Latest RubiQ News
Sep 14, 2020
Words such as "unprecedented" don't come close to describing what airlines and passengers had to contend with earlier this year with mass cancellations and disruption to trips across the world. Startups offering technology that enables passengers to rebook themselves as well as providing carriers with a better picture of what's happening already existed - but the pandemic has thrust the need for such technology into the spotlight. PhocusWire talks to Amos Bar Joseph, founder of Rubiq . What has Rubiq’s experience of the pandemic been? There have been three phases. The first phase was mass cancellations, a rush of cancellations and refunds for the call centre. It demonstrated the need for a solution like ours and we have signed two new contracts including one major airline in Europe. The next phase is market recovery - airlines going back to the air with new routes etc. The workload shifts from the call-centre to revenue management teams. They will start to conduct trial and error experiments on new lines trying to see if there is sufficient load factor. They will cancel flights and try to centralize demand on specific flights. We’re in discussions with airlines about implementing our system for revenue management that will help with disruption in the commercial window, with scheduled cancellations. The third phase is the new normal when we start seeing year-by-year rates getting similar to each other. And we start that there will be three main characteristics for flight disruption: A contactless self-service experience. We cannot allow for the accumulation of long lines at airports and the aggregation of passengers in crowded places. Airlines will need to rely on an autonomous recovery process, a fully automated one mainly due to manpower shortage the industry is experiencing. They will encounter the build and hire versus buy and fire equation - when you have enough manpower to accommodate the recovery process, technology will replace it. Airlines will need to forget everything they have learned and rely on new data-driven approach, mainly due to the environmental uncertainty we’ll be entering and those revenue management models do not apply in the new normal. These are the three pillars that will drive innovation in flight disruption and our platform is going in that direction. You talk about airlines needing to forget everything from recent years, do you believe technology adoption is going to now accelerate in the air transport industry? If you look at the trends combining the remote trend, now working in remote environment and need to adopt technology in day-to-day like they have never adopted. It’s easier to replace manpower with technology then rehire employees than purchase technology and fire employees, that’s another stimulating trend that gives the airlines a push towards technology adoption. I think that the contactless/self-service trend due to the virus really takes an industry that heavily relied on manpower and does not allow it to use that manpower, so airlines need to reinvent the way they are approaching customers. There’s a lot of big brands in the industry whose mission statement was about that personal customer experience and this reality can not sustain in the new normal and they will need to rely on the best practices of customer experience in the digital manner not face-to-face. I’m projecting a manpower shortage because when demand returns the airline will not have sufficient to accommodate it and will have to make that decision to bring more manpower or rely on technology to replace that manpower. Airlines don’t have a lot of money, how do they then make the best of the technology to carry out the above elements to be more efficient and automate processes? Airlines are accustomed to relying on big projects that have multi-year return-on-investment length. Get a dose of digital travel in your inbox each day Subscribe to our newsletter below Submit They are implementing software that on year three will get ROI and from there everything will start bounce back. The shift we will see is about solutions that will give ROI on day one. It means airlines will need to implement faster, better agility, have faster sales cycles because they will need to see instantaneous ROI. That pushes them to rely more on startups than big corporates because startups can drive that agility with airlines. It will mean taking greater risks but a crisis demands greater risk approach so that’s one trend I’m hoping to see. I think it will be key driver in the recovery of the industry, airlines relying more on innovative technology but with smaller players and not those big players that take those years of implementation. And, following on that statement and diving deeper into the collaboration of startups and airlines, startups will play their role, as a more funded entity, they will need to build smarter and better business models that will enable airlines to cooperate with them from day one, seeing that ROI and trying to grow together. One of the pillars you talk about is being data-driven, what makes you think they can switch to revenue management in the new normal with the way their data is currently managed? There are two aspects - the de-siloing trend and relying on third party data providers. The de-siloing trend - the fact that we have end-to-end platform in that we take it from the monitoring of the passengers, find optimal solution then communicate it to them then enable them to choose and self-manage the process. If you look at that end-to-end, once one provider has a grip on all of that process, the insight you can discover are much greater than the silo mode. When you’re working with vendors that can take an end-to-end process, monitor all that, find the gaps, then you have better visibility and make smarter decisions in real time. The contrast is you have two vendors, one in charge of the communication, one in charge of the monitoring and they are trying to understand what to do better but each is looking at their own turf. Once you combine them you find a lot more hidden opportunity. There’s a big trend in the industry of relying on third party data. One example is a startup that is producing data about COVID-19 restrictions, The R factor etc., using that data airlines stimulate better passengers to book. Another thing is that since we’re doing the rebooking, we can understand which date they rebooking themselves and you can analyse that data to understand it is not new bookings but let’s see the passenger intent. We saw in our data a lot of passengers rebooking for September/October and they believe they will fly again then. Airlines have demand prediction models and they say those work great and to change the revenue management system takes two years of the sales cycle. In this reality those model will need to change constantly and to adapt and rely on those third party data providers. Collaboration in the industry has been a challenge in the past in terms of airlines working with governments and other parts of the industry. Does the current situation force more collaboration so that we can get to this new normal? We’re already seeing a lot of organizations trying to collaborate. One of the main hazards for countries are their airports, it’s one of biggest channels of new infections. At the same time the airport for a lot of countries is one of biggest revenue streams so in order to enable air transport to the country but avoid infection stimulators, airlines need to collaborate with governments to try and detect infected passengers e.g. when you see an infected passenger, where they were on flight, who they were sitting with and monitor that. Airlines will need to collaborate with competitors, governments and startups. The industry should rise up together from this crisis, it’s the only way to recover as quickly as possible. Do you see other digital technologies accelerating in the aviation industry? I think conversational technology and self-service technology. The virus has accelerated significantly the need for airlines to communicate with passengers automatically and in a more human like manner. They need to rely more on automation and at the same time they are losing their point of contact with customers, replacing human point of contact with machine point of contact. When an airline only has regular communication channels with their passengers, this will be face of the brand so they will need to rely on more sophisticated communication channels. Project forward five years, how do you think what we do today will change or will have changed…when we go to airport or get on on a flight? That’s the one million dollar question. If I look at just one point in the security process today and you need to take shoes because 10 years ago one suicide bomber tried to hide a bomb in their shoes - 10 years later… so for those that say everything will return to normal, I think not. The new normal will be that you need to show you are coronavirus free through some kind of documentation. Airports will also be hazard so will a lot of contactless robotics. The belief there be vaccine that will cure the whole world, I don’t buy that. I think it will be lot longer to vaccinate the whole world. Airports will be a dangerous place so in five years, we will need to come to the airport four or five hours earlier, we will need to go through more extensive security measures in terms of epidemiological measures. And, you see almost no personnel at the airport.