Improving Revenue for Hong Kong International Airport
Abstract
Hong Kong International Airport is one of the most thriving airports globally due to its quality, innovations and extraordinary services offered to the customers. The primary source of revenue for the airport currently mainly comes from the passengers and cargo. The airport has over 160 destinations worldwide, indicating how expansive the company covers worldwide. It has been ranked as one of the best airports globally over 40 times for ten years. The airport is highly accredited due to its high levels of security, comprehensive safety measures and its obsession with environmental protection. In the year 2008, the airport made revenue of HK $78 billion dollars, which equalled to 4.6% of the city’s GDP. In essence, the company has over 62,000 employees in the organization. It also has a long time planning once every five years aiming at focussing on demand forecasts, efficiency and quality of the services provided and maintaining a competitive place in the aviation sector globally. The summary to implement its 2030 master plan, Hong Kong international procedures to increase revenue to expand its scope of performance due to expected increase in activities by 2030. The revenue required to implement the master plan cannot be sustained by the current operations of the airport.
Self- Service Technology and Integrating Data to Drive Gate-Side Revenues
The airport management should improve on tactics that allow their clients to spend more by buying goods and services in the airport. According to research, when passengers report high levels of satisfaction they tend to spend more than 45 percent in the airports. By improving, the quality of services offered in the restaurants and receptions the customers will spend more during their stay in the airport (Three Runway System, 2016). This will increase the revenue for implementation of 2030 mastermind. This will be implemented by innovation and integration of the customers in their flights as well as during their retail scenes.
Personalization of the Engagement in Technology As Well As Features as Mobile Tracking
The airport needs to increase the level of technology exposure to the clients so that they can request services at their leisure without having to hover through the airport. This will be utilizing using smart phones to track information such as traffic flow, and control it accordingly. The process will also involve the customers using I-pads, Smart phones to get information on flights, and this will reduce the traffic at the gates for departing flights by 50% (Three Runway System, 2016). This will have a great implication on cutting operational costs and increase revenue generation for the company. The process will be a win-win situation for travellers and the airports. The customers will enjoy smooth travel process as well as a close engagement with the services by the airport; while the airport will be able to cater for travel needs and increase the number of flights as well as increase revenue growth (Three Runway System, 2016).
Ground Transportation and Parking
The company can also develop revenue by assimilating the transportation on the ground. When the airport takes hold of transportation of customers coming into the airport and out of the airport, they will be able to generate over 19.8% of the total revenue being received currently (Three Runway System, 2016). This revenue generated by ground transportation is classified as non-aeronautical flights.
Commercial Developments and Advertising
Although the two development option for vision 2030 aims at expanding the operational structures of the airport, simple temporary structures will help in improvement of the revenue. By creating features such as industrial parks, logistics hubs and advertisement banners, which will be rented to outside companies, will boost the revenue of the company. By making the airport business oriented while maintaining the quality of services provided will boost the income revenue of Hong Kong Airport (HK Airportofficial, 2011). Compared to other airports such as Asian airlines, who have endorsed advertisement strategies both at the airport and inside the planes, Hong Kong airline will have to chip in various strategies to advance its commercial take and advertising both on the ground and during flights (HK Airportofficial, 2011).
Time Spent By Customers in the Airport
For the airport to ensure that they make maximum sales to the customers they have to make the clients spend more time at the airport. If a customer spends an average of 98 minutes per day, the amount of money spent by the clients will increase by a favourable value (Three Runway System, 2016). For clients spending more than 60 minutes will spend an average of 30 percent more than those customers who spend less than 60 minutes at the airport. For Hong Kong airport, being a destination for both local and international clients, varying commodities will be an added advantage for the revenue of the airport (HK Airportofficial, 2011).
In conclusion, Hong Kong airport can generate an enormous amount of revenue through non-aeronautical services. The two development options by Hong Kong airport will need the airport management team to implement such strategies to ensure the revenue collection moves in line with the project. To add a third runway at the airport will benefit a lot from these services. In the long run, since the expansion will be a beneficial strategy to the government, funding from the government can be a stepping stone to the upgrading of the airport.
References:
HKairportofficial (Director). (2001). Hong Kong International Airport Master Plan 2030 [Motion picture].
Publications - Three-Runway System - Hong Kong International Airport. (n.d.). Retrieved June 09, 2016, from http://www.threerunwaysystem.com/en/Information/Publications.aspx
