3 Reasons why the Airline Industry

Should Embark on Digitalization


We are in the era of the fourth industrial revolution. We? Oh, that’s us and the robots! While digital technologies disrupt long-established players in every business, they also open up a whole new world of opportunities. Since digitalization has been the main impetus for rethinking their future strategies, organizations need to look across industries and evaluate their services in terms of the broader business landscape.

When it comes to the airline industry, it seems to be clear that taking a holistic view on customers becomes a must. Because when consumers become accustomed to increasingly innovative services, they have come to expect the same convenience. Therefore, airlines must realize that they are competing against everybody and find ways to cater to those rising expectations.

Here are 3 reasons why airlines should make their own transformational journeys for a better customer satisfaction:

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Higher Customer Expectations

Technology created a monster: high customer expectations. It’s not only about having a safe and on-time flight. Now they demand a better service. The challenge for the airline industry is that providing the ideal balance between service, product and convenience changes for each passenger. Because one size does not fit all.

Airlines should think in terms of the fundamental value they create for different travel personas. They first have to understand why each persona is choosing them. Is it because of unique product offerings and extraordinary customer service? Or is it low prices and convenience?

Airlines can gather this information through a broad range of tools from surveys, previous customer purchasing, and browsing behaviors and big data analysis. Once they gain an understanding of the value proposition, they can better adjust their resources and capabilities to communicate with different personas like we created for Pegasus:” budget traveler”, “pampered traveler”, “business traveler”, “traveler with kids”.Such evaluation on existing customers can also open up the possibility of untapped opportunities to attract new audiences.

Real-time customer insights also enable airlines to turn each touchpoint into stellar customer experiences. Combining customer database in their systems with real-time insights from other sources (such as airport information systems), airlines can make timely and relevant offers to their passengers.

Probably, the best medium to communicate these in-the-moment offers would be mobile apps. IATA survey shows that while SMS messaging remains the preferred option for receiving notifications, this trend is reversing with 28% of passengers preferring communication through smartphone apps. Therefore, if airlines deliver timely and relevant push messages, their ability to personalize travel experiences for their customers will increase.

While these good-to-know messages provide a better experience for passengers, they also allow airlines to grasp an opportunity to upsell. For example, can displaying security wait times in the app be a good idea? Why not? People do not want to lose time in security lines. In fact, 74% of passengers think that the maximum acceptable queuing time is 10 minutes. Acting on the real-time insights, airlines can warn their customers if the waiting time is more than 10 minutes and offer them a fast-track option to avoid long security lines.

Need for a Strong Omnichannel Marketing Strategy

Airlines is only one part of the whole travel ecosystem. Before booking a flight, travelers google it, follow social media communities or go to travel agencies at the planning stage of their journeys. This also continues after the flights. They get in contact with ground services, security services or even arrange their transfers and hotels. Airlines need to reach their customers on the ground as well as in the air. Therefore, airlines have to tailor their business to the customer’s travel preferences in order to find a way to attract people for reasons other than the schedule.

First, airlines need to see their customers from a single point of view while interacting with them through a number of touchpoints. Travelers search for flights at an airline or 3rd party websites, book their flight on mobile and/or demand an upgrade at the counters. While airlines need to create a consistent brand image at every touchpoint, the next thing is to integrate these touchpoints together to create a single profile for each customer. Only when airlines can centrally manage data flowing from social media, apps, and website, they can create a seamless omnichannel experience for their customers.

One critical point for strong omnichannel marketing is to keep innovating on mobile. Now that people spend more time on mobile and mobile payment gets easier, user-friendly and easy-to-navigate apps will be the most impactful path of an omnichannel journey. Airlines, therefore, have to redesign their apps in a way that travelers can use apps not only to purchase flight tickets but also to improve their travel experience. Collaboration with third parties can enhance digital offerings of airlines to connect with customers. For example, integration of the airline app with Uber for getting and leaving the airlines will add value to their customers.

Ensuring Operational Excellence

Airlines need to run high-performing operations in order to improve customer experience. Adapting advanced technologies can only ensure such operational excellence through closer collaboration between all units: flight planning, crew scheduling, ground operations, technical operations, and customer service.

Collecting quality data from all units of an airline’s operations and turn that data into actionable insights make all the difference for airlines. Airlines can only realize this potential by adopting a holistic approach to information technology. Building unified technological systems that link various areas of the airline would allow capturing real-time data needed to optimize operations. Let’s imagine that due to bad weather conditions, some flights have to be canceled or postponed. The greatest challenge is to how to choose quickly which flights to cancel and which ones to postpone. Then, what to do with the crew and how to shift their schedule? What about customers who seek for a compensation or accommodation? As it’s already challenging to make operational decisions in real time, it’s impossible to make the right ones with incomplete data. If not extracting from all relevant parties, data may be limited in its value. And no matter how intelligent the system is, the output may cause serious disruptions to flight operations and result in negative passenger experiences.

At the end of the day, strengthening the airline’s operations not only keeps airlines ahead of the competition but also drive profits.

We know that trying to provide and maintain a good customer service is even harder in the airline industry when they are also involved with various 3rd parties and their settlement/payment issues. But we have good news; luckily the airline industry started to adopt blockchain technology which will solve their main challenges in addition to create time for them to enable travel easier, more secure and cheaper. Blockchain also opens windows into other additional possibilities such as digital passenger wallets with biometric IDs where customers can customize their flight tickets or even change and sell them.

Companies cannot perform effectively in a steady state. Deciding on where to go is only half of the challenge. They also need insights, the vision and the right tools to get there. The airline industry needs to understand the tectonic changes that transform each and every industry. And before it’s too late, it should take off for its digital transformation journey.