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BCG Insights: Digital Innovation Will Take Air Freight Revenues to New Heights

The Ascendance of the Spot Market

As prices climbed and freight forwarders searched for scarce capacity, more and more bookings were pushed into the spot market. Long-term contracts negotiated one-on-one with freight forwarders—which traditionally made up 90% of bookings at agreed bulk rates—quickly began to take a back seat.

In the day-to-day operations of freight carriers, this meant that traditional ways of doing business—through relatively infrequent emails and phone calls—became inadequate, with staff overstretched by the unprecedented flood of requests. More critically, freight carriers were leaving money on the table, missing opportunities to price each booking dynamically and in accordance with the strategy devised for each market.

Time to Catch Up to Passenger Airlines

Passenger airlines have long been able to quote prices dynamically for specific “buckets” of seats based on dimensions such as market type, cabin, season, and days to departure. And within the…

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