Digital now: Traditional airlines not ready for post-COVID travel

Posted Oct 22, 2020 by Tim Sandle
As the airline industry feels the turbulence of travel restrictions, many are now working toward digitization which will be key for travel from now and post pandemic.
Airlines have been slashing costs all round after revenues plunged 80 percent in the first half of t...
Airlines have been slashing costs all round after revenues plunged 80 percent in the first half of the year
Daniel ROLAND, AFP/File
However, industry insights indicate that traditional airlines are falling behind the budget airlines when it comes to digital transformation initiatives.
A new report, which draws on data collated from 49 carriers worldwide and analysed by Glassbox (an analytics platform), looks at the digital state-of-play. The ability to agile matters for the post-COVID-19 world, where many businesses will emerge economically weaker. This is particularly so for the travel sector, which has been hit hard as many people have shunned travel, both in terms of vacations and businesses trips.
The report looks at who is likely to prevail in a post-COVID travel world. The balance appears to be with the start-ups, given that 71 percent of airlines who are classified as leaders in digital maturity are the low-cost airlines. In contrast, 80 percent of the least prepared are traditional airlines are the full-service carriers.
To gather the metrics, the report looks at seven general digital optimization areas. These are: people, skills, analytics, user and UX research (revised area), test quantity, tools, organizational support.
The report does find that many airlines are taking digital transformation issues seriously. With this, 52 percent of airlines have digital optimization teams in place and a similar proportion (51 percent) of airlines have a documented and structured conversion optimization process.
However, a sizable number are not in this digital ready position. The report finds that 45 percent of airlines said they do not have a budget for digital optimization and experimentation and 49 percent of airlines do not run experiments at all or only do them on an ad-hoc, project basis.
In terms of the more forward looking airlines, 10 percent of airlines run more than 10 digital optimization experiments per month. With these, most airlines have combined digital optimization and personalization activities with the same team.