What airlines can do to maintain customer loyalty

I recently came across this report by the Executive Travel Magazine, that said that airlines could do more to keep their customers loyal. Let me say up front, that I entirely agree. While the report is a global one, with no specific countries named, I think it is also particularly relevant for the Indian market. India's aviation sector is pretty fragmented. To think it was worse, in the days of Kingfisher and Paramount !

As of date, there are 2 full service carriers operating in India (Air India and Jet Airways), and a slew of low-cost carriers (Indigo, SpiceJet, Go Air, Jet Konnect), and a few more at various stages of starting operations - Air Asia India, Tata-SIA combine for a full service airline, and the new ABC Airways that proposes to launch ops in January 2014.

With all of this happening, it is important that airlines do more to keep customers loyal, and keep their load factors high. I've written in the past about how under-matured the Indian FFP segment is, so not attending to customer loyalty would severely jeopardise ALL the players involved, though there is always the possibility that one or two could nonetheless fail in any case. So, to my mind, it is absolutely critical that at least the current full service airlines - Jet and Air India - ramp up their customer service parameters, and deliver to a higher threshold. And it is not like the LCCs are far behind either. All airlines have extensive amounts of data that can be mined and analysed productively, both from a general approach (route rationalisation, new routes, fare buckets) and a tailored approach to individual travelers, especially the frequent travelers. I've mentioned in some of my recent posts here and here, my recent experience with Air India - and the going seems good for them. On the other hand, I think 9W may have lost the plot to some extent, with their indifferent attitude towards customer service. Come to think of it, 9W may be becoming the erstwhile AI !

The report I've quoted makes a reference to a study by the accounting and consulting firm Deloitte, and I reproduce some of the findings below, along with my comments on those.

...airlines are making a mistake when their frequent flyer program presents a “one size fits all” approach to members, with everyone getting the same benefits and the same earning capabilities.
I couldn't agree more! There isn't really much in it for the frequent flyer. What seems to matter today in India, is how much you pay for your ticket. And if you've paid an obnoxiously high fare, then maybe you might get upgraded. That's about all you can expect. With the kind of information that airlines have at their disposal, what the system lacks is a targeted approach to address the needs of frequent flyers (I don't mean those holding memberships in programs, just anyone who flies frequently, especially on one or a few airlines).

Airlines could analyze the destinations that high-frequency travelers visit most often, and offer them special discounts for hotels and restaurants at those destinations.

Again, I have to agree. However, this may be possible only where there is significant data available to conclude on what offers to make to such high-frequency fliers. Even so, I believe the data might be available, but what is likely lacking is the will to be customer-centric rather than just bottom-line focused.

Study which customers usually buy a glass of wine or cocktail with an in-flight food purchase, and offer them a free drink the next time they buy an in-flight meal.

I'm not going to complain. However, this may not work much in the Indian context, where alcohol is prohibited on domestic flights. That said, why not work this in differently, and if a customer has been loyal to an airline, then they could well recognise them in-flight by offering a free meal, a snack, or even a soft drink! I'm sure for many of us, it is not what we are offered, but the fact that we are offered - an indicator of recognition. There was a time when Jet's crew used to take pride in calling a passenger by their names - even if it means having had a look at the passenger manifest. I remember the time that many of the MAA based Jet crew members knew me by name, and I knew them by their first names. Sadly, given the churn with in-flight crews, this is no longer the case.

“Airlines should show a greater willingness to forgive lapses in loyalty program membership participation,” ...“Airlines should think twice before a high priority customer has to start all over again to regain status.”
Well, I'm a bit iffy on this one. The whole objective of FFPs is the fact that you need to qualify as per a set of parameters, to be treated as an elite customer. Not meeting those parameters is the disincentive that makes many of us come up with crazy itineraries and get into mileage runs! It would be hard - not to mention, a high degree of subjectivity - to show a greater willingness to forgive lapses. Having said that, what comes to mind is what Jet did in late 2012, when their systems messed up. They ended up sending automated mailers to many JP members, that indicated that their FFP tier was upgraded to the next level. This was followed up by the joining pack for the new level! Now, for practical reasons, they could not have backtracked on this and invalidated the tier upgrades and benefits that went along. But they managed to turn the fiasco in their favour by (a) admitting to the lapse and (b) committing to those JP members that they will, indeed, be treated as per the upgraded tier. In doing so, Jet managed to avert a potential disaster, and in fact, turned it around in their favour.

Having said all that, here are my own takes on what an airline - full service or low cost - can do, to improve customer loyalty:

• In general, recognise the customer. Call them by name - a simple "Hello Mr / Ms xxx" will do. In front of other passengers, this would make me feel like royalty!
• Give your high-frequency fliers, something to remember you by for each flight they take with you. It may be of small value, but it will score high on gesture. For instance, a free snack? A souvenir to remember your trip by?
• Open up award availability options for elites. They want variety of options, not just the fact that they can redeem a bunch of hard-earned miles for an inconvenient red-eye, with family including an infant in tow.
• For full service carriers, don't limit upgrades to the number of certificates they earn - bring in SWU equivalent concepts, so the fliers potentially qualify for an upgrade almost every time they fly. Remember, the seat's going empty anyway, and as an airline, you're more likely to have unfulfilled demand for an economy class seat as compared to business/first.
• At the same time, don't make your non-FF crowd feel like they must be privileged to fly with your airline - a lot of airlines treat the regular crowd in a very pedestrian manner, which isn't good at all.
• Compete with the airline you want to be, not the other one that's taking off to the same destination within 10 minutes of your flight.

I'm sure the frequent flier community can come up with a lot more. So what would you like to see airlines do, to improve loyalty?