Today there are exciting opportunities for airlines to grow revenue beyond the traditional airline distribution channels.
NB: This is an opinion by Eric Dumas, CEO at Vayant Travel Technologies.
Performance advertising and metasearch network development are two key alternative channels – but each presents its own challenges, when it comes to making real time offers available.
Put customer knowledge to work: performance advertising
There have never been more opportunities for airlines to leverage their customer knowledge to promote their offers.
Performance advertising players, such as Criteo and Adara, enable airlines to reach a wider audience of prospective customers and not only at travel search and ecommerce sites.
The cost-per-click-based model means airlines only pay when leads are sent to the airline website.
Big data analytics means performance advertisers can use information about customers to target offers and optimize them according to their context: using this powerful customer intelligence, vendors can ensure their email and display ad campaigns reach the right audience.
But however precisely-targeted the advertising pitch, airlines do not follow up with real-time offers available for sale.
That’s because many airlines do not own their data: the historically-integrated nature of the reservation systems means airlines cannot easily allow performance advertisers to get at their shopping data.
Airlines can barely provide access to their offers outside their standard GDS channel and ecommerce site.
Making metasearch work for airlines
Another alternative marketing channel is offered by metasearch network development.
Metasearch engines – like Kayak, Skyscanner and Momondo – funnel customers to the airline IBE and can help carriers bring down the cost associated with GDS bookings.
Moreover, moving shoppers into the direct channel brings greater opportunities for airlines to establish more personalized customer relationships.
There’s also more scope to include ancillary services in the shopping process: with ancillary now accounting for more than 6% of global airline revenues, these have to be part of the picture.
The benefits offered by metasearch can be overshadowed by systems overload caused.
The huge volumes of search queries generated by metasearch sites means airline hosts and the GDS are barraged with unproductive hits: look-to-book ratios and airline costs quickly soar.
So how can airlines make metasearch work for them?
One move is for the airline to set up a separate shopping engine to handle its whole metasearch network.
A separate shopping engine means the airline is not at risk of being charged excessively for search by incumbent providers. In effect, this shields the airline from unproductive hits.
Another smart move is for the airline to give metasearch sites the ability to land directly on the booking page once the shopper has selected their flights.
This saves time and frustration for shoppers (who don’t want to have to re-enter data) and means the airline is not loading more work onto its systems.
Addressing availability
As with performance advertising, success of these channels hinges on the airline’s ability to make its real time offers available.
At Vayant, we see this as one of the biggest challenges facing airlines. As more and more channels proliferate this challenge can only become more acute.
In a real life example from our business, a single metasearch site generated around 80,000 pricing queries to an airline customer of Vayant for one week.
Out of those, 51 landings happened that triggered four bookings for our customer.
This means a look-to-book ratio of 20,000:1, which is a good illustration of what is happening on the market today and cannot be tackled with traditional solutions.
Keep it flexible
Performance advertising and metasearch engines are rising phenomena that cannot be ignored by airlines when planning their marketing strategy.
The key to winning in these channels is flexibility: allowing the airline to customize offers for different partners.
For airlines facing slim profit margins and seeking to optimize their channel presence, the good news is that a flexible and modern approach to search will allow airlines to make alternative distribution channels work to their advantage.
NB: This is an opinion by Eric Dumas, CEO at Vayant Travel Technologies. It appears here as part of Tnooz’s sponsored content initiative.
NB2:Airline distribution technology image via Shutterstock.