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Airlines: Will the customer experience really take off in 2020? - By Ahmed Haouaria

Airlines: Will the customer experience really take off in 2020? - By Ahmed Haouaria

19 Jan 2020

Airlines are faced with a double challenge: generate brand preference in a highly competitive universe, and continue to develop their paid services, whose share in turnover has already doubled since 2010. Consequence: a race to innovation to seduce passengers. The sector today faces a challenge comparable to that of other industries. The customer experience is constantly gaining in quality as technological innovation continues and companies are now able to analyze their data more easily. Travelers are used to having an increasingly personalized experience and, as a result, becoming more demanding.

Airlines are increasingly acting as distributors in the way they think about the customer experience. The era of trivialization is well and truly over. From now on, it is no longer a question of price but of choice. And to be able to offer choice, airlines must understand the individual expectations of their customers.

In 2020, we see carriers going beyond the traditional criteria to which they were previously limited - such as business travelers vs leisure travelers - and thus promoting adapted offers to better meet the individual needs of travelers.


How Airlines will ensure that the customer experience does not turn into a bad memory ?

The combination of mobile, big data and the Internet of Things should allow airlines to radically change the customer experience in the years to come.In what constitutes the full cycle of the customer experience, from booking tickets to retrieving luggage, there are two moments in particular that customers seem to find it hard to bear : security clearance (which, it is true, is not the responsibility of the airlines) and baggage collection on the carousel. These are the two moments that generate the most negative emotions and stressOf the four communication channels used - mobile, laptop, kiosk and face-to-face - the mobile will be brought to develop and take precedence over the other three for the main stages: reservation, baggage registration and boarding.Airlines - like other industries for that matter - are experiencing a long-standing trend in mass retailing: shifting a large part of the workload from agents to customers. In this evolution, the Web and the mobile play a central role.Clearly, passengers are eagerly awaiting new services, both at the airport and once on the plane. In particular, they are requesting more and more information to facilitate their travel and on-board services. These go through better Wi-Fi coverage in aircraft. New satellite broadband link technology is expected to significantly improve connectivityFor their part, the airlines are experiencing an upturn linked to the continuous increase in passenger volumes and the drop in kerosene prices which have enabled them to improve margins).The vast majority of companies focus a large part of their efforts on personalizing services. An evolution made largely possible by the generalization of smartphones which become the Swiss knife of customer relations. On the other hand, the Internet of Things is emerging among the technologies that will allow companies to improve their services. Nearly 9 out of 10 companies report that they are already using these technologies.

The customer experience put to the test

It is not so much the journey itself that is unpleasant for the passenger as it is before and after. First, you have to get to the airport one, two, or even three hours before departure. Then you have to register. Until recently, ground agents did everything for you: issuing boarding passes and checking baggage. But it could take a long time. Today, in the era of "the customer does everything himself", the traveler must use so-called interactive terminals to edit his boarding pass before going to the counter to deposit his luggage. It always takes that long and generates additional stress. Then, you have to wait in line to pass customs before being caught in a new queue which will lead you to security where you will have to deposit all your hand luggage, take out your computers and other electronic equipment, empty your pockets , take off your shoes, undo your belt before going in the best cases a simple metal detector gantry or in the worst a body scanner where you are seen naked like a worm by a security agent. Rest assured, he doesn't know you and neither do you. If you forgot to dispose of your water bottle, it will be confiscated. A small nail couple, it will go directly to the trash. If everything went well, then you will have to repack everything and put it back in order. This is reassuring, but also generates some anxiety.Now you can think about your final destination. Not so fast ... Because when you pass the boarding gate, it is not impossible that you are randomly chosen to unpack the contents of your hand luggage. And showing your personal belongings is not always pleasant.And here it is, you can take your seat and wait for the happy moment of flight where after so many things down to earth you will be able to take a little height of view. Almost ... A final detail, the pilot tells you that a final check must be made before taking off on the take-off runway. "We are in second position" he reassures. What has become a kind of obstacle course is over. By crossing the cloud barrier, you discover the sun and you can enjoy your favorite drink. But you may find a hole in the ozone layer and feel guilty because your plane is going to make it bigger.

2020 customer service experiences trends to watch

It will be easier to select additional services for traveling. As each traveler is unique, airlines seek to create an unforgettable end-to-end customer experience, going beyond the offer of the flight itself. According to a report released in 2018 by Skift, a company specializing in studies and monitoring in the travel sector, 71% of academics and executives working in airlines consider that offers of third-party services - such as hotels, car rental or transfer - are of high or medium importance, with 4% finding it essential.Personalized offers benefit both customers and airlines to the extent that setting their prices matches the traveler's budget. To do this, companies must be able to collect and manage information in a relevant manner in order to provide the appropriate services and options.Using machine learning, airlines can create campaigns to promote destinations for specific segments such as online travel publishers, social media and search engines. Machine learning will allow a more precise measurement of campaign performance and will provide better information on the intentions and behavior of travelers.However, carriers must find the right balance in order not to offer too many choices to travelers. Indeed, studies show that the more options they have, the more likely they are to make bad decisions.

The holidays choice becomes more intuitive

Travelers are often constrained by the frozen, not very ergonomic drop-down menus that appear on most websites. We can expect to see more open search engines capable of answering specific questions like "Where can I go for a week in the Caribbean in November for less than $ 1000?" ". Travelers will no longer need to go to multiple sites to get the information they want.Virtual reality will increasingly integrate the booking process. Indeed, airlines seek to show travelers seeking unique experiences what their journey will look like at the time of purchase.

Booking and check-in will be simplifiedTechnological advances allow airlines to address the needs of each customer. They are able to take into account the preferences of travelers who have special expectations or who wish to go through a travel agency but also those of millennials who do not know what a paper ticket is and are used to buying their tickets and check in with their mobile. Did you imagine yourself saying 10 years ago: "I checked in on my flight thanks to my watch"?More and more airlines are deploying chatbots to offer automated assistance during reservations, and this trend will intensify in 2019. On the airport side, experiments in facial recognition and biometric boarding are emerging in order to rationalize the recording. This type of practice will become more and more common.

The in-flight experience 

Personalization will be a key aspect in 2020, especially regarding entertainment on long-haul flights. The increasing availability of Wi-Fi during the flight will also be an important factor for carriers. This is a need for business travelers. Airlines will be able to earn additional revenue or include Internet access in the price of the ticket to use it as an argument to differentiate themselves from their competitors in certain destinations.2020 is a year of significant changes in the airline industry and new technologies will emerge throughout the year to create ever more memorable travel experiences.

Ancillary revenues to compensate the loss of passengers and their poor yield management thanks to digitalization 

"Ancillary income" Do you know this expression? airlines use this concept to designate their various paid services: baggage supplement, reservation of a specific seat, priority boarding, meals, etc. These revenues break records. Last year, these "à la carte" benefits reached $ 44.9 billion, according to a report by IdeaWorksCompany. Ancillary revenues even weigh $ 67.4 billion, taking into account the sale of "miles" to partners, essentially loyalty programs.In total, ancillary revenues now account for 9.1% of airline turnover. This is almost double compared to 2010, when they represented only 4.8% of turnover. But the disparities are strong between the low-cost companies, which multiply the paying services, and the traditional companies which were built on a model known as "full service", with historically few paying services. The highest ratio is thus found at Spirit, a low-cost American company: 43.4% of its revenues come from the sale of additional services! At Air France-KLM, the share of ancillary revenues is 7.6%.According to IdeaWorksCompany, the first source of additional revenue comes from excess baggage charges. They represent a quarter of the ancillary revenues of traditional European companies. But the fastest growing revenues come from options such as the ability to choose a seat or board first. These supplements are offered by a growing number of traditional companies, from their website or their app.An example: in a single quarter in 2015, Delta Air Lines generated $ 125 million in profits thanks to its Comfort + offer. It is a package of services allowing to remove several irritants when traveling in economy class: a more spacious seat, priority boarding to settle before everyone else, a reserved luggage compartment near its seat, more snacks to enjoy between meals, etc.




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