New luggage tracking technologies are all the rage and have compelling industry benefits, reports Andrew Hennigan

Lost luggage is a primary concern for travellers and one that airlines are keen to address. In the first half of 2014, according to the US Department of Transportation, there were over 1.6 million cases of lost luggage in the US. According to an article by Andrew Price, Head of Airport Operations at IATA, the estimated cost of all baggage operations is around $29 billion a year. Little wonder then that anything that helps with making luggage handling more efficient has to be a good thing and the airline industry is moving towards new electronic solutions that address these concerns.

Individual travellers can already track their own luggage using consumer tracking tags like Trakdot and LugLoc. These palm-sized gadgets use cellphone technology to recognise location and report back to the company. Meanwhile, the traveller uses a smartphone app to establish where the bag is. Both these devices recognise when they are on board an airplane and automatically switch to airplane mode, and are also approved by aviation and security authorities.

Though the technology is similar, the companies differ slightly in their approach. Trakdot, for example, charges an annual subscription fee, and the traveller is notified automatically as soon as their bag lands in an airport. LugLoc, on the other hand, charges no subscription fee but there is a pay-per-trace fee payable only when a bag is lost. Right now, present each device comes with five free. But this is a new business and changes are likely.

Beyond the bag

Airlines and other travel companies are looking beyond these in-bag tags to technologies that address the broader baggage handling process. Fasttrack is one that offers an in-bag tracking tag, eTrack, like the others but also provides an electronic label, eTag, that can be attached to the outside of the bag. The company is working with Air France/KLM to test the system and plans to offer the same technology to other airlines and travel businesses. For airlines this combination of electronic tracking and labeling helps solve the mislaid bag problem. At the same time it streamlines bag check-in because the bag can be labeled automatically, speeding service for the customer and saving on label printing, hardware and supplies. New technologies like this also allow airlines to differentiate frequent flyer service levels.

Fasttrack is also partnering with Samsonite to create new, high-end luggage with built in tag and track technology, and other luggage companies are working on similar solutions. “ LugLoc has been in this market over a year now and we have been working with customers to perfect the experience,” says LugLoc Chief Operating Officer Carlos Esnal

Other luggage makers are known to be working on bags with built-in labelling and tracking, but to get a taste of where this is heading look at the proposal from a US startup called Bluesmart. Their proposed new luggage includes a smartphone tracking feature as standard. In addition, it will include a smartphone-controlled digital lock, a built-in electronic scale to weigh the bag and its contents, and a power outlet from its onboard high-capacity battery to charge the owner’s phone on arrival.

Know your customer

For the industry, the cost benefits associated with more efficient luggage handling are compelling, but whether consumers buy into them remains to be seen. And in the highly commoditised airline environment, customer understanding is crucial in the bid to differentiate. In his recent work with one start up, Don Birch, a travel industry veteran and founder of Travel Innovation Partners, says the market research showed, to example, that the people most likely to worry about lost bags were women aged 35+. Frequent business travellers, on the other hand, are far less concerned as most carry on baggage.

According to LugLoc’s Esnal, companies that transport delicate or expensive material, such as audiovisual equipment have shown real interest in luggage tracking technologies. “We have also seen risk management companies offering our product as an additional risk reduction,” he says.