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Airlines increase investment to deliver modern retailing, finds Amadeus study

Airlines increase investment to deliver modern retailing, finds Amadeus study

Both full service and low-cost airlines are digitally transforming, with carriers planning to increase investment in technology by an average of 13 per cent in 2024, according to Travel Technology Investment Trends, a major new study commissioned by Amadeus.

Data shows carriers are optimistic about the move to ‘modern retailing’, which sees airlines adopt a completely new generation of technology to create personalised offers and administer them using a single order record.

A large number of airlines are already acting, with a third planning to implement new technology for offer creation and order management during 2024 and a further 50 per cent intending to implement such technology over the coming five years.

Around 40 per cent of airlines surveyed have already hired additional IT talent and put both business plans and business process plans in place, with almost all remaining airlines currently working on those tasks.

According to the study, the vast majority of airlines plan a ‘gradual shift’ to new Offer & Order management technology over the coming years, with 58 per cent of airlines surveyed intending to implement the new model across existing interline partnerships as a first step.

Some 44 per cent said they would begin by gradually implementing Offer & Order across the airline’s own digital channels first.

However, roughly a third of airlines are planning a ‘big bang’ or ‘one-off’ switch to Offer & Order across all sales channels when those channels become ready.

Cyril Tetaz, executive vice president, airline solutions, Amadeus said: “These findings match our own experience.

“Several Amadeus customers have firmly committed to digitally transforming their entire operation with new retailing technology.

“Doing so is helping airlines become customer and data driven so they can better understand passengers and deliver a truly traveller-centric experience.


“We’re ramping up our investments to support these trends. It’s an exciting moment for airlines and their passengers.”

In addition to packaging compelling offers, the move to modern retailing also sees airlines improve how they ‘deliver’ for passengers at the airport.

According to senior airline leaders, ‘improving the airport experience’ tops their list of technology priorities, with 65 per cent of airlines planning to enable this by rolling-out biometrics at key service points like check-in, bag-drop and boarding over the next three years.

“Our data shows two-thirds of LCCs plan to increase investment in technology. Interestingly, the top drivers are ‘innovation’ and ‘revenue increase’ rather than cost reduction.

“While many LCCs already operate with Offer and Order style technology, the broader shift across the industry presents opportunities.

“For example, more than half of LCCs told us they plan to interline with traditional airlines when those carriers make the switch to new retailing technology,” added Dave Evans, chief executive at Navitaire.

More Information

Find the full report here.