Virtual communities in the airline industry

Companies use brand communities so that they can establish long lasting relationships with their customers and are, as a result, of significant importance to their online strategies. Within these brand communities, companies can interact with their customers and use it as a platform to co-create “products and experiences” and so the business can turn their customers into partners. Other benefits of a virtual brand community are: higher customer loyalty, lower product development costs and a reduction in marketing costs. (Martinez-López, Anaya-Sánchez, Aguilar-Illescas & Molinillo, 2016)

Martinez-López, et al. (2016) write that there are 3 types of values in a virtual community that exist simultaneously. The first is ‘intellectual value’, which arises from the company and its customers co-creating something. The second is ‘social value’ and is created through the platform on which the community is located. This value can lead to strong social bonds between the company and its customers but also between the customers themselves, which can lead to a high devotion and the number of loyal users. The last value is ‘cultural value’ and is produced by the community’s culture and self-regulation. (Martinez-López, et al., 2016)

A brand community succeeds or fails through its ‘specific value or the linking value that it provides to its members’. The latter comes from the collaboration between the company and the customers and have a direct relation to the ‘value that the brand and its product have in creating, developing and maintaining the interpersonal relationships among customers.’ (Martinez-López, et al., 2016)

Finnair’s and Helsinki Airport have teamed up and invited their customers to share their ideas on comfortable traveling since 2010. The aim of the programme is to co-create a better traveling experience for their customers through the customer’s own wants and needs. Each year, Finnair seeks applicants with good, innovative ideas that can enhance the travel experience they provide and invite them to the office in Helsinki to brainstorm together on new ideas. One of the ideas that has been put into practise is the second hand book-swap that was introduced to Helsinki airport. (Loukas, 2013)

Kollau (2013) gives another example of airlines teaming up with their customers and co-creating new products and services. While Finnair has its quality hunters program, which has been described in the previous paragraph, KLM has a program where they ask their Facebook fans to contribute their ideas on KLM’s products and services as well as their ideas on how to improve them. Moreover, Scandinavian Airlines has its own online community which enables customers to post new ideas on products and services and other customers are asked to add their thoughts and feeling to these ideas. (Kollau, 2013)

Delta even added a program to be used while making use of the airline’s services, called ‘Ideas in Flight’. In this program, the airline offers the customer ‘thought-starting’ TEDTalks with the idea to inspire their customers and can fill in the potential ideas they have on a dedicated Facebook page. (Kollau, 2013)

Author: Yannick Jongejan


Kollau, R. (2013, June 08). Passengers on Delta’s ‘Beta Plane’ can submit their ideas via Wi-Fi [Blog post]. Retrieved from http://www.airlinetrends.com/2013/06/08/delta-beta-plane-ideas-in-flight/

Loukas, N. (2013, October 24). Finnair and Helsinki Airport invite ‘Quality Hunters’ to co-create new products [Blog post]. Retrieved from http://www.airlinetrends.com/2013/10/24/finnair-helsinki-airport-quality-hunters-cocreation/

Martínez-López, F. J., Anaya-Sánchez, R., Aguilar-Illescas, R., & Molinillo, S. (2016). Value Creation in Virtual Brand Communities. In Online Brand Communities (pp. 189-205). Springer International Publishing.

 

Data mining and its impact on the airline industry

In today’s technology filled world, marketing a company’s product or brand requires a vastly different approach than it used to. Consumers themselves have changed drastically and often do not fit in a certain persona or target group anymore. (Peelen, 2013) consumers themselves are becoming product experts and make their purchase decisions based on their own research and knowledge obtained through the internet via reviews and forums. Moreover, when dealing with a company, the customer of today wants to be approached in a personal manner and expect the company to know what they want. (Peelen, 2013)

To get insights into the personal wants and needs of a company’s customers, customer data needs to be obtained, managed and analyzed. (Peelen, 2013) Using, or rather, ‘mining’ these big data is crucial for companies to remain competitive in this digital age. (Direction, 2012) Data mining itself is the process of going through (organizational) databases, managing the data and trying to find patterns and connections within groups of data. (Chaffey, 2009)

A significant problem for organizations concerning big data is that it’s, much as the term suggests, a lot of data and also a lot of work to mine it all. As there are many different options to gather data and store it in different places it can be an overwhelming task for companies to effectively manage and use big data. (Direction, 2012) Many organizations also struggle as to what they should be looking for in a database. However, despite the problems around handling big data, an increasing amount of managers are starting to become aware of the benefits of being able to handle the data and are willing to invest in better ways to monitor and manage data as well as hiring new expert staff members. (Direction, 2012)

So what does data mining mean to the airline industry?

Ishikawa (2015) writes that 8.6 million passengers worldwide travel every day in close to 100.000 airplanes. Moreover, a lot of these passengers travel on a regular basis and thus can provide companies within the airline industry with a substantial amount of data. Ishikawa (2015) also explains that these data can be used to verify what attracts customers on an individual level and data can also be used to review the ‘costs of airplane upkeep, equipment and staff’, which can be of help with budgeting. It can be difficult however to select data that can be of use, although many airline companies are already ‘utilize up-to-date data mining strategies’, Ishikawa (2015) says.

Customer service can also greatly benefit from data mining, as the more a company knows about their individual customers, the better they can accommodate them. The customer experience can be positively influenced greatly when data is used effectively. Southwest Airlines has seen positive impacts after they switched to using personal data instead of anonymous customer data to market their products. They are also using personal data to strengthen the evolving relationships between them and their customers. (Ishikawa, 2015)

Lastly, Ishikawa (2015) argues that the key to an airline’s big data is how they store it. As a substantial amount of new data is added to the data pile so to speak, a cloud-based software program could provide a solution to storing the data. By having all the data in a single place and having it available on a ‘cloud’ so that it’s accessible from anywhere, allows for more effective data exchanges between parties involved with flying. Air controllers for example can use data from the cloud to write a more efficient travel route, based on earlier flights.

Author: Yannick Jongejan


 

Chaffey, D. (2009). E-Business and E-Commerce Management (4th ed.). Harlow, England: Pearson Education.

Direction, S. (2012) Big data needn’t be a big headache: How to tackle mind‐blowing amounts of information. Strategic Direction28(8).

Ishikawa, M. (2015, July 16). Data mining’s impact on the airline industry [Blog post]. Retrieved from http://www.avianaglobal.com/blog/data-minings-impact-on-the-airline-industry/

Peelen, E., & Beltman, R. (2013). Customer Relationship Management (Second ed.). Harlow: Pearson Education Limited.

Personalised customer service innovation

Peelen (2013) argues that customers highly value the unique and personal experiences that they receive while making use of a business’s service or product. At the same time, customers also base their own value of a company on these unique and personal experiences. This means that the actual value of a company lies with the feelings of a customer instead of with the business itself. (peelen, 2013)

Customers today also expect more from companies they buy from; they want them to offer solutions to their problems and offers that are composed according to their own personal preferences. For businesses to accommodate their customers’ needs, they have to create a network of “value-creating partners”. Moreover, companies need to be able to delegate certain aspects of their service to experts in their network of value-creating partners’. (Peelen, 2013) Peelen (2013) further writes that the network needs to be able adjust timely according to the needs of the consumer and the market.

If companies want to create these unique experiences for their customers, they need to take on an entirely different perspective on the relationships between the consumer and product/service supplier. (Peelen, 2013) For businesses to create a successful value creating interface to accommodate their customers’ needs, it is vital that they make use of technology. (Peelen, 2013) In short, for companies to gain loyalty of their customers in today’s digital world, they should provide a service that runs smoothly and intuitively while facilitating a personal experience.

Theory in practice

Virgin America is a perfect example of a company that Peelen (2013) describes in his book ‘Customer Relationship Management’. The company wants to be seen by consumers as a unique airline company. Normally flying isn’t seen as fun or exciting, but Virgin America tries their best to make it fun and exciting. Even their goal is to ‘make flying good again. The company has set up features to ensure their quality and experience offer by having ‘new planes, attractive fares, top-notch service and a host of entertaining, innovative amenities’. (Salesforce, n.d.)

Virgin America says that it’s important for them to involve all its employees and to make them a part of their community. They are given the opportunity to still be able to interact with the community through technology. With tablets and mobile phones they can interact with other employees and also customers, even though they never sit at a desk. (Salesforce, n.d.)

By implementing a new intranet called VXConnect, which is a social intranet that is powered by Chatter and the App Cloud. This system is operated by Virgin America, but controlled by Salesforce, a partner in the company’s network of value creating partners. (Peelen, 2013) With this intranet, employees can now interact with ‘co workers, share information, solve problems, and work together to provide the best possible experience for guests’. (Salesforce, n.d.) For example, when a storm is causing a delay, employees can quickly notify the customers about the delay and give them regular updates with regards to the delay times or gate information.

The chatter app can also be used by customers and while using the app they can be in contact with a Virgin America employee within moments. The app gives customers information and access to a variety of things, such as their train schedule, boarding pass copies, music playlists while at the same time having access to direct contact with employees. The planes of the company have been outfitted with larger screens that also run the software so that the customer has access to real time information while flying. When boarding, the screen will greet the passenger by name and give suggestions for on-flight entertainment based on what the customer’s personal interests are. (Salesforce, 2012)

Author: Yannick Jongejan


Peelen, E., & Beltman, R. (2013). Customer Relationship Management(Second ed.). Harlow: Pearson Education Limited.

Salesforce. (2012, November 11). Virgin America 社 – Salesforce でソーシャル化を実現 [Video file]. Retrieved from https://www.youtube.com/watch?v=HbN3-O5H4-Q

Salesforce. (n.d.). Virgin America keeps teammates connected with Chatter. Retrieved from http://www.salesforce.com/customers/stories/virgin-america.jsp

 

The role of mobile engagement in customer engagement management

Marketo (2015) writes that engagement marketing isn’t about fulfilling the need of customers by offering them the product that they want or even by providing them with an experience during their interaction with a company. Rather, they say that it’s about “creating meaningful interactions with people”. In other words, engagement marketing should focus on getting to know the individual customer. By effectively using user data, companies can find out their customers’ individual wants and needs and establish a meaningful relationship that grows over time.

Airlines have already been using customer loyalty programs for a long time to try and keep customers coming back. Frequent flyer miles and partnerships with credit card companies that provide points for travelling with them have been used widely across airlines in the past already. (Bouman, 2016) Presently, apps like Skyscanner and Expedia are focused on providing customers with the best search results and the best prices, across a platform of airlines and hotels, so how can airline brands build long-term relations with their customers?

In today’s world, customers are much more knowledgeable about products and services than they were in the past. It’s easy to look up prices, specifications and also reviews of a product or service. (Marketo, 2015) Moreover, customers are receiving impulses from social media to share and compare. Airlines can use this to their advantage by focussing on customer engagement marketing. By getting to know the company’s individual customers and using the knowledge about their wants and needs, companies can benefit on multiple levels.

Customers that are being interacted with in a meaningful way can gain more sympathy for a company and may even share that experience amongst their friends and family. Also, if the interaction is taking place online, other potential customers may take notice, which may also positively affect their attitude towards an airline.

The average person looks at their phone between 150 and 200 times a day. These are valuable moments that provide companies with opportunities to connect with their customers. As customers are using their mobile devices so often, they expect companies to also be easily engaged via mobile platforms. (Booth, n.d.)

Booth (n.d.) writes that especially airlines have a strong opportunity to build customer loyalty by “providing greater accessibility, enabling deeper connections and providing a superior, one-to-one service.” Moreover, airlines that make use of online and mobile platforms in an effective manner to connect with their customers on the right time, will have the opportunity to stand out from the rest of the crowd.

Creating a personalised experience is one element of online interaction that will become even more important over time. Most customers are now starting to expect companies to know what they are interested in individually and so a company must put effort into knowing what content they have used and know about their previous purchases. (Booth, n.d.) During a study amongst travellers, 85% said that they would value a website that remembers their purchasing history and behaviour and uses that information to present relevant choices first. (Kenny, 2016)

Airlines should also provide the customer with as much autonomy over their booking as possible. Booth (n.d.) writes that over 80% of Millennials want to “self-serve” their holiday and would rather not have to interact with airline staff. By using mobile platforms, airlines can engage with their customers in their times of need and prevent customers from having to stand in line and wait for a ‘long’ time before a physical employee can help them with their problem or question. In addition, 50% of travellers say that mobile rebooking and personalised engagement options should be available during disruptions relating to their travels. Airlines can increase their customers’ loyalty to their brand by exceeding their expectations concerning (self-serve) mobile services. (Booth, n.d.)

Lastly, airlines have the opportunity to influence and enhance their travellers’ travel experience. Providing important information with good timing on gate information, delays, airport navigation and security updates. To make full use of mobile communications it is advisable for airline companies to use push notifications, so they can provide relevant real-time information per travel stage for their customers.

Author: Yannick Jongejan

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Sources

Booth, E. (n.d.). THE ROLE OF MOBILE ENGAGEMENT IN DRIVING CUSTOMER LOYALTY. Retrieved from http://www.mttnow.com/blog/the-role-of-mobile-engagement-in-driving-customer-loyalty

Bouman, J. (2016, March 2016) The big missed opportunity for travel apps: consistent engagement between bookings [Blog post]. Retrieved from https://www.appboy.com/blog/travel-app-marketing-needs-consistent-engagement/

Kenny, E. (2016, February 22). Getting beyond cost: What matters most to the modern traveler? Retrieved from http://www.boxever.com/getting-beyond-cost-matters-modern-traveler

Marketo (2015), The 5 Principles of Engagement Marketing,Retrieved from Marketo: http://uk.marketo.com/ebooks/elements-of-engagement-marketing/