Measuring Passenger Experience for Airlines

Passenger Experience for Airlines

Evaluating experience drivers for Airline passengers

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Contents

Current Challenges facing Airline industry

Competitive Strategies adopted by Airlines

Airline Passenger Lifecycle framework

Passenger Experience dimensions

Select Global leading practices

Current Challenges

External Challenges

Internal Challenges

Input Costs

ATF Fuel price fluctuations

Passenger Service Taxes as per local regulations

Airport charges

Demand – Supply mismatch

Cyclical nature of demand (business and leisure)

Difficult to scale capacity in same line as Demand

Sustaining high Passenger Load Factors (PLFs)

Intense Competition

Price pressure from LCC operators putting downward pressure on top-line revenues & market share

Increased choice leading to higher churn

Low brand/experience differentiation

Operational Efficiencies

Fleet management (single type / multi-type, maintenance, turn around times)

Inventory management (Flight equipment reusability, meal forecasting, ordering, spares)

On Time Performance and Passenger Load Factors

Managing customer expectations

Customers likely to switch based on price

Customers demand better and more “tailored” experiences

Customers prefer peer recommendations

The airline industry faces a myriad of challenges, both external and internal which pose unique issues impacting the overall industry profitability

Competitive Strategies adopted by Airlines

All the major players in the airline industry, full service or low-cost, strive to strike a balance between the following strategies in order to gain competitive advantage and increase market share…

Cost Leadership

• Reduced Fleet Types & Upgrades • Capacity Optimization (E.g. Increasing Load

Factors by driving down capacity)• Employee Layoffs / Pay cuts• Network Optimization (E.g. Hub & Spoke

Model)

Increased EBITDA

Higher Load factors / fleet

efficiency

Reduced market share

Fewer destinations

Labor conflicts & negative PR

Price Leadership

• Dynamic Pricing / Fare Management• Revenue Management• Diversifying Income Streams• Discounts & Promotions• Services Offered

Increased passenger share

Top line revenue

Increased complexity in pricing

Eroding profitability

Mismatch in meeting demands across all segments (low & high revenue seg.)

Customer Leadership

• Customer focused Loyalty Programs (E.g.

Frequent Flyer)• Customer Experience Management• Brand Creation and Brand Loyalty• Targeted Value Proposition

Increased passenger share

Increased revenue & market share

Improved brand and value creation

Customer loyalty adding to CLV*

Sustained competitive advantage

* CLV – Customer Lifetime Value

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The Airline passenger Lifecycle1. Reservation 2. Departure 3. In-Flight 4. Arrival

1.1 Discover Flight Information & Routes

1.2 Check for Price & Promotions

1.3 Ease of Booking / Manage changes

1.4 Customer Service

3.2 Cabin Crew

3.3 Cabin Ambience

3.5 In-Flight Entertainment & Meals

3.1 Flight Punctuality

3.4 Safety Arrangements

4.1 Landing & Taxiing to Terminal

4.2 Announcements

4.3 Baggage Claim

4.4 Lost Baggage Management

4.5 Cab/Hotel Services1.5 Allied Services (Frequent Flyer programs)

2.1 Arriving at Airport

2.2 Check – In Process

2.3 Lounge Facilities

2.4 Boarding

2.5 Flight Delays / Missed Flights

Airline Website

Travel Portals

Check – In Kiosks

Safety Manuals

In Flight Entertainment

Travel Agents

Airline CC

Travel Portal

CC

Mobile Phone

Email

Airline Offices

Ground Staff

Cabin Crew

Passen

ger

Valu

e D

rivers

Value Creation

Brand Creation / Recognition

3.2 Cabin Crew

3.3 Cabin Ambience

3.1 On-Time Performance

Ground Staff

Cabin Crew

Social Media

Social Media

Airline Website

Mobile Phone

Social Media

Airline CC

Social Media

Passenger Experience Dimensions – Reservation Phase

1. Reservation 2. Departure 3. In-Flight 4. Arrival

1.1 Discover Flight Information & Routes

1.2 Check for Price & Promotions

1.3 Ease of Booking / Manage changes

1.4. Customer Service

1.5 Allied Services (Frequent Flyer programs)

Experience Dimension Value Drivers

Connectivity Flight Schedule Information Peer Reviews Brand Awareness

Shortest route (minimum stops) to

destination Flight times in line with travel plans Make informed choice Social status

Price Competitiveness Deals & Promotions Alliances

Lowest affordable fare to destination Value for money

Booking Process Payment Options Ease of Change / Cancellations

Convenience Reduced effort Speed of transactions

Availability Ease of Access Issue Handling Staff Behavior

Hassle free communication Ability to track interactions across channels Quality of service Speed of issue resolution

Loyalty Programs Multi Vendor Tie-Ups Referral Incentives

Value for money Options for redeeming miles “One-stop shop” for the entire trip

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Passenger Experience Dimensions – Departure Phase


2.1 Arriving at Airport

2.2 Check–In process

2.3 Lounge facilities

2.4 Boarding

2.5 Flight Delays / Missed Flights


Pickup services Ground Staff Flight/Terminal information

Reduced effort Speed Ease of navigation to reach the right

terminal

Check-in options Queue wait times Baggage handling Boarding pass details

Convenience Speed Reduced effort Ground staff assistance

Lounge availability Lounge accessibility Lounge interiors Services available

Comfort Social status Quality of service Ground staff assistance

On-boarding process Terminal gate to aircraft transit

Speed Means of transport to the aircraft Ground staff assistance

Flight detail notifications Flight alternatives Ground staff behavior Managing passenger expectations

Flight times in line with travel plans Issue resolution Ground staff assistance

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Passenger Experience Dimensions – In-Flight Phase


3.5 In-Flight Entertainment & meal options

3.4 Safety Arrangements

3.2 Cabin Crew

3.3 Cabin Ambience

On-Time Performance


Flight departure time Flight arrival at destination

Flight Times in line with Travel Plans Minimum Delays in Travel Times Cabin Crew/Ground staff Assistance

Availability Cabin Crew behavior Willingness to assist Crew grooming

Quality of service Branded experience Crew able to meet passenger needs

Interiors Seating Temperature control Cleanliness

Comfort Value for money Hygiene

Safety demonstrations Safety equipment Safety instructions

Safety

Availability Quality Variety of content / meals In-flight shopping

Entertainment Branded experience Flight information Quality of product / service

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Passenger Experience Dimensions – Arrival Phase


4.1 Landing & Taxiing to Terminal

4.2 In flight Announcement

4.3 Baggage Claim

4.4 Lost Baggage Management

4.5 Cab/Hotel Services


Landing Transit options to reach terminal Disembarking process

Comfort Minimum delay in reaching terminal Cabin Crew assistance

Information Language of communication

Information updates Cabin Crew assistance Language translation

Baggage carousel information Wait times Ground staff Baggage condition

Ease of access Speed Ground staff assistance

Enquiries / Complaints Availability & accessibility of customer

service Ground staff behavior Claims

Hassle free communication Ability to track interactions across

channels Quality of service Speed of issue resolution

Cab services for destination drop Tie-ups with hotels for accommodation Onward journey tie-ups

Convenience Comfort Branded experience Hassle free transfer for On-ward journey

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Select Global Leading practices (1/5)Airlines adopting Social Media for Ticket reservations

Malaysia Airlines has launched MHbuddy, a service

which allows any of the more than 500 million

people who use Facebook to not only book a flight

with the airline, but to also integrate trip details into

their social graph, identifying friends who might be

sharing flights, or who will be at their destination.

“Our passengers are spending more and more

time using social networks and Malaysia Airlines is

one of the most active airlines on social media

including Facebook and Twitter.

With MHbuddy we are pleased to provide our fans

on social media an easy way to book a ticket

without having to leave Facebook. In doing so, we

have also opened another distribution channel for

ticket sales,”

– Dr. Amin Khan, Executive Vice President,

Commercial Strategy, Malaysia Airlines.

Select Global Leading practices (2/5)Using Mobiles as a channel for providing Check-In services

British Airways’ mobile app allows users to view flight information,

timetables up to a year in advance, links to the airline’s Twitter page

and also incorporates the mobile boarding pass

Trinity Mobile has just announced a 1,200% increase in the use of mobile

boarding passes by airline passengers in the past year. While 2008 saw just

50,000 travelers take advantage of the technology, which works by using a

scanner to read the QR code directly off the display of your smart phone, in

2009, that number had increased to 600,000.

Select Global Leading practices (3/5)Brand building through Customer Forums

Southwest

passengers can blog

about their

experiences, rate

southwest and give

their fellow

Southwest

community friends

tips and tricks how to

make their travel to

and at the

destination more

enjoyable.

Southwest uses the blog to

circulate Marketing & Sales

messages (e.g “we won the

Freddies for the best frequent

flyer program”), understand

changing market needs and

identify areas within the

travel experience, that need

to be optimized to foster even

more loyal customers.

Select Global Leading practices (4/5)“Upper Class Wing” by Virgin Airlines

Virgin Atlantic has

introduced an

exclusive “upper class

wing” in Heathrow, to

optimize the much

dreaded Heathrow

travel experience for

its premium

customers

Select Global Leading practices (5/5)Driving innovation in Loyalty programs

Jet Airways, one of the

leading Full Service

Carriers in India, has

launched a loyalty program

for those passengers who

travel extensively in short

bursts of time in order to

drive business in off-

seasons. The airline offers

a single fare option to

passengers. Under the

scheme, a passenger pays

a fixed sum for a fixed

duration and can then avail

a pre-defined number of

flights in that duration at a

constant price.

Thank You

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