NB: This is a viewpoint from Jason Kelly, CEO of Sociomantic
When they aren’t flying the skies, airlines have a down-to-earth problem on their hands.
All of them have enormous amounts of customer data at their corporate fingertips but they’re missing out on a first-class targeting opportunity to help decrease distribution costs and boost incremental revenue.
Think of all that rich first-party consumer data available: geo-location, search and click-through-rates, customer financial value, customer system details, past travel booked, loyalty program membership, website activity, call center activity – the list goes on.
Then add to it the data amassed from years – decades in many cases – of doing business: which flights can be priced higher, how to scale ticket pricing according to time-to-flight, and so on. Between customer systems and revenue management systems there’s a ton of information flying around; but too often it misses its connection.
Communicating one-to-one
The problem is that all this data has been stored and managed in separate silos – customer data has been the purview of marketing and business data of interest to revenue management. Most CRM systems push offers and messages built around specific customer 'profiles' or audience segments. Tapping into the full pool of first-party data allows airlines to send the optimal offer to each individual – communicating on a one-to-one basis, not just to bucketed segments of their audience.
At the same time, most revenue management objectives are currently focused purely on maximizing revenue for every flight by optimizing load factors and average fares (i.e., don’t sell a seat today that you can sell for more tomorrow.) It’s a tried–and-true system that has worked fairly well for years, but it ignores the new possibilities driven by deep knowledge of the customer.
Many airlines today are leveraging their customer data and revenue management information for email campaigns – and seeing results – but this approach has not yet been widely adopted in real-time outbound messaging through website activity and digital media optimization.
The result is that many airlines are missing an incredible opportunity to connect with consumers and turbocharge their revenue management systems by integrating this data across divisions and deploying it in outbound digital marketing campaigns. Leveraging this data can also help outbound marketing become a way to build customer lifetime value (CLV), turning digital media into a personalized experience by not simply blasting the same ad to every potential customer across the web.
Joining the dots
By integrating first-party customer data with inventory information, yield-optimization systems and real-time bidding (RTB) systems, airlines can deliver highly targeted marketing messages customized for specific customers and based on current yield-optimization goals.
For example, if a customer starts to configure a flight package but then abandons the purchase, having an integrated approach to data can tell the airline whether the customer is a business passenger (who likely has to book the flight anyway and so should not be offered a discount) or a leisure traveler (who might be enticed by a lower fare).
Airlines can also use this same strategy to further boost incremental revenue by showing ads with ancillary offers (such as seat or class of service upgrades) to customers who have already booked flights.
Synchronizing customer data with inventory information lets airlines reach consumers through dynamic personalized creative in real time, with offers just right for who they are, what their real intent is, and where they are in the purchase funnel. It’s a huge opportunity – and one that is not yet being taken advantage of.
Airlines need to use the information and systems they already have in place to communicate as effectively through digital media as they currently do through other channels. Unlocking the power of first-party data and tying together marketing with revenue management systems is a first-class opportunity for airlines to delight customers and increase profits.
NB: This is a viewpoint from Jason Kelly, CEO of Sociomantic
NB: Airplane image via Shutterstock