The other day Eye for Travel interviewed Sabre Vice President and General Manager – Asia Pacific, Hans Belle. Somep parts of it read a bit too much like it was written by the PR department or lifted from a brochure, but there are also some interesting comments.
Hans Belle: “A company like Sabre, which has a consulting practice in this space, acknowledges that it is critical to understand “how do we help the traveller assess the marketplace and find the right travel product for themselves when shopping”
Is that a Sabre consulting practice helping airlines maximize ancillary revenue. Seeing as I’ve got people doing the same thing with a number of airlines but only charging for the IT component and not for the consulting, it makes me wonder if I am giving something away that should be charged for. An interesting thought to ponder.
Sabre launched an industry first with Sabre Pay-For-Seats capability, which allows travellers to select premium seating for an additional fee. Sabre launched this capability with Midwest Airlines and is currently working with United Airlines on a similar capability.
I’ve got to give credit to Sabre here, as I know one airline that was close to a related Sabre product who despite complaining about all GDS companies on various occassions seemed quite happy with Sabre on this point.
Eye For Travel: With airline websites garnering millions of unique visits on a monthly basis and sizable opt-in e-mail subscribers, in your opinion to what extent airlines are ready to expand their product basket as suppliers try extracting the “overall value” of the guest?
Hans Belle: Far too often, airlines have difficulty in assessing the overall value of the guest. Without that, it is really just window-dressing. In fact, a core attribute of SabreSonic Customer Sales and Service (CSS) is meant to address this very issue. Taking a customer-centric view of a sales opportunity, combining that with insight into the airline’s revenue, then determining what offers are appropriate to that customer given supply/demand issues, as well as that customer’s personal needs is the harbinger of why we’re seeing success with SabreSonic CSS.
I’m not sure he is really answering the question on this one, as I doubt any airline customer of theirs has so far implemented customer value in the CSS (probably related to price paid on a single flight or frequent flier tier and used for reaccommodation purposes) to sync with customer value in a loyalty system, airline communities, proprietary social networks, an opt in email database or any of the newer ways of pushing information to passengers such as widgets, gadgets, Twitter or RSS. That said, I doubt any airline has, but I’d love to be proven wrong if there is an airline that has an integrated approach to true customer value, and is using it to sell in a more targetted way. The question from Eye For Travel is a very good one, but the answer is straight from the brochure. And what are the supply/demand issues referred to – does that simply mean you can’t sell more exit row seats at a premium if the prior demand for that product has exceeded the supply? No doubt about it though, airlines love this talk from suppliers, as I’ve heard about one recent Datalex pitch to an airline for their internet booking engine where they really pumped up the ancillary revenue credentials of their product, and it’s ability to link with other databases and to help sell other products/services the airline was offering to passengers. Last I heard they didn’t end up winning that deal, but it certainly shook things up. And no doubt this talk from SabreSonic has resulted in some good successes recently with wins on JetBlue and WestJet.
Eye for Travel: What do you recommend when it comes to signing partnership deals?
Hans Belle: Working relationship, track record, depth of content, quality of content (e.g., do they offer competitive prices), strength of service – to both the airline and the end-consumer are all important. Still, the thing which most often breaks partnership is discontinuity among the partners on what defines success. Accordingly, often, the most important aspect is goal alignment between the partners.
I once engaged in an email exchange with a supplier of airline white label hotel websites who was lamenting the fact that the deals signed with airlines were not very profitable as all. Their view was that all the airlines cared about was playing off one supplier against the next to sign a contract with the highest rate of commission, and that once the contract was signed the airlines always wanted more development on the platform but weren’t prepared to pay for it. I’ve got one customer who definintely takes an approach closer to what Hans is describing, but when it comes to ancillary revenue partnerships, I’d say it was the exception rather than the rule.