nigel dolby - aci.aero events/trinity... · 5 152535 4555657585 95> dwell time minutes spend per...
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Maximising Commercial RevenuesDwell Time
Nigel DolbyFounder
Core Objective
To Maximise Airport Shopping & Dining Revenues:
Every PassengerEvery Customer
Every VisitorAll Day
Every Day
Achieving Our Objective?
Global Turnover = $35 Billion USDSignificant Evolution & DevelopmentImproved FacilitiesWidth & Depth of Portfolio
$35 to $40 Billion per annum Lost Sales
Achieving 50% of our Potential
We Are Not Maximising Revenues!
Delivering Our Objective
A Commercially Dynamic EnvironmentIn Which:
The optimum portfolio of shops, restaurants, facilities
Of the appropriate quality and size
In the right locations
Delivering the optimum range of products and brands
Supported by the highest levels of retail/dining standards and service levels
Dynamic Commercial Environment
Relaxed, Comfortable & Stress Free
Facilitate, Motivate, Stimulate & Inspire
Can Spend, Want to Spend & Do Spend
The 3 ‘Musts’: Money, Opportunity & Time
Commercially Dynamic?
Commercially Destructive Environments
Time
One of the 3 Minimum RequirementsIt’s a Must – Not a BonusAirports = Finite & Limited Time
2 Essential Elements to ‘Time’
Physical Time – ‘Dwell Time’The ‘Concept of Time’ – How long have I got?
Time Retrospectively Has No Value
Penetration %age by Dwell Time
0%10%
20%30%40%
50%60%
70%80%
5 15 25 35 45 55 65 75 85 95>
Dwell Time Minutes
Spend Per Customer by Dwell Time - Ratio Increase
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
5 15 25 35 45 55 65 75 85 95>
Dwell Time Minutes
Global Dwell TimeAirport Dwell Time = 137 Minutes36 minutes of Processes & Transitions101 Minutes to Complete
65 Minutes of queuing, waiting, watching & orientation47% of Total Airport Dwell Time is Wasted
Commercial Dwell Time = 29 MinutesOnly 21% of Customers Total Time
This is Not Commercially Dynamic!
Lost Dwell Time2.1 Billion Hours of Lost Time
Only 0.9 Billion Hours of ‘Commercial’ Dwell Time
Global Lost Dwell Time
0
100
200
300
400
500
600
700
Check In Security Orientation FIDS The Gate
Hou
rs in
mill
ions
Breakdown of Customers Airport Time
26%
47%
6%
21%Process Time
Queue, Watch & Wait
Basic Needs
Commercial DT
Dwell Time - Check InCapacityProcess TimesKiosk & On-line Ratios Staff CompetencyCheck-In SystemsQueue Management
NO
The Allocation and Utilisation of Check InDesks does not meet the demand from
Customers wanting to Check In
Check In
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
265 245 235 225 215 205 195 185 175 165 155 145 135 125 115 105 95 85 75 65 55 45
Arrival, Check In & Capacity ComparisonArrivalCheck InCapacity
Waiting
Queuing Over Capacity
Dwell Time – Check In
Customer: 18 Minutes of Waiting & QueuingAirport: >40% Capacity DecreaseAirline/Handling Agents: 22% More Resources
Duty Free Companies, Retailers & RestaurateursBrand Owners & Airport Owners:
$4 Billion Lost Revenues
Every Stakeholder Loses
Dwell Time – The Gate
• On-Time Departures• The Myth of Late Arrivals• Controlled by Airlines• Over Compensation
No Correlation Between Call to Gate & Boarding
Average of 22 Minutes of Waiting
Dwell Time – The Gate
Call to Gate
Permanent Gate
Arrival Pattern at the Gate
0%
50%
100%
150%
At Gate
Boar ding
At Gate 26% 66% 92% 100%
Boar ding 0% 0% 0% 0% 0% 0% 0% 27% 27% 27% 14% 5%
5 10 15 20 25 30 35 40 45 50 55 60
Arrival & Boarding Comparison
0%20%40%60%80%
100%120%
Minutes Pre Departure
At GateBoarding
At Gate 4% 10% 17% 28% 42% 61% 82% 95% 100%
Boarding 15% 54% 26% 5%
120 110 100 90 80 70 60 50 40 30 20 10
Dwell Time – The Gate
Customer: 22 Minutes of WaitingAirport: >18% Reduced Gate CapacityAirline/Handling Agent: 13% More Resource
Duty Free Companies, Retailers & RestaurateursBrand Owners & Airport Owners
$6 Billion Lost Revenue
Every Stakeholder Loses
The ‘Concept of Time’
• Processing Passengers – Not Serving Customers• 10 Minutes of Lost ‘Commercial Time’• ‘Wait in Lounge’?• “How Long Have I Got” – Timeframe
Control Of TimeI have got 45 mins – not – I had 45 minutes
Time Retrospectively Has No Value
Airport Spending Drivers
Impulse Sales – CriticalAdditional SalesImpulse = 79% of all revenueNeed or Want = only 21%
Only 27% Impulse Revenue73% Convenience RevenueOur Malls are not ‘convenience’Not Maximising Revenues
Downtown Shopping - 3 Spending Drivers
Need2% Want
19%
Impulse79%
Airport Shopping - 3 Spending Drivers
Need24%
Want49%
Impulse27%
Time – Understanding The ValueAirport Shopping/Dining Spending
0.00
1.00
2.00
3.00
4.00
5.00
5 15 25 35 45 55 65 75 85 95>
D we l l Ti me M i nut e s
Considered Impulse Concept of Time Impulse
Considered/Convenience – Finite ValueImpulse = Revenue GrowthImpulse driven by Dwell Time & The ‘Concept of Time’
Creating a Demand – We are Not Fulfilling a Demand!
Dwell Time - Summary$4 Billion Lost Revenue – Check In$6 Billion Lost Revenue – Gate$3 Billion Lost revenue – Security, FIDS, Orientation$5 Billion Lost Revenue – The ‘Concept of Time’
$18 Billion Lost Revenue
Appalling Customer Service Levels/ExperienceOver ResourcedCapacity Reductions
Every Single Stakeholder LosesWHY?
Why? Because We Always Have!
Queuing & Waiting is expected, tolerated and excusedCustomers have no choiceCaptive Audience Syndrome
Treating the Symptoms & Not Solving the Problems• Build for Queues• Queue Management Systems• Resources to Manage Queues• Fast Track – at a cost• Avoid Queues - Premium Service for the minority
We Manage & Exploit – We Do Not Eliminate
Why?Airports
• Poor Relationships with Airlines• There have always been queues• Operations v’s Commercial• Complex Contracts• Why Should We Change?• “What’s In It For Us”?• We Do Not Know Where to Start
Retail/Restaurant & Brand• Poor Relationships with Airport• Its Not Our Fault• There’s Nothing We Can Do • We Do Not Understand• Is It Worth It?• It is Too Difficult• We Do Not Know Where to Start
These Are Not Valid Reasons to Turn Your BackOn Your Share of $18 Billion Per Annum
Individual & Collective ResponsibilityYour BusinessYour CustomersYour Revenues
Global Averages Are Irrelevant$4 billion or $40 billion – it is just a number
What Does This Mean For Your Airport, Your stores, Your restaurants, Your brand
What Is This Worth To You?
The Challenge• Commercially Dynamic – Not Destructive• ‘Time Is of The Essence’• Eliminating Entrenched & Endemic Problems
Is This Challenge Realistic & Achievable? Yes It Is
Is This Challenge Worth It?Yes It Is
Is This Challenge Quick & Easy?No It Is Not
The ChallengeCommercial Dwell Time = $13 Billion per Annum
Efficient and Effective Processes
The Concept of Time = $5 Billion per AnnumCommercially Focused Customer Information – Not Passenger Data
$18 Billion - No Challenge is tough enough
I am up for the Challenge
ARE YOU?
Thank You For Your Time
I WelcomeAny Questions?
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