As many travel leaders adjust to temporary COVID realities, experts are starting to think about how the industry recovers. They’re trying to figure out if it is possible to come out stronger than before and take advantage of the disruption to accelerate initiatives and elevate their businesses.
Recent Cirium numbers show a slight decline globally in both international and domestic flights in the first few weeks of September. However, there is some optimism in the industry. Cirium recently collaborated with Yocova, to bring 35 top travel professionals together to discuss the COVID disruption. Despite universal challenges like the availability of parts; regulatory requirements; and coordination with airports and ground operations providers, most participants agreed the crisis could lead to opportunities to improve internal efficiencies and processes. Travel organizations who can take advantage of this will likely be the first to find new commercial opportunities as the market lifts.
In July, Forbes reported on a similar panel of experts. Though there wasn’t agreement on what recovery would look like, they did believe consistent testing and trust in the safety of flight and hotels was key. Increased visibility into the precautions hospitality and transportation companies are taking will build more confidence in travel. This will continue as travelers share their positive experiences.
Digital transformation key to a strong recovery
The article goes on to state “there is a certain amount of optimism in the industry that this will be an opportunity to emerge stronger, healthier and much better prepared for future downturns.” One respondent, Philip Balaam, President of Inmarsat Aviation stated that digitalization will be at the heart of recovery.
“Digitalization will drive aviation’s return to profitable growth. Learnings from other industries strongly support this view. At the turn of the 21st century, maritime faced its deepest recession since the thirties, with costs rising and revenues falling. Instead of hunkering down and cancelling new vessels, an industry notoriously slow at adopting technology turned to digitalization to deliver much needed efficiencies. If we can learn anything from the crisis response, it’s that digitalization can drive greater business efficiency, automation and intelligence, and deeper customer engagement,” said Balaam.
In a recent Aviation Business News article, Jeremy Bowen CEO at Cirium, also touched on the need for leaders to focus on decision making.
“Not everything is controllable, but we can gain more control through a research-driven response. Even before the pandemic, many companies had started to use data to deliver real-time alerts and proactively manage flight disruption.”
Andrew Doyle, Director, Market Development at Cirium, is expecting significant consolidation that will accelerate advances in efficiency and digital transformation. “Weaker players will exit the market, there will be consolidation (M&A), and those that survive will be able to transform their businesses in ways that would normally take decades to achieve.”
Reimagining the business
In the airline industry, “there will likely be fewer airlines operating smaller fleets of aircraft at higher rates of daily utilization and at higher levels of technical reliability, delivering better on-time performance while achieving higher load factors and higher average fares. And all this while dramatically reducing net environmental impact. The supply chain and other industry stakeholders have a critical role to play in delivering this industry transformation,” said Doyle.
Organizations which recover in a stronger position are the ones who will “fully grasp the need for radical change and understand that there will be no return to ‘business as usual’. They will embrace the opportunities to achieve step changes in business performance and efficiency by unlocking insights from data using advanced analytics.”
When asked about what leaders should be focused on, Doyle listed major initiatives to create new revenue opportunities in travel and tourism:
- Embracing data-driven decision making
- Actively collaborating with industry partners to facilitate open data sharing
- Looking at partnerships to drive wide-spread adoption of common standards for mutual benefit
As Bowen said: “The pandemic has exposed areas which are ripe for change and if there’s any silver lining, it will accelerate the digitalization of the end-to-end traveller journey. Using data and analytics, companies can better understand a traveller’s needs, monitor consumer trends and identify potential new markets and revenue streams.”
Contact Cirium to continue the conversation.