7 benefits of advanced business analytics for airlines

By Hélène Dubos | Trends & Innovation

Mar 12
Advanced business analytics for airlines

How Could the Airline Industry Use Business Intelligence? 7 Inspiring Use Cases

Airlines have a strong track record of using data to improve operations, routes and passenger experience. Today, data is more ubiquitous than ever and the tools and techniques available for data mining in the airline industry are incredible. So, how could the airline industry use business intelligence technology, software, and techniques to further enhance its offerings? And how would airlines benefit from investing in this area?

One of the key advantages of an airline digital transformation is that it helps airlines explore innovative ways of improving the industry's existing processes. While there is a long history of sophisticated analytics in the aviation industry, utilizing new tools will only help your airline differentiate itself further.

To help put this innovation in context, we look at 7 ways how the airline industry could use business intelligence to really change the game.

What is advanced business analytics?

Gartner defines advanced analytics as to 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 such as:

  • data mining
  • machine learning
  • forecasting
  • predictive analytics
  • pattern matching
  • and much more…

It has been reported that more than 53% of companies today are using advanced analytics and business intelligence. And, in the aviation industry, it could potentially bring about a step-change.

At present, most airlines still utilize traditional BI - which is effectively 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. It also relies on machines to do much of the analysis automatically and independently, which means your employees save a lot of time and effort. This also lets you discover the information you may simply never have had the time or resources to find before.

7 topics that show how the airline industry could use business intelligence

What are the business benefits of advanced data and analytics then? Here are seven ways the airline industry could start using advanced analytics and business intelligence tools to really differentiate their services:

  1. Real-time customer service
    In most scenarios, airline customer service is provided either by customer-facing staff or at a call center off-site (learn more about the future of airline call centers in our free eBook). These will always be key touch-points when customers have problems, yet advanced analytics in the aviation industry 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).
  2. A personalized 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, ancillaries and their typical behavior. This allows for more targeted offerings such as personalized deals and offers which resonate with that particular customer. For example, airline data platforms like ConztanzONE allow airlines to better know all their travelers and develop micro-targeted campaigns that tap into the needs and desires of specific customer segments.
  3.  Differentiate your airline
    “All airlines are basically the same nowadays, right?” Wrong! The profiles and behaviors of customers are really different from an airline to another. Airlines that can provide more targeted customer experience, relevant ancillaries whatever the distribution model and the right price per ticket differentiate themselves and show they fit the demand. And that means more loyal customers.
    To learn more about the essentials of passenger profiling, read our in-depth blog.
  4. 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.
  5. A 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 marketing & 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. Learn how the airline industry could use business intelligence to populate Customer Relationship Management platforms with better, more timely and more relevant data that will delight customers and save you money in our CRM blog.
  6. Marketing that truly resonates
    A major business benefit of data mining in the airline industry is that it allows you to send out marketing communications that 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.
  7. A better loyalty program
    Last but not least, next-generation airline industry business intelligence platforms allow you to analyze existing customer loyalty programs to decide how effective they really are. Through cross-analysis of loyalty programs with information held about the customer in other data silos, you can work out how cost-effective those loyalty programs really are – and also offer variations of your loyalty program to different customers, depending on their relationship with you (i.e. a different type of program for business flyers, casual vacationers or even students).

Learn more: read about innovations in airline eCommerce

How could the airline industry use Business Intelligence?

There is no doubt that the airline industry will benefit enormously from using the most cutting edge analytics technologies. So, what are the next steps?

  1. First up, you need to develop an advanced analytics vision that will help your business define what goals you hope to achieve with your analytics.
  2. Next, you need to develop a strategy that will help you put that vision into practice.
  3. Finally, you need to create Key Performance Indicators (KPIs) which will help you assess your progress with advanced analytics; is the new technology helping win more customers, boost the customer lifetime value or increase ancillary sales?

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.

Discover how Conztanz can upgrade your data eco-system and business intelligence capabilities.