The airline world is in need of new business models – Experts discuss change in aviation at the Hamburg Aviation Conference

2013-02-14 — /travelprnews.com/ — Michael Eggenschwiler, Chief Executive Officer of Hamburg Airport, is certain that “the world of the established airline is in need of new business models.” Many traditional airlines, including Lufthansa and Air France, are already looking for new ways of commercially viable operation and are launching low-cost subsidiaries for the short and medium-haul market. Current forecasts from organisations such as IATA (International Air Transport Association) and ADV (German Airports Association) predict stagnation in passenger numbers, particularly for European aviation.

The Hamburg Aviation Conference has taken this current issue as its theme. Experts from the commercial and academic spheres will attend the international gathering from 14 to 15 February to explore the extent to which the aviation industry has reached its limits as well as how it deals with disruptive elements. The official title of the conference, being held at Hotel Sofitel Alter Wall in Hamburg, is  “Aviation industry at its limits? How to cope with disruptive elements.”

Rise of the low-cost airlines

A thorough assessment of the situation will be provided at the Hamburg Aviation Conference by former head of Air Canada, Montie Brewer. Today, his various activities include membership of the Board of Directors at the airline Aer Lingus. He is also a member of the Advisory Board for the Hamburg Aviation Conference. His assessment of the current market situation: “The rise of the low-cost airlines has put traditional airlines under enormous pressure to either adapt or go under.” He attaches great importance to customer communication via smartphone for the future development of airlines.  “If an airline does not have the means to manage online customer relationships via mobile devices, it is highly likely that these customers will be lost,” says the airline expert.

Building on these thoughts, airport CEO Michael Eggenschwiler observes that “in order to succeed, the airlines must know and adopt their customer’s point of view. This will certainly not be easy for airlines that have, until now, been strongly focussed on product offerings. ” Passengers have internalised three important principles:they know that flying has become cheaper; the expect more service for the same money; and they have the power of choice. Brand strength has therefore become the key for airlines, because it creates brand loyalty on the part of the passenger.

Passengers exerting pressure on companies

Social networks place passengers in a position where they have power over companies. Today, the mobile internet allows customers to rate services immediately – whether positively or negatively. “Customers demand transparency. These days, they will not put up with any negative surprises – instead, they will punish them immediately with their online social power,” explains Ursula Silling, business consultant in the aviation industry and member of the Hamburg Aviation Conference Advisory Board. Critical customers expect to receive the service promised by the airline, without any hidden unpleasant surprises, and with tailored service. This includes automated check-in, real-time flight updates as well as the possibility of ordering in-flight meals and duty-free shopping in advance.

If airlines are to continue being successful in the future, they must become more innovative and offer their customers personalised service, tailored to individual wishes and expectations. “Ecommerce and mobile commerce, i.e. sales via the internet and mobile devices, are redefining not only product offerings but also demand and consumer expectations. We are currently living through a period of change on a level with the industrial revolution,” concludes the international industry expert, Ursula Silling, in her assessment of the influence of modern communication technologies on aviation companies.

Changed business models for airlines

Michael Eggenschwiler is convinced that the new airline business models now being formed will each build on a single pillar. Emirates, for example, will be a long-haul carrier with a hub in Dubai. British Airways will be a specialist for global air traffic to and from London Heathrow, and Condor will be the specialist for European and international summer sun destinations.

The role of the airport

Airports have a central role to play in looking after passengers. “Today, the passenger is our common customer, passed from one point to another in a constant flow within the airport family, experiencing the individually booked elements of the journey as an integrated chain,” says Michael Eggenschwiler. “We, the airports, function as integrators and moderators. We can get involved in the process chain and meet the varying needs of all participants.“ Airline alliances will also gain in importance. The needs of their individual members often differ greatly, and airports need to be able to respond to this flexibly. “In the future, the airport will be a platform for airlines to position and differentiate themselves in the competitive marketplace. It is an airport that makes the range of product offerings on the ground possible and commercially successful,” says the airport CEO.

With the help of aviation experts along with thought leaders from outside the industry, participants in the Hamburg Aviation Conference will analyse further trends in the aviation industry.  Speakers at this year’s conference include: Thomas Haagensen, head of easyJet Germany, Dr Mairead Brady, lecturer at the School of Business, Trinity College Dublin, and Jonathan Norris, Executive Director at Ink, one of the biggest publishers of in-flight magazines.

Location and languages

The Hamburg Aviation Conference is organised by Hamburg Airport.  The conference will take place at Hamburg’s Sofitel Alter Wall Hotel from 14 to 15 February. The conference languages are German and English, with simultaneous interpreting available.

Notice for Editors:

Participation in the Hamburg Aviation Conference is free for representatives of the media. Please register at hamburg-aviation-conference.de. Media representatives should go to the “Registration” menu and choose “Registration for Media.”

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