A report published this week by Amadeus,
‘Embracing airline digital transformation: a spotlight on what
travellers value’, sheds new light on what travellers value when
shopping for a flight.
Today retailers from a multitude of sectors have
reinvented the customer experience. However, the challenge often
lies in working out what customers truly value when they make that
Looking specifically at the airline
industry, the report explores new methods to aggregate customer
data, accompanied by behavioural economic approaches, Artificial
Intelligence and ‘Contextual Commerce’, in order to better answer
this question. These developments can offer great opportunities
for those airlines that embrace this change, asserts the report.
The report discusses a model of product vs
service vs convenience, in order for airlines to be able to market
intuitively each upsell opportunity. But this isn’t a one size
fits all approach. For each traveller, the balance between these
three elements will shift, affecting the overall price that they
are willing to pay for a flight.
In a survey conducted for the
report, 56% of travellers said that the total package was most
important to them, while only 24% valued the lowest price the
most. For example, a new mother travelling with a baby will have
different priorities that when travelling alone for business or
Commissioned by Amadeus and Connections, a
global networking and events organiser, the study is based on
interviews with airlines, travel agency and technology experts. In
addition, the report contains an independent survey of travellers
focused on what they most value when booking a flight.
The report charts a range of changes taking
place as digital is becoming a driving force in the airline
Economy class is evolving:
changed economy class travel. Airlines are responding by using
data to better upsell products with the base fare. American
Airlines recently introduced its ‘Basic economy fare’ and British
Airways moved to Marks & Spencer food on short routes.
The promise of AI:
Chatbots powered by
Artificial Intelligence will drastically change the industry. AI
advice will deliver more personalised experiences for travellers
when they request it.
Reinventing loyalty: An increase in digital
offers is challenging brand loyalty. The industry is now securing
loyalty with spend- based schemes, retail partnerships and pooling
of loyalty points. Travellers can now redeem loyalty points much
more easily as a result.
“Identifying upsell opportunities has long been
the holy grail of the airline industry. Now there are new
approaches to truly understand and define what people actually
value when they travel. The ability of new technologies to
aggregate customer data, combined with the application of
behavioural economics, will help airlines to present their offer
in a way that secures revenue and loyalty,” said Elena Avila, Head
of Airlines Strategy at Amadeus IT Group. “In the digital age,
it’s more important than ever for airlines to make an emotional
connection with their travellers.”
You can download the entire white paper in .pdf
here (3.05 MB).
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