With the trend towards digital retailing in the airline industry, and the desire for airlines to become the sole source of the offer, there has also been a lot of discussion related to dynamic pricing.
Here, we aim to demystify some of the concepts and definitions of dynamic pricing and take it a step further – to dynamic offer creation.
It is a good time to look into the crystal ball. Technologies such as artificial intelligence, cognitive intelligence and machine learning – all somewhat related – are on the rise. Concepts such as segmentation, personalisation and contextualisation in airline offer creation are taking shape, and in some cases, are quite advanced. With the increasingly competitive market and new tools and channels available to make offers and sales, airlines need to rethink their understanding of not only their competitors but also their customers’ needs and desires.
The Airline’s Nightmare
Currently, the business traveller’s dream of an omnichannel, seamless booking experience for a complex itinerary is also the airline’s nightmare. Putting together a multifaceted offer is a difficult task.
To make an offer compelling enough to keep the traveller within an airline’s own channels – or those of its alliance/codeshare/interline partners – is even harder as is the ability to offer the end-to-end experience from a single place.
Airlines do not have systems today to create and view complex orders such as these. While individual components are easy to figure out, and prices from airline partners can be quoted, there is no way to build the complete offer, and have a certain degree of confidence that the traveller will choose one offer over another because it is attractive enough – or more attractive than the competition.
And lastly, airlines are lacking the systems which help them determine what it is that the traveller needs and what he wants. Knowing this can make the difference between converting the traveller or watching him move to another website.
