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Trans-Tasman Business Circle Lunch – Rob Sharp Presentation

September 28, 2018 Aviation No Comments Email Email

• Good afternoon everyone and thank you Johnny for the warm introduction.

• Firstly, I would like to acknowledge and pay my respects to the traditional owners of the land on which we meet; the Gadigal people of the Eora Nation.http://www.itb-asia.com/press/media-services/accreditation/

• I would like to thank the Trans-Tasman Business Circle for having me here today. This Business Circle provides a strong network for us to explore opportunities and strategic growth initiatives both in Australia and abroad.

• I am delighted to be presenting to you on a topic that I am very passionate about, which is how to make travel easier in a complex environment.

• When 1.3 billion people travelled the globe in 2017 alone1, you can see why there is a growing need for airline operators such as Virgin Australia to implement new technologies into our operations to make travel as seamless as possible.

• Demand for travel is growing on a daily basis and we need to ensure that as passenger numbers multiply, we can accommodate this demand with easier ways of getting from Point A to Point B.

• It sounds like quite a straight-forward concept, but I will demonstrate today how travel is being transformed by the hyper-connected world that we live in and give you an insight into the behind the scenes work that ensures your travel is as smooth as possible.

Complexities of travel

• In today’s society, travel is more accessible than ever before and the number of tourists visiting Australia is growing, with over 9.1 million visitor arrivals to our country for the year ending June 2018, which is a six per cent increase on the prior year.

• Today, airlines such as Virgin Australia cater to all types of traveller needs and budgets. We have business and leisure guests; guests that travel on a minimal budget; and we can’t forget our millennial demographic of travellers – who are having an impact on the travel industry in more ways than one!

• Yet despite competitive airfares opening up new travel possibilities to a broad demographic of travellers, there are still some pain points when it comes to flying.

• For example, two of the first things that comes to mind when we think of travel is the cost and logistics involved. Travel can be expensive, especially if you make a last-minute booking and there aren’t many seats available on your chosen route.

• Yet I am proud to work for a challenger brand – Virgin Australia recently celebrated its 18th birthday, and that means we have been bringing strong competition to the aviation market for nearly two decades.

• We have been raising the bar in terms of customer service and on time performance and we have always offered competitive airfares to our guests, putting our competitors on notice as a result.

• A good example of this is our Hong Kong routes. When we started selling our Melbourne-Hong Kong fares last year, our competitors’ fares dropped by up to 30 per cent – demonstrating how we provide strong competition that creates a better result for our guests.

• But, research is showing that it’s not just the cost of airfares that our guests are focused on – there is increasing demand for airlines to tailor their products and services to individual needs to simplify the overall travel experience.

• Regardless of whether you are travelling for business or for a holiday break, there is one common theme that is becoming more prevalent within the travel industry – which is for operators to identify technological solutions to the common travel frictions experienced by our guests.

• Which leads me to the main point of my presentation today – how technology is becoming the driving force behind the simplification of travel.

How technological advancements are simplifying travel

• To put it in perspective, in 2017, the International Air Transport Association (IATA) shared the results of its annual Global Passenger Survey, and the statistics were staggering. Of the more than 10,000 passengers who were surveyed across 152 countries: o 82 per cent of passengers said that they would prefer to use a digital passport on their smartphone; o 64 per cent said that they would prefer biometric identification processes at check-in; and o 72 per cent said that they preferred self-boarding gates.2

• It goes without saying that the airlines who quickly adapt to the shifting dynamics of customer engagement will thrive in the modern travel market which is centred around apps, chatbots and other gadgets that further exemplify the 24/7 industry that we operate in.

• Our guests are becoming more tech-savvy and this has motivated airlines such as Virgin Australia to utilise technology in order to streamline the travel experience.

The self-service experience

• At the heart of making travel easier is the evolution of self-service technologies.

• Booking.com recently found that 80 per cent of guests prefer to use self-service to obtain the information they require and at Virgin Australia, we have invested in this technology to offer this option to our guests.3

• Take our airport experience for example. This year, Virgin Australia has focused on implementing self-service technology across many of our domestic airport terminals so that guests can check-in quicker for their flights. Earlier this year, we introduced self-service check-in kiosks for guests travelling from Adelaide Airport.

• Self-service is the way of the future as it eliminates queuing and congestion at the check-in halls and provides our guests with more flexibility.

• Self-service technology also frees up our team members on the ground to be able to provide more of a concierge service to our guests, which further complements the overall travel experience. I will talk about this later.

• As you all know, Virgin Australia is all about giving its guests choice and our Domestic Terminal at Perth Airport is another good example of this service.

• Just like Adelaide, Perth Airport also has self-service check-in and a self-service baggage drop for those guests who prefer to self-manage their check-in experience. Yet, we also offer the full checkin experience provided by Virgin Australia team members so guests have the option of how they would like to check-in, depending on their personal preference.

• Construction has also recently commenced at our domestic terminal at Melbourne Airport, where one of the key components of these works is to replace the check-in kiosks with new software and introducing automatic bag drop facilities – exemplifying our commitment to fast-tracking the airport experience for our guests so that they can make their way to their flight as efficiently as possible.

• With IATA indicating that by 2020 it wants 80 per cent of travellers to have the option of total selfservice at the airport4, this places a definitive timeframe for airlines to work with when identifying opportunities to make travel easier in the 21st century.

Smart Phone technology

• Yet when we talk about self-service, we also need to look at smart phone technology because it’s not just self-service check-in kiosks at the airports that our guests need to make travel easier and stress-free.

• Travellers now expect to be able to use their phones as a key tool in the travel process – checking-in for flights, accessing boarding passes, as well as being alerted to travel disruptions.

• And when it is estimated that the average Australian spends a total of 38 days of the year5 on their smart phone, it is no wonder that this device has become front and centre of travel behaviours.

• In the past financial year alone, nearly 16 million guests visited the Virgin Australia website from their mobile device, demonstrating the reliance on this mobile technology to access information and streamline the travel process.

• Virgin Australia is investing in mobile technologies in order to provide a more seamless travel experience for guests, along with providing guests with the ease and convenience of accessing our services from a mobile device.

• Starting from this week, our customer-facing Virgin Australia app will have additional functionality, such as improved three-dimensional airport terminal maps. From October, guests will have the ability to share flight information with family and friends and around Christmas time, new payment options and enhanced notification alerts regarding your scheduled travel itinerary are scheduled to be available!

• Later this year, we will also be delivering airport terminal augmented reality wayfinding leveraging Augmented Reality technologies. This will make it much easier to navigate through complex airports such as LAX.

• There is extensive investment in our app-based approach due to that fact that our guests are empowered by apps – they want direct control over their bookings and have higher expectations in terms of being notified with travel updates too.

• Machine learning technology is also being developed to simplify the interaction with our Apps, as we are planning for our Apps to present the next best action for you. The future of App-based travel is that when you are almost at the airport … you will be presented with the latest gate details whilst ordering a coffee. Or, when you are near the gate … your boarding pass will automatically open on your App. Your travel experience will become even more intuitive.

• Virgin Australia is working with its high-quality partner airlines including Singapore Airlines, Etihad Airways, Delta Air Lines and Hainan Airlines to enable integration of mobile Apps which will be available next year.

• This means that when you are on a Delta Air Lines flight in America travelling to Australia, the embedded Virgin Australia App functionality will be able to open up to enable check-in and seat selection. Likewise, the Delta App will be embedded in the Virgin Australia App … right at your fingertips!

• Smart phone technology has seen a major shift in traveller behaviour which has acted as an impetus for airlines to up the ante on our customer engagement strategies, which is seeing flow-on benefits to the overall travel experience.

The need to stay connected

• When talking about improving the overall travel experience, one of the most exciting developments this year from a product perspective has been the launch of inflight WiFi.

• A large majority of the audience here today would travel for business regularly. For business travellers, taking a flight was previously seen as being quite disruptive, especially when you have pressing deadlines to meet and no access to your emails whilst in the air.

• Virgin Australia recognised this need to stay connected and this year, we became the only Australian airline to offer WiFi on international services to and from North America, after we activated WiFi across our B777 fleet.

• Introducing WiFi across our B777 fleet allows our guests to stay connected whilst travelling abroad, which is especially important for our corporate demographic of travellers.

• We are also focused on activating WiFi domestically across our B737 fleet. With more than 50 per cent of our B737 fleet fitted with WiFi, this means that when you are travelling domestically with Virgin Australia, more often than not you will be travelling on a WiFi-enabled aircraft!

• Offering WiFi is a game-changer in more ways than one – it allows our guests to stay connected, meaning that emails can still be answered, posts on Facebook can still be ‘liked’ and your favourite series on Netflix can still be downloaded. More importantly, at this time of the year, you can stay abreast of the latest breaking AFL news!

• And inflight connectivity is not just reserved for our mainline services – we also ensure that guests travelling to remote areas of our network also have access to the latest inflight technology.

• I am proud to say that Virgin Australia is the only charter operator in Australia to offer wireless inflight entertainment across our charter fleet to cater to our Fly-In, Fly-Out guests.

• The ‘Bring Your Own Device’ movement is picking up pace and our wireless inflight entertainment charter product has embraced this framework.

• And that is the thing about making travel easier – it is also about making it more consistent across our mainline and regional services.

• Our guests want to see the same products and services on offer regardless of where they are travelling to and we make it a priority to provide consistency across our operations.

Artificial Intelligence, Machine Learning and Biometrics

• Yet inflight connectivity is just one small aspect of new age technologies that are enhancing the travel experience.

• It would be remiss of me not to mention the two letters that will transform travel in the years to come, that will not only create easier methods of travel, but will also open up new ways of accessing and collating data that will further improve how we engage with our guests.

• The two letters I am referring to is ‘AI’ – also known as artificial intelligence.

• Artificial intelligence allows airlines such as Virgin Australia to get to know its guests and their typical travel behaviours, which in turn allows us to tailor your travel experiences.

• Amazon Alexa is one of the latest additions to our suite of products that uses artificial intelligence as a means of improving how we engage with our guests.

• Alexa is a voice-controlled service that acts as a concierge service for our guests. If you have an Alexa-enabled device at home, you can ask Alexa the status of your flight or even for your Velocity Points balance. This saves you the hassle of having to log-on to your Virgin Australia account – Alexa does all the work for you!

• We are all about providing our guests with real time information and we are working to increase the capability of Alexa so that guests can rely on the device for all sorts of reasons.

• In the coming weeks, we will be adding more features to Amazon Alexa so that it can provide guests with even more information about their travel itinerary, so watch this space!

• Yet artificial intelligence is not the only technological advancement that is occurring in the travel industry. Virtual Reality is also becoming prevalent overseas.

• For example, German Airline Luftansa has created 360-degree videos of certain destinations6 such as Hong Kong and New York to entice travellers to book holidays to these locations. Soon, Happy Hour sales on our websites will be a thing of the past and travellers will be expecting these ‘real life’ advertisements to be accessible to be able to make informed travel decisions.

• When we are talking about making travel easier, what we are really talking about is making modes of travel more intelligent. And by intelligent, I am meaning more connected, more personalised and multisensory.

• As an airline, we understand that getting our guests to their destination on time is very important. Aircraft are very complex machines, yet I am pleased to inform you that the major airframe and engine manufacturers, such as Honeywell, GE and RR, are all developing digital platforms that harness embedded sensors and “big data” to enable more efficient operations.

• The software is designed to capture data and provide integrated solutions to operational problems including enhanced component reliability, enhanced flight path predictability and operational disrupt artificial intelligence.

• Virgin Australia Engineering are liaising with key suppliers to further enhance our reliability as an airline. Virgin Australia had the highest domestic On Time Performance in the last financial year and our core B737 fleet is also fully equipped with Electronic Flight Bags for our pilots, removing paper based navigational charts and forms, underpinning operational performance.

• So, as you can see, it’s not just the customer experience that is transforming at a rapid pace – a key component of making travel easier is also enhancing our ground and flight operations to make travel as seamless as possible moving forward.

The human element

• Despite technology eliminating some of the pitfalls of travel and progressing towards a more seamless travel experience, I still believe that human interactions make up a very important part of the travel experience.

• Simplifying the travel experience doesn’t just benefit our guests, but it also benefits our teams on the ground who can focus on providing a better customer service at each travel touchpoint by using technology to better communicate to guests and alert them to potential disruptions.

• We recently introduced a new iPad based mobile app, iGo, for our Ground Operations team which allows them to update our guests with real-time, accurate information about their flight.

• This app allows our teams on the ground to provide up to date check-in, boarding and disrupt information to guests, which in turn alleviates any stress for our guests who may be affected by such disruptions.

• This creates more transparency for our guests, and more transparency for our teams at the airport, and this has a positive impact on our quality of service.

• Sometimes it is a small advancement in technology such as the iGo app that can make a big difference to how we are engaging with our guests and improving the travel experience before they even step foot on the aircraft!

Conclusion

• We are only just seeing the start of what the future of travel is going to look like – it will be seamless, tailored and multi-channeled.

• Our world is transforming at a rapid rate and the beauty of technology is that it not only enhances the travel experience by making it easier for guests to book flights, source travel information and travel from Point A to Point B, but it is also finding solutions to the trademark pain-points that have long been bugbears for travellers.

• Technology may be changing the nature of the travel game, but in essence, our value proposition for our guests remains the same – and that is to provide ease of travel with a reliable and consistent service.

• We may be living in a complex world, but I can assure you that Virgin Australia is picking up the pace to make every day travel simple, accessible and engaging.

• Our primary focus is on our travelling guests. They are our most important asset. The intention of each of our technology initiatives is to ensure travelling with Virgin Australia is a great experience time and time again.

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