Dara Brady, head of digital experience for Ryanair, shared his insights into how the airline, like all other brands, is trying to play a more active role in the customer journey.
NB This is a viewpoint by Pamela Whitby, editor of EyeForTravel.
In a keynote address to an EyeforTravel audience in London, he said:
“What customers want is communication, information and control.”
He explained that the ‘communication’ piece is, of course, being driven by the rise of mobile. ‘Information’ relates to big data and how brands harness it to deliver real-time personal and relevant travel information and offers. The third part – control – well, that’s about the customer who today owns the journey.
As Guy Stephenson, chief commercial officer for Gatwick Airport, puts it: “In a digital world, the customer owns himself. The power lies with the consumer.”
Even Ryanair, notorious for its poor customer relations, has recognised this and completed a strategic volte-face in the past 12 months. In doing so, it has put mobile, data and the customer firmly at the centre of its business goals.
Ryanair’s strategy seems to be paying off – this October it saw half-year profits after tax rise by 37% on revenues of £4bn.
On mobile: apps aren’t everything
On mobile there isn’t much to say other than to state the obvious: that if you don’t have a focused and measurable strategy in place you’re in trouble.
The industry knows this and in 2014, 70% of travel executives had planned to increase investment in mobile , according to EyeforTravel research.
No doubt that figure is rising and for those getting it right, investments are beginning to pay off. IHG, one of the first hotel groups to introduce mobile booking, has seen mobile revenues rise from $148m in 2012 to $1bn this year.
And with mobile expected to account for 40% of all e-commerce transactions by the year-end this upward trajectory is expected to continue.
However, while mobile is strategically important, the path to conversion is getting longer and travellers are using more devices and different sites to compare offers.
But the ability to study customer behaviour and understand what role different channels and devices play in the purchase path is difficult.
“There are a limited number of solutions available to address this,” says Breffni Horgan, head of mobile and product at Hostelworld.
She explains that some are technical solutions that require investment, while others tend to negatively impact the customer experience with login-walls and so on.
Clearly, multi-device behaviour should not be ignored, but Tom Valentine, chief commercial officer at upmarket flash hotel sales site Secret Escapes, has this warning:
“If I see another mobile agency case study saying that the users who download the app are more valuable, I will shoot myself and probably the person delivering it.”
On data: a single source of information is needed
Today many brands have recognised that sharing data is good a thing, so long as the right partnerships and agreements are in place.
Because wherever the customer is accessing it, what they want is reliable information; they expect booking apps and websites to be able to work with different providers of services. APIs are one way to do this.
Heathrow Airport is one brand that has recognised the importance of keeping the traveller connected.
Stephen Glenfield, its digital development manager, explained to an EyeForTravel audience how the airport is improving the airport experience.
The four key pillars of its strategy are:
- Providing a single source of information to business partners in order to improve the passenger experience
- Building a digital passenger information hub that will enable business partners to utilise Heathrow’s digital estate
- Establishing a ‘data exchange charter’ to build trust and security
- Innovating in order to deliver the experience that the passenger expects
However, it’s worth bearing in mind that while it’s imperative to work with both old and emerging gatekeepers of data – Apple, Google, Facebook, Uber, Airbnb – travel brands must ensure that their data is being used in an appropriate and commercially beneficial way.
On the customer: don’t be irrelevant
So mobile and data are two key trends but the third, and the most important, is customer experience. Indeed, how you win, engage and hold on to customers in a competitive and crowded landscape will separate the winners from the losers.
“The biggest opportunity, and challenge, is making the customer experience better,” says John Whitley, director of ancillary sales at Hertz.
Though he doesn’t say it, this also has to be done in a way that is commercially viable. Here ancillary offers represents a huge opportunity because although they make up just 7% of the revenue, they can account for 20% of the profit due to higher margins, says Michael Bentley, a partner at Revenue Analytics.
However, for ancillaries to really deliver value Bentley argues they need to leverage predictive analytics with revenue management capabilities to produce personalised and relevant offers at the right time.
Being personal and relevant is undoubtedly the holy grail but Torsten Kriedt, vice president of product planning and corporate intelligence at BCD Travel has concerns:
“2016 will see even more brands pretending to own the traveller by increasing investment in their branded digital channels and bombarding customers with irrelevant offers every 48 hours.”
His advice is to focus less on mobile and more on the end-to-end experience. Because while securing that all-important big ticket booking is, of course, important, the full value will be realised before, during and after the trip.