Customer Trends for 2014-15

This post isn’t all about JLAB but I am pleased to say that the interest continues at a high level in the media and from potential entrants.

With JLAB in mind, I’ve been thinking about the prominence of technology and innovation as the engine of changing times for retail in the UK.    At the Retail Week Awards last Thursday, for instance, Chris Brook-Carter of Retail Week  said in his introductory speech:

‘Have the rules that define British retailing changed irrevocably under the cultural and economic forces that have driven the recent evolution of consumer behaviour?   Rapid digitalisation, combined with a reappraisal of financial norms, has broken down old barriers but opened new pitfalls too.   The Oracle Retail Week Awards is more than a roll call of the leading achievements in the industry. It is a window into the industry’s development. Those looking for themes this year will note how closely the roster of winners reflects the opportunities these changing times have given birth to.’

John Lewis was fortunate to be recognised as the Multi-Channel Retailer of the Year for the second year running.

Rather than reflect on the past, I thought we should look ahead.  So I had a word with John Vary, our Innovation Manager and JLAB leader, about what are the Mega Trends for Customers in 2014-15.  This is what he came up with, with a few thoughts thrown in by me:

1) Multiple touch points

We are increasingly expecting things which interact with all our senses, offer us a range of touch points to play with, and involve us  in immersive new experiences – see larger HD TVs and game consoles.

2) Hyper-efficiency

We are seeking ever-smarter and more efficient ways to solve age-old issues such as keeping fit, lack of space and, most of all, limited time – see wearables and home control technology like Nest.

3) The open industrial revolution

Science is no longer a closed world, just for us geeks. Digital and technological advances are enabling more of us to create in new ways, perhaps giving us a new appreciation of the digital hardware and apps as things of beauty – see the iPods, iPhones, iPads, brilliantly designed and sold to millions.

4) Escape

In a world of austerity and grown-up responsibilities, consumers have an increasing desire to let go, let loose and indulge in child-like escapism – see GTA and Candy Crush on everyone’s mobile.

5) Mindfulness

In a world full of hype and surface interactions, people are seeking depth and meaning. They are craving time away from the always-on stimulus of the media, making their leisure time more about self-development – see learned groups on Twitter discussing The War of 1812, Norfolk wildlife, crows and everything else…..

6) Super personalisation

Personalisation has been taken out of the hands of consumers. So it’s not just the bespoke products you select – it can be the bespoke products that find you. Advances in technology mean that producers are increasingly able to know consumers and give them what they want – see most retail web sites these days.

And finally, here is a rather jolly picture from the Retail Week Awards last week:

John Lewis Launches ‘JLAB’

Screenshot 2014-03-02 09.43.09

As part of our 150 year celebrations, John Lewis has launched its first ever technology incubator ‘JLAB’, in a partnership with technology entrepreneur Stuart Marks.

The purpose of JLAB is to identify and develop technology innovations that will provide John Lewis with future strategic advantage with customers’ needs at the core of each idea.

The incubation period runs from June to September – JL and Stuart will work together to select five start-up companies who will be based within JLAB during that time.  When they are at JLAB, businesses will rapidly develop their products and solutions, supported by a team of John Lewis leaders and external mentors.

Three main areas will form the framework for innovation:

  • Helping customers shop: in-store innovation, customer experience across all channels (e.g. self service product info and prices) and technology-driven customer inspiration
  • Simplifying customers’ lives: innovation around the “Internet of Things” (how all devices will communicate together, enabling a more connected home)
  • Knowing each other: using data to drive real-time, in-store personalisation for customers, provided they want it.

The John Lewis Partnership’s founder, John Spedan Lewis, was a radical entrepreneur and so adopting a novel approach to business and retail innovation is not new to JL.  It’s a fundamental part of the Partnership’s DNA.

If anyone wants to be part of JLAB, you can apply on  The closing date for submitting ideas is 17th April 2014.

Spedan Lewis c1904 300dpiJohn Spedan Lewis c1904

As an Airline, which Retailer are you like?

On the 18-20th June, airlines at the Air Transport IT Summit will be reflecting on how IT can help them boost their profitability and efficiency, and bring about better ways of working. As Chair of SITA, the air transport provider, I will be host at the Summit.

Among the many topics, ancillary sales will be one area under scrutiny at the event. With the airline industry as a whole just about achieving profitability in tough conditions – including slowing economic growth and rising oil prices – ways of boosting revenues through retailing are clearly high on the industry’s agenda.

I believe there are real opportunities here for airlines. Ancillary sales are claimed to have delivered as much as 5% of global airline revenues in 2012, according to estimates from IdeaWorksCompany. At the same time, 100% of airlines now have a presence online in the ‘virtual high street’, selling through their web sites, according to the Airline IT Trends Survey by SITA and Airline Business.

So many airlines are focused on ways of increasing retail revenues. In addition to the web, airlines now have new passenger systems, big data, social media and other new technologies at their disposal, which can enable them to become much more effective air transport retailers.

What do I mean by this?  Airlines will be able to make personalised offers to passengers, presenting an array of additional products and services that can be bought and making recommendations to customers in ways similar to Amazon and other retailers. There are opportunities to up-sell and cross-sell every time a passenger interacts digitally with the airline. Harnessing social media and big data will also enable airlines to look beyond their immediate loyalty programmes and target other potential customers with customized smart offers.

But I have a word of caution. While the technologies are definitely there to enable increase retail activity, airlines need to be sure of what their customers will or won’t find acceptable when they receive a targeted offer. There are boundaries. So before you embark on this journey of ‘retail enablement’, as an airline find your retailer analogy and ask yourself: which retailer are you like?

The topic will be discussed in detail in the next issue of Air Transport IT Review, to be available at the time of the Air Transport IT Summit.  

You can join the conversation on the Linked In ‘Air Transport Information Technology’ group.*2_*2_*2_lna_PENDING_*2.gmr_4443272.gde_4443272_member_240648445.gmr_4443272

And you can follow this year’s IT Summit at #ATIS2013

The StyleMe Mirror in Oxford Street

Click here for the link to the CISCO case study on the StyleMe “magic mirror in the john Lewis Oxford Street store, which I have talked about earlier on this blog.

Is the Airline Industry becoming like Retail?

In my latest article in Airline Business I examined the increasing convergence between the airline and retail industries as customers become ever more connected and the way in which technology developments will shape both their futures
I thought readers of this blog might be interested:

A popular theme for airline industry conferences and discussions is how the sector is becoming increasingly like retail.

This is perhaps a bit unfair since, in my view, retail itself is in many ways catching up with the air transport industry. In the UK and the USA many retailers are now going through the “between 20% and 30% of revenues online” barrier – in other words, the point when online moves from an interesting additional channel to market to the mainstream.

This is a stage which most airlines reached mid last decade. Nothing surprising here, given the different nature of the product that airlines and retailers sell – one which is simply a permission to fly and the other a physical product in a shop, or ordered online and delivered from the warehouse.

These industries – and arguably most others too – are converging, however. Travellers and shoppers are the same customers, after all. Everyone is connected all the time everywhere these days, through iPads, smartphones or laptops. These devices are increasingly used not just for personal or business use, but for both. Both retailers and airlines understand that a website is not enough. Customers expect the companies they buy from – and interact with – to be present not just online but in the mobile world of tablets and smartphones, and – of course – out there on Twitter and Facebook.

Just as we in 2012 present ourselves seamlessly in multiple channels as individuals, so we expect our preferred airline or shop to be there too. We expect them to communicate with us appropriately, we expect our business relationships to be just as channel-savvy as our personal relationships. So, for a complex transaction like a round-the-world holiday or a complete house redecoration, we expect human interaction and advice in person.

For an update message that our flight is cancelled because of fog or our online order is ready for collection at the store, we expect a message on our mobile device. And, in between, we may be interested in staying in touch with these businesses through Twitter and Facebook, and in looking at their newest products or their newly launched advert on YouTube.

For airlines or retailers that aspire to be brand-leaders, however, even transacting seamlessly across the channels is not going to be enough. You need to be able to engage customers in your product and get them to associate with your brand and its values. No longer is this just about TV advertising – or indeed paying Google to promote your products in its search listings. It is about creating an experience that reinforces customer loyalty and provides your best customers with benefits and privileges they really value.

Some of this will be delivered in-store – or in the lounge, or on board – but increasingly it will be about connecting with them in the periods between shopping or flying.

Airlines – because of the connectivity limitations and long-standing concerns over interference – have been the one place on or above Earth where you could not be connected. In the last few years this has come to an end, and we are seeing wi-fi on board and mobile and internet connectivity increasingly provided or planned. In the same way, we are now starting to see wi-fi provided for free in-store by retailers, with tailored landing pages. This is also being extended into how airlines connect with their customers before and after they fly, such as the Malaysian Facebook for groups application.

Intriguingly, airlines are now looking to retailers for inspiration – John Lewis in London and Tesco in Korea have used matrix barcodes, known as quick response codes, in public places or other stores to sell their online assortment of products. The customer scans the code and then checks out.

These have appeared at several airline retail conferences, presumably because of the potential read-across to airlines which could use onboard connectivity and the entertainment screen to facilitate customers ordering ancillary ranges of products online.

On their websites, airlines and retailers are using the same methods to encourage up-selling and cross-selling across their product ranges. In conclusion, this is what technology has done for business. Increasingly, all businesses – whether selling flights or sofas – are becoming more similar, as customers buy and interact seamlessly with them and each other in the omni-channel world.


Why Technology is the Future Battle-Ground for Airline Customers

This is the slightly expanded text of an article which I published in the latest edition of Airline Business:

The world is being changed by technology – and technology is changing the world – faster than ever before. This is a big claim but, if I am right, every airline and airport CEO and CIO should be thinking about this issue…

Passengers have changed

Look first at who your passengers are.  No-one leaves home these days without a smart-phone in their pocket or a tablet in their handbag.  PCs and laptops are so last century.  We want to be connected anywhere, any how, any time.

We want to make informed travel choices based on surfing the web and social media. We expect information from our travel providers – which might or might not be an airline – to be personalized and tailored to our needs.

We all, whether we are Generation Y or more mature travellers, require technology to be app-easy to use, simple and intuitive.

The Future is predictable

It’s not hard to predict how we all will use technology in the future.  Our personal devices will in the future have enough data about us to learn our needs. So they will new able to recommend what holiday – and what resort or city –  we might like.  They will pull together information – reviews, flights, hotels and videos – from social networking sites and the net, and give us options.

Augmented reality will be commonplace: we will be able to go on virtual holidays to experience what previous travelers have seen and heard, with tags of information in front of the images and audio commentary.

When we have decided where we want to go and what we want to book, making payment through our mobile device will be secure and easy.  Handsets will replace plastic cards for payment.

In the future, self-service check-in will be even more ubiquitous, with mobile phones making way-finding and check-in easy.   Although we will still need to physically drop-off our bags, the airline will send us electronic bag receipts. We will be alerted as soon as we land to confirm that our bags are with us, and we will be alerted again when they are arriving in the baggage hall.

Even Security can be easier

Now here comes the piece where technology can – and should – make the most difference: the queues at Security.  Combining new technologies like biometrics and e-passports offers the opportunity for governments and airports to streamline – and improve – border checks.

Digital attention at the Airport

We as passengers – and our smart-mobiles – are going to be the subject of a great deal of digital attention at the airport.  Airport-wide WiFi will provide connectivity all the time: already many airports have realised that getting passenger attention is more important than charging for connection.

Location sensing will ensure that we no longer have to worry about where the gate is and when it is open.  The mobile will calculate how long we need to get there, calculating queue times on the way in real time, and airport staff will be able to find lost passengers, avoiding late departures.

Augmented reality will give us directions to what we want to find, whether it is the airline lounge, a coffee shop or duty-free outlet. We can opt in to receive promotional coupons from retail outlets we are walking past, and all of this traffic will enable the airports to manage their passenger flows and prevent bottle-necks forming.


More and more airports and airlines, having mastered self-service ticketing and check-in, are looking at self-service boarding.   We will scan our 2-D bar code boarding pass ourselves and pass through a secure gateway to board.  Barcodes will soon be old-hat and sensor technology and NFC (near field communication) will allow our smart phone to share boarding information with the gate.   NFC will enable our travel documents to be retrieved as we approach the gate and security check-point and to be verified by the airport reader.  The hand-set can stay in our pocket throughout this process, making the whole process much less hassle.

Technology On-Board

Everyone will expect to be connected – if they wish – during their flight.  This means that IFE (In-Flight Entertainment) will be revolutionized, and we will watch films, access our iTunes, read our Kindles, look at our Facebook and tweet using our own devices.   So will we still want an airline-provided screen or console as well?

Social networking will be as prevalent on the plane as it is on the ground. We will reward good service (and punish bad service) instantly through our social networks.   As at the airport, access to customers on-board will be eagerly sought by travel partners, retailers – and competitors.

Is it possible that eventually our flights will be free, and the costs will be paid by the providers of the products and services passengers purchase whilst travelling?

This is not a Vision

All of these technologies exist already.  Most of what I have described already exists as pilots somewhere in the world, many developed by SITA Labs.

I personally like this Future: it will be easier (and more fun) to travel like this.  But for it to happen the airlines and airports must work together to agree common-use standards and inter-operability in these new technologies.  It is in everyone’s interest to do so, at least in the Air Transport Industry.

So CEOs and CIOs reading this will, I hope, feel inspired to consider the above technologies – I believe they are going to be the entrance ticket to the future.

SITA/Airline Business IT Summit – Closing Speech June 2011

Here is the video link to the summing-up of what was a great IT Summit in June.

I think it marked a landmark in Airline IT – but more of that later…

There were some great contributions from airline and airport CEOs and CIOs.  Here are some of statements I tried to pick up on in the Closing:

* Spend more on your IT

* Don’t talk about social networking: do it

* Do more IT for less

* Fresh thinking is needed for mobile and social networking

* The difference is that the Cloud is now easily accessible cheaply and securely

* Emphasis on customers will make the difference

* Get IT out of the ‘techy corner’ and get it listened to

* Technology without business process is asking for trouble

* Need to integrate airports with the end-to-end customer experience

* IT is the driving force for Business Model change

* Every CIO/IT Director has Mobile, Cloud, Internet of Things, CRM and Social Networking on their agenda these days

My personal conclusion was two-fold:

First, that IT matters – really matters – even more than before, because it is leveraging social and economic change much more than ever before.  The role of the CIO or IT Director is to make sense of all this change and of all these possibilities.

Secondly, that IT providers are central to airlines and airports in new ways.  Yes, of course, for Operations; yes, of course, for Selling and for Servicing; but now IT is central to the whole Customer Experience.  That is new and that is the landmark change.

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