“To Have or to Be?” is the title of a once-undervalued 1976 work by psychologist Erick Fromm in which he reflects on the materialistic nature of human beings. Erich’s argument of society’s deviation from the path of “being” in nature was backed by strong cases of consumerism and great promises made by industrialization in late 1970s.
Fast-forward 40 years and a radical modern version of postmaterialism dominates virtually every aspect of our lives, from home ownership to transportation. And while there’s a wide range of possibilities to “own things”, the impact of the sharing economy has never been more profound. By some estimates, the value of the sharing economy sector in the US will equal the country’s traditional rental equivalent already by 2025 (PwC, 2016).
Hungry for new experiences and products and services with no strings attached, the so-called millennials make up a whole new generation of consumers for the majority of traditional sectors – private aviation included.
Millennials include those born between the early 1980s and the early 2000s. They are widely considered to be the most complex consumers of the present era. They combine traditional education with Internet-powered content and bear a disruptive mindset.
A visible lack of brand loyalty and an increased awareness of the importance of sustainability are just some of the challenges that stem from the growing influence of millennials on any segment, including aviation. With the sector facing a number of transformatory pressures, among them digitalization, new business models, and electrification of the fleet, millennials might provide the answer to business aviation’s future.
As a millennial myself, I argue that there are at least four reasons why business aviation companies should consider reaching out to millennials as their future best clients.
Business Aviation is (largely) a technology business
With at least two high-profile acquisitions that took place within the marketplace sector within the last two years (Vista Jet acquiring Jet Smarter and Direction Aviation buyingPrivateFly), the sector has gradually realized the importance of technology to the scalability of commercial business aviation services.
In fact, according to the 2019 Corporate Jet Investors London Conference Survey, more than 48% of decision makers claimed that the industry hasn’t invested enough in technology.
It’s not a secret that venture capital-backed startups are today responsible for a large part of what we would call “private aviation brands”. Companies such as Avinode, JetSmarter, PrivateFly, Wingly, and SurfAir were all set up by tech-savvy millennials, which looked to improve the way aviation was sold to end customers.
Flapper’s own 2016 survey, conducted on the base of 1,000 potential private aviation customers, highlighted that the two main barriers for onboarding new customers are (1) Lack of awareness, and (2) Lack of price transparency – both of which can be solved in the long term thanks to technology and the widespread use of social media.
It might not be called “Business Aviation” in the future
During this year’s flagship business aviation event EBACE 2019 in Geneva, the panel composed of industry experts concluded obstinately that the electric airplanes of the future might not fall under the auspices of business aviation anymore.
They pointed to the growing ambitions of e-hailing players, most notably Uber, and the “startup character” of the current eVTOL solutions – way ahead of the existing R&D timing standards established by the industry’s giants, such as Boeing or Airbus.
Separately, one of the representatives of the European Business Aviation Association told me in private that there are widespread expectations of replacing the majority of current commercial aircraft with electric airplanes by 2030-2035 (already!). The association’s 2018 report highlights that 59% of Millennials believe that “new forms of air transport will drastically change our lives.”
Yet, it’s short- and mid-haul travel that is likely to lead the next wave of disruption. The popular aerial mobility website eVTOL.news lists 191 electric and hybrid-electric vertical takeoff and landing (eVTOL) concepts, as of 19th July 2019.
Many of them are poised to start commercial flights within the next 5-10 years, according to their websites (Lilium, Volocopter, eHang, and TRI are at the forefront). Also in July, the European Aviation Safety Agency (EASA) released its first certification for VTOL aircraft, aiming to fully certify similar vehicles in the coming future.
Today’s Millennials might one day be your most loyal customers
By 2020 the oldest Millennials will enter their peak earning years. The luckiest ones will become vivid users of charter services or fractional ownership programs. But that’s not where it ends. Inspired by unique luxury experiences elsewhere, including fine dining and on-demand boutique accommodations, the 1980s and 1990s generations will seek out new consumption models, including memberships, crowdsourcing, and flight-sharing.
Paraphrasing KPMG’s Retail Think Tank, “Knowing what drives the current ‘Grey Pound’ is useful in the short term but in the long term this generation will be replaced.“
And whereas many question the disposable incomes of the millennials (AT Kearney highlights high debt and low wages), one thing is unquestionable: by onboarding the young generation of business aviation enthusiasts early on, operators and charter providers can secure their place in building the audiences of the future. Canada’s digital broker Jettly and Brazil’s Voom both report that up to 60% of their first-customers had never experienced a private flight before. The share of the first-time business aviation users reaches 40% here at Flapper.
People don’t buy what you do, they buy why you do it
In case you wonder why your advertising efforts don’t attract millennials, you’d better look at your value proposition. Ever heard about Joon, Air France’s dramatic attempt to build a cool airline? Their entire brand revolved around one core concept: a whole different customer experience. Detached from the reality of transporting passengers, the identity eventually died a slow death, but serves as a stark reminder of how traditional players try to reinvent themselves.
According to a famous 2016 Cone Communications study, 76% of millennials consider a company’s social and environmental commitments as a key factor in choosing their future workplace. The same must be true about their buying preferences. “Only 1% of them are influenced by advertising”, says KPMG’s David McCorquodale. These are some of the reasons why business aviation companies must urgently apply new marketing tactics and expand their brand footprint.
User-generated content seems to be one way to go. The on-demand business aviation company Blade reports they get 10-12 social media posts for every flight. Brand massage matters, too. Just look at JetSmarter’s “Private Aviation is Now Open to More of the Public” or Wingly’s “Share the sky with your loved ones. Share it with passionate private pilots” and you’ll know where I’m coming from. It’s not what you sell, it’s why you sell it.
Final remarks
As Michael Amalfitano, Embraer Executive Jets president once famously said, “[Millennials] want experiences and will make price-driven decisions based on an experience desired.” Accordingly, the distinctive consumption style of the 1980s and the 1990s generation requires a new approach in business aviation.
Traditional charter professionals can benefit from their close association with millennials in some of the following ways:
- Treat younger audiences as a reference in terms of the user experience of your mobile- and web products. Run occasional feedback sessions and UX tests;
- Establish a meaningful mission for your company. Be conscious about the environmental impact of private aviation and engage in activities aiming at reducing it;
- Create an “entry level” product to onboard new audiences to the world of business aviation;
- Search for collaboration agreements with the existing eVTOL players and electric engine producers.
Without appropriate means to discover and purchase private aviation services, operators lose the opportunity to reach their future early-adopters in the most effective way possible – through a combination of technology and strong value proposition. In the era of stagnation that the industry faces today, forgetting about millennials might result in the gradual disappearance of the business aviation sector and its disruption by well-funded aerial mobility companies.
About the author
Paul Malicki is the CEO of Flapper, Brazil’s first on-demand executive aviation company. Flapper operates crowdsourced flights in the Southeast region, with an additional 10 high-season destinations across the country.