Although airlines make informed choices about where to operate their aircraft, airports and destinations can influence that decision making. Otherwise, those unlikely routes would never be operated and studying traffic growth would be an unsurprising read.
Referring to route development managers as superheroes is not far from the truth when considering the diversity of the route development task and the skills required to deliver new air services.
The route development process starts with the formulation of the network strategy and route target plan. Once the strategy and targets are identified, each individual route target campaign usually begins with a route forecast and business case.
A discussion with airlines follows and when a level of interest is established with a target carrier, other stakeholders can get involved. Ultimately a contract is signed and, hey presto, the route begins. Be warned though – this may not be a quick process and is fraught with challenges along the way.
Each part of the route development process requires different skills. Producing business cases and traffic forecasts requires specialist skills and know how, for example. Traffic forecasts can involve the manipulation of large data sets and market research techniques. And to identify targets and understand the customer, the route development manager must initially reach out to the airlines to start the “journey” of selling, persuading and ultimately negotiating a deal – the latter an area perhaps most often neglected by route development managers.
The final hurdle is formulating a contract within the relevant legal framework. Some route development managers will need to defer to an in-house lawyer or even seek the help of a specialist aviation competition lawyer. So a route development manager must be an analyst, salesperson, marketer, politician, fundraiser, accountant, negotiator and lawyer.
Other activities that route development managers find themselves getting involved in include terminal design, external relations and even debt collection. Given the diversity of the task in hand, good airport/tourism authority CEOs will need to develop the right structure for a route development team.
ASM has worked with a number of airports and tourism authorities, advising them on the optimal structure for their route development teams. For a mid-sized, 5-30 million passenger airport, the typical size of the airport route development team is 10-15 employees. This team is usually divided into three key areas: research, sales and account management, and marketing. All areas report into a head of route development who in turn typically reports to a CCO.
This structure encourages the development of centres of excellence within the team. The market research team can develop business cases through expertise in data, analytics and traffic forecasting. The sales and account management team will become experts in negotiation and relationship management, responsible for bringing in new airlines, while the marketing team will focus on B2C and B2B techniques to build awareness and passenger numbers.
Training at ASM
ASM, have developed a suite of training products to help the personal development of the teams. The courses run every month in different regions across the globe and cover a number of subjects including: The fundamentals of route development; Route traffic forecasting, data tools and techniques; Negotiating incentives with airlines and the legal guidelines; The fundamentals of air cargo route development; Route development for destinations and tourism; Understanding the airline/airport business; World Routes preparation boot camps.
The course programme has recently doubled in size but continues to be led by active practitioners. The programmes include guest speakers from airlines and the industry in general. It focuses on the reality of route development as well as the theory.
An alternative structure for the route development team is by geography, which is adopted by many of the larger airports/destinations. This enables an individual to understand their market in more depth.
It is important too to provide a dedicated resource if there is a function that needs attention. Little attention will be paid to cargo unless a cargo manager is appointed, for instance. Or it may be that the relationship with the hub carrier is crucial, so a dedicated account manager for that airline will provide focus and clarity.
Understanding the complexities and having the right structure is still not enough to ensure route development opportunities are maximised. Airports and tourism authorities should audit their route development activities, capturing customer insight as well as providing a learning and development programme for its team.
Auditing and benchmarking practices against competitors can be undertaken internally or externally and should cover all aspects of route development. Airline customers, both existing and potential, should be asked for their views. This process should be formalised and reported and can be conducted using both qualitative and quantitative survey techniques.
Finally, any route development team can continue to develop its knowledge and skills through investing in a learning and development programme. The skills required are varied and it is important that the team has the same approach and philosophy.
The task of route development may require superhuman abilities but with the right structure and the right development programme, route development managers may well become superheroes.
(This article first appeared in Routes News – Issue 1, 2016)
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