This is a song I have been singing for a long time. Ancillary Revenues drives unhappy customers and Brand Disloyalty. So the dilemma for the US and all other airlines and travel suppliers is to try and do something about that.
However there are other drivers for Brand Disloyalty. Airlines are especially bad at this. When the good times are around they think they can ignore their customers and at high load factors (80%+). In the last boom (2007) they did just that. Behaving in a very cavalier way. But - you might say - what was new about that, haven't they always done that (BIABLT!) and the traffic always comes back because they have no choice? Well now the web is making this form of behavior much more apparent to the user communities. Whether it is the high value frequent traveller (through such forums as Randy Petersen's FlyerTalk or the regular John Q Public and social media sites that range from Trip Advisor to Facebook and all flavors in between) this behavior can no longer be spun by PR Hacks. It is transparent out there and people who make purchasing decisions can now see it clearly. And they notice and they are not happy about it.
Forrester has recently completed a study and it makes a strong point that their data reveals travel brand loyalty has decreased by 19% since 2006. Actually I personally think the number is much higher now. (For the link go here: http://www.forrester.com/Research/Document/Excerpt/0,7211,47560,00.html). Ouch.
Further, and I quote from Forrester:
"Leisure travelers in 2008 have every reason to be disloyal. Why? More travel products and options for travelers to choose from, virtually no incentives for travelers to remain loyal..."
So this bad behavior needs to be addressed and it better be soon. The airlines in particular believe they can control their customers. Dream on chaps. Those airlines during the downturn who behave well and pay attention to their customers at each and every touchpoint will be winners. Those who pursue business as usual will be slammed when the traffic returns.
You have been warned.
Cheers
‘"Leisure travelers in 2008 have every reason to be disloyal. Why? More travel products and options for travelers to choose from, virtually no incentives for travelers to remain loyal..."
ReplyDeleteI would also say the same would hold true with respect to travel agents. There may not be more of us around in total numbers, but there are so many that are going home based to compete with traditional travel agents brick and mortar agencies, that if we don’t actively work to keep our clients they will bale on us at the drop of a hat. With regard to corporate travel agencies, I think companies have every reason to switch agencies if we don’t engage our clients, actively building and maintaining relationships.
reb
Very true observation and from the types of comments I continue to view and the feedback and research on FlyerTalk - you and Forrester are correct.
ReplyDeleteRandy Petersen