline, two major seams exist:
We are solving the .com seam for interlining ancillaries
The interline seampassengers are unable to buy
ancillaries on a leg of the flight if a second carrier is involved
The distribution seamProduct offerings differ depending on the channel (.com vs GDSs)
Seamless Seat Maps and AncillariesSolving basic service customer pain points and generating additional revenue
Pain Points
With interline tickets, often customers:
• can’t view the seat map
• can’t make their seat selection
• can’t select preferred seats
• can’t change seats
• can’t purchase baggage ancillaries
All of which leads to inconvenience and stress
The result?
Travelers are frustrated…
p7
The solution? Introducing…
Advantages
• Bridges providers and message formats (both NDC and non-NDC)
• Provides airlines with numerous options if they want to add new functionalities
• Enables leaner and quicker development of new IT-services
• Delivers a more consistent customer experience
• Quick time to market
Seamless Seat Maps and AncillariesSolving basic service customer pain points and generating additional revenue
Solution
• Exchange seat maps and cross-sell ancillaries through the SkyLink Digital Spine
✓Bridging differences betweensystem messages
✓Marketing carrier’s look and feel
✓Operating carrier’s product characteristics and prices
• Delta and AeroMexico were the first members to go live with the SkyLink Digital Spine on August 2nd, 2018
• More members will follow over the next two years
MMB
A small step, but a significant oneThese are the first bricks of a Value Creation Hub (VCH)
• Today, SkyTeam’s focus is only on this relatively small segment, MMB (Manage My Booking)
• This technology can really open up a new world of possibilities
Overall Ancillary landscape
1) Connect up to 360 airline pairs
2) Expand to the Initiate Booking phase
3) Expand to the Check-in window
Sold indirectly
Sold directlyAirlines.com, call centers, etc.
Initiate Booking
TMCs,OTAs,etc
Check-in window
Reservation window
• Seamless check-in
• Track and trace for baggage
• Using miles as currency (enhancing loyalty)
• Purchase additional baggage
• Upsell from economy to business (includes using miles)
• Lounge access, Wi-Fi, meals, …
The future opportunities are endless…We have been just scratching the surface
This innovation may significantly enhance the customer experience and enable a wealth of additional opportunities by offering, among others: - …
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AIR Symposium I 23 – 25 October 2018 I Rome Italy
Understanding the Path to Purchase
Surain AdyanthayaSenior Vice President
PROS
Understanding the Path to Purchase
Surain AdyanthayaPrincipal, Travel Product InnovationPROS
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.2
the airline industry RM and pricing leader
2018
1985
1000+
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.3
3 OUT OF 5AIRLINES
2/3 OF ALL THE WORLD’S FLIERS
6CONTINENTS
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.4
©2016 PROS, Inc. All rights reserved. Confidential and Proprietary.
Airlines are Embracing a New Era of Modern Commerce and Digital Business
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.6
The Buyer Experience has Changed Forever
Digital, social, and mobile are the new front doors
Buyers flow seamlessly across multiple channels
Time is the new currency
Self service and price transparency are the new normal
Buyers expect frictionless interactions, every time
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.7
Airlines want full control of every offer/sale
Segmentation, WTP,
Dynamic Pricing & Packaging
Kayak, Orbitz …
Airline.com
GDS
A single dynamic offer optimization
product!
Customers
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Real-Time Dynamic Pricing
O&D RMDynamic Pricing Science and AI
Group Sales Optimizer
Shopping and Merchandizing
Offer Optimization
LegRM
IndividualizationFull Realization of Modern Commerce
Vision Path to Airline Modern Commerce
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Dynamic Pricing Science and AI
Individualization
LegRM
O&D RM
Real-Time Dynamic Pricing
Full Realization of Modern Commerce
Group Sales Optimizer
Shopping and Merchandizing
Offer Optimization
PROS’ Vision Path to Airline Modern Commerce
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.10
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AI has an Important Role in Modern Commerce
AUGMENTPricing & RM User Expertise
GENERATEIntelligent
Offers
CREATEPersonalization
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Shopper DNA: Personalization à Individualization
“Time to booka vacation”
§ VACATION§ CONVENTION§ STUDY
CONTEXT
§ EUROPE§ JAPAN§ U.S.A.
CULTURE
§ RENTAL CAR§ HOTEL
TRAVEL ADD-ONS
§ NATURE§ SHOPPING§ CITY CHIC
ENVIRONMENT
§ CHINA EASTERN§ AIR CHINA§ CHINA SOUTHERN
BRAND§ PREMIUM§ BUDGET
PRICING
§ FIRST§ BUSINESS§ PREMIUM ECONOMY§ ECONOMY
CLASS
§ BEACH TRIP§ SKI TRIP§ GRADUATION
OCCASION
§ BAGGAGE§ LOUNGE§ DUTY FREE
ANCILLARY
Jasmine
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.13
Airport City State
Country Region
Destination Type
TravelerLIK
ESIN
QUI
RED
ABO
UTINQUIRED
ABOUT
TRAVELED TO INQ
UIRE
D AB
OUTLIV
ES IN
IS IN
IS IN
IS IN
IS NE
AR
IS IN
IS IN
TRAV
ELED
TO
HAS
TYPE
Destination
Shopper Insights
©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.14
Utilizing Data from Varied Sources
How can I help you?
Structured data
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©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.
Offer Optimization Using AI
Product DNA
Shopper DNA
Context
Product Images
Product Descriptions
User Reviews
Lifestyle Content
External Data
Gamification
Clickstream
Search
Explicit Profile
Purchase History
Social Opt-inANON
YMOU
SAUTHENTICATED
Channel
Location
Day + Time
Intent
Season / Holidays
Insights that Create Conversion
andLift Engagement
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Behind the scenes:Recommender System for Personalized Offers
Feedback Loop
ATPCO Services Conditions
Aircraft information
?Query
Customer Context
• Location weather• Nature of trip
Context Information
Customer Information
• Customer type• Customer persona
Product Information
• Type of services • Flights they are offered on
personalized, relevant ancillary & package offers
Recommender System
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New Revenue Opportunities with Dynamic Pricing
NEW REVENUE GAINED WITH VARIABLE PRICING
# OF PASSENGERS
$0
$300
$550
$200
FARE
$375
$300
$225
$205
$175
$125
$500
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Personalized Ordered Ancillaries
AnonymousSteve
Personalized
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Personalized Branded Fares
Personalized Ancillary Bundle
Unique, personalized offer prominently displayed
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The Customer-centric Digital Experience
Data-driven
End-to-end
Real-time
Personalized
Omni-channelOmni-device
Passenger, shopping & RM data
Fast, live during the traveler e-journey
From inspiration to post-trip
Tailored to passenger needs, journey context
Across all digital touchpoints©2018 PROS, Inc. All rights reserved. Confidential and Proprietary.
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PROS HeadquartersHouston, Texas3100 Main Street, Suite 900Houston, TX 77002, USA+1-800-555-3548
PROS San Francisco101 Montgomery Street, Suite 400San Francisco, CA 94104, USA+1-415-283-3000
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PROS SydneyThe ArkLevel 32101 Miller StreetNorth SydneyNSW 2060Australia+61 2 8912 2199
PROS DublinOrmond Building31-36 Ormond Quay UpperDublin 7Ireland+1-800-555-3548
Thank You
AIR Symposium I 23 – 25 October 2018 I Rome Italy
Airline Distribution as a Digital Pure Player
Kevin WangGeneral Manager of Flights APAC
AIR Symposium I 23 – 25 October 2018 I Rome Italy
Final Remarks
Marc HeinickeAssistant Director Marketing
IATA
Together, Let's Build Airline Industry Retailing!
23 – 25 October 2018, Rome, Italy