I saw this news from Alaska Airlines last week and was pondering how I could make use of it in a blog post.
Joe Sprague, a 10-year veteran at Alaska Airlines, has been named vice president of marketing. Sprague will be responsible for the carrier’s overall marketing strategy as he oversees marketing communications, sales, reservations, food and beverage, customer care, the Mileage Plan frequent flier program and Board Rooms. Sprague will also retain responsibility for Alaska Air Cargo, a division he has led for the past two years.
Steve Jarvis, formerly Alaska’s vice president of marketing, sales and customer experience, will assume the new role of vice president of customer innovation and alaskaair.com. In this position, Jarvis will oversee the airline’s Web site and efforts across the company to continue developing customer-facing technology, such as online and mobile phone applications.
And then it came to me. In the most best-practice most efficient airline (horrible phrase I know), who should the eCommerce manager report to? Even more importantly, how are the best airlines in the world structured for maximizing the opportunities in direct sales? And finally, should mobile and/or social media sit together with eCommerce?
Jet Airways (India) Ltd, the country’s largest airline by passengers, says it has 5,000 Facebook and 1,300 Twitter fans. The airline set up a separate social media division to manage its presence on these platforms.Jet Airways (India) Ltd, the country’s largest airline by passengers, says it has 5,000 Facebook and 1,300 Twitter fans. The airline set up a separate social media division to manage its presence on these platforms.
I’m not exactly sure how separate this separate division at Jet actually is, but for a more detailed discussion with one view on where social fits in the the organization, click here. Today I’m much more interested in website first, call centre second, mobile third and social a distant fourth.
In my mind, the best airlines in the world have the website and the call centre reporting into the same person. I’m not going to name names in this piece, but I don’t have to think too hard before coming up with some extremely efficient airlines and some horribly inefficient airlines when it comes to direct sales. In every case I’ve seen, the structure of the inefficient ones is obviously a big part of the problem. I know of cases where website and call centre actually compete with each other, do not co-operate at all, and have built parallel and therefore wasteful and overlapping infrastructures - quite frankly I’m amazed that senior management tolerates such a duplication. There is so much cost to be cut out of the back office of virtually any airline direct channel operation, but if website and call centre are not working hand in glove, then these savings will never be realized.
Onto reporting lines, and on this I am a little more flexible. Reporting into Sales probably makes most sense, but in some airlines Marketing has a strong commercial focus, and because the website is such a large part of most airlines direct sales operations, then reporting to Marketing can also have strong merit. Reporting into Loyalty is less common, but I’ve seen frustration in airlines where commercial online and redemption online don’t work well together, so maybe Loyalty also has some merit, especially as the loyalty program can be a powerful tool in warding off the threat from OLTA’s. Reporting into IT is more questionable, but depending on who is the CIO and what other responsabilities this person has, maybe it could also be justified – especially if bleeding edge innovation is a desire of the airline and the CIO is more a techie than a bean counter. Finally you’ve got some eCommerce departments reporting into Revenue Management, or Schedules or other totally unrelated and non-synergystic areas. Once again, I’ll never say a definitive “no” as the quality of the individual heading that role can make hard and fast rules redundant, but it ceratainly raises a lot of questions around whether the airline is set up in an optimal manner.
Mobile is also something that I am more open minded on. Whilst building a web app and a mobile app in isolation of each other will only cause problems down the road, in this early stage of rapid mobile innovation and fluid business models, having a rapid team working in mobile with only a steering committee or very senior executive in common with the website could be justified. The days are numbered on this structure, and maybe in a lot of airlines that time has already passed and the two need to be headed by the same person, but it needs to be looked at on a case by case basis after understanding the objectives of the airline in mobile. Is mobile just for servicing, is it customer acquisition, is it merchandizing / upsell, is it loyalty, is it destination content related, or is it something completey different. The answer to this question will largely determine to whom mobile should report.
And whilst on the topic of airline appointments that I started with, here is a recent one.
In a surprise development, Tiger Airways has announced a new boss to head its Australian operations to replace its local managing director, Shelley Roberts, who helped set up the discount airline and has steered its rapid growth. ”Shelley has established Tiger Airways Australia as a major national airline, and led it from infancy to profitability,” Tiger Airways Holdings Group chief executive Tony Davis has announced.”She intends to take a well deserved break. We would like to thank her and wish her continued success in her future endeavours,” he said. Replacing Ms Roberts is Crawford Rix, the managing director of no-frills UK airline ”bmibaby”.
Crawford Rix worked with bmi regional before he was head of bmibaby. Definitely not one to pick the easy jobs. For some reason I do not understand, I get a disproportionate amount of search engine traffic for a post I wrote once on Tiger Airways, so maybe the mention above will drive traffic to this post!
And then just today I saw:
EasyJet today confirmed that its new chief executive is Carolyn McCall, the head of the Guardian Media Group. Ms McCall has no experience of the cut-throat airline industry and is leaving one company in turmoil for another beset by management rows and departures.
Finally, if you like the sound of living in Las Vegas, then Allegiant are looking for someone to fill the role of Pricing, Ancillary, Revenue Management Analyst.