Whilst it remains crucial for Airline Revenue Management analysts to stay abreast of the latest travelling trends and patterns, it’s also becoming more and more critical to understand the latest psychology behind the so-called “Travelling Decision”.
A recent PWC study found some very interesting trends shaping the future of air travel and that has a significant impact on the way Airline Revenue Management analysts manage and control future flights. PWC surveyed more than 1,300 US consumers in April 2021 and compared that to an earlier survey they conducted in April and August of 2020.
Below are some highlights of the survey results and important take-home values to especially the Revenue Management departments:
- Higher-income groups are eager to travel again, plan to go on vacations for longer periods and spend more on better accommodation. Whilst this is all good news, it looks as if the rest of the income groups will only see pre-pandemic travel patterns return sometime in 2023.
➔ Take Home value: It will be important for the airline’s Revenue Management analysts to follow the correct inventory management strategy by ensuring they focus on the correct market segment that’s currently eager and willing to travel. I guess one can say to focus now on the low hanging fruit.
- Safety and health-focused measures remain extremely high on the minds of travellers and there’s a tendency to stick to the strong brands in the industry for added peace of mind. Airlines need to offer more options and greater flexibility for travellers whilst positioning their brand as a safe and trustworthy alternative.
➔ Take Home value: More flexibility will have to be incorporated into pricing rules and the airline’s Revenue Management department will have to work hand in hand with the Pricing division to set this up and to manage the availability of these more flexible classes.
- The more reluctant travellers rely heavily on feedback from the current travellers about their experiences before taking the leap to travel again.
➔ Take Home value: The airline needs conscious drives to publish positive feedback from current travellers to provide the necessary comfort and reassurance to the more reluctant travellers. Airlines would need a concerted effort to build and position their brand.
- Travellers expect business travel to resume sooner rather than later, but the business traveller remains ‘less-than-eager’ to travel.
➔ Take Home value: The airline’s Marketing and Revenue Management departments need strategies to kick start business travel again by focussing on providing more comfort and a personalised experienced whilst focusing also on the soft issues like empathy towards the business market.
- Mid- to lower-tier loyalty members are very likely to switch to a new preferred airline.
➔ Take Home value: Brand loyalty remains very important in navigating the recovery process. Airlines need to focus on keeping the top tier loyalty members happy whilst trying to retain the lower tiers. The airline’s Revenue Management analysts need to ensure that there are sufficient seats open in the Frequent Traveller classes to support this drive in retaining customer and brand loyalty.
It’s clear from the above that closer inter-departmental cooperation, especially between Pricing, Sales, Marketing, Customer Services and the Revenue Management teams, is necessary to retain the current customer base and to kick-start those market segments that remain less-than-eager to travel. The Marketing- and Customer Services department need to understand the psychology behind the latest travel decision and the airline’s Revenue Management department need to implement the correct inventory strategy to support these efforts.
As Dr Spock would say: “It’s life, Jim, but not as we know it”
Let us help you to set up the best RM strategy for your airline and allow us to show you how Aviator can automatically assist you in managing these changing trends.