In the past month or so I’ve been writing more on mobile than on any other topic, culminating in last weeks piece for Tnooz on a perceived underinvestment by airlines in mobile enabling their existing website or sites. Today I’ve gone for something a little different by publishing a guest post by Daniele Beccari, VP at Isango.com and a travel technology consultant. He has recently returned home (to Paris, France) from the Mobile World Congress in Barcelona where he tells me was impressed with the Blackberry Travel strategy, Android’s omnipresence, and the size of Ericsson’s booth. Over to Daniele:

Mobile is changing everything”, and by 2011 everyone agrees with this statement in
some form or another. When it comes to airlines, mobile represents not only a strategic channel, but also an opportunity to transform the way airlines interact today with travelers, generate new revenue streams, and hopefully create value for the whole ecosystem.

Today is already Tomorrow: We must assume that, sooner rather than later, everyone will be on smartphones: “mobile” will include any device that a user can interact with, at any
time, anywhere. The numbers are amazing. Smartphone penetration has just grown from 4% to 15% in the past 18 months (73% growth only in Q4 2010. Source: Asymco). Today, mobile means smartphones, laptops and ipads. Tomorrow, mobile will mean everything except desktops and servers, and including tablets, game consoles, cars, ebook readers, and watches. But maybe more important, smartphone sales in Q4 2010 have surpassed PC sales for the first time ever (101m against 92m units shipped. Source IDC). Make sure you understand this right: there were more mobile OS units shipped than good old Windows and Mac PCs!

Airlines are getting there. I see three levels of evolution in the way airlines are approaching the mobile ecosystem. These are stages indicating the level of service and integration offered to travelers, not directly related to technology. In fact, almost all of the services in all stages are relatively easy to implement even today.

Level 1, the basics: providing mobile versions of existing web services.
Level 2, additional “anytime, anywhere” services: enhancing user experience with specific services for people on the road.
Level 3, contextually intelligent services: understanding a traveler’s context in real time and proactively building the service experience around it.

Level 1, the basics: adapting existing services to mobile devices

Every big and small airline is establishing a mobile presence, almost always as an extension of services already available through their web channel, either through dedicated apps or mobile web portals. Users on the road can conveniently perform the same tasks they could have performed on the website: check schedules, flight status, gate, loyalty program status, book, cancel, check-in, use paperless boarding passes, search and find loyalty program partners, get flight alerts, and more.

It’s worth mentioning that services on mobile are being made available in a simplified format, which some users actually seem to prefer. The bare essential nature of mobile apps removes all the clutter, confusion and useless advertising often found on “modern” websites.

Some airlines have started playing with other features, or tools aligned with their brand values. Virgin Atlantic has apps to handle jetlag and fear of flying. Qantas has an augmented reality app to help people find their local partners’ venues. Lufthansa has a social flying application where travelers can interact with other LH travelers with similar interests nearby, and find pals to share cabs. Alitalia allows users to track lost luggage. American Airlines provides very useful terminal maps (oh, and mobile sudoku, if you’re really bored).

Level 2 – additional “anytime, anywhere” services tools and services

The mobile ecosystem can play a key role to fuel a number of core airline strategies.

More direct. Mobile is the most direct channel one can dream of. It’s more than the web: it follows users everywhere, it’s always available in their pocket. Even if the user had booked a seat through an indirect channel, access to an airline app or mobile site remains just a tap away for any additional needs – and this is direct. The big battle for directness is just starting.

More unbundling. Unbundling is a necessary evil in a world of transparent price comparison engines, where only the cheapest fare wins – whatever the service actually included in the fare. Marketing a seat at the cheapest possible unbundled fare, today, means having to offer all possible options during the initial booking process, and through a few e-mail reminders before departure. Mobile allows an airline to keep that upselling door permanently open. As passenger needs evolve between the booking and the travel date, they must be able to access and book additional options at any time.

More cross-sell. Mobile is also an ideal channel to cross-sell additional services at the right time. Travelers expect to be able to reach information and interact with remote services anytime, anywhere as soon a need arises: impulse can be a strong business driver. Some examples.

  • If a traveler is tired and longs for an upgrade to a better seat while in the cab to the airport, allow them to do so, right there on the spot, in one tap.
  • If a traveler is actually carrying extra luggage, allow them to pre-book the extra piece directly through mobile, without queuing up at expensive in-airport check-in kiosks.
  • If a traveler needs to book a cab upon arrival, allow them to do it in one click while in the departure lounge.

More loyalty. Building loyalty has several components, starting with service excellence, understanding travelers’ needs, and being able to successfully communicate the benefits of a long term relationship. As loyalty is the key to personalization, the loyalty account will become the central customer intelligence repository with all interactions logged and analyzed there. Mobile interactions add a lot of data which must be integrated in the right way – is the customer using mobile touch points frequently? How can “good” loyal
behavior be incentivized?

More customer service. Being closer to travelers also means being easy to be reached when needed. Click-to-call, click-to-callback, video calls and other customer service touch points can find a natural fit in mobile apps. The apps/sites should be smart enough to offer help when a user is visibly having problems, or getting stuck while trying to perform some task. Technology also allows agents to actually view remotely the display of the customer in order to be able to provide more efficient guidance.

Level 3, contextual intelligence: understanding a traveler’s context and building services around it

By combining PNR data, location, time, and loyalty data, the airline is in a unique position to make educated guesses about the context of each traveler. By looking at the party size, child ages, time of arrival at a destination, length of stay and many other parameters, it is possible to identify and offer relevant services and push them at the right time.

Some examples:

  • If a traveler arrives early at the airport, they’d be interested in special offers for a lounge pass or to cafés/restaurants near their departure gate. But they would not like any of these offers if they arrive late – you would just annoy them.
  • Someone arriving very late at the airport after a long business day (the airline knows they were on a red eye flight the same day), on the other hand, is most likely tired and might be interested in a good offer to get an upgrade to a better seat or class. If the flight is half empty, the airline could yield manage the offer price tag and make a very good offer.
  • A family spending a few days in a foreign destination will need to exchange currency. Why not give directions and a discount to a currency exchange desk at the airport.
  • A couple spending a romantic weekend in Paris is very likely to be interested in boutique hotels, shopping coupons, and a nice dining experience.
  • If the traveler is on a flight on their birthday, why not offer a surprise gift of a few thousand miles announced just when the flight lands for the best impact.

The first good news, for airlines, is that they already have plenty of trip data, without the need to ask. The second good news is that few other partners actually have the same data. In other words: the airline can understand what a traveler needs, and no one else can. The airline is in a micro-monopoly situation.

This leads to three areas opening up innovative thinking

1. Using location services to optimize operations. Access to traveler location through on-device apps or through the mobile network API (see note below), can enable a flurry of new applications. Sure enough, this needs strict privacy policy control mechanisms, and most mobile carriers are in the process of implementing solutions.

  • No more ‘last call for Mr Jones’: detecting user location can enable gate personnel to decide whether they should wait for missing passengers or not. If the pax is detected 200 miles away from the airport, a decision can be taken – let’s call the customer and see if he’s maybe forgotten the phone in the cab. If he can’t make it, let’s give the seat to someone on the waitlist and take off.
  • Gentle reminders: if the user is detected very far away from the airport a few hours before departure, they can be sent a quick reminder that they should leave for the airport. This could be sync’ed up with local traffic situations, and therefore sent only when relevant.
  • Gaming and competitions: “get 200 bonus miles if you reach the airport 60 minutes before check-in time”. “Visit our new partner hotel and get a 200 miles bonus”.

Note re first bullet point: What’s the benefit of using network location from the mobile operator API? Two main reasons: 1. it works even when the phone has no GPS, when the GPS is off or not in reach, when there is no active location application running to use the GPS data, or when there is no data connection at all; 2. it works with all devices, even old ones. For the services described above, network triangulation accuracy is more than sufficient.

2. More real-time feedback. Operations can be streamlined thanks to quality forecasting of traffic data. With the ability to interact directly with the user at any time, many situations can be handled more easily.

  • Severe traffic disruptions can be better handled with broadcasting relevant instructions and updates to the right people without creating confusion for others.
  • Travelers can be asked to rate their flight satisfaction within minutes from landing. Real-time satisfaction data can help take proactive actions towards valuable travelers, depending on each airline’s target level of service. On a larger scale, satisfaction data can be plotted on a chart to see exactly where service needs improvement: either on specific time slots, specific city pairs, or specific aircraft.
  • Luggage problems can be shared with customers more proactively, thereby avoiding bigger problems or at least saving the passenger some time.

3. Fraud detection. Double checking data owned by the airline with other data available from the mobile carrier makes it possible to detect fraud situations.

Some examples:

  • when a customer books on a website with a name different from the name registered as the phone owner, or if the billing address does not match the phone owner address. This, combined with other data, will increase the efficiency of fraud prevention algorithms.
  • Real-time and one-time SMS based authentication, already used today by some banks to authorize wire transfers, can also help ensuring the user requesting a transaction is a legitimate user.

Think different: Every airline will find even more creative ways of improving services to travelers through the mobile ecosystem, in line with their own strategies. Some of the services described above are actually very simple to implement even today, but they demonstrate how completely new thought processes must be applied to building mobile use cases.

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