The aviation industry is constantly evolving, and the latest report from IdeaWorks Company delves into the "coolest" airline products and services that are revolutionising the sector. Among the eight airlines recognised for their innovative initiatives are AirAsia, Jetstar, and Cathay Pacific.

The report – Airline Revenue Innovations, a Global Sample of the Coolest Products and Services – is authored by Jay Sorensen, an expert on airline ancillary revenues, and sponsored by Car Trawler, the B2B technology provider of car rental and mobility services.

Capital A for effort

The report also takes a close look at Capital A, the new name of AirAsia Group, which is “undertaking a significant change by becoming an Asian conglomerate”.

Focused on AirAsia Super App’s wide variety of retail and media activities, Sorensen says this initiative is definitely a work-in-progress in which the company has bet its future on the ambition "to be the top online travel agent in ASEAN", according to Tan Mai Yin, CCO, AirAsia Super App.

Capital A wants to go beyond a loose-knit affiliation of companies in finance, logistics, air travel, catering, airport operations, online grocery, and venture capital, to a customer-facing powerhouse,” the report notes, calling it “a huge goal”.

Sorensen says Capital A represents a level of innovation on a scale the airline industry rarely sees.

“There may be a pot of gold at the end of this rainbow and the company will likely need the luck of an Irish leprechaun to reach it,” he adds.

Cathay gambles “all its chips”

Cathay launched an “experiential retail space” in Hong Kong’s Cityplaza in December 2022.

Cathay’s opening of an “experiential retail space” in December 2022 can be viewed as a physical manifestation of the airline’s mission to become a premium lifestyle carrier, IdeaWorks suggests.

The store is located in Hong Kong’s Cityplaza and features merchandise to “showcase the very best of the premium travel lifestyle that Cathay represents”.

Shopping is enabled by Cathay’s app which allows consumers to scan items to an in-app shopping cart and pay by credit card or a mix of money and miles.

”It’s a lot for consumers to digest and for the company to deliver," notes Sorensen. “Cathay is certainly on a mission to redefine itself and is betting 'all its chips' to be Hong Kong’s hometown airline, and much more.

“In an industry which is moving to serve price-conscious consumers, Cathay hopes the focus on upscale travellers will allow it to maintain their unique competitive advantage,” Sorensen says.

The ‘Cathay’ brand also refers to the airline within the Hong Kong market, whereas Cathay Pacific will continue as the airline brand globally.

Sorensen adds, “This is a unique approach for airline marketing, and it has the feel of being an ongoing experiment as Cathay Pacific Group flies a path out of the pandemic, which includes determining Hong Kong’s future role in Asia.”

United’s ‘grab-and-go’ concept

United found 54% of its airline club and lounge visitors wanted to take food or drinks to go. That prompted the airline to create the Club Fly grab-and-go concept which was introduced at Denver International Airport in November 2022.

The IdeaWorks report says Club Fly has a smaller footprint than a traditional lounge and does not encourage travellers to linger (only 16 seats) – “perfect for Denver’s many connecting passengers”.

Emirates offers ‘retail escapism’

Emirates World retail store in Dubai offers VR A380 tours, Premium Economy experiences, and aims to provide a personalised touchpoint.

Emirates World offers 280sqm of lounge-like retail space which combines physical and virtual reality displays.

Premium economy seats are on display with first class suites and the onboard lounge of the Airbus 380 aircraft rendered in a life-size presentation using virtual reality technology.

Cross-trained representatives provide one-stop service for airline services, loyalty programme, and vacation planning. Branded merchandise is also available for purchase from the Emirates Official Store and Costa Coffee baristas provide coffee, tea and other refreshments.

The airline plans to introduce more Emirates World locations throughout its network during the next three years.

Sorensen predicts, “Look for more airlines to adopt a style of retail escapism by offering immersive experiences that make travel planning enjoyable and entertaining, coupled with skilled and personalised service.”

Delta and Starbucks brew partnership

Sorensen says the best partnerships are those in which both partners generate benefits and are excited by the opportunity.

“The Delta SkyMiles programme now has contact with billions more transactions and customers. Starbucks is now associated with a travel reward programme and the universal allure of rewards which are more exciting than a cup of coffee,” Sorensen says.

Every dollar spent at a Starbucks accrues one mile from Delta SkyMiles. When the Starbucks Rewards member travels on Delta, double Stars are accrued for Starbucks purchases.

Eurowings’ take on premium seating

Eurowings Premium Economy Class offers wider seats, up to 50% more legroom than Economy Class, and includes two pieces of baggage.

While offering an empty middle seat is not an innovation, the Ideaworks report commends Eurowings for automating the process in its booking path.

“Blocking the middle seat is an expedient method for LCCs to create a premium seating zone to attract business travellers. It mimics the 'business class' seating provided by sister carrier Lufthansa on short- and medium- haul flights in Europe,” Sorensen says.

Jetstar entices FareCredit spend

IdeaWorks finds Jetstar notable for selling Flex and Max bundles which allow fee-free changes and cancellation of bookings. The base Starter fare and Plus bundle are not refundable (limited exceptions apply under law) and impose fees for reservation changes.

Just prior to making payment in the booking path, Jetstar offers the FareCredit option to consumers who have selected these restricted fares. This provides credit for the fare and a la carte options when they cancel a booking for any reason.

FareCredit is fulfilled as a travel voucher and does not provide a cash refund. “It’s an effective way to encourage additional spending from consumers before they close the transaction,” Sorensen notes.

The traveller is required to cancel the reservation before their flight opens for airport check-in, typically three hours before departure.

The airline issues the voucher within 24 hours via email. Voucher validity is three years for original bookings made on Jetstar Airways (Jetstar Japan: 6 months, Jetstar Asia: 18 months).

EasyJet ’s lounge for low-cost flyers

EasyJet is rare among low cost carriers (LCCs) for offering airport lounge benefits.

EasyJet’s Gateway fee-based lounge at its London Gatwick hub opened October 2021 and offers complimentary hot and cold food, freshly prepared and served to guest tables, alongside a range of self-serve side dishes and hot and cold drinks.