Interview: Theo Panagiotoulias, CEO, Star Alliance

Theo Panagiotoulias is CEO of Star Alliance and is responsible for driving the organisation’s overall strategic direction and growth. He joined the airline alliance in June 2023 and has more than 25 years’ commercial and operational experience in the airline and travel industry, most recently serving as senior vice president for global sales and alliances at Hawaiian Airlines. He has also held senior positions at global distribution system Sabre and at American Airlines. BTN Europe met with Panagiotoulias at Business Travel Show Europe in June, with the conversation below edited for clarity and brevity.

BTN Europe: You’ve been in the job a year now. What appealed about the role?

Theo Panagiotoulias: When I joined, what I was attracted to was a real customer experience focus. Historically, in my past career and in our industry, from a technology perspective, we’ve often been playing catch up. I don’t think we’ve really leveraged and taken advantage of the technology available to the extent we could. So I saw this as an opportunity where we can use technology to make life easier for travellers – little things like having the ability to track your bag across the member carriers when you’re travelling. My personal ambition is to make a difference. No one airline can serve the whole network so you want to be able to come together with partners and do it in a way that serves the customers and meet their needs.

BTN Europe: Where can technology have the biggest impact for travellers?

Theo Panagiotoulias: It’s all about the customer experience and the focus we have on that, the multiple touchpoints on a journey, and how customers get problems resolved at those touchpoints, whether it’s the booking experience, the airport experience, connections, loyalty… Technology is the key that enables us to solve those problems because ultimately customers want control over their own destiny, in particular the corporate traveller.

BTN Europe: Does the alliance exist more for the benefit of corporate or leisure travellers?

Theo Panagiotoulias: We exist for the travel communities of our carriers and we work on initiatives that are specific to specific target audiences. The corporate traveller is obviously a big one when it comes to loyalty, for example. But if we get the customer experience right it actually reinforces the loyalty. We want to reward them [travellers] in a way that reflects the value they represent to the carriers, and we want to make sure that when they’re on a journey they know they’re being listened to. What I’ve learned is that they want control of their own destiny. When a problem arises – and they invariably do in this business because it’s so complex – it’s about how you deal with it that matters to travellers the most.

BTN Europe: What do you think matters most to business travellers?

Theo Panagiotoulias: It’s all about seamlessness. We have four categories that we look at: booking, airport, connections and loyalty. Understanding and identifying problems along that journey and using technology to resolve it is something corporates truly value. For example, we’re already doing bag tracking across multiple carriers when you’re flying on Star Alliance members, and we’ve got connections centres – at Heathrow, for example. In the event there’s an irregular operation, having the people to get to those frequent travellers and get them to their next flight quickly is crucial. Another thing: instant redemption of miles when they want to use them. These are things where we’re market-leading from an alliance perspective. They [business travellers] want control of their own destiny more than any other type of traveller. Using technology to address that is the key for us.

BTN Europe: How much can your airline members collaborate on passenger initiatives?

Theo Panagiotoulias: We are owned by our members. We serve them. The airlines are clear on what they want. We want to be able to deliver to our customers an online experience. Take two airlines on an interline experience – we want to make it seamless, effortless. The level of collaboration… there’s a lot we can do that is not commercially related. It’s the focus on the customer. But from a commercial perspective, there are obviously limitations and the airlines respect that, but really it’s about the customer anyway.

BTN Europe: Scandinavia’s SAS has left the alliance after founding SkyTeam member Air France-KLM took a stake in it. Does that leave a hole in the Star Alliance network?

Theo Panagiotoulias: We’re pretty comfortable with it. They were a founding member and they were a significant member carrier who helped make Star Alliance what it is today and I say that with sincerity – we are very appreciative of that. They had new business reasons and a structure that took them in a new direction. We understand that; business is business. But because we are the largest alliance in the world and we have a broad and deep network we’ve got multiple carriers that serve Scandinavia with lots of frequencies from multiple gateways. It’s the diversity of the alliance that makes a difference. We’re very comfortable with how we serve Scandinavia and we wish them nothing but the best.

BTN Europe: On the other hand, potentially joining Star Alliance is ITA Airways following its planned acquisition by the Lufthansa Group later this year.

Theo Panagiotoulias: We haven’t received any formal application yet so there’s nothing really for me to talk about there. It’s with the regulators [the takeover] so we’re in a wait-and-see mode. If and when they apply for membership we will give it the utmost due consideration at that point in time.

BTN Europe: Star Alliance does not have any members based in the Middle East. Is that a gap in the network?

Theo Panagiotoulias: No, but what we do have is some strong member carriers such as Turkish Airlines who have a robust network in the south east of Europe, on the cusp there, that provide us great connectivity. And of course we have multiple member carriers that service key cities in the Middle East so we’re in pretty good shape.

BTN Europe: But if the opportunity came along…

Theo Panagiotoulias: I always look at opportunities. We are really comfortable with the network we have got but you’re always looking at opportunities and there are always white spots that may appear. The key to that has to be that any airline wanting to be a member has to meet specific criteria with the ultimate objective of complementing and strengthening the alliance even further. Any airline that may be interested we would take a look at.

BTN Europe: What’s the decision process if an airline wants to join?

Theo Panagiotoulias: There is an internal process that has multiple criteria to it but it has to come down to whether it augments the alliance and serves its broader needs.

BTN Europe: Star Alliance moved into a dedicated terminal (T2) at London Heathrow ten years ago. Would you like to replicate that set-up in more locations?

Theo Panagiotoulias: Heathrow is a critical gateway for us. We have more Star Alliance carriers serving it than any other gateway in the world – 23 of our 25 members – so it makes it a critical airport for us. That customer experience philosophy I talked about is no more relevant than at Heathrow. Having all the carriers under one roof and all the associated benefits of that in making it seamless from the moment passengers get there, when they’re checking in, the lounge facilities – it just makes perfect sense. We’re working closely with Heathrow to make sure we strengthen that position even further. We know Heathrow has its own challenges like any major airport but from our point of view, from the customer benefit perspective, that is the only way to do it. So we want to double down on that and strengthen it in the future. We’re also under one roof at Tokyo Narita, but that’s not 23 airlines. If we can repeat it elsewhere around the world that would be fantastic but it takes investment and commitment.

BTN Europe: Airfares increased steeply over the last couple of years. Do you get the sense they are settling now?

Theo Panagiotoulias: As I see it now, you’ve still got really strong demand, the supply chain issues are starting to ease now, and you’re getting more capacity into the market place, so I think it’s finding its equilibrium. I’m a very big believer that when it comes to airfares it’s all driven by supply and demand. But ultimately, if airlines want to be successful… our member carriers are driven by value proposition and are focussed on value. The customer experience plays a huge part in determining what people are willing to pay for. It’s all about value.

BTN Europe: On something like NDC, how much can or should members align their strategies?

Theo Panagiotoulias: Different airlines are going to look at this in different ways and have different business models. You have to respect that. What I will say about NDC is that it is new technology that is going to serve customers in terms of more choices, more options, and also for the airlines, giving them the ability to provide more choices with more rich content. It’s a win-win for both. What I would also say about NDC is that this technology is here to stay so it’s up to airlines to embrace it. I said earlier that perhaps we haven’t taken advantage of new technology as quickly as we might have in the past, here’s an example right now. Use it. How it’s used can be debated, but ultimately, it’s going to benefit the customer.

BTN Europe: What influence can an alliance have on sustainability? How does it supports it members on their progress towards net zero?

Theo Panagiotoulias: It’s such an important question. All the Star Alliance carriers are committed to achieving net zero by 2050 so there’s clear alignment and full support on that. We all know that in our industry there is an awful lot to be done but that commitment is consistent and transparent across the membership. But each member has its own geography, its own priorities, its own focus, and they have a bunch of different sustainability initiatives that serve their communities so trying to apply something across all our members is not really practical. What we can do is facilitate best practice sharing between our members and amplify their messaging more broadly.

BTN Europe: There’s only three airline alliances in the world. How do you define success?

Theo Panagiotoulias: We’ve got our network nailed down and we’re the largest alliance in terms of network. For me the key metric is the effectiveness of delivering real value creation from a customer experience perspective. What I continually reinforce within my own organisation and within our member carriers is that we have to keep working on the customer experiences particularly where it involves multiple carriers because they can’t do that on their own. How do we measure success? We measure the effectiveness of what we do to resolve the problems for travellers and then we’ve got metrics in place like NPS that can tell us that we’re doing a good job or we’re not doing a good job.