February 2010


The recent guest post from Lennart van Opbergen at Martinair was a good lead in to an article one reader sent me soon afterwards about Twitter.

Roughly two-fifths of Twitter accounts have never sent a tweet, according to analysis by RJ Metrics, and a quarter of those signed up have no followers. Further, 80 per cent of all Twitter users have tweeted fewer than 10 times and only 17 per cent – not quite one-fifth – tweeted in December.

Despite the gloomy tone of that paragraph, the article actually goes on to make a good case for the value of Twitter. The power for airlines and many other businesses looking for new (cost effective) ways to promote their product is probably in using it as a largely one way form of communication – almost like a variation on the good old email distribution list. The article I was sent then goes on to say:

So while there may be fewer people active on Twitter than the number of account holders suggests, it is also clear those who use it are using it more intensively. This is backed up by a finding by social media monitoring company Sysomos that the most committed 5 per cent of Twitter users account for 75 per cent of tweets. This suggests the platform is moving towards the few-to-many model that typifies all other information media. Think about television, newspapers, radio, blogging: the audience is always considerably greater than the number of producers of the content being consumed.

Rather that eveyone having an active voice, we are moving towards power users – this raises a whole new question of how companies should treat power users and should airlines factor a person’s social media standing into their calculation of customer value. The question is, which passengers really deserve VIP status? In a non airline context, the case of Heather Armstrong and Maytag illustrates this dilemma quite nicely.

The title says this will be my last Twitter related post for a while, but it should actually be my last post of any kind for a while. I’m taking my main vacation for the year, starting tomorrow. If you want a clue as to where I am travelling to, it is the country where freedom of speech seems to be disappearing at an alarming rate.

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Earlier this week I was on the phone with a senior airline executive and he was asking me what I thought of the mobile phone and its role for the airline in extending eCommerce beyond the PC. What I didn’t know then, but I would surely have introduced into the conversation had I known, was the following guideline Apple gave to iPhone developers on February 3rd.

If you build your application with features based on a user’s location, make sure these features provide beneficial information. If your app uses location-based information primarily to enable mobile advertisers to deliver targeted ads based on a user’s location, your app will be returned to you by the App Store Review Team for modification before it can be posted to the App Store.

In our conversation I did mention Google buying Admob and Apple buying Quattro, and interestingly it was actually Admob who today made me aware of the statement from Apple. So why does this have any relevance for travel, and even more so, why could it be of benefit for airlines at the expense of some travel industry start-ups whose business plan has “mobile” written on every page?

Before I start, let me make clear that despite all the hype around the new technologies, one thing I have learnt over the years is that the best return of investment, as least on a risk adjusted basis, almost always comes from getting the basics right first. In the mobile context, the best strategy for an airline is to first ensure that as much post sale servicing as possible is moved out of the call centre and onto either SMS, a web enabled phone or a PC. This is where the mobile is most valuable to airlines right now, but that doesn’t mean we can afford to lose sight of where the big opportunities might be in future.

There is no doubt that the iPhone has opened so many doors in mobile for many others to thrive, especially start-ups doing innovative things on the platform. But I’m suspecting that Apple’s ownership of Quattro may be behind the statement on advertising they have given to developers, and you can tell from the tone in the Admob post that Admob/Google don’t like it. As I have said before on many occassions, airlines already know through the PNR where the traveller is going and can usually guess the context behind the trip. Using geolocation on a GPS enabled mobile phone might work for serving ads for a local restaurant, but the real money will come from airlines getting a bigger cut of the spend tourists already make on destination content like day cruises, amusement parks, event tickets etc. You don’t need to know where the person is down to the nearest 10 metres to be able to service those ads affectively and if you do it well by getting in early, the airline should be able to get more of it via email before the passenger even departs. Or at least definitely before they land, just like what Guestlogix have announced in their relationship with TicketSwitch, or what Allegiant are doing with their flights into Las Vegas and their relationship with The Blue Man Group. So Apple’s guidelines on advertising may negatively impact some, but they should have no negative impact at all on airlines trying to use mobile for increased ancillary revenue. 

Speaking of innovative marketing, yesterday I saw some incredible technology that Amadeus in the US had licenced earlier this month. I thought I knew what was at the cutting edge in this field, but what I saw blew me away. I’m always very wary of pushing my employer in these pages as I try to take a more neutral stance, and I’m not even sure if this is public information yet, but once I know more details and I know for sure that I am not breaching any confidential information, I’ll be sure to share it.

I wasn’t familair with Loop11, but they have got themselves some extra publicity by using their tool in a way that was guaranteed to catch my attention. Taken from the text on their homepage, Loop11 is an online usability and user experience testing tool, allowing individuals and companies to conduct online, unmoderated user testing on any kind of digital interface.

The have done a brief usability study on 10 leading airline websites. The sites they looked at were American Airlines, Air New Zealand, Cathay Pacific, Virgin Altantic, Lufthansa, Singapore, Malaysia, Qantas, Bristish Airways and Emirates. It is definintely not an exhaustive study, but it is a very nice way for them to get on the radar screen of airline eCommerce managers. Clever marketing, and well worth a look if you work in that role.

Unlike last week when I was in Nice and struggling to get through client meetings given a case of the flu, the week before I was in Amsterdam and full of energy. At one point I was enjoying a very good night out at a restaurant with two employees from Martinair. It is rare that I meet someone in the airline industry as passionate about social media as myself, but Lennart van Opbergen, eCommerce Specialist at Martinair was just that person. We ended up having a very entertaining conversation about a fairly wide range of eCommerce issues. In fact, I really enjoy it when someone makes me question some of my own beliefs by proposing intelligent counter arguments, and Lennart was such a believer in the power of Twitter, that I asked him to write a few words on his success using it in his job. Long time readers of this blog will know I’ve never really jumped onto the Twitter bandwagon, but Lennart gave me some very good food for thought – enough from me, time for Lennart’s own words:

Martinair is a Dutch airliner, flying mainly on Caribbean destinations. With sales channels shifting more towards the internet, we have been looking into ways to use Social Media to our advantage. We started using Twitter about 7 months ago. Already having a very competent call centre and customer contact centre, we choose not to use Twitter for customer support. Right now, we use Twitter for listening to what our customers have to say about us, to directly promote special offerings and to inspire people about our destinations.

Twitter is a great tool to listen to the world about what they have to say about your brand. Tools like Twitterfall and my favourite, CoTweet, let you define searches for particular topics. Listening to the world has already delivered very valuable information. The other day for example, somebody complained about functionality on the website not working how it was supposed to. After having the technical guys take a look at it, it was quickly discoverd that some exotic piece of coding was not implemented correctly. An excellent example of finding something very small but very important to your customers, otherwise left unnoticed. With a reply to this particular Twitterer, we apologized for it not working and thanked this person for having found the bug. As we do not use Twitter for customer support, it is very important not to react from this point of view. So, if somebody complains about our services in a Tweet, we reply with an apology and a link to customer support, as they are the experts in helping people with complaints.

We also use Twitter to promote special offerings. In a particular case, we had a big promotion going on with a famous Dutch warehouse called De Bijenkorf. Once a year this warehouse launches a three day sales campaign (Dolle Dwaze Dagen, literally Mad Crazy Days) with amazing offers. Last year we participated in this event with great offers to some of our destinations. By combining a specially marked fare in our online booking engine and a clever way of using hashtags in Twitter with the name of the event, we sold a nice amount of tickets through Twitter compared to the total sales during that period, as measured by our analytics software. This shows that a lot of people can be reached through Twitter without them being a follower of your account, by using hashtags and subjects in a smart way.

For another promotion, we had a special online auction of tickets. We used Twitter to let people know in advance when the special, very, very low start bids were coming up. This also led to some direct sales via Twitter.

Finally we use Twitter to inspire potential customers about our destinations. For this, we created several accounts related to the destinations we fly to. Through these accounts, we try to share really nice things to do on our destinations. Not the things you read about in tourist brochures, but things our crew like to do. While this does not generate revenue (that we track) or help people directly, it is a nice way to link your brand to a certain destination.

In the coming months we will invest more time into Twitter. At the moment we lack a “corporate” account for more general contact with the world. For this we will also need to free more resources. We are also looking into ways to thank our listeners and followers for their contributions. One way could be in the form of discount codes.

We believe that Twitter can be used as a great tool for connecting to the digital world without spending huge amounts of time or money. However your intentions must be honest and your Tweets must be consistent in tone of voice. Don’t try to “buy” your followers and stay social – let it grow naturally.

I was reading a couple of interesting things on the weekend. One was a December publication from Boston Consulting Group that kept talking about BMI – rather than being about the airline British Midland it was actually about business model innovation (PDF) – it did mention Qantas, Jetstar and Virgin Blue; not surprising given the influence BCG have had in Australian aviation and then their subsequent success in selling that story elsewhere.

Whilst that article was interesting, if you work in the industry and want to read a post that I could never dream of writing, then Jilted by JetBlue for Sabre, Navitaire strikes back written by Dennis Schaal comes with my highest recommendation. The closest I came to writing on this topic was referring to Sabre on ancillary revenue, or the reasons claimed by JetBlue for choosing Sabre over Navitaire, but Dennis has done a great job in getting Navitaire on the record and fighting back against the perception that after losses to Sabre on WestJet and JetBlue, New Skies couldn’t handle LCC’s that have evolved beyond their original LCC business model.

Part of the debate seems to be around selling ancillary items during the online booking flow, but I tend to suspect a bigger issue could be the impending importance of electronic miscellaneous documents and the need to be able to interact with the EMD servers of airline partners – this is potentially the big ancillary revenue story for 2011. And don’t underestimate the relevance of back office processes; when no ticket numbers are stored in the PNR it leads to operational and accounting processes being custom built for each airline – a similar story could be made about ATPCo feeds and interlining as well.

Probably the most well received post I’ve written in the past month was on the future of travel search, but the reason I mentioned that I could never do anything as impressive on the topic Dennis has written about is because my employment at Amadeus can involve competing against Sabre and on occasion Navitaire – this would give me zero credibility on a piece like his. That said, I definitely love reading it when someone else makes such a good go at it.

Not sure if it is a Dutch thing, or just a co-incidence in timing, but if the frequency of how often you asked for feedback directly correlated into positive customer satisfaction, then KLM would surely have the most satisfied passengers in the world.

When flying on KLM last week I checked in at the counter in Madrid. Upon leaving with my boarding pass I was stopped by a woman holding something kind of like a very early prototype for the iPad, asking me to press on the screen to indicate how happy I was with five aspects of the check-in service I had just received. From memory I think I scored them highest on every count, as I’d arrived at the airport too early meaning there was no queue, so what did I possibly have to complain about?

Then on the plane, the steward seemed to single me out during the flight and asked if I would fill in a longer paper based survey. Sensing some possible material for this blog, I happily obliged. Some areas I scored lower, especially the airport experience, but this wasn’t really any fault of KLM. I am so used to getting lounge access and not needing it, that the time when I really did need it (having arrived at the airport too early), I found that I didn’t have sufficient status with that alliance, and as a result ensured a mind numbingly boring wait for departure on a hard wooden seat.

A colleague of mine who flew trans-Atlantic the same day on KLM told me that he too was asked to complete a survey mid flight. And then when leaving Amsterdam, and when I was waiting near the departure gate at Schiphol Airport, someone from the airport came and asked if I would sit with him for five minutes an answer his questions for a survey on the airport experience. By this stage I was surveyed out, and the guy to my right got to answer the questions instead!

Survey’s are great, but be careful relying solely on asking people what they think, as just as Ideaworks have written (PDF) in their good analysis on the impact of recent changes to US checked bagggage fees, sometimes what people say they will do bears little relationship to what they actually end up doing:

This anecdotal evidence suggests fees are hated and have been a failure from a consumer perspective. In a recent survey by Consumer Reports, “hidden fees” were listed as the top consumer gripe. But the economics of baggage fees tell a completely different story.

And just in case my use of a slightly obscure word in the title stumped you (I know of a number of readers of this blog that have English as a second language), surfeit comes from the French word surfaire meaning to overdo, and in English it can be defined as an over abundant supply.

A very interesting idea to try and achieve upsell to people who would normally consider business class as being too expensive.

Enjoy the perfect blend with Emirates. Fly Business Class on the longer sector and Economy Class on the shorter sector of your journey to and from Europe.

I’m not convinced it will work, but maybe that is just because I didn’t think of it myself! It can be booked online, but you have to do it via the complex itinerary page which I suspect most travellers rarely actually use for non-stopover multi-segment itineraries.

It certainly is a novel idea, and so long as it doesn’t kill O&D availability for last minute minute corporate travellers wanting business class over both segments, it is probably at least worth a try.

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