The impact of the COVID-19 pandemic is visible in major industries, including transportation. The airline industry has lost more than $300 billion in a year due to the pandemic.
The loss of ancillary businesses hasn’t been included in the estimation. The airline industry is trying various ways to handle revenue loss, from layoffs to flight cancellations and customer service restrictions.
Instead of giving credits on canceled flights, many airlines offered vouchers to reduce the impact of revenue loss. Sturdy airlines IT solutions are the need of the hour as airlines can provide the same services without splurging more.
The use of advanced technologies allows various opportunities for cost optimization and revenue generation. Like others, the airline industry utilizes emerging technologies and takes advantage of digital transformation.
Improving digital capabilities
Many airlines underwent a minor digital transformation half a decade ago. After the pandemic, many companies had to make use of digital technologies. Using digital tools, airline companies have increased their revenue by 32% in just ten years.
From cost optimization to passenger experience, several factors contributed to the increase in revenue over these years. The main objective of deploying digital technologies is to improve the customer experience and operational capabilities without splurging more.
R&D investment
When passengers book the ticket, they are provided with an option to upgrade their ticket to business class. Though the acceptance rate is low, it is an exceptional opportunity to improve the revenue. Moreover, emphasizing the unique attributes of business class seats can influence their decisions.
It has helped some airline companies to boost customers’ ticket purchases. Similarly, improving passenger experience will be beneficial in the long run. Many airlines have started looking for opportunities to enhance revenue by investing in R&D.
Adapting to the digital transformation
The airline industry has witnessed the digital transformation of many sectors, including banking, healthcare, and more. However, many airline companies must include digital tools to help them survive in the industry.
The airlines IT solutions can enhance productivity, cost savings, and generate revenue streams. However, a proper plan is required to improve in all these aspects.
A few things to remember during the digital transformation
Apart from the above attributes, it is essential to upskill your employees and educate stakeholders. Executives curating the business strategy for your company should understand the complete concept of digital transformation in your company.
Employees in the mid-level require training to embrace new methodologies. Every airline must understand that deploying digital tools is a significant business transformation.
It includes modifications in the organization, operating model, company culture, and more. It is not about hiring resources to learn about AI; airline organizations must do more.
A precise plan to kick-start the business transformation will be helpful in the long run as the employees and senior executives will be well aware of the company goals in this transformation.
Most companies have concentrated more on the customer for years, and the digital age necessitates the same. It is the executive’s responsibility to find new ways for customer engagement.
Wrapping up
More than 50% of airline executives believe digital transformation is crucial for companies as it is the ideal path for the industry’s recovery. The investment in digital technologies is in demand as it recovers revenue and keeps airline businesses ahead of competitors. Rely on artificial intelligence and data-driven solutions to enhance the productivity of airlines.