Where's the smart money going?

This year's big fall in mishandled baggage is thanks to massive industry investment. So where's the smart money going next?

Baggage Report 2015

With traveler numbers on the rise, the air transport industry must keep up its investment in baggage systems to cope with the ever increasing pressure they’re coming under.  

According to the Baggage Report 2015 by SITA and Air Transport World, the industry is doing just that, with baggage processing and management as well as self-service processes ranking as top investment priorities.

But the relentless pressure constantly threatens to nudge up the mishandling rate as we see record load factors and uplifts in the number of passengers.

“It is a reminder to us that we cannot afford to take our foot off the pedal,” says Francesco Violante, CEO, SITA.

“IATA is forecasting another year of strong passenger growth in 2015 – even higher than in 2014. Just to keep bag mishandling rates in check will require continual investment, collaboration and focus from all industry partners.”

Control

Airlines and airports recognize passengers’ desire for more control and are pushing forward with investment plans for self-service solutions to allow passengers to process their own bags at the airport.

So given the big focus on bags, what investment priorities does this year’s Baggage Report identify?

Bag-drop

Top of the agenda is self-service bag-drop: 16% of airports and 9% of airlines now provide passengers with self-service bag-drops. This is set to rise to 62% and 70% by the end of 2017.

Finavia in Europe has been piloting self-bag-drop at Helsinki Airport since 2012, with extremely positive results according to Ville Haapasaari, Finavia’s Director of Helsinki Airport.

“Self-service, such as bag-drop machines, makes the check-in times of passengers more flexible, evens out the busy periods at the airport, and increases the check-in capacity of terminals,” he says.

“More effectively produced airport services also provide airlines with cost advantages, which are also ultimately the precondition for moderate flight ticket prices.”

Self-service benefits

Self-service, such as bag-drop machines, makes the check-in times of passengers more flexible, evens out the busy periods at the airport, and increases the check-in capacity of terminals. 

Ville Haapasaari, Finavia’s Director of Helsinki Airport

Bag-tagging

Self-bag-tagging will grow in popularity too. Enabling passengers to print their own bag-tag, at home or at the airport, gives them more control and enhances their traveling experience.

Currently, about a third of airlines and airports give passengers the ability to self-tag their luggage using tags printed at airport kiosks. Over the next three years 59% of airports will invest in a major program and 26% will finance pilot projects.

While most of the industry is focused on airport-based bag-tagging initiatives, a growing few are making headway in bag-tagging at home. Alaska Airlines became the first US carrier to offer home-based self-bag-tagging, during 2014.

“Our goal is to be the easiest airline to fly,” says Curtis Kopf, Alaska Airlines’ Vice President of Customer Innovation and alaskaair.com.

“That’s why we’re introducing additional self-tagging capability so customers who prefer self-service options have the ability to print bag-tags at home during the check-in process. Tagging your bags at home can save some time at the airport.”

Bag tracking

With the rapid adoption of mobile devices – not to mention IATA’s Resolution 753 to keep tabs on every item of baggage from start to finish – bag tracking is firmly on the industry’s IT agenda.  

To date, 35% of airlines provide real-time baggage information to their staff, with 79% anticipated by the end of 2017.

With 97% of passengers traveling with a mobile device, 81% of airlines expect to offer travelers the ability to use their devices to track their baggage within the next three years.

BagJourney

SITA’s new BagJourney is helping the industry to meet these expectations.

“BagJourney enables the user to provide the passenger with instant feedback on where their luggage is from scanning a bag-tag receipt,” says Nick Gates, SITA Portfolio Director, Airports.

“At the same time the information from BagJourney helps the user to complete the report without the passenger having to fill in forms.”

These greater efficiencies go hand-in-hand with improved levels of customer service, says Gates.

“Feedback from passengers has been good in that they like to be processed where they are. The tablet app forces ground handlers to be more proactive in seeking out passengers, which in turn is deemed by passengers as providing a much better customer service.” (See ‘Let’s make baggage smarter.’)

Choice and flexibility

Passengers are hungry for more autonomy and choice when it comes to processing luggage and getting more information about what’s happening with their bags.

At Melbourne International Airport, choice and flexibility top the baggage investment agenda. It’s all part of the focus on enhancing the traveler experience, according to Bryan Thompson, the airport’s previous General Manager Strategy Planning & Development.

“Our vision for automated baggage and self-service is to give passengers choice. Different passengers have different needs so to provide choices that will meet everyone’s needs, we believe our infrastructure needs to be flexible.”

As more travelers become more comfortable with self-processing their bags, saying they’d definitely use this service if available, it’s all too clear that greater control and choice are essential to the passenger experience.

See also

Let's make baggage smarter

Let's make baggage smarterSmarter baggage will continue to improve the travel experience and save money, with real-time bag tracking keeping passengers in the know, says Nick Gates, Director Baggage Portfolio, SITA.

Read his column

The power of data ... released

The power of data releasedThe beauty of having simple application programming interface (API) access to a wealth of data is that this data can be reused over and over again across multiple applications and customer touch points.

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Don't miss

Baggage Report 2015

The air transport industry (ATI) has cut the rate of mishandled bags by 61.3% globally since 2007, creating US$ 18 billion in total estimated cost savings.

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