Twelve months ago I made five predictions that I thought would be key travel industry trends applicable to airlines seeking profitable innovation in 2010. The time for self assessment has come. Were any of them on the money, or was I living in a land of self-delusion one year ago?

I’m following the same format I used when rating the success or failure of my 2009 predictions. I’ve rated the accuracy of each prediction in percentage terms – 100% means I was a visionary (at least in my own mind), whilst 0% means I had no idea what I was talking about.

1. Death of Twitter as a customer service model (Prediction accuracy 25%)

My track record here is not great, but no need to talk at length on this as regular readers are probably sick of me by now raising doubts about the scalability of Twitter in an airline direct channel servicing environment.  I’ve had some positive things to say as well, but the reason why I’ve been generous with a 25% rating is that Twitter growth has slowed and it is now very doubtful that Twitter will become anywhere near as popular as email – if this pattern holds then it will remain a niche servicing medium and the scalability issues will be much less of an issue for airlines who see servicing via Twitter as more as a marketing benefit than a serious competitor moving volume out of the call center.

2. In-flight entertainment will move beyond the cabin (Prediction accuracy 10%)

I was expecting this one to become reality much faster than is actually happening. In September I saw the following on Cranky Flier

Both providers are working on systems where you can create your own inflight entertainment experience before you even get to the airport. For Thales, they’ve created a system where you can go online and browse entertainment options. You’ll be able to create movie or music playlists and set a variety of custom settings, including meal choices, etc. The way they envision it, you’ll then be able to take your boarding pass on to the airplane and each screen will have a barcode scanner. This will then load your preferences.

And then in October on Flight Global

Virgin America is planning further upgrades to its ‘Red’ in-flight entertainment system (IFE) as part of a bid to continue growing its ancillary revenue stream. The US low-cost carrier this summer introduced a new upgrade to ‘Red” which included making SkyMall products available for the first time through the system. Virgin America vice president of marketing Porter Gale says the next step would to be individualise the shopping experience for its passengers using ‘Red,’ which is installed at every seat across the carrier’s Airbus A320 family fleet. “It’s hard to individualise to the guest at the seat,” … “As we further develop our software we think we think we’ll be able to better understand our guests.”

So the vendors say the product is ready (or very close to), but the airlines are implying it is not ready yet. All I know is that so long as IFE’s remain a part of the plane (assuming we don’t move to a model of bringing our own entertainment with us), and as long as airlines are looking for new ways to maximize ancillary revenue, then this prediction will come true – 2010 was just a bit optimistic on my part.

3. Semantic will fizzle, not sizzle (Prediction accuracy 75%)

This time last year the word semantic was a little like augmented reality – way, way over-hyped. You don’t hear it mentioned anywhere near as much these days, and when it is, it tends to be used sparingly. A the Phocuswright conference in Arizona there were a couple of start-ups at the Innovation Summit (eg. TrustYou) who emphasized semantic attributes and Adioso are doing some good stuff with natural language search, but overall I remain much more bullish on various innovations in travel search relevant to airline direct other than semantic.

4. Rebundling is the new A La Carte (Prediction accuracy 10%)

The GDS companies are investing a lot to make ancillary services a reality across all distribution channels, the airlines are for the most part saying they can’t wait to get it, everyone talks about improving merchandising and personalization, but at the end of the day as far as the airline website visitor buying a ticket, not that much has changed in the last 12 months insofar as this prediction is concerned. Some of the US carriers have done a decent job of selling ancillary packages as part of the booking flow, and branding these accordingly (eg. United, American), but globally, and also from a perspective of really using fare families effectively to increase differentiation and perceived value through strong brand association with groupings of product attributes, the leaders like Air Canada remain the leaders and the movement in this space is much less than I was expecting.

The solid gold quote related to this prediction comes from an unnamed executive at an unnamed US carrier when he said to me earlier this year something like “you know, everyone within this airline talks a lot about merchandising, but I don’t think any of us really know what we mean when we use the term.” I only wish there we more honest people in the world, as I suspect a good number of airline execs are thinking the same thing.

5. Data will transform travel (Prediction accuracy 25%)

This is the sleeper prediction of the lot. Things are happening behind the scenes at so many different companies within the travel and related IT space, and I’m sure there is much much more that I don’t know about. A lot of different people are talking about making better use of data and the money looks like it is starting to be spent. I wrote back in August how customer centricity and personalization are taking center stage, and making better use of data is a key pillar. By its nature this trend is more difficult for the casual observer to monitor, but I’m hearing of various airline website executives taking concrete steps in the right direction as they realize that even small percentage gains in conversion, lower drop out rates, or slightly higher upsell and cross-sell of high margin products will have a significant impact on the bottom line. Incorporating data in a more intelligent way is key to realizing this increased profitability, but often the airlines that are having success in this area don’t want to shout about it too loudly lest their competitors take notice. The seeds have been planted, and the early shoots are spouting, but this trend really has the potential to grow into something to rival that found in Styx Valley.

In summary, 2010 was not a great year for my predictions coming true, as in all honesty I couldn’t give myself 100% on any of the five, but one consolation is I didn’t score a zero either! Maybe you disagree?

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