When it comes to the airlines industry, the difference between profitability and panic is more often than not a razor thin margin. With a number of internal and external costs, airlines need to squeeze out every dollar they can. Because of this, the industry has began a digital transformation, which includes how they market themselves.
As it stand now, airlines are making a net profit margin of just 4.6% and a profit of less than $10 per passenger. In a $700+ billion industry, moving the needle just a little bit can lead to a significant increase in profit. So how can airlines move the needle?
An effective marketing plan that leverages data to target the right customers with specific routes can cut costs while boosting revenue for airlines. By uniting revenue management with marketing through programmatic technology, valuable insights can be extracted and carried out through relevant messaging.
Furthermore, the programmatic tech and newly gained insights into both aircraft yield and customer demands allow airlines to circumvent costly global distribution systems (GDS) and online travel agencies (OTA) to sell direct to consumers.
Such digital transformation can increase the passenger load factor of individual flights (which was at 80.6% in 2015) and boost ancillary revenue, an important cashflow stream that reached $59.2 billion last year.
Check out Yieldr's gifographic to learn more about how data-driven marketing can be leveraged by airlines.
