How Can Airlines Maximize Revenue From Existing Visitors?

by | Oct 3, 2022 | Airlines, Retailing

How Can Airlines Maximize Revenue From Existing Visitors?

 

Improving the sales performance across direct digital channels is a key objective for any modern airline. But with an army of users online at any one time, each looking for a flight or holiday specific to their individual needs, how can the aviation industry present the most relevant information to every single user?

Converting more users is a key target for most e-commerce sites, but maximizing revenue from each visitor is equally important. And to do that, you need to connect with your customers on a one-to-one level.

 

The challenge

Traditionally, airlines have segmented digital audiences with business rules. If people fulfilled certain criteria or acted in a particular way, they would be targeted as part of a segment. When an airline’s sales pace was slow, strategy often relied on offering vouchers or incentives to drive bookings to broad segments.

Whilst such offerings would improve booking pace, it was ultimately diluting the revenue taken by the airline by providing discounts or value adds to people who would have booked without any incentive. Segmentation simply can’t account for the varying motivations of individuals, treating everyone in the same group exactly the same way.

The challenge for airlines was set: how can they better profile – on an individual basis – every user to drive higher revenue through strategic sales-led initiatives, avoiding revenue dilution whilst achieving higher conversion goals?

 

The solution

Machine learning is the key to understanding individual online users in real-time and at scale. By implementing a personalization platform, a customer-centric approach is able to form the basis of every sales and marketing decision.

Utilizing real-time customer-level signals throughout the user journey, technology can respond automatically to shopping behaviors. At BD4, we call this ‘Human touch e-commerce’ – and our work within the aviation and travel industry proves that individual-level modeling works.

AI-driven profiling  and decision-making solution drives real-time interventions which:

  • Increased revenue per user
  • Minimize churn
  • Reduce retail friction
  • Avoid unnecessary discounting
  • Ensure effective allocation of incentive funds and optimize budgets

With a deep understanding and connection to customers, airlines are able to present individually tailored messages which are relevant to each person within their broad audience profile. Deploying automated AI allows airlines to offer digital interventions at the most appropriate stage of the booking process, removing the risk of revenue dilution for customers who were already determined to book.

To prove the effectiveness of a targeted approach, multiple tests under transparent control periods are run, from the initial Learning phase (as we know every airline and indeed every company has nuances in their audiences), to a Training period. This is followed by a Test and Control period, highlighting the impact of the tailored interventions, before implementing the optimized solution across the site. Driven by AI technology, the platform continually learns and improves the algorithms to ensure airlines are always adapting, and moving forward with their audience.

The latest AI-driven interventions for airline customers focus on providing intelligent incentives to drive bookings – intelligent in a way that only those users who needed an incentive to be converted saw a discount campaign. The individually targeted incentives have shown up to 6% uplift in revenue per user, and saved more than USD 1 million versus a more traditional, scatter-gun segmented approach to distributing vouchers and incentives. All this was achieved with a significant return on investment – up to 8 times! Read more about this specific project in our case study .

 

Helping airlines form meaningful connections with their customers

At BD4, we work with multiple airlines and well-known holiday brands, including easyJet holidays, Royal Air Maroc, and Etihad Airways.

The different stages of the digital buying journey enables a multitude of use-cases to connect with customers on a personal level. By interacting with customers on a one-to-one level, technology is able to humanize a company within the digital realm. And it’s this human touch e-commerce that helps companies maximize the value from each customer.

Discover more about BD4 online or visit them on stand 12.610 during the World Aviation Festival 2022.


Article written by BD4 – human touch e-commerce