Transforming a San Diego Airport Terminal into an Innovation Lab

By Kelsey Alpaio |  September 20, 2017

From long security queues to delayed flights to wayward baggage, air travel is in dire need of innovation.

And the San Diego International Airport wants to bring it. The airport’s Innovation Lab, opened in 2016 and housed in a former commuter terminal, serves as a place for innovators inside and outside of the organization to develop and test new ideas.

Photo by Melissa Jacobs

“What we’ve done with the Innovation Lab is say, ‘Maybe there are other ways to create an experience for our passengers that also helps to increase and create different streams of revenue,'” says Rick Belliotti, the airport’s Director of Innovation and Small Business Development.

The airport’s first partnership to emerge from the lab is with an Orange County startup called AtYourGate, a mobile app that allows passengers to order concessions and other amenities from anywhere in the airport and have them delivered right to their gate. The airport started to test this service in actual terminals in August 2017.

Moving forward, Belliotti says he is looking for other types of partnerships — including one that will assist him with running the lab. InnoLead sat down with Belliotti to discuss the lab’s approach to creating partnerships, how the airport is innovating in a regulated environment, and how they’re trying to better understand the needs of travelers.

The Innovation Lab

At the San Diego airport, the commuter terminal was once home to small aircraft that would fly between San Diego and Los Angeles. But as demand for this route grew, so did the aircraft, forcing them into other terminals. The commuter terminal was shut down — until its former baggage claim area was revived to serve as the airport’s innovation lab.

“Everything that we’ve done to create the space, we’ve done trying to be conscious of the fact that we want to be [fiscally responsible],” says Belliotti. “We want to do it in a way that’s economical to the benefit of the [airport] authority, the community, and the industry.”

The former baggage claim area was transformed into a simulated terminal space using reclaimed components from the rest of the terminal.

“It’s designed to simulate from the curb all the way to the gate and ultimately to what we call the apron here, which is where the aircraft parks,” says Belliotti. “We can simulate a terminal within that space so that people can prototype, innovate, and come up with new ideas in a safe environment that is not necessarily intermingled with active passenger traffic.”

And Belliotti says the vision for the lab was to be open to anyone inside or outside of the organization.

“We don’t want to box ourselves in and say we’re only working with startups or only with people in the aviation industry,” he says. “We do see some value in airport employees using the space for training. We’ve set up a training facility…We’ve seen meetings in there, which maybe wasn’t the intended use, but that’s OK because it’s a good space and it helps spur thought processes. We’ve seen it used by airlines as they are starting up service at the airport and they need to train their employees. It’s quite flexible in what it can be used for, and that was really the intent.”

Forming Partnerships

Belliotti says the airport is looking to build relationships with external organizations as well, including startups, incubators, and accelerators. One such relationship is with the San Diego-based accelerator Connect, which is helping the airport find relevant companies to partner with.

“What we’re really trying to do right now is just build that relational foundation of ‘we know each other,'” he says. “We’re not yet to the stage where we’re putting out opportunity statements and having those organizations help us put those opportunity statements out to innovators. That will come — but that’s not where we’re at at this stage.”

One of the main objectives of a recent RFP sent out by the airport was to help get the lab to its next phase.

“We’re looking for someone to come in and help us manage the innovation lab as it stands, look at the business process that we’ve laid out, and give us some feedback,” Belliotti says.

According to the RFP, the main role of the chosen third party will be to create opportunity statements for innovators based on business challenges at the airport. They will then source applications, select finalists, and run “mini accelerator programs,” with the goal of piloting or implementing the innovators’ solutions at the airport.

The third party, which will be selected before the end of September 2017, will be offered a two-year agreement, and a fee of roughly $150,000 per year.

“We always want to learn,” Belliotti says. “And we’ve taken the position that we’re not the experts on everything. When we get good feedback, we want to learn from it… When we get that [third party] on board, they’ll help us with getting new innovators in the space. As we’re doing those opportunity statements, they’ll be helping those partners that come into that space, help them make the connections and relationships that they might need…”

Creating an Experience

Belliotti says that one of the main goals of the innovation lab is to better understand airport customers, and to create new offerings and experiences for passengers. He says the airport keeps tabs on the needs of airport customers in a few different ways: a standard industry-wide survey, intercept surveys they conduct on their own, and by simply “eating, breathing, and sleeping” San Diego.

Belliotti understands that “people aren’t coming to an airport for an experience,” as he puts it. “People are going to a theme park, they’re going to a monument, they’re going somewhere else for an experience. They’re coming to the airport, unfortunately, because it’s a step in their journey. And I use the word unfortunately loosely, because from their perspective, it can be a very challenging environment to function through. For a variety of reasons, people tend to just want to get in and out as quickly as they can.

“Belliotti says that creating new experience in that context may mean helping passengers reduce stress, or make better use of the time they have to spend at the airport. One example: the “indoor pet relief station” they installed in one of the terminals. The airport also ran a test with FuelRods, a startup that provides reusable phone chargers via kiosk, allowing passengers to pick up airplane-safe power in the terminal.

“When you’re marketing and innovating for a product, you tend to be very much focused on, ‘What is the problem it’s going to solve?'” he says. “When you’re creating an experience, you’re trying to tap into a whole different part of the brain where you want somebody to stop and have an ‘ah ha’ moment, or stop and feel refreshed, or activate a different part of their brain.”

Working with regulators

Belliotti says that one of the factors that can make innovation challenging at the airport are the reams of regulations that surround the aviation industry. His solution: treating regulatory organizations as partners, not adversaries.

“We just need to be very nimble as an organization to adapt and address those regulations as they come along,” he says. “We never want to work around a regulation, because in many cases, they’re [for] safety and security…What we end up finding is that a lot of it is conversation. If there’s a federal requirement for safety or security, we have conversations with those organizations that put those regulations in place. Because it may be that we’re not interpreting it right, or as we talk to them we may discover that…we can do X, Y, and Z, and that can help us meet the regulation but still do what we want to do.”

“We look at them as partners, not adversaries,” he says. That’s the same approach he takes with existing departments and operating teams throughout the airport. “When we have a solution that comes through the innovation lab,” Belliotti says, “we’re partnering with those that are on the campus to make it successful.”