Top 5: tips and tales from October 2016
From up-to-the minute insights from our most recent event to how digital innovation will be crucial to the future of European airlines, it was all go in October
Travel is a busy old sector and so here is a round up of what our readers found interesting and what you may have missed in October.
EyeforTravel’s recently rebranded flagship US show was packed with strategic insight and tips and in this piece we round up the key insights. These came from, among others, United Airlines’ Managing Director Mandeep Grewal who argued that having the best product today simply isn’t enough – service is as important. Also sharing insights was Dan Christian, Chief Digital Officer, The Travel Corporation, who said travel brands need to open their ears to customers, and then leverage those insights. Having a central analytics/reporting function, he said, which oversees all business units to provide insight and optimisation across websites, digital marketing and social media certainly helped. Egencia SVP America’s Mark Hollyhead, another speaker, stressed the importance of testing and learning. And then there were the highlights from an EyeforTravel survey, which found that 67% of pollsters said loyalty was the biggest driver of the their distribution strategy. Another popular read was the Day 2 round up where the focus was Google power, VR and AI.
With European airlines facing strong headwinds, digital technologies present a huge opportunity, but do they have what it takes wonders Sally White in this October analysis. Certainly the direct booking battle is hotting up and against this backdrop cost cutting is seen as key. Business-model convergence is another focus and McKinsey suggests that the scheduled carriers follow in the footsteps of the low cost crowd with denser seat configuration, fares with unbundled fees for luggage, meals early boarding and so on. Greater use of loyalty programmes (a theme highlighted at EyeforTravel US show – see story 1) and sales through global distribution systems to premium customers is another recommendation. Ultimately though the winners will be those airlines that are able to harness data, which has increased in “quality and quantity”, to apply price premiums, cross-sell and create brand loyalty and advocacy.
The results of an EyeforTravel survey of 183 European travel industry executives shows that mobile will be a central focus for the next two to three years with over two fifths of the executives predicting that their mobile budgets would spiral upwards by 50%. Out this month, the report titled The Mobile in Travel Report Series 2016-17 examines a range of mobile-related issues including global smartphone adoption, the rise of the mobile web and different ways to create mobile apps. Perhaps unsurprisingly 79% of executives still see mobile as the biggest opportunity in travel.
Andrew Hennigan caught up with Beyond Pricing co-founder and CEO Ian McHenry, the fledgling firm which won the EyeforTravel startup and innovation award in Las Vegas last month. In this exclusive interview Henry outlines how the rise in the vacation and short-term rental market has necessitated a new type of revenue management. As in the hotel space, he says, pricing trends are all about moving towards forward-looking, predictive analytics to predict price as well as yielding for individual units.
Regular columnist Tom Bacon is in fine form in October and shares his insights into some of the common pitfalls in airline RM. On the one hand he argues that firms either tend to oversimplify customer behaviour. One of example of this is the practice of last-click attribution, which “ignores the fact that travel booking is a series of steps and that the driving factor may occur before the ‘last click’”. On the other hand, there is a tendency to over complicate and he explains why some revenue models have, quite simply, “gotten too complex”. In the end it’s about finding the right balance.