Regulatory Inquiry

Customer research can help airports & regulators work together to improve choice & value for consumers

Every Sunday in Newcastle upon Tyne, where Surveyapp is based, there is an open air market on the Quayside. This part of town, right next to the River Tyne and its iconic bridges, was once a grimy dockland. But over the last 40 years regeneration and investment has turned the area into an exciting and vibrant urban space. As well as the market it offers groovy bars, fancy shops, elegant restaurants, designer offices and funky apartments.

Buyers at the market can snap up locally made gifts, designer gear and foodie treats. Newcastle locals, known as Geordies, are generous. So portions are large and prices low. Since traders are physically close to each other consumers can easily compare the wares for sale and their prices, while traders can watch to see what sells well and adjust their orders for next time.

Well-functioning markets like Newcastle Quayside’s are said by economists to be ‘efficient’, meaning that it is hard to see how any one buyer or seller could be made better off without another being made worse off. Prices are transparent, search costs are low and there is plenty of choice, but not so much choice that sellers cannot cover their costs and have to go out of business.

Airports serving Newcastle also deliver a great service to people in the north east of England. Just like the market traders down on the Quayside, they each know travellers have a choice – Edinburgh, Glasgow, Newcastle, Teesside and Leeds airports are only a short distance away from each other – and want to keep customers coming back.

Just like down on the Quayside, the airport market in the north east of England and Scotland is efficient.

British airport regulation covers customer experience

British airports are regulated by the Civil Airport Authority (CAA) in London. The regulator has three priorities – ensuring high technical and safety standards, planning and regulating airspace, and improving choice and value for consumers. The latter is their way of saying that they want the UK’s airports market to be efficient.

To help ensure airports are aligned on these priorities the CAA has a range of powers to enforce relevant legislation. This includes the famous consumer rights for accommodation, refreshment and travel rearrangement in the event of disruption first covered in EU261/2004 but which remain in force following Brexit. They also cover access to air travel for passengers with disabilities, especially mobility issues, and price transparency.

The CAA also has powers to regulate how much five airports can charge. These are London’s Heathrow, Gatwick, Stansted and Luton, plus Manchester. But price regulation is another topic for another time. Today’s article is about the customer experience side of airport regulation.

Airports are required to address reasonable consumer complaints. And from time to time the CAA may receive a “super-complaint” from consumer bodies which can be made when a large number of people can be shown to suffer due to an airport’s actions.

When consumers send in these complaints they can be analysed and aggregated to show underlying trends. One airport might have persistently excessive waiting times for security, another could offer inadequate wheelchair provision and a third might lose a lot of bags.

If enough complaints are made the regulator may decide to act. They will assess nine questions to take this decision:

Q1. What impact would any regulatory action have on airport users?

Q2. What are the wider economic impacts of any regulatory action?

Q3. Does any regulatory action tie in with the CAA’s wider strategy and objectives?

Q4. What is the severity of the key issue at hand?

Q5. Is the CAA best-placed to act?

Q6. Are there opportunities for private rather than regulatory action?

Q7. How would the balance of consumer protection, competition law and economic regulation be affected by any regulatory action?

Q8. How likely is a successful outcome from any regulatory action?

Q9. Are the resources required for the CAA to act proportionate to the matter at hand?

It is harder to measure success than failure in the current environment

Airports like those in the north east of England and Scotland do a great job of looking after passengers when things go wrong. Your author has personal experience of using the excellent wheelchair service at one after an accident.

Consumer bodies and the CAA have been receiving and analysing complaints about airports for decades. There are detailed data sets showing how and why things went wrong. But showing where things are done well is arguable just as important for meeting the CAA’s choice and value objectives.

A data revolution promises to make it easier than ever before for airports and regulators to work together to ensure that regulatory objectives are being achieved.

Sensors recording equipment maintenance and air traffic control analysis will cover safety and operations. Collecting customer behaviour data will help airports show regulators they meet or exceed relevant standards, where there are any shortcomings, and most importantly whether or not any required or recommended improvements are appearing in practice..

Part of the customer behaviour data that regulators will find helpful will come from customer research programmes. Some of these will be done in person, like the Airport Council International’s Global Traveller Survey. Others will be collected electronically.

At Surveyapp we believe that the best time to conduct electronic passenger research is at the time of travel. When designed correctly to ensure that the questions are unbiased and meaningful, results are raw and accurately reflect what people felt at the time they were actually in the airport. Research surveys done by e-mail a day or two afterwards do not necessarily have the same emotional connection to the passenger, so may lose some important messages.

Customer research & the regulator’s questions

Recall the CAA’s nine questions that they ask to decide whether or not to act. Three of these are directly impacted by excellent customer research.

Q1. What impact would any regulatory action have on airport users?

When passengers are able to quickly and easily provide feedback to airports about specific issues, data is generated showing what is happening at the airport right now. Surveyapp’s survey kiosks for example can scan a boarding pass to identify characteristics of the passenger.

Some of these may be relevant for the regulator, like whether or not the passenger is a wheelchair user. When Surveyapp surveys are sent to straight to passenger smartphones when a QR code is scanned, the same types of data can be analysed.

Over time customer research will generate a new and rich data set which airports and regulators can explore together to figure out which types of regulation deliver merely acceptable outcomes and which deliver truly great results.

Q4. What is the severity of the key issue at hand?

It is well known that people are more likely to complain when something goes wrong than they are to praise when things go well. But there are thresholds below which people might not complain but nevertheless leaves them dissatisfied.

With data collected by next-generation customer research programmes, airports and regulators are likely to uncover ‘hidden’ issues that are a small nuisance by themselves but when aggregated over thousands or millions of passengers represent a significant economic loss.

Q8. How likely is a successful outcome from any regulatory action?

Electronic customer research sent straight to people’s smartphones or collected through kiosks at the airport has the potential to show whether regulatory actions are working in real time.

If a certain airport needs to work with the regulator to discover whether initiatives really are delivering desired results, statistics like these can help show progress faster than ever before.

At the same time, regulators will be able to test which sorts of regulatory remedies lead to better results. If challenges need to be addressed at different airports simultaneously, real-time customer research could even allow a regulator to A/B test. Better outcomes for passengers would be delivered faster and at lower long-term costs to airport operators.

At Surveyapp we offer tablet-powered survey kiosks to help airports deliver detailed customer feedback. Our surveys are fully customisable and can help address questions posed by regulators and all other stakeholders in the airport’s operations.

We always love to talk about challenges that airports are facing. Drop us a line.

oliver AT surveyapp DOT io

savio AT surveyapp DOT io