Focus: Driving Non-Aeronautical Revenue At The Airport Setting

A focus on non-aeronautical operations and revenue growth is crucial for airports today.

Developing this area of airport operations has become even more important during economically challenging times. In the majority of cases, an airport's revenue streams depend on the number of passengers an airport serves; lower traffic equals lower income. Nevertheless, there are some areas of an airport's non-aeronautical operations that can still generate a high percentage of earnings, despite a decline in traffic figures.

Diversify

Airports drive revenues from number of activities, one of which is sales of advertising spaces inside and outside of terminals. Passing through an airport of any size and located anywhere in the world, it's mpossible not to notice some kind of advertising at one point or another. 

Advertisers have come up with several new, innovative ways to creatively use available space to communicate specific messages to those who utilize airports.

Lately, we are getting exposed to more sophisticated methods of brand promotion. Airports are getting keen on allowing companies to showcase their products and services to prospective buyers in more creative ways. Rather than using more or less  traditional, static or digital media formats, companies are interested in providing passengers with a chance to experience and interact with a product or a service. Nonetheless, it seems that a major part of smaller, regional airports cannot see the potential of such strategy when it comes to offering their terminal spaces to advertisers.

It is obvious that expanding  media offer, investing new opportunities, but technology can be overwhelming. 

Special events, branded spaces, and sponsored areas amenities not only drive non-aeronautical revenues, but also give airports a chance to create a social buzz, reduce cost, improve passenger experience, and provide entertainment in a highly stressful environment. 

At the same time advertisers can experience exclusive opportunities that make them stand out from a crowd of not always appealing airport ads.

Changing the way airports think about terminal space intended for advertisement seems crucial. A relatively small number of airports have changed their relationships with advertisers and decided to go a step further; creating meaningful and valuable partnerships with brands can help airports in number of ways.

Cost Reduction

From the airport perspective, this approach to airport advertising seems to be the most interesting and attractive. Airports try to reduce their operating cost to meet their budgets. At the same time, passengers expect services that sometimes cannot be provided due to the lack of resources. By passing  some of the costs on external companies, airport operators have a chance to provide passengers with improved services, or services that would not be available otherwise.

Airports such as Zurich, Frankfurt International, and Dubai International have teamed up with well known tobacco companies to provide millions of smokers that pass through their terminals each year with exceptional services. 

Smoking lounges do not seem to be the necessity for most of the passengers. However, there is a large group of travelers that appreciate an amenity that not many airports provide. Investing in a new facility that may require a significant amount of money and caters only to a small percentage of passengers does not seem to be cost-effective for most airports. That is the reason why finding the right partner, which can partially or even fully absorb the cost.

Customer Experience

Improving the customer experience is a critical issue for any airport. In today's fast moving world, passengers look for experiences that make them feel special. A service that differentiates the airport from its competitors can greatly improve the loyalty and satisfaction amongst it's travelers.

One of the best examples of how a brand can improve passenger experience through airport advertising is installation of recharge/power stations. The service is becoming more popular with an increasing number of recharge stations available at airports around the world. 

A leader in providing power stations is Samsung. The company found a way to engage passengers by providing them with a solution to one of the most common problems that travelers face — the inability to recharge a device, which may cause a lot of stress and annoyance in an already stressful environment. Apart from providing passengers with much needed services, each of Samsung's "Power Poles" are equipped with a build-in screen that allows the brand to promote its latest products.

Creating A Social Buzz; Free Publicity

The popularity of social media and ever growing number of mobile devices, such as smartphones and tablets, allow airports to engage and communicate with passengers in a way that was never available before.

A single short message or a picture has a potential to reach millions of people around the world in an relatively short time. The power of social media has already been recognized and cannot be underestimated. 

So how can airports achieve the goal of 'free', and even more crucial, positive publicity worldwide? 

A number of examples exist, one of which is Ikea's pop-up lounge at Paris Charles De Gaulle Airport. The campaign ran during the summer of 2012 and was organized jointly by ubi bene, KR Media (IKEA France's event agencies), and by JCDecaux Airport (advertising concession at Paris Airports).

The Swedish furniture design specialist put together a 200-square meter "VIP lounge open to everybody" (including a supervised children's area) in Terminal 3 of the Parisian airport. The space gave passengers a place to rest before their flight while also providing them with a unique experience.

The partnership between IKEA and the airport was featured in number of publications.  Magazines, websites,and  blogs around the world that specialize in topics such as architecture, interior design, advertising, commercial aviation, experimental marketing, and branding were all interested in covering the topic. 

The  examples outlined above show that airports have immense possibilities when it comes to accommodating the terminal space for advertiser needs. Working together, airports can partner  with well known brands, identifying opportunities to help advertisers reach a targeted audience in an unusual and influential way.

However, to work well, this approach to advertising requires a complex collaboration not only between a brand and an airport, but also within the airport itself.  Media departments should work closely with a number of other departments to be able to identify the needs of advertisers, and to match them with the needs and desires of passengers. 

Airports need to understand that brands are looking for new creative ways to capture the attention of travelers, and they need to learn how to use it to their advantage.

About the Author:

Malgorzata Lach is the founder of a recently launched training and consulting firm, smartaer.com. The company focuses on helping airports and airlines research, identify, analyze, and evaluate sponsorship and partnership opportunities that enhance passenger experience, reduce operating costs, and get recognition.  

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