• Thursday, July 18, 2024
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BusinessDay

Airlines reap harvest from travel tech apps

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Heightened competition in the airlines industry, are compelling carriers both locally and internationally to harness the enormous potentials inherent in Information Technology (IT), specifically in the area of travel software apps, to cut down cost of operations, drive customer acquisition, and improve revenues, industry watchers have said.

According to Cisco, United States based technology company, Airlines globally expect mobile sales to reach over $70bn by 2016. In view of this, during the next three years, 98 percent of Airlines will invest in delivering passenger services via mobile devices.

Interestingly, 94 percent of them are already planning on delivering customer service via social media. Nigerian Airlines are not been left out of the party as BusinessDay investigation have shown that a large chunk of travelers on the domestic routes daily purchase their tickets through the internet in the comfort of their homes either on their smartphones or laptops or computers.

Smartphones have become indispensable in the daily lives of many Nigerians, according to industry watchers, and Nigerian Airlines are hell bent on taking advantage of this trend. Nigeria, Africa’s largest economy by GDP, is currently the largest mobile market in Africa with approximately 130 million mobile subscriptions.

Telephony density is well above 85 percent and rising, of which 30 percent are smartphone and tablet users. The above data reinforces the decision of local Airline operators to step up the implementation of innovative mobile booking and ticketing solutions, in a continued strategy for growth, while making air travel accessible and affordable within Nigeria and Africa.

A cross section of travellers who spoke to BusinessDay at both wings of the Lagos airport came to the airport only with their flight reference numbers which they promptly got after completing their online bookings.

“All you need to do is quickly get your boarding passes printed as soon as you get to the airport, you don’t have to queue for a long time to go through the hassles of buying tickets at airports before flying. The world has actually advanced beyond waiting for hour for tickets at airports, as it becomes a global village, we are bound to cue into it, invest on the equipment that can drive the needed sales and bring business for us,” an airline operator said.

Although, foreign airlines were early adopters of Information Technology (IT) and have a long history of technological innovation, in comparison to many other travel and tourism businesses, about three years ago on the domestic scene, only Aero airline services was on the internet fully as any traveler could practically carry out any transaction online with the airline.

Today, all the airlines (domestic) now have online booking platform compared to three years ago when many of them still rely on paper tickets. Medview, Dana, IRS, FirstNation Airways, Azman Air, DiscoveryAir all quickly activated their IT platforms as they discovered that only way to quickly make it in terms of ticket sales was to migrate to the online system.

“The process for paper tickets is cumbersome, time wasting and money gulping, IT platforms simplifies the whole process leading to improved distribution strategy and costs reduction,” he added.

Industry experts are of the view that the competitiveness of future economies will, to a great extent, depend both on the development and application of new technologies, adding that the proliferation of the mobile devices has forced most organisations to rethink the way they do business and how they can reengineer their business processes.

“Carriers are appreciating the fact that reservations could no longer be on manual display boards, where passengers were listed, as they expanded their fleet and routes,” Ade Owolabi, an travel expert, said.

In Nigeria, statistics from last four years shows that in 2010, passenger traffic was 13,981,677, in 2011, traffic was 14,889,958, in 2012 it was 14,116,790 while the sector recorded 14,641,768 in 2013. And in the first quarter of 2014, it was 3,416,977.

Analysts are saying that the boom in the sector witnessed towards the end of the year is likely to shoot up the traffic cumulatively. They are also of the opinion that the sector will generate higher amount to the Gross Domestic Product (GDP) next year.

Also, according to the National Bureau of Statistics, Air transport contributed N32.6bn to Nigeria’s “rebased” GDP in 2010, N36.6bn in 2011, N42.7bn in 2012 and 48.8bn in 2013 representing an average of 4.8 percent of transport and storage sector and an average of 0.05 percent of total nominal GDP during the period. The sector grew at a compound average growth rate of 14.3 percent between 2010 and 2013.

 

Sade Williams & Ben Uzor