Not a publication I can say I read too often, but in a July story from Retail Customer Experience there is an interesting piece written by Matt Nitzberg, Executive Vice President, Manufacturer Practice at dunnhumbyUSA. The article is titled Seven requirements for becoming customer-centric. It is not the first time I’ve mentioned his company on this blog, as once I was at a conference where Simon Hay presented and there is no doubt that consumer brands use checkout data in ways to understand non-registered buyers (ie. like non frequent flyer members) that airlines can only dream of doing. So I’ve lifted a few quotes from the article.
Happily, some retailers and brand owners are starting to turn the question around. Instead of asking “why are customers disloyal to us?” they are asking “how loyal are we to our best customers?” These leading thinkers are rebalancing investments and refining strategies and tactics in order to earn and grow customers’ lifetime loyalty.
An insight from Edwina Dunn, CEO of dunnhumby ltd., connects the dots between relevance, efficiency, and effectiveness: “The more targeted the offer, the fewer gimmicks you need to sell it. It will sell itself because it’s what people want.”
That last point leads me to airlines and merchandising and the need to really get fare families correct. This might even be one of the most obvious problems I see on airline websites in general, as there is no use having 4 or 5 different brands (fare families) on the shelf if the buyer does not perceive any difference between each. Air Canada and Frontier have both been pushing their credentials for a while in this regard, but most airlines have been late to the party. And I know why – it is not easy. It cannot be fixed by the head of online alone, or even the head of direct sales. How fares are packaged and marketed can have an impact offline as well, meaning buy-in from across the airline. But it is worth getting right, and lately I’ve seen a lot more people taking merchandising much more seriously in the airline world.
Back to check-out data; I’ve been thinking a lot recently about improving customer centricity on airline websites through a more personalized experience. If I think of data sources the website could incorporate into the rules engine driving contextualization and personalization, I can think of three sources. The first is airline related databases like frequent flyer profiles or even GDS data like what is in the face of the PNR or past searches performed by other users on the site. We’ll call this first category proprietary travel data. The second source is lacking a name at the moment (at least from me), but it is all the information on the internet that can be publicly searched and classified - think of the tools that do reputation management and social media monitoring today; this is the kind of thing I am thinking of. The third category is what I am calling proprietary non travel data. This is check-out data, credit card company data or any other type of data that helps you better understand what people are doing and how they are spending their money, but is outside of the scope of data normally used by the travel industry.
Airlines have traditionally not been users of this type of data, relying more on MIDT and their frequent flyer profile databases, but I’m really wondering if the next generation of airline content management systems may end up pulling data from all three sources in order to deliver a level of personalization that most have not even dreamed of yet. Getting it right means we almost certainly have not even scratched the surface of what is possible in ancillary revenue.