CRM opportunities in Airline Industry

Trends impacting airline industry CRM for Airlines From Satisfaction to Loyalty Bridge the divide Bottom-line

 Trends impacting airline industry CRM for Airlines From Satisfaction to Loyalty Bridge the divide Bottom-line

TRENDS IMPACTING AIRLINES & STRATEGIC IMPERATIVES

Decrease in Customer Satisfaction

Rising cost Constraints in existing infrastructure

 Global passengers to rise by 5 billion in 2010 and more than 9 billion by 2025 Passenger traffic in Africa forecasted to increase by atleast 7% and Asia Pac by 6.8% a year, respectively, by 2010 Asia will be the worlds largest aviation market by 2025

trends manifold increase in air travel !!!

 40% of satisfied customers switch suppliers without hesitation 65% to 85% of customers who choose a new supplier claim to be satisfied and very satisfied with former supplier

trends customer satisfaction

 85% of customers claim to be satisfied, yet willing to switch to other suppliers In the 12 months before Feb 07, there was a 49.6% increase in the number of passenger complaints

trends customer satisfaction

2,0% P ostal Service

1 ,0%

CAGR 1994-2005

Limited-Service Restaurants

Cable &Satellite TV 0,0% 50

W ireless Telephone Service Cellular Telephones Computer Softw are EnergyUtilities 75 Hotels

Ex press Delivery 1 00

Hospitals Airlines -1 ,0% New spapers Motion P ictures Netw ork/Cable TV New s Fix Line Telephone ed Service

Q1 2006 customer satisfaction (out of 100 points)

-2,0%
Source: The American Customer Satisfaction Index University of Michigan. 2006. IBM analysis, Air Travel Consumer Report. U.S. Department of Transportation. April 2007

trends - customer satisfaction

Customers View
While consumers agree that price is important, they would choose a slightly higher rate for added service 83% of the travellers say that personalised service & attention to their needs provides value, rather than price- defines a good deal for customers Service differentiation is the foundation of brand equity. Brand is a source of sustainable competitive advantage

CUSTOMERS EXPECTATIONS
Frequent flyers expect1- Allow me to contact you through the channel of my choice 2- Recognize & Reward my value 3- Use the information you have about me. 4- Treat me as an individual. 5- Treat me consistently 6- Solve my problems in first time 7- Make amends when things go wrong.

 Trends impacting airline industry CRM for Airlines From Satisfaction to Loyalty Bridge the divide Bottom-line

agenda

CRM In Airlines for Operational purposes Automation of basic business processes (marketing, sales, service) Analytical purposes Analysis of customer data and behavior using business intelligence Collaborative purposes Communicating with clients

CRM - ideology

Pre-Airport

Airport

In-Flight

Post-Flight

Promotion notification Travel planning Reservations and booking Ticketing Flight delay notification Virtual check-in and seat assignment Transportation to airport and parking Frequent flyer account management

Airport check-in and seat assignment Baggage check Security Airport shopping or dining Club room access Airport waiting areas Boarding pass and boarding Gate location

Baggage storage Entertainment Meals Shopping Connectivity

Gate connections Baggage claim information Baggage pick-up Customer service and complaint management Transportation from airport and parking Frequent flyer account management

crm for airlines

 Trends impacting airline industry CRM for Airlines From Satisfaction to Loyalty Bridge the divide Bottom-line

agenda

Customers who are satisfied may still switch Customers who are dissatisfied may stay loyal Majority of customers can be transformed into loyal customers

To secure your customer. Accumulate guest-centric customer intelligence Market to your most

valuable customers

securing customer value

 Trends impacting airline industry CRM for Airlines From Satisfaction to Loyalty Bridge the divide Bottom-line

agenda

Value

Value

Conversion

Member Retain

Segmentation

Customer

Communication

Communication

Bridge the divide.

Segmentation

KLM MEETS CRM

KLM differentiates itself from its competition by offering a superior customer experience at every interaction point with its customers. Every customer interaction was to be perceived as both a great opportunity to bond with customers or prospects. The ultimate aim for KLM was to infuse CRM as a business philosophy into the complete KLM Circle of Contacts and make the relationship with its customers as intimate as possible. A first major CRM project was set up in 1997.

KLM Circle of Contacts

CRM benefits
1- Decreased service costs 2- Reduced Brand marketing spend 3- Increased revenue from target customers. 4- An increase of 2.5 % in Revenue. 5- Increase in $ 5bn for passenger revenue 6- 40% of tracked customer This all turns out to be $ 50 million per year

 Trends impacting airline industry CRM for Airlines From Satisfaction to Loyalty Bridge the divide Bottom-line

agenda

Bottom-line !!!!

THANK YOU

Thank You