Following the release of our new smart airports research report, this is the first of a number of pieces examining the market for airport self-service and automated touchpoints, the trends shaping it and the expectations for seamless passenger journeys.
A Clear Changing Emphasis and Strategic Approach
As with many sectors and the adoption of new solutions, it is impossible to talk about it all as a continuous flow. We can speak about airports’ and airlines’ first steps towards introducing more self-service and automation – which has been going on for more than 10 or 15 years in some instances – but the immense impact of Covid-19 on the aviation sector creates such a division that we keep finding ourselves talking about pre-Covid and post-Covid.
In the pre-Covid years, adoption of self-service and automation technology was driven by a range of different factors. The need to squeeze an ever-increasing number of passengers through physically constrained infrastructure is the general over-riding one. Moves in this direction first began about 20 years ago when self-service check-in kiosks were introduced to process passengers more quickly and reduce the space taken up by manual check-in counters.
Easy as ABC?
ABC eGates came next, driven by wider adoption of biometric passports in the mid-2000s, while automated pre-security and self-boarding eGates are relatively new smart applications in airports. Self-bag drop is also relatively novel, and interest in this segment has rocketed in recent years as evidenced by the number of recent acquisitions.
All of this was taking place with a view to moving an ever-increasing number of passengers onto an increasingly frequent volume of flights. This was in evidence in globally, no matter the maturity of each region’s infrastructure and capabilities.
Then Covid hit…
Survival Mode and Recovery Strategies
As we are all too well aware, the industry was decimated in 2020 and whilst there are pockets of recovery, numbers and traffic remain well below 2019 levels. We identified recovery as a factor influencing the adoption of smart touchpoints. I won’t go into too much detail here but we see this broadly varying between 2023 and 2026 (until it reaches close to 2019 levels again), with differences between regions, type of airport, whether domestic or international travel and passenger type and demographic.
The standard (and sensible) option of many was to freeze everything, batten down the hatches and mothball what they could, consolidating operations as much as possible as they went into “survival mode”. However, whilst this first step was clear, the next step was less clear. Should they stick or twist? Bunker down or choose to roll the dice and look to invest?
Left in limbo
Some projects were already underway and have been completed during the downturn, adding to the installed base. Other projects – related to border control and immigration – were government-backed and/or driven by regulatory and mandated change, so this work has continued. A relatively small number of projects have been pulled forward so that can be completed during quieter times and whilst airport terminals are closed. However, many projects were left in limbo, pushed back, reduced in size or shelved completely as budgets were slashed and squeezed.
Airport operators and their partners have been frantically reducing costs and find themselves in a position where they have to plan to re-open for business as normal but not knowing quite when this will be. Plus, they have the added difficulty of managing the process with huge uncertainty around their workforces, with it unclear as to how many well-trained and experienced personnel may be retained or willing to return. Earlier in the pandemic, with regard to resuming “normal” operations, the biggest question was should they – and could they – invest now to implement new solutions and procedures to encourage travellers and reassure them that it is safe to do so? Or should they hold tight and see how far things progress before loosening the purse strings?
Necessity is the Biggest Driver for Change
There is no clear answer to these questions. We do not believe that there is a one-size-fits-all roadmap out of disruption into recovery and future growth. We do believe that the market will recover and we will see growth resume but it will be patchy and staggered. Disparate and uncoordinated border and travel policies only exacerbate this, leaving uncertainty lingering over the sector.
More consideration and emphasis is being put on creating additional revenue streams. Some of this comes from higher levels of (digital) service with more opportunities being realised as a result of the pandemic, e.g., remote ordering, use of mobile apps, near real-time on-demand services. Airports and airlines have been forced to try new technological options to comply with social-distancing and contactless service requirements and customer expectations. They have had to work with hospitality and other commercial partners to try and maximise revenues from a vastly reduced target market. This has included looking at ancillary and off-site services, with a more cooperative mindset and willingness to try new approaches.
Domestic recovery (in larger countries) is well underway and this is having an interesting effect. Pre-Covid most new approaches were first and foremost focussed on international travel but we are already seeing more emphasis on domestic travel for touchless and self-service processes. Biometrics are increasingly being added to domestic travel channels (as well as international) to improve the passenger experience and operational efficiency, maintaining operations on reduced staff levels.
Concept Into Reality
As I said, it is patchy and staggered but the first green shoots are already being witnessed. Self-check in kiosks are being upgraded and new installations are being undertaken to reduce staff interactions. More airlines are investing in their digital operations and incorporating a wider array of features and services into their apps and online channels. More automated eGates are being introduced at pre-security, airport lounges and boarding gates. Self-bag drop is now seen as a value add rather than a low-cost measure.
Regulations are lagging but proofs of concept for a post-Covid evolution are increasingly prevalent.
There remain issues to be resolved, notably concerns around personal data privacy and incorporating new solutions into security policies. However, often borne of necessity, there is a greater willingness to cooperate, be more open to new approaches, modernise operations and meet customer expectations. It could be in five years’ time that we look back at this period and recognise that it acted as a catalyst for improvement and modernisation in an industry that is often maligned for being slow to change or only adapting when it has to.
P.A.ID Strategies and Valour Consultancy have combined their expertise in aviation, airports, biometrics and digital identity to produce the first edition of “The Seamless Passenger Journey is Smart Airports – 2021 Edition”. This is an in-depth analysis of the market based upon over 40 one-to-one interviews with key stakeholders and extensive secondary research. Please contact authors John Devlin or Craig Foster for more information.