Amsterdam Schiphol: Growth strategy

27 Nov 2014 by Michelle Harbi
A firm focus on attracting transfer traffic has made Schiphol one of Europe’s leading airports, reports Michelle Harbi "Every time I see [Heathrow chief] John Holland-Kaye I say to him: ‘Don’t worry about this third runway, we’ve built it already – have that one!’” Amsterdam Schiphol president and chief executive Jos Nijhuis is joking, but he makes a serious point. While the debate on whether and where to construct another London runway rumbles on, the Dutch airport – with five of its own, no slot constraints and yet more room to grow – continues steadily to build its global connections for passengers across the UK and the world. Schiphol serves 26 airports in the UK – half through its home airline KLM – compared with Heathrow’s seven. Add its strong worldwide network – 323 direct destinations in 99 countries, of which about 140 services are intercontinental – and it’s no wonder many business travellers in the region are choosing to route through Amsterdam rather than London. In 2014, Schiphol was named Best Airport in Europe at the Business Traveller Awards for the 25th time. “Heathrow is much less of a true hub than we are,” Nijhuis says. “We have a very good network that is extremely accessible for people from the UK. The number of passengers from there is about 7.5 million – 15 per cent of our passenger stream.” Maarten Koopmans, vice-president of passenger services at KLM, adds: “Heathrow has been focusing on the London market, whereas our strategy is to serve the world through Schiphol.” It’s perhaps no surprise that a country built on global trade and exploration founded its airport with the key aim of providing “connectivity to compete”, as Nijhuis terms it. “The Netherlands is a small country so connectivity is key for our economy,” he explains. “Almost every business in the Netherlands is international because the domestic market is too small. To be able to offer this amount of intercontinental destinations, we need to have the transfer passenger, and that’s the whole business model of KLM, which it has developed over the past 95 years. We have designed the airport according to that, because we have always understood that connectivity is so important.” More than 40 per cent of travellers using the airport are connecting to another flight. KLM’s figure is even higher. “Between 65 and 70 per cent of our customers at Schiphol are transferring – two-thirds of our business,” Koopmans says. “That’s our strategy. Without the transfer traffic, we would not be able to offer these numbers of destinations and connections.” Schiphol is certainly purpose-built to serve transfer traffic. Its one-terminal concept, well-documented on these pages before, helps the airport to minimise connecting times. While some may argue that walking distances can be longer as a result, way-finding is excellent, and intercontinental services operated by KLM and its Skyteam partners are grouped in piers D, E and F, near the centre of the terminal, to keep flights close together. Flights are also organised in waves throughout the day to optimise the number of global links the airport can offer. An average of 875 KLM Group/Skyteam flights arrive and depart each day, offering a total of 40,000 possible global connections. The airport environment itself, meanwhile, is among the most imaginative you will find anywhere. The rest areas are inspired by nature (complete with trees and tweeting birds), there’s a roof terrace, public art, a library, numerous Dutch touches – from a tulip shop set inside a greenhouse to a choose-your-own Bols cocktail station – and even a mini Rijksmuseum. Nijhuis says: “That’s part of the atmosphere you want to create. The ambience is important, especially for those transfer passengers who have to spend more than an hour here – we want them to experience the airport as a nice place to be. It’s something you have to renew constantly.” Currently closed, the Rijksmuseum is to be relocated as part of major renovations of Departure Lounge 2 now going on, which will increase the amount of retail and food and beverage space by 20 per cent. “The area is being redesigned in seven ‘worlds’, such as wellness, luxury and family, where particular activities will be clustered,” Nijhuis explains. New retail outlets that will be added include a flagship Johnnie Walker House store and a Gucci boutique. The area remains open while the works are taking place – they are scheduled to be completed by summer 2015. The whisky shop, the first in Europe following several Asian openings, points to the importance of the Asia market to Schiphol – as does the casino situated on its “Holland Boulevard”. The airport offers direct flights to 23 Asian destinations, including seven in China. “We want the Chinese passenger to enter Europe in Amsterdam because we can provide the onward connectivity,” Nijhuis says. The revamp in departures is part of the airport’s master plan to boost capacity from 52.6 million annual passengers (2013 figure) to 65 million in the next five years, with the ability to go to 80 million if necessary. This includes adding another pier and extending the terminal (both due to be ready by 2018) and building a new Hilton hotel (to open in mid-2015). One of the main parts of the project, now well under way, is the introduction of centralised security areas to replace the airport’s at-gate checkpoints – currently a bugbear for many travellers. “We are one of the few airports with decentralised security and have waited a bit too long in changing that,” Nijhuis concedes. “It’s a huge project. We are in the middle of the refurbishments and it should be ready on June 3, 2015.” There will be five central security zones – one of which, for Schengen passengers departing Amsterdam, is already open. Three will be for point-to-point flights and two for transfer travellers. The nature element is again evident in the design, with the area already open featuring greenery, a wooden slatted ceiling and mood lighting. It’s something Nijhuis is evidently proud of, and passionate about. “We want to get away from the security hassle to execute a service,” he says. “To call it a security ‘spa’ is a bit too much, but it should be full of hospitality; it should be a process that every passenger understands.” The area has been designed so that experienced travellers can bypass those who need more time to prepare for scanning. Bags that fail the scan are passed through a dedicated machine, rather than being fed back through the same one, so as not to slow down the process. Passengers can also keep a closer eye on their belongings while being body-scanned. The airport aims to keep security queuing time at peak periods to no more than five minutes for premium passengers and ten for other travellers. “That’s the absolute maximum – it should be much lower than that, and we can have that now with our new concept,” Nijhuis says. That should have a knock-on effect on overall connections. “Our aim is that centralised security will speed up the transfer time,” Koopmans says. “We will not shorten the times more than they are right now, but it will make our process more robust.” The minimum connecting time at the airport for intercontinental flights is 50 minutes. Still, some contributors to our online forum have suggested this can be too short for passengers – and their baggage – to make their next flight. Nijhuis acknowledges that margins can be tight. “A 100 per cent guarantee is always difficult because there is a certain dependency on weather conditions and things like that,” he says. “It’s easier for the traveller to get the connection than [for] the baggage – the baggage needs a bit more time, although transfer bags are always given preference when unloading. Our experience is that the traveller feels more comfortable with an hour and a quarter, so KLM’s schedules are mostly based on that.” Koopmans says: “Overall, the percentage of passengers that miss a connection is 0.2 per cent on average – and that’s for all reasons, so I think we’re doing quite well.” Figures from airline data specialist OAG show that an average of 85 per cent of departures in 2013-14 were on time. Once the centralised security is complete, work will start on revamping the gate areas to offer what Koopmans calls “a better gate service and atmosphere, and a whole new look”. That will probably take a year, he says. In the meantime, KLM is working on other elements to improve your journey through the airport. Already set up at various points are self-service transfer kiosks allowing you to print out your boarding pass or make changes to your next flight, while in the three transfer centres and two business lounges, airline staff are on hand to do it for you. Now the carrier is turning its attention to your smartphone. Koopmans says: “We are building new mobile services to make your journey more personal. We can help you around the airport – this is something we are offering now as a trial [in October it released a route planner app that uses beacon technology to help passengers navigate their journey]. We can tell you how far it is to get to your next gate, how long the lines will be for security, when it’s time to start walking. We will also give you the opportunity to change the next leg of your journey via your phone.” He adds: “I expect most of these functions to be ready in 2015 – we’ll have much more location- and time-based services. A new KLM app should be available in the first quarter of the year – the look and feel will change so that it will show you what you need most at that moment.” KLM’s flagship intercontinental Crown lounge is also being transformed (it remains open during the refurbishment). Currently 3,600 sqm with more than 800 seats, it will almost double in size. “Right now, the lounge is good but it doesn’t give you a wow effect,” Koopmans says. “Since we are a transfer carrier aiming to draw customers to Schiphol, we want to offer something special there. It’s a big project – it will take two years – but we should then have one of the best lounges in the world.” He adds: “We want to surprise our customers every time they visit. We want to give a big role to Dutch design.” In that, it is working with Concrete, the Amsterdam-based agency behind the likes of the W London and home-grown hotel brand Citizen M. At Schiphol, there is always something new to experience on your journey through the airport. SCHIPHOL IN NUMBERS
  • Fourth-largest European airport
  • Five main runways
  • 26 UK airports served
  • 87 restaurants
  • 111 shops
  • Over 40% passengers transferring
  • 65-70% KLM passengers transferring
  • 323 direct destinations
  • 40,000 connections with KLM/Skyteam
  • 650,000 sqm terminal area
  • 52.6 million passengers in 2013
  • 1.5 million being invested in the airport daily 2014-16
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