Airline business BI report

18 June 2012

Business intelligence is moving up the airline priority list, not just to ensure efficient data management but also to drive customer service and personalisation.

Business intelligence (BI) sounds so simple and self-evident. Yet you'd be hard pressed to find two words that encapsulate a concept that has so many implications for all areas of business. Around 80% of airlines intend to invest in BI solutions over the next three years according to the Airline Business/SITA Airline IT Trends Survey. At the broadest level, we are talking about the applications and technologies for gathering, storing and providing access to data to help businesses optimise their resources and create value-added opportunities.

Mignon Buckingham, ICLP's Managing Director, is quoted in the latest edition of Airline Business regarding some of the key challenges and opportunities for airlines to use BI more effectively. Below are some of the main points raised in the article:

"Improving customer services and increasing revenues are also key areas of the business that can really benefit from BI. "Effective use of a revenue management system has been credited with revenue increases of between 3% and 7% resulting in profit increases of 50% or more" .

"The goal is really to combine the computer brain with human intelligence, where experienced individuals live and breathe the booking patterns and load factors for a specific route or group of routes and are able to predict booking patterns and load factors with extreme accuracy," Buckingham says.

She adds: "Airlines are also good at applying BI to frequent flyer programme data, which lends itself to analytics as it is generally clean data, and FFPs are very much number-driven entities. They use various off-the-shelf tools and more advanced statistical modelling techniques, such as clustering and regression."

On the not so distant horizon are opportunities for airlines to incorporate new data streams into the mix, which will deliver rich insight about their customers and potential customers. "Traditional customer data sources such as FFP, CRM and reservations data are being supplemented by social media, web and mobile 'footprint' data," says Buckingham."Therefore any airline that integrates these relatively new data streams with the traditional ones within a single BI platform will take customer insight to an entirely new level."

Read the full article here.


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