Location Data to Increase Revenues and Customer
Satisfaction for Regional Airports
We live in a world where people seek for individual and customized services, that fit into their needs more than ever before. Airports, in order to increase their revenue, need to understand their customers and offer a better experience to their visitors. From the passenger’s perspective, a better experience means a fast and convenient process from the moment she enters the airport to the moment she reaches the gate.
Today, the satisfaction of passengers in airports is of greater importance to the cities, regions and governments. Airports are not considered any more as places of departures and arrivals, but instead, they are the first physical contact of tourists and the first impression of countries, therefore they play a critical role in tourism and other businesses. The global contribution of aviation to GDP was $2.7 trillion and airports have a great share in this contribution¹.
Furthermore, according to the ACI Airport Economics Report, 80% of all airports host less than one million passengers each year. These airports are mostly regional and secondary airports, and unfortunately, 94% of those airports are loss-making airports. Besides, the loss is inversely proportional with the satisfaction of passengers.
To improve customer satisfaction, airports need to comprehend passenger demands, problems and desires. Unfortunately, in the big data era, physical businesses cannot compete equally against digital businesses (e.g. e-shops, cloud platforms, etc.) in terms of customer knowledge, since the later have access to information such as customers’ preferences, favorite features and numerous of personal data. On the other hand, airports mostly operate based on intuition, estimates and gut feeling.
With rapidly advancing technologies, all businesses are forced to a digital transformation and eventually solutions for aquiring data in physical spaces started to exist. Similar to GPS in outdoor areas, there are now technologies to localize and track people in indoor areas. By tracking the crowds in airports, managers can get customer insights and better passenger understanding. To provide several examples,
– how much time it takes from the very entrance to each gate,
– which paths are being followed,
– where (e.g. check-in or security area), when and how much time each passenger
– which areas are visited the most and which areas are not visited at all,
– unique visits compared to returning visitors and much more can be derived from
There are limitless improvements that can be made thanks to data. For regional airports, a high margin of revenues depends on non-aeronautical activities, which is acquired from duty-free area, car-parking and other amenities. Airports can lease their space for these facilities and optimally locate them, not based on estimates, but on reliable traffic data. For duty-free stores, managers can see how many visitors are passing by the shops and how many of them enter inside, which products they visit and how much time is spent, and eventually whether the entrants buy anything or not. This is a great way to see marketing success, develop strategies, optimize pricing and maximize sales, which is very essential to prevent losses and finally make profits for regional airports. According to a McKinsey study², a 1% better pricing can lead to an 8.7% increase in operating profits.
How can data be used for customer satisfaction? Waiting times and long lines are mainly what annoys the air-travelers the most. By gathering data from passengers, resources (e.g. time, staff) can be allocated optimally to the most needed areas. For instance, if the average dwell time in check-in area exceeds 15 minutes, more counters can be opened. Passengers who have a positive airport experience spend 45% more than disappointed passengers³.
Major questions for low-cost airports are mostly about price, privacy regulations, accuracy of location and coverage of the visitors, and Ariadne Maps’ solution meets all these criteria.
Hasim Koc, Sales Manager