PANEL 1: Delivering the promise of an improved passenger travel experience: Technology & Innovation shaping the future of aviation - lT trends for the next decade - Kapil Kaul, CEO, CAPA South Asia (Moderator)

1. Technology & Innovation Shaping the Future of Aviation
India Aviation ICT Forum
Goa, 26-27 September 2013
South Asia’s leading
aviation advisory, research
& knowledge practice
Portfolio of close to 100 aviation consulting and research studies in South Asia
www.capaindia.com

2. About CAPA – Centre for Aviation
700 global consulting studies, over 10,000 reports
 Worldwide Coverage: Our global practice provides in-depth coverage of strategic
industry trends across all regions.
We have released more than 10,000 reports for the global aviation community and
offer a proprietary data analytics platform for more than 7,000 airlines, airports and
suppliers.
CAPA research and data is relied upon by more than 500 of the leading aviation
businesses in the world.
 Global Presence: Headquartered in Sydney, with offices in Singapore, Hong Kong,
Tokyo, New Delhi, Manchester, Washington and San Francisco. Dedicated research
teams provide worldwide coverage across all key industry verticals.
 Leadership in South Asia: The region’s leading aviation consulting, research and
knowledge practice. Portfolio of close to 100 advisory and research studies in South
Asia.
 Skilled and Practical Consultants: Our team members have been involved with the
leading airlines and airports in the world at Board and Chief Officer level, and have
worked for governments, IATA and ICAO.

3. About CAPA – Centre for Aviation
700 global consulting studies, over 10,000 reports
 India’s First and Largest Aviation Research Practice: Released 30+ in-depth research
reports and position papers, with 10 currently underway in verticals such as business
aviation, freight and logistics, distribution, airport retail, ground handling, MRO, ATM,
and ancillary revenues.
 Supported by India’s most comprehensive databases: Our up-to-date store of data
and market indicators across the value chain is unrivalled and covers for example:
o traffic, capacity and load factors;
o fares and yields;
o schedules;
o market shares;
o bilaterals
o fleets and aircraft check histories;
o airport development status;
o district and state-wise economic and income data.
 CAPA Aircraft Advisory: Aircraft sales and acquisition support that has advised a
South Asian carrier on a US$250m fleet transaction; and assisted with the acquisition
of multiple business jets and helicopters.
 CAPA Analytics: Launching FY13/14 to provide high performance outsourced
analytics. Initial focus on analytics to support revenue and sales initiatives,
subsequent expansion into risk and financial analytics.

4.  Expectations of the air travel experience in India are increasing;
 Passengers are seeking a smoother, quicker and more personalised experience;
 Airlines and airports are taking steps but the use of mobile and self-service technologies is still at an early stage;
 The foundations to support increased technology adoption exist:
o 82% of air travellers surveyed were carrying a smartphone;
o Experienced travellers are more confident and self-reliant than ever before;
o Many next-gen travellers expressed a preference for technology over human interface;
 Encouraging experienced travellers to use self-service will free up human resources to assist first time travellers;
 Adoption of new technologies has been hindered by a lack of coordination between stakeholders;
 Passengers, particularly younger ones, are keen to engage more closely with airlines and airports through social media;
 Technology could also play an increasing role in the in-flight experience with passengers keen on wi-fi and IFE streaming;
 Travellers appear to be open to retail opportunities, provided that offers are tailored and not intrusive.
Changing Expectations of Indian Air Passengers

5. CAPA and SITA conducted an extensive survey of more than 500
airline passengers in India:
 Travel Stress: Check-in and bag-drop was identified as the most
stressful part of air travel by 34.1% of passengers, the largest
proportion among stress points. Self-service solutions have the
potential to address this issue.
 Self-Service Awareness: 80% of passengers stated that they
would be open to using self-service check-in options. But only
33% were aware that they already exist.
 Self-Service Experience: 29% of passengers had used a self-
service option at some point, either on the current or previous
journeys. The most common option was web check-in
(64%), followed by kiosk (30%).
 Self-Boarding Gates: 76% of passengers were open to using
self-boarding gates.
 Flight Status: 65% of passengers used a real-time flight status
update tool.
 Reservations: 78% of passengers stated that they would be
comfortable making reservations on a mobile device if the
interface was easy-to-use.
 Social Media: 64% of passengers stated that they use social
networking sites.
Technology Adoption by Indian Air Passengers
34.1%
18.3%
13.1%
12.2%
7.7%
6.1%
5.6%
2.3% 0.7%
Check-in and bag drop
Security/border control
Shopping and F&B experience
Baggage collection
Transfers
Searching/booking flights
Boarding
Other
Inflight experience
Points of Stress for Passengers during Air Travel

6. CAPA and SITA also conducted focus group discussions with 30 passengers selected from a range of ages, occupations and
levels of travel experience. Key findings included:
 Security: Passengers expressed frustration at the need to print out boarding passes to enter the airport and pass
through security checks. Variations in security protocols at different airports also results in reduced confidence among
passengers that the system works. Passengers have therefore opted for manual, human interactions to be sure.
 Lack of Awareness of Self-Service: Passengers were frequently oblivious that self-service kiosks exist. There is often
limited signage or call to action, and an absence of well-trained staff to encourage and assist use. Travellers often
thought kiosks were simply part of the ‘furniture’ at an airport for use by officials.
 Eligibility for Self-Service: Variations by airline in eligibility for use of kiosks also deters use e.g. some restrict it to
passengers with hand luggage only, whereas others permit hold luggage which has to be taken to a bag-drop counter.
And several carriers do not offer the service at all.
 Kiosk Availability: Availability of kiosks varies by airport, with reasonable numbers at Bangalore, Hyderabad and
Mumbai, limited facilities at Delhi and virtually nil elsewhere. Take-up rate is approximately 10% at airports where
offered, with Bangalore having the greatest penetration at close to 20%. With all these variations, passengers have
tended to be conservative and stick with manual options in which they have confidence.
 Loyalty: Frequent travellers are keen to be recognised as such even in the absence of a formal loyalty
programme, which may involve the use of smart cards or near-field communication technology.
 Social Media: Younger travellers stated that they would be interested in receiving personalised promotions and
exclusive offers through social media platforms.
 Service Recovery: Passengers would like have a greater voice in service recovery, with the ability to communicate
feedback in real-time. This would also enable airlines and airports to address issues early and improve service
standards.
Technology Adoption by Indian Air Passengers

7. Thank You
www.capaindia.com

8. IT-enabled growth and
the way forward for India’s airlines
India Aviation ICT Forum
Goa, 26-27 September 2013
South Asia’s leading
aviation advisory, research
& knowledge practice
Portfolio of close to 100 aviation consulting and research studies in South Asia
www.capaindia.com

9. IT is considered by airlines as a major enabler of key services, strategic in nature and essential to achieve company
objectives. The high importance accorded to IT indicates that we can expect to see increased automation and
technology deployment in the future.
 Focus is transitioning from efficiency to revenue: Current focus of IT deployment at airlines is on increasing
operational efficiency, improving the passenger experience and cost optimization. By end FY15 the focus is expected
to shift increasingly towards driving revenue.
 Mobile technologies could play a huge role: Provision of services by airlines to passengers on mobile devices is
expected to be the next major development in the Indian airline industry as a result of the growing penetration of
smart phones.
 Self-service take-up is slow to date but will remain a priority: Self-service technologies have not yet achieved much
traction in India, but airlines continue to believe in their potential and several are pursuing initiatives such as
automated boarding, self-bag drops and flight transfer kiosks over the next three years.
 Social media, behaviour and purchasing profiles and data analytics remains limited: Airlines have not yet
developed an appropriate framework for capturing customer profiles through mobile platforms and social media, nor
are they able to leverage such data through an appropriate analytics solution.
 Current airline financials represent a challenge: Availability of budget is the biggest challenge to IT
implementation, followed by regulatory uncertainty; reliability of technology suppliers; determining priorities and
securing support from key business stakeholders.
IT-enabled Growth for Airlines

10.  As a proportion of airline revenue IT expenditure was just below
2% in FY13, similar to the previous two years. The poor financial
performance of Indian airlines is one of the reasons that IT
expenditure has not increased in recent times.
 Current focus of IT deployment at airlines is on increasing
operational efficiency, improving the passenger experience and
cost optimization.
 By the end of FY15 the focus is expected to shift increasingly
towards driving revenue – both from new market opportunities
and ancillary streams.
IT-enabled Growth for Airlines
FY12 focus
1.Increase
operational
effciency
2.Improve
passenger
experience
3.Cost
optimization
4.Product
andservice
differentiaton
FY15 focus
1.Drive
revenue
2.Improve
passenger
experience
3.Increase
ancillary
revenue
4.Increase
operational
efficiency
5.Product
andservice
differentiaton
Airline Priority Objectives for IT Deployment

11.  Self service check-in through the
web, mobile or kiosks accounts for just 10-
15% of passengers.
 But airlines are optimistic about the
prospects of this changing by the end of
FY15, by which stage for example one
airline expects this figure to rise to 80%.
 Plans for several self-service initiatives are
in various stages of design and
development. However technologies
supporting automated boarding
gates, self-bag drop and flight transfer
kiosks at airports are expected to be
implemented by the end of FY15.
Self-Service Initiatives
Status of Self-Service Initiatives (Response from 4 airlines)
0% 20% 40% 60% 80% 100%
Bag recovery at kiosk
Self-boarding gate
Bag tag printing kiosk
Assisted bag drop with self-printed…
Self-service bag drop
Self-service flight transfer
Flight re-booking at kiosk
Assisted bag drop
Kiosk for ticket sales
Info service at kiosk
Staff using mobile
Kiosk check-in
Web check-in
Implemented
By end of 2015
No plans

12.  Provision of services by airlines to passengers on
mobile devices is expected to be the next major
development in the Indian airline industry as a result
of the growing penetration of smart phones.
 Almost all airlines offer flight search, online
booking, flight status notifications and check-in via
mobile devices, either through apps or mobile
optimized websites.
 All of the airlines that responded expect that services
such as Customer Relationship Management
(CRM), reporting of lost luggage and sale of ancillary
services will be possible on mobile devices by the end
of FY15.
 Some carriers will also roll-out the ability to book
lounge access, pay baggage fees and modify tickets
on mobile platforms by the end of FY15.
Mobile Initiatives
Status of Mobile Initiatives (Response from 4 airlines)
0% 20% 40% 60% 80% 100%
Integrating travel suggestions
NFC for pax processing
Geo-locationing of pax
Access to entertainment on device
Re-booking
Lounge access
Ticket modifications
Baggage fees
Ticket upgrades
Retail services
Purchasing ancillary services
Social planning
Promotion of airline services
Missing baggage reporting
Customer relationship management
On board services
Flight discovery
Itinerary integration & sharing
Purchasing airline tickets
Notification of flight status
Check-in via mobile app
Implemented By end of FY15 No plans

13.  Coordination will deliver better results: Airlines need to develop a much more collaborative approach with
airports and government agencies if they are to extract real value from technology.
 Greater adoption of self-service will drive efficiency benefits: Airlines and their passengers can benefit more
and more from self-service solutions.
 Technology will play an increasing role for passengers in-flight: Airlines can generate competitive
differentiation - and new revenue - from using technology to enhance the in-flight experience.
 Mobile technologies ca n enhance service and drive revenue: Airlines should leverage mobile technologies
to introduce step changes in customer service and to generate new revenue streams.
 Do not ignore social media, but approach wisely, poor strategies can backfire: Social media is a
must, particularly for interacting with younger passengers.
 Passenger represent a captive retail audience: Airlines should better exploit the goldmine of data that their
passenger profiles represent.
The Way Forward for Airlines

14. Thank You
www.capaindia.com