The Untapped Billion-Dollar Market Airlines Are Sleeping On
A few weeks ago, I urgently needed to send a mobile phone (with a lithium battery) to a friend in another city. Traditional courier services typically avoid transporting mobile phones by air due to potential safety restrictions and airline guidelines. At the same time, I noticed that almost all prominent low-cost airlines in India already have a growing cargo division, which handles a diverse range of shipments.
Opportunity Statement:
How might a leading low-cost airline leverage its existing infrastructure to create a fast, easy, and reliable courier service, bridging the gap in urgent, fragile, and independent shipments?”
Airlines could diversify by offering courier services across their domestic network, utilizing their existing flight routes and ground infrastructure to fill a substantial market gap.
The Gap in Consumer Courier Services
India’s domestic air cargo has grown, yet widely available courier services rely heavily on ground-based transport or multi-day shipments, often restricted to battery-related items or fragile cargo. Traditional courier leaders — DHL, FedEx, UPS — excel in global shipping, but local short-haul, urgent “send package now” solutions are relatively underrepresented.
The Hypothesis & Opportunity
- Immediate Value Add: Numerous domestic routes, short turnaround times, and cost-effective scheduling would let airlines provide a unique “next flight out” courier.
- Positive Brand Diversification: Similar to how many airlines gain ancillary revenue through seats, meals, baggage, or priority boarding offerings “AirlineCourier” could be a logical extension.
- Capture New Demographics: An airline courier service would be appealing even to non-flyers.
Research & Information Gathering
Personal Observation
I had trouble shipping my phone via standard courier. Even premium couriers had disclaimers about Li-ion batteries or required complicated packaging. This “personal friction” revealed a bigger consumer need — fast and reliable domestic shipping for electronics or urgent items.
Competitive Benchmarking
- International Courier Giants (DHL, FedEx, UPS): They have door-to-door coverage but are subject to more air-cargo restrictions for personal shipments. Often, processes are complicated or expensive for ad-hoc individuals.
- Other Airlines: Some airlines run cargo divisions, but rarely is a user-friendly, B2C courier booking tool baked directly into their main platform.
Informal Interviews
- 5 of my friends were polled in a quick qualitative interview. Most recognized the Airline’s reliability but never knew they could use an airline to ship personal packages.
- Top Pain Points: Slow deliveries, high cost for urgent shipping, complicated packaging instructions, unclear restrictions.
Regulatory & Operational Constraints
- Battery Regulations: Focus on ICSRs (Inner Container Shipping Requirements) for electronics. This means special disclaimers and packaging standards.
- Safety & Security: Airlines must vet shipments. Items like perishable goods or regulated substances need extra checks.
- Operational Synergy: Airlines already operate robust cargo processes for freight services; redirecting a fraction of belly space for urgent personal shipping could be feasible if managed well.
Conclusion from Research: There’s a validated user need, a feasible route for solution through synergy, and an open space in the market for Airline’s brand to enter.
Proposed Solution (User Flows, Wireframes & High-Fidelity Designs)
- I will link the Figma file if anyone wishes to view the Initial brainstorm, wireframes, what were high-fidelity screens, iterations, and prototype.
But Below is the TLDR
Key Design Decisions
1. Assistive Sizing
Intuitive sizing guide that allows users to visualize their items against common objects. For instance, a user shipping a laptop can see it compared to a standard shoe box or moving box. This visual aid eliminates guesswork, reducing errors in size selection and ensuring a smoother booking process. By providing relatable references, have made it easier for users of all tech-savviness levels to confidently select the right package size, ultimately streamlining the shipping experience.
2. Mandatory Weight Field
Recognizing that weight is a critical factor in courier pricing, I have made the weight field mandatory in the booking process. Users are asked to provide accurate weight information. This approach ensures transparency in pricing from the outset, avoiding surprises at later stages. By prioritizing weight accuracy, we’re building trust with our users while optimizing our operational efficiency.
3. Documents-Only Feature
The ‘Documents-Only’ option is designed to offer a faster, more cost-effective solution for users sending paperwork. By selecting this option, users enter a simplified booking flow that bypasses the need for detailed item descriptions or special handling instructions. This streamlined process not only saves time for our customers but also allows us to offer competitive pricing for document shipments, making us an attractive option for businesses and individuals alike who frequently send important papers without the hassle of special screening and customs.
4. Special Items Handling
Understanding the critical nature of fragile, lithium-ion, perishable, medical shipments, we’ve implemented a specialized flow for these items. Users selecting medical shipment options are guided through important considerations, including temperature requirements, handling instructions, and regulatory compliance. I have designed an intuitive checklist that ensures all necessary information is captured, and users must explicitly acknowledge specific terms and conditions before proceeding. This approach not only safeguards the integrity of medical shipments but also demonstrates our commitment to handling these sensitive items with the utmost care and professionalism.
5. Dangerous Goods Classification
The system incorporates a comprehensive dangerous goods classification module, aligning with international air transport regulations. Users are guided through a series of exceptions to accurately classify their shipment, with clear explanations of categories like UN3481 (lithium-ion batteries) or UN3373 (biological substances). Added intuitive icons and color-coding to help users quickly identify the appropriate category. Unlike passenger luggage restrictions, the courier service can accommodate certain dangerous goods with proper declaration and packaging. This feature positions us as a go-to solution for businesses needing to ship specialized materials safely and compliantly.
6. Two-Tier Service Model
There is a flexible two-tier service model to cater to diverse user needs. The Basic tier offers a cost-effective solution for users who can manage airport drop-offs and pickups, leveraging our existing infrastructure. Our Premium tier provides a seamless door-to-door experience, perfect for those prioritizing convenience. The booking interface outlines the benefits of each tier, helping users make informed decisions based on their time, budget, and logistics preferences. This dual approach allows us to serve a broader market while optimizing our operational resources.
7. Multi-Package Upsell
A smart multi-package booking feature encourages users to consolidate their shipping needs. As users add items to their order, the system dynamically calculates discounted rates for additional packages, showcasing potential savings. I have designed a card that allows users to easily manage multiple items, including choice for either individual tracking for each package or merging all into one tracking ID for a single shipment. This feature not only provides value to our customers but also helps us optimize our cargo space and increase per-transaction revenue.
8. Multi-Tiered Packaging Options
The packaging selection process offers users a choice between Basic and Premium options, each with clearly outlined benefits. The Basic option includes standard protective materials, while the Premium tier features advanced solutions like air pillows and tamper-evident seals. Have created comparison cards that visually demonstrate the differences, helping users make informed decisions based on their item’s value and fragility. This multi-tiered approach not only boosts the packaging revenue but also enhances customer satisfaction by providing tailored protection options.
what can be the overall impact on airline business metrics?
- Increased Ancillary Revenue- Forecast an up trend in ancillary revenue by tapping into urgent courier needs, especially for e-commerce sellers and personal shipments
- Enhanced Brand Value- By offering a one-stop solution for flights and fast couriers, airlines could increase brand loyalty. This diversification counters seasonal dips in passenger load factors by maximizing belly-hold capacity.
- Improved Customer Satisfaction- Surveys measuring Net Promoter Score (NPS) for the new courier service could target a better score. The emergence of “courier feature in airlines” as a recognized sub-brand, would draw trust from existing passengers/
- Operational Efficiency- This new courier flow leverages existing cargo infrastructure with minor process modifications. Real-time tracking reduces inbound support queries, as customers can self-track shipments.
- Potential Global Scalability- If successful in domestic operations, the model can integrate with international networks, subject to cross-border regulations. Partnerships with existing courier companies in other countries could drastically expand the airline’s footprint and synergy opportunities.
- Increased Revenue- Increased utilization of belly space or dedicated freighters will boost cargo revenue as a percentage of total operating income. Courier services can contribute to ancillary income streams beyond passenger ticket sales
- Capacity Utilization- Available Freight Tonne Kilometers (AFTK): Improved utilization of aircraft capacity for cargo purposes will enhance efficiency metrics.
Diversification is great, but has its complexities! — Reflection post this design sprint!
You have reached the end! Conclusion:
While diversifying into courier services offers airlines opportunities for revenue growth and operational synergies, it also introduces complexities that require careful planning and execution. Success depends on leveraging existing resources effectively while addressing challenges such as competition, regulatory compliance, and operational efficiency. Monitoring key performance indicators (KPIs) like revenue growth, cost management, on-time delivery rates, and customer satisfaction will be critical to evaluating the success of this diversification strategy.
