CRM- IN AIRLINE INDUSTRY

Group no. 7

Vishv nath soni

Vipul yadav

Bhupendra kumar

Manas gupta

Aishwarya kapoor

Importance of CRM Global passengers to rise by 5 billion in 2010 and more than 9

billion by 2025

Passenger traffic in Africa forecasted to increase by at- least 7%

and Asia –Pac by 6.8% a year, respectively, by 2010

Asia will be the world’s largest aviation market by 2025

40% of satisfied customers switch suppliers without hesitation

65% to 85% of customers who choose a new supplier claim to be

satisfied and very satisfied with former supplier

85% of customers claim to be satisfied, yet willing to switch to

other suppliers

In the 12 months before Feb 07, there was a 49.6% increase in

the number of passenger complaints

In airline Industry

Customer relationship management?

CRM is more than IT or a frequent flyer program.

It is a strategy that enables airlines to remain competitive today and in the future.

Who are the customers?

Individual Traveler The Travelers Company The Person Choosing the Airline The Travel Agent Corporate Customers Cargo Brokers

Airlines’ immediate focus is on cost reductions in driving to more efficient operations.

Many airlines are turning to customer relationship management (CRM) as a tool for managing customer relationship.

CRM focuses on

Customer acquisition –Who are the profitable customers ?How do we attract them?

Customer development – How do we deliver what the customer wants?How they want it?When they want it to optimize profits and

revenue? Customer retention –

How do we build and sustain customer loyalty?

Customer Information

Information captured falls into the following categories:

Demographic profiles Loyalty membership information Service preferences Purchase and travel history Contact information Online behavior

CRM need to be

There are many means of achieving these goals, including: Understanding customer value and lifecycle to prioritize

marketing and service resources Using customer information to target promotional offers

and cross-selling activities effectively Using customer information in the design and

development of products and services Recognizing customers as individuals at all customer-

contact points Offering personalized or mass-customized service Utilizing multiple alternate channels for marketing, sales

and service transactions in order to improve service and reduce cost

Increasing the “share of customer” through greater penetration of travel related products.

SPECIFIC BENEFITS TO IMPLEMENTING A CRM STRATEGY

Planning and implementing business processes across airlines and CRM applications ensures customers are handled in the most efficient and effective fashion from the beginning to the end of the interaction based on their real-time value to airlines.

Implementing CRM applications may simultaneously lower the cost of design, implementation, installation, training, ownership and administration. It also reduces the risk of re-engineering systems at a later date.

Consistent and dynamic processes are built up-front for the customer. This forces the airline to consider each element in the process design including the network, switch, multi-media management, and the CRM - ensuring streamlined processes are in place before the customer makes contact.

Create and leverage detailed statistics/metrics and cradle-to-grave reports.

Airlines must change their approach to CRM in a number of ways Customer segmentation—Airlines need to recognize that

mileage-based segmentation is inadequate, whereas value-based and needs-based approaches can help guide investment decisions and drive greater insight into the needs of high-value customers.

CRM initiative development—In order to differentiate themselves from the competition, airlines must abandon a “fast follower” approach to CRM initiative development, in favour of investing in initiatives with a high return, which respond to the needs and desires of their own customers.

Today , more and more airlines are using the Internet to implement e-business applications and CRM strategy. These applications can be very resource intensive. e-CRM is interest intensified in managing customer relationship through the Internet.

Establishing and strengthening long-term relationships with airline's customers is the key to success. It's the focus of a well-structured and coordinated process of customer relationship management.

e-CRM involves far more than automating processes in sales, marketing, and service and then increasing the efficiency of these processes. It involves conducting interactions with customers on a more informed basis and individually tailoring them to customers' needs.

e-CRM IN AIRLINE

ChallengesCarriers face several key challenges in the context of using CRM to carry out their

strategic priorities: Decreasing cost of serving customers

Moving away from expensive, custom built systems to cheaper pre-packaged apps

Cost-effectively integrating multiple systems and improving cross-channel service

Unified view of the customer Integrating multiple processes that cut across in-house and 3rd party systems

Customer knowledge Identifying the most and least valuable customers

Loyalty program effectiveness Decrease costs Retain most valuable members Increase members’ expenditures and purchase of distressed inventory

Differentiating the product Using service to differentiate their product and, thus, justify a higher price

Raising customers’ switching costs Create a unique offering that competitors cannot easily duplicate

Thank You