In the past decade, airlines have made tremendous progress in optimizing various revenue streams and becoming more passenger centric.
The pandemic’s impact on the travel sector has only accelerated this trend - airlines are now in a race against one another to leverage dynamic pricing and personalized offers to provide passengers with a memorable “travel experience” rather than just a plane ride.
However, most airlines are missing out on optimizing a revenue stream that has the potential to deliver up to a 28% increase to the bottom line - group bookings.
An over-reliance on legacy group booking systems has ensured that airlines report abysmal numbers when it comes to revenue from group bookings. The worst part is that airlines even end up losing money with group bookings due to the drawbacks of not modernizing their group booking processes.
Legacy tech stifles revenue growth
The process of making a group reservation has barely changed in years, leading to poor customer experience and revenue leakage for the airline.
Usually, customers must navigate exhausting Google forms, email exchanges with the sales or revenue management team or phone calls to call centers before their group booking can be processed. All said and done, the process takes at least a couple of weeks.
Airlines that rely on these traditional means of acquiring and servicing group passengers face several major challenges. For instance, they must rely on indirect distribution channels and travel agency partners, which are known for high commissions.
When a group booking request comes in through the reservation system, call, or email, the airline can’t personalize the offer or provide dynamic pricing in real-time based on load factor or competitor fares.
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Customers also can’t purchase ancillaries, as legacy distribution systems can only display airfare and schedules. Besides, the manual ticketing process makes PNR updating, payment collection, name updating, etc., a tedious process. It is further worth noting that post-ticketing services, including canceling and modifying tickets, are a nightmare for both the airline and the passengers.
Most airlines haven’t fully recovered from the pandemic, so it is mission-critical for them to step up and adopt modern retailing solutions when it comes to group bookings, which are guaranteed to increase revenue, improve passenger experience and even boost the productivity of the sales and revenue management teams.
Transforming the group booking experience
Most airlines’ group booking woes disappear with the use of automation and other capabilities that come with a modern, cloud-based group booking solution. Using the following features, airlines can provide customers with a differentiated and personalized travel experience, cut distribution costs and boost revenue with dynamic pricing and ancillary sales.
Airlines are in dire need of group booking software that can identify customers based on their buying habits and offer a group quote instantly based on factors, such as purchase history, demand for the tickets, competitor pricing, etc.
Airlines also need to present customers with the ability to book ancillaries, guaranteeing a shopping experience that can massively improve passenger satisfaction with the trip. Without a doubt, when airlines can deliver quick group quotes to customers by means of automating the process, they can expect a higher materialization rate, an increase in the revenue management team’s productivity and ultimately a jump in the revenue as well.
Airlines need to prioritize the provision of an easy-to-use web portal for customers to book, cancel, or make modifications to the bookings, such as upsizing, downsizing, itinerary change, etc.
Since negotiating group fares is another tedious aspect of the booking process, airlines further need to enable customers to negotiate the fares through the same portal. Once the customers are happy with the airline’s quote, they should be even able to make payments through the mode of choice, update their names and other information and get their PNR and tickets issued quickly and automatically.
Enforcement of group policy
One of the best ways for airlines to maximize their group booking revenue is by adding personalized markups to the group fares presented to their travel agency and corporate customers. Legacy group booking methods don’t offer this functionality, so airlines need to adopt group booking software that lets them configure special policies for each customer.
The policies can govern things like markups, personalized rules for booking and cancellation, etc. Based on these preset policies, the system can even send automatic reminders to the customers for payment, name updating, etc., which will go a long way in saving time for airline staff.
Series booking automation
Travel agents often book a pre-determined number of seats on a flight for a particular period. They make these series reservations, anticipating consistent demand in the same sector for a particular period.
Travel agents who raise series booking requests with an airline do so to avoid making multiple group requests individually, which is an unnecessary and tiring process, especially since the agent knows they will be entering the same requirements over and over.
By making the series booking process easier for travel agents, airlines can generate a lot of operating revenue and ensure that the flights are fully occupied well in advance. This can be done primarily by providing travel agents with a self-booking portal for making series reservations. Instead of the travel agent raising multiple group requests manually, they can simply raise a single series booking request, mentioning the departure point of the various groups, number of seats, dates, expected fare, etc.
Once the travel agents raise a request for a series reservation, the revenue management team can quickly evaluate the request to directly accept or negotiate the fares.
The reluctance from airlines to modernize the group booking process by implementing dynamic pricing, self-service, offer and order management and automated post-ticketing capabilities can end up as a massive drain on resources. Undoubtedly, it will also leave passengers with a poor group booking experience because of the long turnaround time, lack of customization options and poor post-ticketing support.
Alternatively, if airlines can automate the booking, payment and ticketing process, present dynamic fares and streamline the buying experience with an easy-to-use self-service solution, they can see up to a 28% rise in group revenue.