Ancillary revenue generation key to airlines emerging from COVID-19 challenges
Author: David McGowan, Director, Flight Operations & Passenger Market
Published: April 22, 2021
With airline schedules starting to pick up in light of more encouraging developments related to COVID-19, I’ve been thinking about how digital solutions help airlines, especially when considering the passenger experience.
You may recall that we recently introduced Boeing Digital Direct as a new wireless inflight entertainment and digital services platform that is available to implement now on any commercial airplane. What makes this wireless platform so unique is that it also provides new revenue streams for our airline customers – what the industry refers to as “ancillary revenue”. This is a great benefit for airlines, because every bit of revenue is critical as the industry continues to rebound from this challenging environment.
Boeing Digital Direct delivers positive return on investment with its additional revenue-generating capabilities. In addition to enhancing the passenger experience with premium digital content, including movies, TV shows, magazines, music and more, Digital Direct offers e-commerce and retail channels to increase potential for ancillary revenue. What would this look like? Well, for example this could include food and beverage ordering with touch-less payment, destination packages, advertising campaigns and tiered entertainment content — all custom built to an airline’s unique needs
So how do we do that? Take a look at this infographic, which explains how Digital Direct’s capabilities are bolstered by our partner Immfly’s industry-leading e-commerce and advertising acumen. The ability to drive additional revenue is in their DNA. They launched the first inflight digital destination product in 2014 and have been providing inflight entertainment solutions with a return on investment ever since. As a clear leader in inflight technology and retail, we are proud to work with Immfly.
From an overall market perspective, it appears ancillary revenue generation has weathered the COVID-19 storm better than expected. In fact, ancillary revenue accounted for approximately 13% of all airline revenue in 2020—the most ever. We expect that strong performance to continue in 2021.
We’re ready to deliver results with Digital Direct. This solution allows airlines to customize their passenger experience with streaming entertainment while providing a measurable return on investment, driven by proven ancillary revenue generation capabilities.