Airlines Hope A Better Flight Experience Will Be Key to Higher Profits

Airlines have historically had a tough time making profits, a trend that may begin to shift given mergers and acquisitions, getting a handle on fuel prices, and technological advances.

One of those most exciting propositions, at least in the view of some airlines, is improving the customer-airline relationship via technology that enhances the experience (and boosts profits) through more personalized service. The shift would be particular breakthrough for aviation as airline marketing, other than to frequent flyers, has largely been uniform.

“Airlines are already using mobile technology for flight updates, check-in and recovery from irregular operations,” according to PricewaterhouseCooper’s 2014 Global Airlines CEO Survey of of 39 of International Air Transport Association member CEOs. “The goal will be to go far beyond this and turn the passenger experience into one where passengers feel informed, in control and empowered to manage their travel easily and instantly.”

Airlines hope to achieve through data analysis that offers optimized pricing and service to different customer segments.

And the desire to offer personalized services to passengers is one of the drivers of IATA’s proposed New Distribution Capability.

“Better and more sophisticated use of data analytics will also help pave the way for airlines to transition from strictly capacity-driven pricing to customer-driven pricing based on a personalized mix of products and services,” the report states.

Airline CEOs are bullish about the new reality. Seventy-one percent of airline CEOs indicated they are developing future strategies or have concrete plans for changes to their data management and data analytics, according to the report.

About a quarter, or 26 percent, of respondents already have programs under way or completed.

Some examples of this already are taking place. Panasonic Avionics delivers targeted ads to flyers at 30,000 feet, American Airlines’ flight attendants use tablets to access to passengers’ meal and drink preferences, and tour operators can market to flyers in transit to their destination.