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Thought Leadership
February 15, 2018
Social Media Analytics – The Future of Customer Centricity for the Airline Industry
Debiprasad Roul, Abhishek Kumar

Over the past couple of years, the distressed airline industry has enjoyed certain good results due to a steady rise in demand as well as the extended drop in fuel prices. However, now is the time for airlines to digitize and reassess their competitive positions. But the players still face the dilemma over competing priorities which masks or blurs the decision making from a strategy and implementation perspective.

Social Media Analytics may just be the answer for the airlines industry. It involves crowd sourcing of data, essentially from the customer base, and using it to competitive advantage. The advent and rise of social media with Facebook (2.2 billion users), Instagram (600 million users) and Twitter (330 million users), amongst many others, generate voluminous amount of data which can be text mined and used for feature generation, features selection, pattern discovery and subsequently, predicting business outcomes.

Social media activities of customers can give an insight to the carriers on the attributes they can play with, to maximize customer delight with minimized cost. Such impact quantification helps the CIO team in choosing and sponsoring a project based on the customers' feedback. For example, providing plush interiors and ambience when the same customer delight could have been achieved by just changing the catering services. On similar lines, the feedback of the crew, the customer call centers, infotainment cataloguing and catering services can be continuously evaluated for improvement.


Revenue Enhancement

Social media content is not just limited to corrective measures but can also be utilized for revenue enhancement. A leading air career in the US followed similar approach on data collected about customer preferences, where they employed the "Collect and analyze" methodology of the mentions of social media. They claim to have added 15% to their ancillary revenues by focusing on the key customer preferences. Hence, a close watch on the social activity of the customers can provide the carriers an advantage to provide customized offerings to their customers by bundling of products and services.

Analytics on the collected social media data can significantly help the existing social media marketing process in reducing the failure rates and positioning ancillary products. It basically presents the opportunity to run a pilot campaign before going gung-ho on any idea, analyze and understand the resonance and then decide on the roadmap. The loyalty customer segment can be ultra-segmented and be provided with a more customized offering to extract better ROI. The collected data may also help the airlines in weaving the entire travel ecosystem by sharing the insights with the preceding and succeeding players in the customer lifecycle.

Experts also envision this to grow to a level where airlines can customize their network management based on the predictive booking in certain sectors by understanding the objective of travel through the social mentions and existing customer profiling data.


Competitor and alliance watch

Social media content can also be utilized to understand the competition from a customer's perspective – how customers compare you against other airlines. This gives a perception of the choice options that exists for a particular customer. Extrapolating it to a million mentions will give the airlines an understanding on the customer base, essentially the customer switching behavior and what they can do to enhance and retain customers. Similarly, how much of a value add a codeshare alliance is, can be continuously evaluated.


Possibilities of Social Media Content

We have just started exploring the power of social media content; the live feeds have enormous potential in practically all decision-making processes. From as micro as measuring and improvising any category, to as macro as product and brand associations. At this point, an adventurous but cautious thought is the utilization of social media content in institutionalizing design thinking methodology of problem definition and resolution. Considering the content is usually the willful, unconstrained expression of customers about the logo, can help in empathizing with the millions without a real contact. This may turn out to be the differentiator and provide a competitive advantage to an innovator in the industry.

While the possibilities may be multi-fold, what is inhibiting the industries at large is how to tame this dragon of data and utilize it to its maximum potential. Undecided data laws in most of the countries add to this inhibition. The pre-requisite of a threshold social media activity of the customer base can also be a concern, however, it can be propelled with social media marketing increasing the follower base. Nevertheless, the biggest roadblock that remains to be addressed is the filtering of information from the noise.

The next big thing around the corners is how airlines put social first. It is imperative to include the knowledge discovery from social media at some point but it remains to be seen who pioneers in making this amplification analytics into a driving force. Having been said that, airline executives need to also keep in mind that Social Media Analytics is not a panacea, instead it is a tool for tactical innovation. Planting a seed now appears more rewarding than ever, to start the data collection process and build upon it, aligning with the company's short and long term goals.