In an opinion from Timon Bock, the head of distribution partnerships at Blacklane, airlines are challenged to think about how ground transportation could serve their customers better
Airlines are dedicating teams and budgets to add airport transfers to their product offerings. At this stage, they are exploring how to integrate transfers into the traveller experience and make them part of their long-term brand and commercial strategy.
Our view at Blacklane is that airlines have two ways to view ground transportation, both of which can lead to distinct approaches and divergent product paths, and a different customer experience.
Ground transportation is simply one of several ancillary products that fit into the airline’s product proposition. It’s a source of revenue with many potential partners and it’s based on low-cost ticket sales.
A customer-centric perspective closes the missing link in the travel chain. Transfers enable airlines to offer door-to-door travel. Ultimately, it’s both about first benefiting travellers and second about the bottom line.
Let’s consider how this might play out in two possible scenarios relating for round-trip Dublin-Madrid flight on an airline’s website.
Scenario 1: Here the booking confirmation page displays a banner promoting Madrid airport transfers. The traveller almost overlooks it because it resembles an online ad. After clicking, a new tab opens that looks like a ground transportation search engine. The only pre-populated field is the pickup location with the MAD airport code. The traveller returns to the flight confirmation page to get the date, time and flight number, and then adds the drop-off address to search for transfers.
The site, a ground transportation broker, returns 100 options: five pages with 20 different services per page. Trains, shuttle buses, public transportation, taxis and low-cost driver services fill the first three pages. Professional driver services appear at the end. Prices range from €5 to €360.
The traveller selects a service, and then enters the first name, last name, email address and mobile phone number all over again. Then the credit card number needs to be entered. Finally, the traveller completes the purchase and receives an email confirmation from the broker’s website.
The selected service’s contact number appears in the confirmation next to the broker’s email address. If a car service was booked, the instructions say to find a driver holding a sign with the traveller’s last name after exiting the MAD baggage claim.
Scenario 2: Before checking out to pay for a selected flight, the airline suggests transfers by a professional driver service. This allows the traveller to select up to four rides:
Home to DUB
MAD to Madrid city center
Madrid city center to MAD
DUB to home
This time, the airline pre-populates all contact, date, airport and flight number fields. The traveller chooses the second, third and fourth transfers and then enters the Madrid hotel address.
Then, the airline displays three options: business or first class sedans and a business van for more people and luggage. The description says drivers speak English, track flights in real time, adjust pickup times if necessary, and wait for free for up to an hour after selected pick-up time. The traveller selects the business class sedan and chooses the pickup time for the ride back to MAD.
The airline adds the transfers to the flight, and the traveller completes the purchase in one transaction. The airline emails the flight confirmation. At the same time, the professional driver service emails the ride confirmations co-branded with the airline that include 24/7 phone and email contact information. Both the flight and airport transfers are stored in the Passenger Name Record (PNR) in an integrated manner. If the flight is cancelled or later changed, the transfers will update automatically.
Instructions direct the traveller to meet outside of the MAD baggage claim. Furthermore, emails and text messages of driver contact information are promised an hour before pickup and once the driver arrives. The driver service permits changes or cancellations of any ride by phone, app or website for free until one hour before pickup.
What is your perspective?
In our view airlines can serve their customers better and not just while they are in the air. So while scenario 1 provides a random ground transportation shopping option (Ed’s note: and some would argue more choice), scenario 2 differentiates with curated transfers as an integrated piece of the airlines travel product.
The difference between these scenarios is the airline’s perspective.
In scenario 1 the airline:
Drives ancillary revenue on lower-cost tickets
Boosts profitability as part of a wider third-party ancillary strategy
Gives customers some add-ons that [arguably] take [the customer] extra effort
Relies on third parties to deliver the service and takes commission
Scenario 1 might be the industry’s natural reflex but in our view at Blacklane there is another way. Rather than seeing ground transportation as profit-booster like checked bags and reserved seats, we believe there is an opportunity for airlines to rethink the journey from the customer’s point of view. By closing the missing link in the travel chain – the first and last miles of a trip – the airline can improve the customer experience, driving revenue and long-term loyalty.
So in scenario 2 then, the airline:
Extends the airline’s core product for a seamless door-to-door trip.
Becomes a travel company helping to take the stress out of passenger's journey
Rethinks the trip from the customer’s point of view and closes the first and last mile of the trip
However, to achieve such an approach, airlines and professional driver services need invest in integration up front. By linking transfers to the PNR, they create a simple and intuitive purchase and management process. Airlines evolve the flight-booking path to a trip-booking path, and can, as a result, deliver a superior experience.
So, in meeting a passenger’s travel needs, rather than simply the ‘flyer's’ can help airlines differentiate and drive new revenues. Instead of travellers choosing from dozens of unknown companies, the airline curates and integrates a ‘trusted provider’ to give customers peace of mind.
A new chapter in the evolution of travel
Airlines want to acquire and retain direct customers. Ground transportation helps but, in our view, only one scenario transforms customer retention and brand positioning.
Airlines now face a choice. They can continue to refine an ancillary approach that easily adds some limited near-term revenue. Or, they will extend offerings to become a true door-to-door travel service. The technology, customer need and bottom-line benefit point in one direction for customer and shareholder value.