Airlines urged to “think like retailers”
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A new study has identified how airlines can boost their revenues through merchandising.
The “Thinking like a retailer: Airline merchandising” report, which was published by Frost & Sullivan on behalf of Amadeus, revealed that carriers can potentially increase a traveller’s average spend by between EUR30 and EUR35 (US$41-48) if they market their products better.
To win the “battle for additional service revenues”, the report says airlines must use their passenger data more effectively.
With airlines now able to gather a wealth of traveller data, from mobile app and social media behaviour, session history from in-flight connections, travel history and previous purchases, the report argues that this information should be used to create a customer profile, which in turn would allow airlines to target their customers better.
And there appears to be acceptance among consumers; the report revealed that 26% of travellers are more likely to respond to tailored, personal messages, and 22% are more likely to respond to location-specific promotions. In addition, 79% of global travellers said they would prefer to buy extra travel services directly from airlines.
“It’s clear that in order for airlines to succeed in the highly competitive and fragmented travel retail sector, they must think like retailers and adopt an effective approach to merchandising, in which personalisation takes centre-stage,” said Julia Sattel, senior vice president airline IT at Amadeus.
“We are committed to enhancing our airline customers’ merchandising capabilities across all channels, helping them to in turn better serve, manage and connect with the ever-evolving needs of 21st Century travellers across the globe as we shape the future of travel together.”
The most important channel for merchandising ancillary services was found to be online, accessed via PC. But the importance of mobile is increasing rapidly and the study noted that the conversion rate of tablets (2.6%) now exceeds that of PCs.
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