Why improve customer relationship management in the airline industry?

By Hélène Dubos | Personalization

Oct 23

It is among the most important rules of business: to be successful, your company must provide satisfying services to retain its customers.

As a rule of thumb, acquiring a new customer costs around five times as much as winning business from people who've bought from you before. What’s more, marketing campaigns aimed at existing customers are more likely to be effective than those targeting new business. They also cost less money and give you a stable cash flow.

Customer relationship management (CRM) platforms are an invaluable tool for retaining customers and extending customer lifetime value. However, at Conztanz we’ve noticed that many airlines underutilize this technology. So, let’s look at the value of CRM in aviation and see why airlines must improve their approach to customer relationship management.

Why CRM in the aviation industry is so important

Customer relationship management is important in any sector. However, in the highly competitive airline industry, this technology is even more essential. Since air travel is becoming increasingly commoditized, passengers are less likely to be loyal than in the past. Nevertheless, customers do consider the service they get from different airlines when making purchasing decisions, and CRM in aviation is therefore very important when it comes to making your airline stand out from the crowd.

Example: ​

​Consider an airline which remembers the customer's name and past purchases, that can offer personalized deals and which uses a range of technologies to respond to customer enquiries. Compare that to a ‘standard’ airline which shows no apparent interest in the individual customer, and simply sells them the same service each time at the same price.

Yes, for some customers price will always be the determining factor, and they will always choose the cheapest option for their desired route. Nonetheless, for a significant proportion of passengers, the airline which seems to care about them and know what they want and need will gradually become their preferred option.

The marketing or sales automation modules of a CRM system, combined with a good knowledge of your customers, can give you the tools to provide this kind of personalized service.

How an airline CRM system helps you retain customers

CRM implementation in airlines provides a wide range of benefits. Here are just some of the ways that airlines benefit when they improve their customer relationship management techniques.

Less administration, more sales

One of the most powerful benefits of using a CRM in aviation is that your sales team spends more time connecting with customers and developing deals, and less time analyzing data. For example, when British Airways began using Salesforce for their B2B team, they reduced the amount of time that sales teams spent on data analysis from 40% to 10%. And that gave their sales teams much more time to actually sell deals and offers.

More accurate and effective marketing

By deploying modern airline CRM programs, you can create much more effective and personalized marketing campaigns. Today's platforms allow you to really drill down into the data and get to know your passengers and their behavior. This then allows you to create customer profiles and develop more targeted marketing campaigns.

By analyzing your CRM data, you can create marketing campaigns which focus in on specific types of customers and make them feel that your airline truly understands them. Read our article on passenger profiling to learn how this is done.

Improved customer problem resolution

A CRM system for Airline is also extremely valuable for your customer problem resolution centers. Most call centers today have access to a CRM which records past interactions with the client. However, to really up their game, cutting edge airlines are using chatbots, smart FAQ’s and customer self-service apps which collect data and feed it into a central hub, making it much easier to get a unified view of the customer’s experience.

Find out more by downloading our eBook: Why airlines must transform their call centers into customer experience hubs.

Successful use of CRM in aviation is about much more than technology

While there are many powerful and effective CRM platforms which the airline industry can benefit from, simply deploying the technology is not enough. Instead, your airline needs a bigger strategic vision that creates value through the development of customer relationships.

Airlines should aim to develop a genuine Customer relationship policy, stating what kind of relationship you want to build with customers, showing how close you want to be to them and what kinds of problems you hope to solve. This then needs to be underpinned by measurable KPI’s. For instance, you might set a target to increase sales to a particular passenger profile by 5% this year.

Airline customer relationship management is changing fast

The way that industries manage their relationships with passengers is changing fast, with a wealth of sophisticated new technologies such as chat bots, artificial intelligence and Big Data analysis. These tools and technologies can provide much more personalized customer service and help you retain customers long term.

However, at present, many airlines are still struggling to move beyond their basic CRM strategy. And that means that those who do differentiate themselves can expect to profit.

To learn about our CRM aviation services, and for help developing your strategic vision, contact Conztanz today.