How segmentation can increase Cross-selling services within the airline industry.

Traveler experiences are far less linear than going from A to B. The key for airlines is to show opportunities by making every service personalized and within the traveler’s context. Cross-selling provides current customers with additional services including car rental bookings, travel insurances, wifi on-board and many more. Successful cross selling requires segmentation, relevancy and timing consideration. (Ali, 2016) 

48% of the airline travelers are sometimes or often interested in upgrades or additional services. Only 19% of the travelers mention to be never interested. Besides, no traveler mentioned to be always interested. This means that many customers are interested in the additional services and products. But to increase these figures it is important that the service is relevant to a particular client. If this is not the case, there is a chance of feeling annoyed and this could have a bad influence on the airline’s reputation To avoid this, it is important that airlines make use of segmentation, to categories their customers in order to provide the relevant data for a specific target. (CTICO, 2013)

As an example of Cross selling, Austrian Airlines introduced the Austrian Red Cab service, consisting of eight vehicles presented with the name and logo. The vehicle transfer Austrian passengers between Vienna and the Airport. As an extra service, the passengers receive a free daily newspaper, the Austrian’s in-flight magazines Skylines and Succeed and a bottle of water. The promotion of the service is done on its website, in the booking confirmation email, and in their magazine and entertainment program. (Kallau, 2011)

In order to use the segmentation section in a proper way, PhoCusWright (n.d.) defines three steps to make sure cross-sell offers personal and drive bookings for the airline industry. First of all it is important to define the relavancy and review the metrics, by looking for opportunities to display specific deals at the right time, to a specific target group based on their behaviour. After defining this metric, it is important to look for new ways to display upsells and cross-sells by creating innovative ways to engage visitors with additional offers. An example in the airline industry is displaying upgrade options during seat bookings. This will result an effective way to lead more visitors to the offer with the aim to drive additional value.

Finally, it is important to not cross-sell everyone. For this step the target groups need to be classified. (PhoCusWright, n.d.) Clients that have booked there flight revealed many attributes and well-defined travel plans. Difining the clients segments helps airlines to cross sell additional products and services. For instance, a family flying to Costa Rica for a 8 day trip, is likely to respond to car rental offers while a couple to Paris might be interested in theater tickets. (Shebalov, n.d.)

Cross-selling is an essential fee based service within the airline industry to drive profits. Segmentation analysis of the customer profile help to offer the right services and products to the right customers. Airlines need to know what matters and offer better, easier and personalized services. Those that only see the customer engagement as the arrival and departure might lose their clients to those airlines that do have an overal view of their customer’s journey.
Author: Jade van Huisseling


Ali R (April 21, 2014) Low Cost Airlines aren’t getting much upselling hotels. Retrieved on September 29, 2016. Retrieved from https://skift.com/2014/04/21/low-cost-airlines-arent-getting-much-traction-upselling-hotels/

CTICO (June 12, 2013) UpSelling & Cross-Selling  in the Travel Industry. Retrieved on September 28, 2016. Retrieved from http://cticoww.com/upselling-cross-selling-in-the-travel-industry-infographic-report/

Kollau R. (April 11, 2011) Austrian Airlines starts its own branded airport taxi service. Retrieved on September 28, 2016. Retrieved from  http://www.airlinetrends.com/2011/04/09/austrian-redcab/

Peelen and Beltman (2013) Second Edition. Customer Relationship Management, Pearson, 2013

PhoCusWright (n.d.) The Travel Guide To Upselling and Cross-Selling Retrieved on September 28, 2016. Retrieved from http://cticoww.com/wp-content/uploads/2013/06/crosssell-upsell-travel.png

Shebalov S. (n.d.) Customer Segmentation. Retrieved on September 29, 2016. Retrieved from http://www.ascendforairlines.com/2014-issue-no-4/customer-segmentation

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One thought on “How segmentation can increase Cross-selling services within the airline industry.”

  1. Agree Jade that an airline who masters the art of delivering the right service at the right time will benefit more than others who don’t, and are more likely to have more engaged customers .

    Like

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