Airports eye new revenue opportunities from beacon technology

Airports are looking at ways to increase the revenues they extract from non-airline related streams through traveler personalization. But in order to maximize the gains for both sides, airports must have deeper insight into where individuals are located in their facilities, and the movements that those passengers make.

An increasingly important technology for providing proximity and context information are beacons, which transmit a signal using Bluetooth Low Energy. Attached to various locations within an airport, the beacons can sense when an individual customer comes within proximity of that point. By doing so, airports can “push” very specific offers or notifications to a person’s electronic device.

Hong Kong International Airport, in collaboration with SITA’s innovation branch, SITA Lab, has launched a trial of beacons by installing 50 at Terminal 1. Using the tech, the airport can provide passengers with indoor directions, walk times to gates, lounge access and alerts about boarding. The trial uses interactive maps to guide passengers along typical pathways between public transport points, check-in counters, immigration, automated people movers, gates and baggage claim areas.

Kontron now Banner_Avionics-300x300But don’t be fooled, this sort of offering that magnanimously helps the passenger is only the start of where beacon technology is going within airports. The real angle is to use beacons to more effectively position retail and hospitality offerings to customers.

Outside of the air transport industry, there is already extensive use of beacons as sales tools. For instance, a number of casinos in Las Vegas are using beacons to deliver location-specific retail and hospitality offerings to consumers. In another setting, some mall operators are using beacons to deliver product advertising to consumers.

The interesting thing in all of this is that airports need to get much smarter than casinos and malls in their use of beacons. Airports need to think long and hard about the balance between offering beneficial information to customers and simply shoving advertising information down their throats. And this is where some interesting opportunities arise.

If an airport has an understanding of the flight time for a customer, and also has an awareness of his or her location, it can offer truly tailored services that take their time constraints into consideration. Imagine a solution that knows I’m flying to a particular location, understands that I’m flying with my children and knows that I have an extra-long layover. What parent wouldn’t respond positively to an offer of a discount on a handily-located theme park visit?

Of course the elephant in the room is the sometimes adversarial relationship between airports and airlines. Airlines consider their customer data as unique IP and have proven reluctant to share it, even when there is benefit to doing so. At the recent SITA Summit in Brussels, Dubai Airports CEO Paul Griffiths talked about the ability for airports to rebate airlines’ landing charges in the event that airports could find alternative revenue streams. There was even a muted acceptance of the fact that airlines and airports could work collaboratively to develop offerings and share the profits from those offerings.

But alas, to do so would require a level of openness and collaboration that airlines have been reluctant to embrace. And that is the tragedy about hyper-personalized and localized services. Sure, I can receive a bit of low-level information as a traveler, but the real opportunities –  the ones that can really make a difference to me, to airlines and to airports – are locked away because of a reluctance by all parties to open up their data. And that fact doesn’t look likely to change any time soon.

BenAbout the author, Ben Kepes:

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. His business interests  include a diverse range of industries from manufacturing to property to technology. As a technology commentator he has a broad presence both in the traditional media and extensively online. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to aviation technology, enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

3 Comments

  1. Pingback: Mmm… Beacon | The Shopper Project

  2. FanMaker integrates beacons, passenger analytics, and SKU level data inside our interactive loyalty program. Reaching passengers on a personal level with offers and information they care about. Looking outside the airport and in the community the CVB can deploy beacons allowing tourists to experience a city like never before.

  3. Wanderer

    The real problem that airports and passengers are facing is an inadequate pricing policy based upon the prisoner customer and artificial scarcity principles. Should airports significantly lower their price margins, their aggregate revenue would be boosted tenfold. But as it is now, they’re only growing a luxurious bubble making the long tail of customers fearful of spending anything in airports due to ripoff pricing policies. The same is true for business space rental by the meter. This must change.

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