Airlines are seeking to reinvent their short-haul onboard service with modern, branded food and save money at the same time
Automotive manufacturers love to roll out their concept cars at motor shows to whet the public's appetite and spur their imagination about the vehicles of the future. Driessen, the world's leading in-flight catering trolley maker, borrowed that idea when it showed its "concept cart" at the recent International Flight Catering Association event held in Cologne in February, the annual gathering of the airline catering industry.
"People liked seeing something different. They saw the impossibilities and the possibilities," says Joost Geluk, president of Driessen's Galley Equipment Division. The concept cart is more than just a concept. It is one of several innovative efforts from an industry struggling to find a new equilibrium after the events of last September. When cost cutting is top of the agenda, catering is one of the first areas to feel the axe. US carriers swung it most severely of all, with many stopping food altogether in economy on domestic flights and cutting back on business and first-class offerings.
European and Asian carriers were slightly less severe, but also had to find savings. "We have been redesigning menus with our customers to cut costs," says Kevin Abbott, chief executive of Alpha Flight Services, the UK's largest in-flight caterer. Some carriers simply replaced a full meal service with a plain "biscuit and beverage". Others, like British Airways, "went in with the objective saying that if we can make savings they must not affect the customer proposition," says Tony King, general manager catering at BA. For example, the menu cards were removed from business class and only one choice of meal was available instead of two. "The idea is to make savings where the customer does not see a deep impact," he says. These savings contributed strongly to BA's third quarter results.
As traffic begins to recover, carriers are showing the first signs that food is being reinstated too. US Airways, for example, has reintroduced hot meals in first class on some routes. It is predictable that food will resume its place at the head of product innovation in the premium cabins. What is much more uncertain is the future of food for economy and short-haul economy in particular.
The short-haul dilemma
This future is tied up with the broader question of what full-service carriers are going to do with short-haul services, many of which lose money or barely break even. Not only are these services marginal, they are being challenged in many markets by the rise of the no-frills carriers, which either sell food or do not offer it at all.
The events of 11 September may have accelerated the efforts of some to re-evaluate their short-haul food offering, but many carriers had already been brainstorming what to do with their service. "We saw that most European carriers were struggling with their short-haul product," says Lieven Cuyckens, chief operating officer of DeSter, the leading designer and maker of in-flight presentation products, from cutlery to toothpicks. The challenge is to arrive at a new food concept that is not only cheaper, but gives the passenger more value.
"To fight the no-frills airlines, [full service] carriers have to find different ways of serving food on board," believes Paul Staadegaard, vice-president sales of Helios, a sales and marketing organisation that develops catering solutions for airlines. "The idea is to try and bring the service available on the ground to the aircraft," he says. This is achieved by introducing to the airline seat some of the huge eating and drinking choices people find on the high street.
The trick to providing this choice is to bring more branded food on board. "We will leverage the traditional in-flight service with brand names," says Cuyckens. It will be packaged in more interesting ways than simply presented on a tray. "Trays in economy in Europe are out, they will only remain with more traditional airlines," says Staadegaard. The food can be pre-packaged in new and interesting shaped containers. "You can have oblong, triangular or round containers; whatever you want," he says.
DeSter aims to bring out 22 different food serving concepts every year, says Cuyckens. The idea is to enable airlines to freshen their product more regularly. One carrier is even looking at being able to change the concept weekly. Spain's Air Europa is DeSter's launch customer.
On 1 May Air Europa introduced two in-flight products, one for journeys of up to 2h, and one for longer flights. On the shorter flights there will be a coffee mug with Nescaf‚ espresso, sweets and chocolate, while a sandwich will be offered on the longer flights. "These feature more fun, upper-scale packaging," says Cuyckens. DeSter is conducting tests with four other carriers.
SAS began examining its short-haul product a year ago. "Our customer surveys clearly show customers want a change, especially in short-haul flights," says Ulf Ingnas, director for inflight product management. "They want a simplified product at a lower price." The more acute need to cut costs after September spurred its efforts to launch Scandinavian Direct. This includes one travel class and passengers receiving the same onboard service on intra-Scandinavian flights.
On Scandinavian Direct's 600 daily departures, SAS will reduce its 30 different food concepts and their associated expense to six or seven, says Ingnas. "Our menus are inspired by fast-food trends throughout the world. We will have five different themes - Asian, Scandinavian, Mediterranean, 'fusion', and vegetarian. Based on these themes, we will create snacks, sandwiches and wraps. The entire direction is more 'light' food with a high quality."
The food will be presented in a recyclable plastic container - there will be no more trays - designed by US design company IDEO. SAS has worked with top Scandinavian chefs and its caterer LSG Skychefs to create the new concept, which will be rolled out from 1 June. "We have certain value for money rankings on routes and it is our expectation the [food] scores will rise," says Ingnas.
The cost savings associated with this radical change will not come so much from the food itself. As DeSter's Cuyckens notes, the edible part of an airline meal represents just 30% of the cost, with the logistical side making up 70%. SAS makes its savings through reducing the complexity of its offers and by reducing the weight of each flight by 200kg (440lb) by using the plastic containers.
"The big money is in driving the cost down through the food supply chain," says Geluk of Driessen. "If you can compress the length of the chain you make money." Driessen has teamed with Helios to extend its influence down the chain, which is where its concept cart comes in.
Pre-packaged and branded
The partners have developed a variety of new cart and food services to deliver pre-packaged and branded food. Pre-packaging cuts out the need for a caterer to assemble the food on a tray. The branding could come not just from the food products, but the entire cart can be branded, say with Nestl‚ or Pepsi-Cola. KLM is the Driessen/Helios launch customer for such a concept, which will begin trials in October.
Alpha's Brooks agrees that the "days of the standardised wholesale meal service will be gone", but suggests an even more radical view of the future. "I believe that in 15 years most people flying economy or short-haul up to 4h will either pre-order their meal or bring it on board."
For four years it has been offering passengers on Airtours charters the option of paying £5 ($8) extra to have the meal of their choice. A total of 69% have taken it up. "Our satisfaction ratings have soared, people have ownership [over the food decision] and are enjoying their choice." Food can be pre-ordered via the Internet. "If a carrier has a high percentage of internet bookings it could offer such mass customisation," he says.
The challenge for the caterers is to follow the airlines as they ponder are invention of their short-haul food service. Many, especially in the USA, have seen their business plummet since September. But the battle for market share continues for the big two caterers - LSG Skychefs and GateGourmet - albeit in different circumstances. LSG has been named as the preferred buyer of Sabena's catering arm, boosting its European presence, while US investment firm Texas Pacific Group expects to finalise the purchase GateGourmet from Swissair in the second quarter.
Source: Airline Business
