Every customer journey is unique. For brands, every step of the journey represents an opportunity to strengthen the customer relationship, by listening to what that customer wants and personalising products and services accordingly.
NB: This is an analysis from Elizabeth Kenny and Gavin Bourke of Boxever.
Today, the most successful brands are those that recognise the importance of the customer journey and make an effort to really understand their customers. Amazon won most trusted brand in Entrepreneur by offering millions of products, 24/7 access, superior search and browse technology, user reviews and one click shopping.
It knows how customers like to shop, what they like to shop for and the types of offers and incentives which will encourage customers to part with their hard-earned cash. It knows how to go beyond merely “customer relationship management” and instead practise “customer intelligence”.
For airlines - which face increasingly difficult market conditions - the opportunity to benefit from customer intelligence has never been greater. After all, there are significant rewards such as improved customer experience and increased revenues for those companies that really understand customer preferences - both financial and reputational.
CRM to customer intelligence = long-lasting relationships
How do you create relationships that last? It isn’t just marketers who have struggled with this question - a Google search on the subject returns more than two billion results.
Many of these queries refer to personal relationships, the type that many of us manage on a day-to-day basis, sometimes without really knowing it; the relationships we develop with close friends, with partners and spouses.
"It's the little things that are the big things — seriously, go that extra mile. Include a personalized note. Go beyond just listening and let your actions show you truly care in an honest and thoughtful way."
- Dave Brown, director of digital strategy at MKG
Developing strong relationships with your customers is not unlike developing personal relationships, and, there are a number of fundamental similarities for success:
- You know each other and communicate consistently with a common perspective or objective.
- When you communicate, you listen and take action based on what you hear.
- You empathize with the other person and attempt to fill their needs based on what you observe.
These attributes come naturally and instinctively to people who wish to remain close friends, and you could argue that they are just as viable for the development of strong business to customer relationships for airlines.
The history of the business-to-customer relationship
Successful customer relationships require understanding, empathy and two-way communication. The personal touch is key.
Before online shopping, mass-market manufacturing, and the prevalence of supermarkets, the one-to-one relationship between business and customers was paramount. Locals depended on the shopkeeper and the shopkeeper relied on local customers for his livelihood. The shopkeeper’s role at the centre of a community was as a figure of trust. And, there was recognition of mutual interdependence.
Mass production and the evolution of distribution technologies resulted in a gradual breakdown of the shopkeeper-and-customer dynamic. Businesses turned to larger markets and became less reliant on local customers to generate revenue.
As small businesses grew into, or were replaced by large international firms, it became increasingly difficult to maintain a symbiotic one-to-one relationship. Transactions steadily became faceless and impersonal and levels of customer service fell.
However, it was only a matter of time before technology began to shift power back to the customer - just as it had once benefited the business.
Before online booking, the airline industry had access to a tiny percentage of the customer data it holds today. Most the data it had was from those customers who had enrolled with a frequent flyer scheme making it virtually impossible to market to a burgeoning market of occasional travellers - infrequent flyers. Today, infrequent flyers represent a significant proportion of business and increasing margins here have become a critical factor for success.
The empowerment of the people
The recent rise of connected devices, such as laptops, tablets and smartphones, has seen a rapid redistribution of power away from businesses and back to consumers.
In about a decade, these devices have completely transformed how people interact with vendors, whether buying clothes, groceries or flights. For instance, more than 60% of the consumer buying cycle now takes place before the customer has even made contact with a company.
Mobile access to the internet makes it easier than ever for people to learn about products and services as well as shop around for a bargain - they don’t even need to leave the comfort of their homes. In a recent study, more than 80% of people who buy travel products directly admitted to having shopped on other websites or metasearch sites first.
The rise of social networking has also had a huge impact on consumer purchasing decisions. According to recent findings, 85% of people said that social networks helped them decide what to purchase, and in Asia Pacific, 59% of consumers said they had commented about brands online.
People not only have the power to make an informed decision, but to influence - and be influenced by - the purchasing decisions of others - even complete strangers.
The 21st Century has seen a restored balance to the interdependence between seller and buyer. The customer is empowered again, and this has a profound effect on how businesses interact with them. Knowing how to best communicate with customers has never been as important.
CRM, silos and the 360 degree view
Customer Relationship Management (CRM) solutions originated as a means of collecting customer information in one location to identify customers who had purchased before, record payment status, identify product issues and determine when the customer could be back in market. Although CRM relied only on basic, contextual, historical data, it was a significant milestone on the road to personalisation.
In the 1990s, airlines deployed computer systems in an attempt to support sales and service processes. While these early CRM solutions were reasonably adept at capturing and storing customer data - such as spending patterns – they were in a silo.
They didn’t integrate with other systems such as the booking engine to gain a 360º view of the customer. Any communication was at, rather than with the customer, using outdated and historic information.
Frequent Flyer’ programmes, bonus points on credit cards and a host of other resources soon replaced traditional customer service and support systems, but again they lacked the ability to learn from and understand customer preferences.
As competition in the marketplace steadily increases, airlines are realising the importance of delivering personalised products, offers and services to customers. However, this brings its own challenges.
While many airlines have collected mountains of customer information, sometimes dating back thirty or more years, much of this data is stored in different silos throughout the organisation - and this is where traditional CRM falls short.
The increased fluidity of data (across online and offline channels and stored in disparate systems) has eroded the physical barriers between sales, customer services and marketing. It also means that departments, which once collected data in isolation, need to work more closely together to keep customers happy.
For example, a customer might choose to interact with an airline by visiting its website on a tablet, through its social media channels, or via a telephone booking service. Each of these interactions has traditionally be tracked, monitored and actioned in a separate system, by a separate department.
In this sense, static CRM systems often lack the agility required to keep abreast of changing customer relationships. Airlines should therefore look at solutions that can intelligently pull together as many customer touch points and channels as possible, both online and offline. Only when this is possible will airlines be able to take the next step toward true customer intelligence.
Generalisation, personalisation, and context
Thanks to technology, airlines now have the ability to restore the personal relationship that once existed between businesses and customers. However, all parts of the puzzle must be properly connected for a holistic view of that customer. If one part is missing, opportunities are missed and problems start to appear such as customer receiving a flight offer email after making the purchase, at a higher price.
After all, in order for the relationship between the man and the airline to be truly personalised, it must be specific and contextual. This is the essence of customer intelligence. E.g.:
A 35-year-old man is late for a flight to Berlin from Dublin.
The airline knows this traveler well. It knows he has two children aged under 16 and is married. Three times a year, he travels with his family to the south of France, and usually arrives at the airport with time to spare. He visits airport stores and spends money on alcohol and men’s products.
He also checks in two large suitcases and rents a six-seater Jeep for transport at his destination. During the flight, he buys soft drinks for his children and green teas for himself and his wife.
However, the same man flies frequently on his own from Dublin to Berlin. On these flights he never checks a bag, never buys any duty free, always flies business class, and is always late to check in.
How the airline interacts with the traveler relies on real-time recognition of a circumstance followed by real-time contextual interaction. It relies on bringing together all that data the airline holds at one moment in time.
In this case the airline should recognise the traveler is on business. Therefore, he would most likely appreciate information by text on whether the flight is delayed. He would likely not appreciate a text offering him a special discount on duty free alcohol, or information on renting a six-seater Jeep in Berlin.
He might appreciate weather and traffic updates in advance, so he can pack the right clothes or an on-arrivals transportation service.
For customer intelligence to be effective, it must incorporate a real-time and contextual interaction that delivers real value to the passenger. Because, without context, it is simply not possible to gain a truly holistic view of the customer - personalisation becomes generalisation and if this occurs the relationship risks damage.
Conclusion
86% of customers are willing to pay more for a better customer experience. The starting point is to bring the silos of customer information together into a single customer view. Then personalise each individual touchpoint by sending relevant and contextual information to the customer. This will improve the customer experience, increase loyalty and ultimately result in increased sales.
The journey to truly act on customer intelligence is by no means simple - there are lessons to learn and hurdles to overcome. However, if done correctly, airlines can go one step further than simply replicating the bond between shopkeeper and customer.
True customer intelligence enables long-lasting relationships which not only deliver tailored products and services based on requirements at a particular point in time, but also accurately preempts future needs. This means delivering services perfectly designed for the customer, before the customer has even realised they want them.
NB: This is an analysis from Elizabeth Kenny and Gavin Bourke of Boxever.
NB2: People, barcode head and people empowerment images via Shutterstock.