In a situation that is changing hour by hour, it has never been more critical for travel companies to keep in touch with their customers.
This is particularly true of the airline industry, with governments issuing updates around travel restrictions all the time.
Over the weekend, Delta Air Lines CEO Ed Bastian reinforced this message when he said: "Amid the stress and uncertainty, it’s never been more critical to stay connected with one another, even as we practice social distancing to reduce transmission and keep each other healthy and safe. I remain dedicated to keeping you informed about the actions Delta is taking for you during this uncertain time.”
In an interview with 15below CEO Nicholas Key, he discusses the role technology is playing in real-time communications with passengers, lessons learned from previous experiences and the need to meet customer expectations during a crisis.
Give us a snapshot of what you're seeing currently.
We are seeing the airlines, really similar to us as a business, having to react quite differently, almost day by day as the different governments around the world issue different advice and as the situation unfolds.
Unfortunately, it is more than ever before, a changing situation for the airlines and of course for their impacted passengers.
Airlines are certainly struggling with the massive dip in people wanting to travel, be that new bookings and revenue from new bookings or having to handle passengers who are booked and who either can’t travel because of restrictions or don’t want to because of the outbreak. They’re really struggling with the impacts on their business.
Everyone knows the margins in the airline industry are very slim at the best of times and unfortunately some of those airlines who were financially on not so good a footing coming into this crisis are struggling or have gone.
That’s very sad and everybody expects to see more of that depending on how long the outbreak, and the restrictions, and the downturn in travel continues for.
Traditionally in airline disruption, 15below might be helping with reputational issues, how is it helping now?
With coronavirus we are seeing a lot of the airlines reducing their capacity on different routes. Where they had four flights, they are reducing down to two.
That obviously requires a lot of operational change around the passengers who were on different flights being moved around and being put on to alternative flights.
The airlines, if you went back 20 years ago, would have had large reservation call centers who would be able to manage all that change to the inventory and the passengers. Now, because they don't have that human workforce they have to rely on technology like 15below to really allow them to make these changes very quickly and react to different situation like Trump’s announcement that travel from Europe to America was going to be restricted.
That obviously impacts all of the mainland Europe carriers and all of those passengers who were on those flights needs to be re-accommodated on to alternative flights or they need to be contacted to ask if they want a refund or to postpone their travel to a later date when hopefully the restrictions will be lifted and that’s a lot of communication with the passengers.
Operationally there is a big requirement for 15below systems to help keep the airlines’ operational systems and processes going at this time when there is a massive strain on them because normally an airline would change 10% of passengers throughout a year, now we’re seeing 50% plus of passengers being impacted and a lot higher in some areas of the world.
Then there’s the passenger experience side of things which means that a lot of passengers due to travel either want to change their travel voluntarily or they need to know whether they are still able to fly, there’s a real requirement for airlines to be communicating with their passengers and that communication needs to be happening almost in real time as the different situations unfold.
That’s really where we come in, we have the ability to communicate in real-time with the passengers, the ability to tailor those messages to really give the passengers the information they need and the automation to deal with the massive volume of passengers that are impacted by this kind of situation.
Is there a glimmer of hope of recovery in Asia?
Everybody is holding on to what we have seen with the statistics around the cases in South Korea and China stabilizing.
Whilst the airline industry is very vulnerable to these kinds of situations it’s also very resilient in its abilty to bounce back.
In today’s world people need to and want to travel and if we start to see these glimmers of hope, travel will start up again relatively quickly.
The airlines we are working with in that region such as Cathay are really focusing on coming out the other side of this crisis and making sure they have retained the loyalty of the passengers and can go back to business as usual very quickly and we’ve minimized the amount of time this impacts us as much as possible.
Those strong airlines with good long-term passenger focus and loyal passengers will start to see the recovery very quickly as soon as the world gets some sort of control and there is light at the end of the tunnel.
What we’re seeing in Asia is hopeful but at the moment the focus seems to be on Europe and whether it’s going to grow even further in Europe or whether we’re starting to see it peak and all we can do is take advice from the governments and see what they say.
In the past we have had all sorts of disruption, weather, the Icelandic Ash Cloud volcano, etc. - is the process the same in terms of managing them?
It starts the same. I think from what we see from year-to-year is passenger expectations of what their travel company provides them are changing.
When we look back at the Ash Cloud, firstly there were a lot of lessons learned about how operationally that was dealt with in the airline industry. A lot of those lessons were learnt in the years after so systems like the 15below platform were put in place for that reason.
As we approach another big crisis for the airline industry, this time coronavirus, we can look back on those incidents and learn from them but passengers expectations have also evolved, they expect a lot more information in real time, a lot more detailed information and accurate information. Back in 2009 with the Ash Cloud it was completely different.
When we go into a big situation like this it is approached in the same way that someone like Cathay would approach a typhoon hitting Hong Kong island which happens three or four times a year. It's pretty much guaranteed that it will happen but they don’t know when.
The processes they go through in terms of passenger communication and passenger re-accommodation are fairly similar for a fairly confined event like a typhoon, that might impact their business in a huge way but for a fairly short period of time, to this which is unprecedented in the impact in terms of the length of time.
It’s the same processes, the same objectives in terms of trying to personalize the message and trying to understand the different passenger requirements, different routes, different cultural needs of passengers.
You talk about real-time, detailed, accurate information - how difficult is that right now given how quickly it is moving?
It’s difficult for the airline because their scheduling department and their yield management department have got to make decisions based on the advice and the restrictions being imposed on them by different governments. That is changing on a day-by-day business.
It’s a moving target where different markets are imposing different restrictions several times a day. Once those decisions have been made, the technology kicks in fairly quickly and because of the automated nature it’s very easy for it to be real-time and accurate because the airlines we work with have invested in making sure they have that capability to accurately and quickly communicate with passengers.
What they are struggling with is the ability to know what’s next. What we’re seeing is them literally treating this crisis on a day-by-day basis and saying: "What’s the situation today?" They set up their cross-functional teams to respond to the crisis and it’s all hands on deck to make sure that operationally they can carry on.
They are protecting their yields as much as possible and delivering the service to the passengers that still want to or are able to fly and that when the restrictions are lifted they can come out of it still flying.
Right now, what’s your best advice for airlines?
To make sure they continue to proactively communicate with all passengers and their staff. It’s very easy to overlook some groups of passengers or to feel like you are over-communicating with passengers.
In this kind of scenario the more information they can get the better, providing that information is accurate at the time you are pushing it out and you are proactively telling the passenger to expect more information at a certain frequency, that is what they really need to be doing.
All the passengers understand this is a situation that is not the airlines’ fault but as with all these kind of situations it’s an opportunity to build loyalty to show passengers they are looking after them.
The number one way to look after them I believe is by clear, accurate communications to give them the options, to allow them to self-serve to give them the waivers and the different vehicles airlines have to enable or empower their passengers to make those decisions.
When we do surveys of the industry, when we talk to passengers and talk to staff, people still talk about what happened in the Ash Cloud. They don’t remember when everything went smoothly so this is the time to build that loyalty and that is really valuable stuff to the airline industry.
How important are integrations with the GDS and other technology providers right now?
There are key pieces of information that we need and key systems in the airline world such as reservations systems and the GDS that are absolutely integral to everything we do. Through our interfaces to Sabre, Amadeus, Navitaire, etc., we can get hold of that data.
Some of the travel agents clients we have they want to be able to identify passengers in certain markets very quickly. Our airlines also want to be able to tailor the information in a very accurate and very quick way. For example, European airlines want to be able to identify those flying to the US and get a message to them following Trump’s announcement.
The only way that can be done with any kind of speed and accuracy is relying on the technology and we have to have the interfaces in place to access the data we need to push those messages out.
The good thing about the airline industry is that the vast majority use a small number of reservation systems and GDS so by having established links with all of those, when we get new airlines on board, it allows us to implement them very quickly and give them that capability very quickly.
So, broadly speaking, the three things that are happening are - the news goes out, you communicate with passengers and re-booking is going on in the background?
Trump will have made the announcement and passengers planning to fly are seeing that very quickly. Rather than flooding the call center, the European airlines are getting the message out really quickly saying they are aware of the announcement, that it is going to impact travel and they’re working out the options and will present them in the next few hours.
They are then using the 15below systems or GDS to work out what options can be presented might depend on their itinerary, their tier status, different options, different destinations the passengers could still go to. h
Having the tech provided by Amadeus and others in conjunction with 15below means they can manage these different passenger types so a proactive informational message is first followed by an automated message around different options for what that individual passenger can do and a heavy amount of personalization according to their itinerary, tier status, language or culture.
One European airline sent over 800,000 messages through our systems on the first day of last week. There are very, very high volumes of messages going out to pretty much all the passengers but they still need to be highly personalized if you want them to be impactful and to have the benefit to the passenger. There’s not point in just sending spam messages out that are the same.
Are you seeing any opportunity for airlines right now, could be geographically based or something else?
It comes back to that building of passenger loyalty. When we look back on the other widespread disruption and the passengers that were impacted but have a positive message about the airline that looked after them, that lasts for years and years and the value of that in monetary terms should not be overlooked.
There are various studies in regards to that kind of formula of how much that passenger is worth and this is the opportunity, if we’re looking for a positive, to really capitalize and build that loyalty among that passenger base.
The airlines that are surviving this are the ones that will manage their passengers well and will work through and reduce the cost of what they are doing at the moment, the logistical cost, but continue to build that loyalty.
Do actions such as flexible terms and conditions act as a stimulus or what effect do that have?
That kind of flexibility is really needed. Passengers are looking for their chosen airline brands to react in that way. There was a little bit of a backlash against some airlines around dates applicable so it has to be managed very well and really quickly.
Again, it comes down to the communication with the passengers around that - if they didn’t book within the dates announced then what are the options but those kind of flexible T&Cs are going a long way to help passengers on an individual basis and that’s where that loyalty will be bred.
What is the process for when we see some tangible shoots of recovery?
Then, certainly our airlines are trying to get back to a position of competitive advantage that they were working on before. The big international brands see the customer experience as being from the point when the passenger makes the booking all the way through to when they arrive back at home.
There is a really important period up until that passenger is in the safe hands of airline staff on the day of travel where that passenger experience can really be enhanced in a thousand different ways when you look at the different types of communication that are possible and when you look at some of the services that are offered to enhance their experience.
I think the airline industry has really got that in the past few years. They looked outside the industry at the likes of Amazon and Netflix and said how can we enhance this experience and communicate individually with passengers and give them that thing that our rivals are not.
It’s a real shame coronavirus has come along and had such a massive hit because they were making huge inroads in that area last year.
Is there any concern that because they will all be fighting for survival that they might let go for nice passenger experience things?
That’s a real danger and it comes down to the individual airline’s prioritization and strategy. The bigger airlines are very aware of not losing that ground and not de-prioritizing passenger experience in hard times such as these. It will come down to the CFO’s decision and some budgetary compromises in different airlines but certainly the big airlines doing it well are very aware of picking it back up as soon as possible.