7 benefits of advanced business analytics for airlines
Airlines have always collected enormous amounts of data relating to their operations, routes and passengers. And this has often been put to good use – for instance, airlines have pioneered demand prediction for routes so as to ensure there are the fewest empty seats possible
And today, there are ever more powerful tools and solutions for analyzing data, in the form of advanced business analytics – one of the key benefits of an airline digital transformation. However, in the era of commoditized flight, where customers mainly buy on cost and availability, are advanced analytics really worth the investment?
Let’s look at seven benefits of advanced business analytics for airlines to help you decide.
What is advanced business analytics?
Gartner defines advanced analytics as the “autonomous or semi-autonomous examination of data or content using sophisticated techniques and tools, typically beyond those of traditional business intelligence (BI), to discover deeper insights, make predictions, or generate recommendations.”
Advanced analytics includes techniques like data mining, machine learning, forecasting and much more, and is a step-change from traditional BI which effectively was about looking at past behavior to predict the future. Advanced analytics is about using a much wider variety of data sources and information to create a more comprehensive picture of customer behavior.
7 key benefits of advanced analytics for airlines
Let’s look at why airlines should consider investing in advanced analytics:
- Real time customer service
In most scenarios, airline customer service is provided either by customer-facing staff, or a call centre off-site. These will always be key touchpoints when customers have problems, yet advanced analytics offers additional customer service options – such as chatbots on websites to help customers find better routes and answer queries, or event-trigger personalized text and email messages to passengers that contain offers or immediate solution proposition (through links to online self-service or to direct customer care contact).
- A personalised experience
We’ve written before about how airlines can offer a more personalized customer experience. In essence, data analytics allows airlines to better know their customers, their preferred routes and their typical behavior. This allows for more targeted offerings such as personalized deals and offers which resonate with that particular customer.
- Differentiate your airline
“All airlines are basically the same nowadays, right?” Wrong! Airlines which can provide a more targeted customer experience, better routes and the right price per ticket differentiate themselves and show they really understand customer demand. And that means more loyal customers.
- Finding the right price point
Advanced business analytics helps you find the most appropriate price point for your flights. By intelligently scanning multiple sources of data – from competitor pricing to fluctuations in seasonal demand to past sales and even social media sentiment, you can get a bigger picture view of what people are ready to pay for tickets and price your flights right.
- Holistic view of the customer
In most modern customer relationship management (CRM) systems, staff can get a good view of all past interactions with the client. But, what if you could feed even more detailed information to your support teams? Things like the customer’s recent social media posts which tagged your airline, information on all their previous journeys with you and more? This could give you a true, single view of the customer and help offer an even better service.
- Marketing that truly resonates
A major business benefit of advanced analytics is that it allows you to send out marketing communications which are significantly more relevant to existing and potential customers. If your marketing teams could draw on a wider range of data sources, they could get a much clearer picture of where specific kinds of customer want to fly next and therefore develop more detailed and specific marketing campaigns which increase conversions.
- A better loyalty programme
Finally, advanced analytics allows you to analyse existing customer loyalty programmes to decide how effective they really are. Through cross analysis of loyalty programmes with information held about the customer in other data silos, you can work out how cost-effective those loyalty programmes really are – and also offer variations of your loyalty programme to different customers, depending on their relationship with you (i.e. a different type of programme for business flyers, casual vacationers or even students).
The next steps for airline analytics
So, what are the next steps? First up, you need to develop an advanced analytics vision which will help your business define what goals you hope to achieve with your analytics. You then need to develop a strategy which will help you put that vision into practice.
McKinsey, the consultancy, describes the importance of advanced analytics like this: “Those who advance furthest, fastest will have a significant competitive advantage; those who fall behind risk becoming irrelevant.” Advanced analytics for airlines offers enormous opportunities – and the first movers will undoubtedly gain serious advantages.
Ready to develop your advanced analytics vision? Talk to Conztanz today.