The Evolution of Airport Concessions through Mobile Apps and the Impact on Airport Facility Design

Few people have regular telephones or even regular cellphones anymore. Most telephones and cellphones have been replaced by smart phones. These smart phones, regardless of which operating system they run (iOS or Android), provide incredible capabilities that were not even dreamed of a decade ago. We have entered the age of “swipe left, swipe right” and consumers can now get anything they need or want at a touch of a button.

Except in the aviation industry, where technology has lagged significantly in its application. Some airports have developed, or are developing apps. These apps, however, have limited value, except to a person who flies through that single airport frequently. Some companies, like Chipotle or Starbucks, have developed their own Apps, which work for iconic brands (although not always for these brands locations in an airport). However, for lesser known brands, or those with only a limited geographic presence, branded Apps offer limited value to travelers and have minimal impact on the consumer and concession experience at the airport.

Consumers have grown to expect on-demand access anywhere they happen to be. To meet the tremendous demand to offer the convenience of mobile ordering that consumers have come to expect, including providing recommendations and delivery, some third party companies have designed applications which will work with airport concessions to provide additional convenience to passengers. There are two which are currently leading this new segment of the market, Airport Sherpa and Grab. These applications have the potential to positively impact customer service and customer satisfaction, increase revenue from concessions and potentially, require changes to facility design in the future.

Grab allows customers to order food service concession products and the customer can then “jump the line” and pick up their order without waiting in the queues that often develop at concession locations. The potential impact on airport facilities would primarily occur in the design of the concession locations. Ideally, there would be a separate, and clearly designated, location for customers to pick up their orders. This is a change as most quick service locations have limited counter space, and minimal space behind the counter where prepared orders can be kept at the correct temperature. The appropriation of the valuable space up front in these locations will need to be reconsidered to optimize the facility, the revenue resulting from use of the technology, and to positively impact customer satisfaction. Order pick-up full-service restaurants may occur at bars or hostess stands; however, maintaining food at the right temperature will be challenging, as customers may not proceed to pick up their orders as rapidly as they might have hoped for when the order was placed.

Airport Sherpa varies from Grab in a number of ways. One primary point of differentiation that impacts facility design is that Airport Sherpa offers delivery of food service and retail products to customer locations anywhere in the airport. These delivery locations may include employee breakrooms, airport offices, and, most importantly, holdrooms. Orders may be placed anytime, up to a week in advance of the day of travel, and Airport Sherpa tracks the location of the customer’s flight to ensure delivery to the correct location at the proper time. A second differentiation is the use of data analytics to create a personalized experience for the customer. Airport Sherpa gathers flight itinerary information and then provides recommendations based on the flight time, gate and user preferences as well as adjusts to unforeseen situations like delays or gate changes. There are many customer segments and scenarios where who would benefit from concession pre-ordering and delivery service including:

• The business traveler, who has her journey from car park to holdroom timed out exactly and who does not include time to visit a concession, but who might be interested if they could pick up their purchases as they board their flight
• Families, which have significant amounts of hand luggage, strollers, backpacks, etc. These people often find it difficult to move all their belongings into a restaurant, and further, there are often differences in the types of food each person wants. Delivery services can solve for both these issues by bringing orders, possibly from different stores and restaurants, to the family’s holdroom
• Gate-huggers, who immediately head towards their gates as soon as they pass through security, and who then are fearful of journeying out of eye-sight of their holdroom. These travelers can now enjoy any concession products that they want (as long as they pre-order, or there is sufficient time for the order to be brought to them)
• Airport employees, who may not have the time to go through security in order to order the foods that they want. Instead of grabbing a candy bar from a vending machine, they can simply open up their smart phone and the airport is brought to them
• Airline employees, where a 25-minute turn does not allow them the time to reach a large variety of concessions. These people can pre-order, even in flight, if the aircraft offers Wi-Fi, so that their orders are waiting for them when their aircraft arrives.

There are potentially a significant number of impacts to facilities that should be considered. The first impact will be in the need for customer queuing space. Traditionally, concession planning requires that significant space be dedicated to Disney-style queues for customers. Apps will lessen the demand for this space by taking customers out of lines. This should also help the flow of passengers through food courts and allow concessions to generate additional revenue while using staff and space more efficiently.

Another direct impact of apps will be reducing the need for additional concession space to serve a growing passenger market. By removing customers from the queues and seating areas, concessions can meet increased customer demand without requiring more seating or preparation space. Similarly, concessionaires will be able to serve more people with the same current levels of staffing, as Airport Sherpa deliveries are done by Airport Sherpa, not concessionaire, employees. This can provide a significant financial benefit to concessionaires. Concession financial metrics, such as sales per square foot, will need to be reconsidered over time as the current standards, as they are applied to facility planning, may no longer be applicable.

A further aspect of terminal planning that will be impacted by the growth of concession ordering and delivery services, such as Grab and Airport Sherpa, is the shape, size, and facilities in holdrooms. While traditional terminal planning has held that concession space, to some extent, may substitute for holdroom space as it holds passengers before flights, this will change as more people actually dine in holdrooms. As a result, the demand for holdroom space will likely increase to some extent. In addition, it will be necessary to ensure that there are sufficient receptacles for trash and recyclables as the need for these will increase to help to ensure that the holdroom areas remain attractive and sanitary. Holdroom seating will also need to be reconsidered. While the current trend towards seating at high level counters with charging facilities will remain a viable option, additional seating that is targeted towards group dining should be considered. This may be accomplished by a center table surrounded by chairs which can be rotated either to face toward the center for group dining, or away from the center for regular use, or through the addition of other flat surfaces to accommodate dining.

There is one final facility impact, specific to those services, such as Airport Sherpa, which provide product delivery. When an airport has unit terminals (such as FLL) or unit concourses (as is currently the case at BWI), delivery personnel and product orders will need to pass through security checkpoints, if the product is only offered in a separate terminal or concourse adding additional demand through often strained facilities. One possible solution would be to create employee checkpoints, such as those available at Chicago O’Hare International Airport and many airports located outside the US. This solution would benefit not only the delivery services, but any employer whose workers must pass through security checkpoints to reach their duty stations. It will also remove two frustrations for travelers: having to wait while products are scanned; and/or having airport badged workers cut ahead of them in lines. Cost and space limitations have likely impacted the consideration of providing employee security lines, and delivery services, by themselves, are not going to be the reason to add these facilities. However, they should add additional weight to the argument for adding separate security screening.

Mobile ordering of airport concessions, particularly when paired with personalized recommendations and product delivery services, provides an exciting opportunity to increase customer service and satisfaction as well as revenue from concessions. While somewhat subtle, the complete implementation of these services will impact terminal planning, and these impacts should not be ignored. However, careful consideration of the changes that concession ordering and delivery services bring about will help to inform future designs that continue to meet the need of the ever-evolving passenger.

Alan Gluck is the chairman of Airport Economic and Concession Consultants, LLC. Gluck has over 22 years experience in airport terminal and commercial planning and operations, and has been a member of numerous planning teams. He served as the commercial manager at both BWI Marshall Airport and Fort Lauderdale Hollywood International Airport, and has participated in facility planning projects throughout the US, in Canada, and overseas.