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Behind the Numbers: an EMARKETER Podcast
What Traveler Media Can Do That Retail Media Can't with Kinective Media by United Airlines | Behind the Numbers
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- [00:01]
Marcus
Connected Media by United Airlines is redefining traveler media with a world first omnichannel network. From in flight to online and in app experience, Best in class tech helping brands engage travelers where it matters most. Ready to make an impact. Discover more@konnectivemedia.com that's Konnective with a K. Hey, gang. It's Friday, April 25th. Sarah, Richard. Listeners, welcome to behind the Numbers, a video podcast made possible by Connected Media by United Airlines. I'm Marcus and join me for today's episode. We have two people. We start with our principal analyst covering everything retail and commerce media based in New York, it's Sarah Marzano.
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Sarah Marzano
Hey, Marcus, thanks for having me.
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Marcus
Of course. And we also have the CEO of Mileage plus living in Chicago as Richard Nunn.
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Richard Nunn
Hi, how are you?
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Marcus
Hey, fellow. Very good, thanks for asking. Sarah, take note, she's never asked how I am.
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Sarah Marzano
I haven't. I never do.
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Marcus
While you're on, once a year we start with.
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Richard Nunn
It's a British thing.
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Marcus
Exactly. Manners.
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Sarah Marzano
I'm a New Yorker. I assume you're fine, you're here.
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Marcus
Yes, true. My dad's from New York. He's equally as terrible. We start with the speech intro to get to know our guests a little better. Mainly Richard, because we know. We know Sarah enough.
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Sarah Marzano
Like I need to redeem myself now.
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Marcus
Though, so that's true.
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Sarah Marzano
I'm gonna be super nice.
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Marcus
All right, 60 seconds. Ish on the clock. Richard, let's do it. You are based in Chicago, but where are you from?
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Richard Nunn
I'm British and very well mannered.
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Marcus
Whereabouts?
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Sarah Marzano
All right.
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Richard Nunn
No, living in Chicago, but also have a place in Denver, so I sort of fight between the two.
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Marcus
Very nice. Where are you from? Back home though.
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Richard Nunn
The south coast, Hampshire. Lived a lot in London, so very nice.
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Marcus
Great part. What do you do? In a sentence?
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Richard Nunn
I literally have the privilege of being the CEO, as you mentioned, to lead a pretty awesome team to kind of change the world. I don't come from the land of airlines and loyalty, but to kind of change the world of what loyalty means through technology. And obviously also to talk about media. And what we're doing is a global first there. So very nice.
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Marcus
And finally, the best experience you've had whilst on vacation.
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Richard Nunn
Well, I like to be in the moment. And it was literally three or four weeks ago, I was in British Columbia in Canada with a company called Mike Vagel who do heli skiing. So every day for six days, I was skiing in one and a half meters of fresh powder in the middle of nowhere. So it was wonderful.
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Marcus
What heli being they drop you into.
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Richard Nunn
A top of a triangle and you ski down it.
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Sarah Marzano
And it's in like really remote areas. Right. That you wouldn't be able to access.
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Richard Nunn
1 1/2 million acres of nothingness. There's eight skiers and 1 1/2 million acres. Pretty cool.
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Sarah Marzano
Oh my God.
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Richard Nunn
That sounds horribly dangerous, scary and exhilarating.
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Marcus
Amazing. Sarah. I don't even know why my answer.
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Sarah Marzano
Is just going to be so ridiculous by comparison, but I think it's a good one. So I love traveling and I have a bunch of examples that involve amazing life changing food or sites that I get to visit. But I think that the crowd pleaser is going to be if I dig really deep into my archives. When I was like 7 or 8, my parents took me on vacation to a resort in Mexico and Mary Kate and Ashley Olsen were on vacation at the same resort. I got to meet them and I got to hang out with them. Now I'm a child of the late 80s, early 90s and so Mary Kate and Ashley Olsen have been really important figures in my life for a very, very long time. No, you hate. Do you hate it?
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Marcus
I feel it feels made up to top Richards.
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Sarah Marzano
We played Marco Polo in the pool. Was a transformative experience for me.
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Marcus
That's amazing.
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Sarah Marzano
Thank you.
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Marcus
Fair enough. Not bad.
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Sarah Marzano
I do not know how to ski. It's true.
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Richard Nunn
That's cool.
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Marcus
Very nice. Very nice indeed. So there are two guests for today. I'll let you decide whether the stories are factual. But it is time for the fact of the day. So what are the most visited monuments, historical and cultural sites in the world? These numbers come from statista as of 2018, seems to be the most recent time that they did this. But they're pre pandemic, which is also kind of probably paints more of a clearer picture than how travel's changed today in terms of where people go. So yeah, for the longest time. Do you guys want to guess anything?
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Sarah Marzano
Eiffel Tower.
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Richard Nunn
I was going to go Eiffel Tower. Coliseum.
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Marcus
Well played. Eiffel Tower. Seventh. The Colosseum's fourth on this list. They all pretty much have about five to eight million visitors a year. This list excludes places of pilgrimage and religious gatherings. But yes. The Colosseum is fourth. The Eiffel Tower is seventh. Palace of Versailles. I'll leave number one for a second. Palace of Versailles. Second Lincoln Memorial. Third Dennis Coliseum. Taj Mahal. The Parthenon. Sorry, Eiffel Tower. And then Peterhof palace in St. Petersburg in Russia. But number one with twice as many visitors as the second place. Palace of Versailles is Forbidden City in Beijing. So Forbidden City built a kind of early 1400s. It served as the Chinese imperial palace in the middle of Beijing for almost 500 years. It was the center of the Chinese government and emperors from the Ming dynasty and others lived there. So that is the most visited by a long shot.
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Richard Nunn
Interesting.
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Sarah Marzano
I learned. Thanks, Marcus.
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Marcus
Okay. Please don't be surprised, but you learned something. Everyone is. I do this mainly for me. Anyway, today's real. The future of traveler media. All right, folks, everyone's well aware of commerce media's explosive growth in recent years. Travel media network ad spending is the segment of that we break out. It's also having a high growth moment, expanding by close to 20% this year according to our wonderful forecasting team, and 17% next year to reach the 3 billion mark. So no small amount of change. Sarah, how does travel media, as we call it, fit into the larger commerce media space?
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Sarah Marzano
Yeah, so I think for, for us at emarketer, you know, 2024 was really the year where non retail industries launching kind of commerce media networks went from being sort of a fringe occurrence to this full fledged trend. And you alluded to our wonderful forecasting team, those folks worked really quickly to not only publish a more holistic commerce media ad spending forecast, but also break out the most prominent industries within that. So of course we've been forecasting retail media ad spending for a long time, but we now also forecast what's happening in traveler media and what's happening in financial services as two of the kind of like more prominent non retail verticals that have emerged. And I think something I've been sort of pushing against me a very easy talking point that becomes sort of unnecessarily pervasive in our industry that is sort of taking the emergence of non retail commerce media networks and sort of pitting them against retail media. Right. So making it a vertical versus vertical thing and talking about it as a competitive threat. And I think for me, what's sort of been fascinating as I've done our research and analysis into the landscape is that each sort of cohort enter operating within commerce media can offer something that the other can. So I think there's actually so much opportunity for complementary solutions for both advertisers and sort of vertical to vertical partnerships that's being unlocked as this industry continues to evolve.
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Marcus
It's similar to social media. We talk about them in the same pot, but really every time I speak to Jasmine Emberg, our principal on social, she's Always like they do different things and they have different audiences and there's overlap because they're all social and they do some similar things. They kind of copycat each other to a certain extent but people use them quite differently. So it sounds a similar parallel here. Richard, what can travel media, specifically an airline like United do that retail media can't?
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Richard Nunn
Yeah, well, I mean just to pick up what Sarah said, I mean we define traveler as this sort of pre, during and post. So it's not just in the moment, it is a pre, during and post travel in totality. But I think, and I don't disagree Sarah, in terms of your sort of vertical to vertical and 1 plus 1 equals 3 scenario, I think where as a sort of global first in the airline space doing this, where we differentiate is. And we intentionally, when we launched, came out and didn't just focused on travel advertisers, we went intentionally in the non endemic verticals from luxury to auto to finance. You know, you name it outside of travel because a. The size and scale of our audience is big. But that point about the moment of dwell time. So we can play both the brand game and the performance game. Whereas retail I think is, is challenged. I mean this is a huge market and we've seen it scale massively but it is very centered around performance attribution and CPG categories. So we were very intentional to kind of go across vertical which is really important. But overall it's the size, the scale and the different digital channels we have. If you think about that traveler journey, when people are thinking about trying to be inspired about where they want to go, you go on and search destinations around the world and we have 330 of them to go and visit so.comapp when you're in the lounge and there's. You spend about an hour and a half in the airport even before you get on the flight. So there's a lot of time spent and then our average, this is average dwell time in plane is over three and a half hours. So that's, you know, that's a lot of time in front of the screen where you're strapped in and there's no. You don't get up and get your coffee.
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Marcus
That's close to I think average time people spend with their television.
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Richard Nunn
Yeah, yeah, it's, it's big.
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Sarah Marzano
Right.
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Richard Nunn
And then you come out the other side and then obviously, you know, we can, we can sort of target people on smart TVs and IP enabled devices. So that's how we define it. So I think we play in a slightly broader space both in vertical and channels, which is pretty exciting I think.
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Sarah Marzano
For me, like when I think about the opportunity for an airline like United that has this like robust loyalty program and really knows its, its customers, we take something that can be a challenge in digital advertising like this really long stretched out, fragmented path to purchase and actually can flip it around into being this strength. Like you have so many moments to connect with your customers. Right. And you have this great understanding of what they might be looking for depending on what phase of their travel journey they're in. Right. Are they in research and discovery? Are they in a really efficiency like sort of mindset where they're doing a check in or their boarding process? Are they in a longer dwell time or are they in that like sort of post arrival while they're on vacation? And I can see that just being such a valuable offering for advertisers of all shapes and sizes. Right. To reach customers in those various mindsets.
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Richard Nunn
Yeah. And also the who. Right. You've got business travelers. So Richard Nunn. I have a. @united.com vs. Richard nunnmail.com I'm not giving my full email but you know, I'm a. Could be a family travel guy. I could be going away with my wife. I could be in the moment with my family and kids or I could be on a business travel. That, that mindset is also very different, you know, with your family going away on a family vacation. And we see it, the, the people are prepared to spend lots of money shopping, you know, in that certainly in the airport. My airport shops do really, really well. And when they get there, I've forgotten my sunscreen, I've forgotten that my Apple adapter, all that sort of stuff. Right. There's, there's, you know we've proven that with research that people are in the mom spend money so they're open to being engaged again with the right advertiser at the right time. But also in the flip side, as a business traveler to try and hit B2B audience is hard. It's, it's one of the hardest audiences to hit. So you know we have certain data points around. You know who those are. If you're sitting north front of cabin, you're probably more likely to be a business traveler. Possibly you may know where you work and what title you are because that could be on your mileage plus account. So there's lots of different data points so we can play it's interesting place for consumer and a B2B play which is interesting.
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Sarah Marzano
Yeah, it's such a valid point too though, because I think whether I'm traveling for business or pleasure, like specifically in the airport, like my budget does not exist anymore. If I can acquire something that's going to make me more comfortable or pass the time or help me out with something I've forgotten, like it's happening, it needs to happen.
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Richard Nunn
Yeah, 100%.
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Marcus
You mentioned scale and it is really quite significant. Over 40 million mileage plus folks, you mentioned the amount of time people are spending three and a half hours, which as I mentioned our forecasting team has numbers on how much time people spend with a television at home. And it's around that people who are older goes up, people younger it goes down. It's a remarkable amount. And then I was reading the CBS article from Kate Gibson who was noting that you have 100,000 seat back screens across your fleet as well, which is a lot. So you've got the scale. And then on top of that, as you mentioned, we talked a bit about the data, the cabin class, people's age, the city you live in, where you're traveling to. So there's a lot to this offering airline passengers, as we're kind of alluding to talking about, they're a very captive audience, but they can be an irritable bunch. What makes travelers more receptive, Richard, to personalize ads than folks in other settings perhaps?
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Richard Nunn
Yeah, yeah. The size and scale is, is big. I mean we flew, we had the world's biggest airline. We flew 174 million people last year, various segments. So yeah, we certainly have the scale and the scale is non members and members. We have in excess of 111 million unique IDs. So it's, you know, it's, it's big. But I think this point that I mentioned earlier around the traveler journey and the points in that journey where people have time, some people on the plane, I, I'm probably the most productive on a plane. I work and hammer out emails to my annoyance of my team. They know I'm on a flight at whatever 10pm at night or you're just in the moment where you want to watch some great content and movies and completely switch off. And I know we'll probably talk about this, but obviously with the emergence of Starlink coming in, when I joined the business two years ago, it's, it's kind of a fascinating mindset. So all the things you can do on Earth today, which we do with a phone or on your laptop or on an iPad or whatever, you can enable your life 247 right. With a piece of technology in front of you. And then oddly, when you go into a plane that stops to some degree, the WI FI experience is not great. And you need the connectivity. You may have access to scratch. Great stuff. But if you don't have the connectivity, you're. And I get really frustrated if, if the WI FI is down or whatever. There's been a sort of negative experience that changes with Starlink. And so that enablement of awesome. Very, very low latency, you know, amazing connectivity is going to enable a whole bunch of stuff from. You could be watching a streaming service at home. You could be paused. You get back on the plane and you'll be able to pick up exactly where you were on that. You better do your shopping, your banking, live sports, you know, you. You name it. It just opens up a real world of possibilities. And because of that average dwell time when you're sitting there, you have access to everything. So you're not limited in terms of what you can do. And it's a great experience. And we know through our nps, like if, if there's great content on the screen, the food tastes nicer, the flight crew, you have an amazing experience. Maybe the flight isn't as late as you think it was, if that was an experience. So it's, it is interesting. So I think the focus on that, those screens that we're investing in it and it's 100,000 today, just over, but by 2030 will be near 300,000. So there's a huge investment.
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Marcus
It's the first thing people talk about when they get off of how was your flight? And they're like, I've watched some good films.
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Sarah Marzano
Yeah. Or they're like, the WI fi didn't work. Like, I feel like there's not a single person listening to this right now or watching us. If you are who's taken a flight, who isn't relating deeply to like that Frick. Friction and frustration that can occur, you know, because it feels like a miracle when the WI fi works. Like, Richard, when you were talking about getting work done on a plane, I love it when I can make that happen. But the frustration of sort of getting on a plane with a plan to catch up on emails or even a plan to like work on a deck that might be sort of saved to the cloud or whatever, and not being able to do that is so real. And I think there is such a powerful shift that will occur when you sort of can. Like I think about, I used to not be able to get WI fi in the New York City subways. And now I can and I cannot imagine not being able to do that. Right. And so it's very exciting to think about this sort of unlock in terms of these consumers who are spending a lot of time, travelers who are spending a lot of time but weren't able to access this type of connection before.
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Richard Nunn
Yeah, you get very frustrated. It feels like time wasted.
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Sarah Marzano
It really does.
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Richard Nunn
When you have that amazing time to sort of do.
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Sarah Marzano
Because when do we have time. Yeah. To be just productive. To sit still and be productive or just ingest content too. Because I sometimes before I take a flight, I'll sort of remember, oh, I, I need to download the last episode of White Lotus if I want to watch it on the plane because I can't count on like what's going to be available or, or sort of what have you so very excited.
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Richard Nunn
Well, on that last point, I think that's going to be the interesting challenge which we've thought about very carefully is behavior change. So the world that we live in today, you do see it. You know, I travel a lot obviously and you see people who pre loaded content on an iPad or their phone and so ensuring that we've got awesome big screens on the seat backs, you know, and that will give you literally, you know, foot away from your, your eyes. You want to give them that amazing experience. So we're going to have to sort of go through the process of behavior change from what they've historically done to, you know, you can actually have all the things you want to have now on your, on the screen in front of you rather than. So that's going to be an interesting behavior change.
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Sarah Marzano
No, And I think this is like when we talk about enabling WI Fi and being able to do things like say like place your grocery order right. Like, which is like that's really appealing to me. Like I'm coming home, I know my fridge is empty. Like I want to be able to place my, my grocery order or, or I have like a fund. I'm coming home from Congress, but I've got a vacation coming up. I want to like buy new clothes. Like that's an area where I really see like there's a great opportunity for retail media, right. And traveler media to sort of come together. And I'm curious, Richard, if you see a world where maybe there are exclusive offers available, right. To customers who are on a United flight and doing their shopping, like I'm making this up. If I'm, if I'm placing my, my grocery orders, they're going to Be sort of an incentivization. Incentivization behind that.
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Richard Nunn
Yep. Yeah. And the, what we're doing now and I was at an event last week where I think and it was a retail commerce media event and this point where our hyper focus actually isn't, yes, it's on the advertising partners in terms of innovation but the innovation is coming from this cohort of partnerships. Right. And all the things you can enable, which yes, may have a commercial benefit but also may have an awesome customer experience. So things like ride shares, you can kind of pre book that on the flight so that you know, you know the flight's on time or whatever, you can just pre book that. Your point about a, you know, ordering your groceries, maybe you're renting a, a nice apartment or a house somewhere, get all that done and you're just, you're de stressing your life and there's some great customer experience. You know, if a plane were to be late we could auto update the data to that ride share to then move it by 30 minutes and maybe you know, we know that it's a 22 minute walk and you adjust everything accordingly. So I think there's, there's a lot of things. We did some great testing with Live Nation last year when we launched around entertainment. We know where people are going and we just tested it on some flights into, into Las Vegas. They know exactly what seats are available to the second and we just put the top six or ten shows on that evening what's available and you can book it there and then. So I think what it, what this is going to enable to do is this ecosystem where yes, we're at the center but what else can we enable for a great customer experience? Shopping, dining, entertainment. You know, you're more commoditized, you're grocery shopping and whatever because you have that time as you said, to just think about things. You need to plan your chore list. I've got to check all that stuff off and if you can do that in the sky because you have great connectivity, then it's going to be an awesome experience.
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Sarah Marzano
Ride sharing piece feels like such low hanging fruit because another thing I'm sure everyone can relate to is that frantic feeling of getting off the flight. I am a carry on bag person because I want to get to where I'm going as fast as possible and like frantically making sure there's a ride share available. Right. Like as I get off the flight, if I could eliminate that, it's like that's taken care of, you know, huge.
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Richard Nunn
Yeah. Yeah, yeah, yeah. We're already doing this just from an operational perspective. You know, we have this thing on our app called Connection Saver. So we know again, if flights are moving or whatever, we can send a message to the other plane, hold the plane for 15 or 20 minutes because we know there's 30 people from flight A wanting to get onto flight B. We would hold the plane, send a message and send a message to all those people on the plane to say we're holding this plane for 15 minutes because there's 30 people. And I've been on the receiving end and I've sat there in the plane and people clap and cheer because people are coming sort of red face because they feel bad because they're slowing the other plane down, but like they're coming down high fiving. We've saved like, you know, 750,000 people in terms of Connection Savers. So that's just a great way of using technology and data and joining all these dots up for a great customer experience.
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Sarah Marzano
This wonderful moment of camaraderie among people who are like sometimes not being as nice to each other as they could be because travel is tough.
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Richard Nunn
Yeah, 100%. Yeah.
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Marcus
Let's end with this, Richard. What's next for travel and media?
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Richard Nunn
It's well, we've got a, again through starlink in terms of what we're enabling there, we're going to open up a whole bunch of stuff. So we've got a sort of a product roadmap of yes, new ad formats, different ways of engaging with that customer is pretty super exciting. The other area we're also actively looking at and we have this today is an app within an app called MileagePlus X. And this point about the traveler and bringing alive the traveler because we have sort of two currencies to play with. We have an advertising CPM model and we have our loyalty model based on miles and enabling sort of an E commerce world which we have today where you can go and buy your Starbucks with your miles, either earn miles or redeem your miles, again, buy a Starbucks. And those types of examples kind of extend out this life of loyalty with United outside of just the day of travel. So you have kind of a, an all round everyday experience with that, with that a the brand of United and also that customer. So there's a whole bunch of opportunities around a, because we understand who these people are, what they're interested in and what, through partnerships, what can we surround their life in because people do see the miles that they've saved as kind of a savings plan to some degree in, like, how else can you use that beyond travel? Which obviously that's the predominant use case. Most people use their miles for travel to get to A to B and have an amazing moment in time. But also we see a highly engaged set of audiences that want to kind of use that outside of travel. And what else can we do to enable that? So there's some exciting stuff coming down the road.
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Marcus
Nice. That kind of brings us full circle because at the very beginning you were saying we have travel media forecasts, but you refer to it as traveler because there is the beginning, the during, the after. And it's nice that you're looking at it so holistically because that can really extend the offering throughout. Just the I'm sitting on the plane part of it. That's what we've got time for for today's episode. Thank you so, so much to my guests for hanging out with me today. Thank you.
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Sarah Marzano
First to Sarah, thank you for having me.
- [25:56]
Marcus
Yes, indeed. Thank you to Richard.
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Richard Nunn
Thanks, Marcus. And Sarah, thank you.
- [26:00]
Marcus
Absolutely. Thanks to the whole editing crew. Victoria, John, Lance and Danny. Stewart runs the team and Sophie, who does our social media. Thanks to everyone for listening in. We will be back on Monday with another episode of the behind the Numbers show, the marketer video podcast made possible by connected media by United Airlines.