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December 17, 2014

All I Want for Christmas Is to Better Understand My Passengers

The holiday travel season not only brings an increase in passengers, but an increase in leisure passengers often traveling with children, more packages and a higher stress level. Add in unpredictable weather in many locations and you have the typical atypical holiday travel season. Christmas is coming and so are these travelers and IROP’s, but they are also bringing with them a rich source of data. Airlines that learn how to harness that data will gain better control of their supply chain, operations and a significant competitive advantage not only during the holidays, but also throughout the year.

The holiday travel season puts all airlines through the wringer as they work to maintain operations while promoting a positive passenger experience. Today’s consumer is increasingly unforgiving of delays, poor meal choices and other onboard discomforts. And, in today’s always-connected world, one bad travel experience for one passenger could multiple exponentially in seconds via the pervasive power of social media. Nearly every single passenger traveling today is carrying a powerful communication tool in his or her back pocket. And, while they are waiting for their delayed flight they are writing about you. When they wanted that grilled chicken with gravy meal and you ran out, they wrote about you. When you served the passenger in 14A peanuts when their child is gravely allergic, they wrote about you. So, when you add up the impact, your one dissatisfied passenger with the click of a post or send button multiplied that displeasure 1,000 fold, or more.

There is a whole physical and virtual world happening in real-time around your flight and the services you provide. The online community at large is talking about your airline and how terrible it was that you ran out of the chicken and gravy dish and why can’t airlines figure out how to better supply flights to serve people? People don’t care that you are managing an incredibly complex supply chain and delivery process. They don’t care that it’s the busiest travel season of the year. They don’t care that because of the weather your flight is now at 100 percent capacity vs. 75 percent capacity. What they care about is that they didn’t get their chicken and gravy dish.

More and more airlines are realizing that by connecting into social media, along with other online data sources like bookings sites, caterer systems, cabin crew feedback and global weather service sites they can gain a deep understanding of everything impacting the success of their flights. By collecting, correlating and analyzing this type of data from internal and external systems, airlines can more precisely predict preferred meal choices, quantities and appropriate price points. Airlines can also achieve a level of near real-time feedback on passenger satisfaction and experience by better connecting physical operations to current and historical operational data.

Adopting a big data and business intelligence program may seem daunting to many airlines. Conceptually, it is overwhelming, but when you break it down into it’s smaller pieces it becomes much clearer how an airline can easily adopt and begin benefiting from the data right in front of them.

So what it is big data analytics and business intelligence (BI)? It comes down to three core components: data, analytics and intelligence. 

Big Data
Big data represents all the information related to your operations, internally and externally. Big data is often explained as the three Vs:

  • Volume – 500K passengers traveled on domestic U.S. flights from 11/22/13 – 1/2/14.
  • Velocity – Flight actuals from hundreds to thousands of flights
  • Variety – Data from booking, weather and social media sites

Basically, big data is a large volume of raw information culled from a series of sources during varied times. The question of course is once you’ve got the three Vs how do you push what you’ve learned to the front line quickly? That may be through systems that use intelligent rules to take advantage of learned activity or through applications that enable intelligent, proactive front line interactions.

Data Analytics
Data analytics is the process of discovering useful information by inspecting the large volume of raw data. The purpose of data analytics is to find trends, conclusions and useful information that support the business. Data analytics can be explained by a fourth V:

  • Veracity – Meal option A is the most popular

In simple terms, Veracity represents data quality and understandability. Another example in the airline industry, this could translate in a data-based understanding of missed up-sale opportunities or wastage.

Business Intelligence
Business Intelligence or BI takes the qualified and quantified data and turns into useable business information. This brings in the final V:

  • Value – Set the prime price point based on goods, sales potential and season.

Value represents the analytic application of the data, which means you can use it to benefit your business.

And, what do those benefits look like? With a big data analytics and BI program implemented, an airline can:

  • Gain control over data to improve business operations and performance
  • Maximize the value of data to improve business analysis practices and gain insight that will help you make strategic service, operations, process and infrastructure improvements daily
  • Design accurate and efficient operating plans to better manage wastage and overages
  • Consistently meet demand and improve customer service as well as optimize weight and storage of inflight inventory

Where to Start
So where does one begin to implement a big data analytics and BI program? A great first step is for an airline to consider what questions they cannot answer today to understand the type of information and intelligence they need. As such, an airline should ask:

  • Is my data organized and easily accessible?
  • Am I able to source external data feeds?
  • Should I use in-house or outsourced data aggregation?
  • Do I have a means of factoring analysis back into process and improvements?

Today’s world runs on big data and BI and as a result consumers have grown to expect a heightened level of customization, personalization and service. Passengers are just flying consumers who expectations are the same in the air as they are on the ground. The reality of big data and BI is that the airlines that get their first will win. They will win not only by providing a better passenger experience, but also improved performance and operations in the back end that will render significant cost savings. Once an airline implements a big data and BI program they will gain visibility into and an understanding of their operations and passengers like never before. And the opportunities and competitive advantage available from that operational and passenger intelligence are endless.