In the first part of this blog series I looked at some ways airlines can customise their offers today, but despite these advances there are some challenges still to be addressed. This post will explore these issues in more detail.
Firstly, customisation requires an airline to successfully identify its end customer and their needs. The way an airline could do this is through the customer profile information saved in their Frequent Flyer programme. Yet, while airlines may have rich information on their customers’ preferences, travellers don’t, on the whole provide frequent flyer numbers when searching with an online travel agency or a metasearch provider.
So just how can we identify customers?
For online searches, ‘cookies’ – software which resides on a computer to identify the user to websites – can help to build knowledge of users and their choices. However a growing number of internet users employ cookie blocking software to preserve their anonymity and the operating systems of many leading smartphones block cookies by default.
The growing use of devices raises another issue. Cookies work best when we use a single device to access the web, and as we use a wider range of devices – desktops, laptops, smartphones, tablets – this makes the process of accurately identifying a user more complex. I must be a real head-ache for airline marketing departments since I regularly search for flights from my laptop at work, my iPad and my desktop at home.
For travellers using a travel agency to make a booking, at the very least, the airline will know the travel agency office which the customer is using and the company they work for. Amadeus can share this information with airlines, that use the data to decide, in real-time, what level of availability they will offer.
Can the airline’s IT system support customisation?
The second challenge, is that once the airline system has identified the traveller, it must match that information with that of the traveller’s preferences. This must then be fed to the merchandising or pricing engine in order to deliver the customised response.
All this is possible today, but the challenge for the airline is to do it quickly enough to present the customer with an offer before they lose interest. In the web environment, customers will move on to a different website if they have not received a response within a few seconds.
Furthermore, to achieve customisation through the travel agency channel, airlines require Amadeus to deliver a live feed of customer information. However, feeding this data to the airline directly requires an airline’s own systems to process around six times as many transactions per booking as they would do normally.
Amadeus, today, shields a carrier’s own IT systems from this burden by processing internally, on average, 194 transactions per booking, while the airline’s system is only exposed to 32 transactions per booking. In order to achieve true customisation we would need to pass all of these transactions on to the airline. Airlines would require much more robust IT infrastructures than those they have today.
The good news is that none of these challenges is insurmountable. The cost of robust IT infrastructure will fall as the cost of processing power and data storage falls, and increasingly, websites are integrating with social networks to have users identify themselves voluntarily. As these challenges are overcome, it may not be too long before your airline is one step ahead of you, predicting services and options even before you know that you want them.