We spoke to Dominic Clarke, SVP Sales for Datalex and he answered some of our burning questions about the airline industry and passenger experience. Dominic’s background is primarily airline, with 10 years at British Airways followed by 8 years working for technology providers to airlines. That included working in the internet booking engine space, PSS, mobile, and now travel retail with Datalex.
Datalex provides a leading retail platform for airlines. They power over 50 airlines globally, including some of the biggest and best innovators in this space including Delta Air Lines, Frontier, Aer Lingus and WestJet. Fundamentally, Datalex help airlines become better retailers, enabling them to dynamically offer tailored products and price to the customer at every touch point in their journey. By giving the airline a unified view of the customer, they allow them to control customer engagement and, in doing so, really drive revenue and service.
What are the biggest challenges for you as an aviation service provider to create a great passenger experience?
One of the biggest challenges we see is the mind-set of the airline. We would like airlines to think like retailers. For example, a few months ago we had the Datalex conference, and Simon Calver, who’s the CEO of Mothercare, came along to speak about customer knowledge and insight.
He made a very good point regarding the fact that airlines, in terms of retailing, actually have quite a great advantage. For example, they know in advance when the customer will come to their shop; they know who they are, who they’re travelling with, they know where they’re going. They have this wealth of customer data to leverage, which means that the opportunity is there to provide a really great customer experience.
Which areas should stakeholders be focusing on to improve customer engagement and loyalty?
We think airlines should focus on providing value through choice and self-service. To give you a simple example, it’s often assumed that passengers will choose the lowest available fare. From our work with fare bundles, we see that a good proportion of customers will actually buy up from the lowest fare, if they can see the value in the higher fare. We have a number of clients who see 30% of passengers actually buying up from the lowest fare to a higher fare.
Can you give me an example of something that they might pay more money for, something that might influence the value from the basic fares?
It depends how they bundle it; sometimes they’ll have a business bundle, which might incorporate the airfare plus priority boarding, fast-track through security. There’s quite an art to the perceived value of a bundle and what you bundle in.
Frontiers slogan is “The choice is yours,” so they’re all about the difference in choices and value between their different fare families and bundles. For us, the areas of engagement would be value through customer choice and self-service.
What do you see as the most important technologies that will impact passenger experience in the next five years?
We think it would have to be mobile; just by virtue of being a traveller, they have mobile devices with them throughout their journey. However, one of the key points we would emphasise is the importance of having the underlying capability to be able to segment the customer, and offer optimised products and services, based on where they are in the journey.
For example, if they’re on their way to the airport, are you going to offer a lounge pass? Are you going to give them information about check-in? If they’re at the airport are you going to give them a retail offer? If they’re in Paris on vacation, are you going to give them a destination-based offer?
Lots of airlines we see have quite a fragmented mobile offering, so it’s not consistent with other channels that they have and very difficult to manage. For us, the key point is the underlying capability to be consistent across channels.
Would you say the benefits outweigh the investment when it comes to systems and services that improve the experience?
Yes, without question we strongly believe that the benefits of the investment outweigh the costs. I would say that, being a technology vendor.
However, we are quite fortunate in that a lot of our clients will regularly publish or put their results and data in the public domain. To give you a recent example, last week WestJet announced their Q2 results. Datalex went live with WestJet in early 2013, to drive their new fare bundling strategy.
Last week they stated that this strategy was forecast to bring in incremental revenue of $50-$80 million per year. For Datalex and for our customers we strongly see the benefits outweighing the cost.
How should airports work with assorted stakeholders to enable a better passenger experience?
For us, we believe the airlines should focus on the airport experience and making that easier, and again through client value, choice and self-service. Some of our customers work with the airport car parking providers, and other examples include fast-track through security, priority boarding. Again it’s about the choice and the value.
One of the interesting things we see in terms of the focus of airlines, research has shown that a lot of airlines would primarily focus on selling ancillary services at the initial booking stage, reservation stage, when in fact there’s a big retail opportunity at the departure and arrival touch points, i.e. the airport.
How can we create a more personalised service and overall experience?
In our view, it would be through the capabilities of custom segmentation, offer optimisation, and true multichannel support. In that context Datalex, for example, have powerful persona shopper functionality. For example, me travelling with my family is different to me travelling on business; it’s different to me travelling with my friends a ski holiday, so same person but very different needs and personas.
Datalex can find the ability for an airline to present and tailor an offer, based on who the customer is, what channel they are shopping in, what they are doing in that channel in the moment, their history, their itinerary, and where they are in the journey. It’s that capability that can really create a great personalised service and increase revenue.
Meet Datalex at the Terrapinn World Low Cost Airlines Congress, 16-18 September, London