Airlines identify their top IT priorities

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Published: June 23, 2012

Nine out of 10 airlines plan to sell tickets via smartphones by 2015, turning mobile into a mainstream distribution channel, according to SITA’s latest Airline IT Trends Survey.

Mobile technologies were a top investment priority for the airlines surveyed, for both distribution and passenger service. “Airlines are going to get personal, selling direct to customers through new channels,” said SITA market insight director Nigel Pickford, speaking at the 2012 Air Transport IT Summit in Brussels.

Although 86% of respondents expected their website to remain their dominant direct sales channel beyond 2015, smartphones came in a close second with 70% of the vote. SITA estimates that roughly half of airline tickets are sold direct.

By 2015, mobile is expected to generate 7% of revenues, followed by social media at 3% and kiosks at 2%. “Together, by 2015, these channels will represent 12% of total sales. This is where we see a new and strong change occurring. We could be at the start of a big change in terms of revenue generation,” he added.

While websites are expected to keep the top spot when it comes to direct sales, smartphones are expected to overtake the web as a customer service tool and the two channels will be neck and neck when it comes to passenger processing.

“Passengers have an insatiable appetite to have more control, more personalization,” Pickford said. “Data needs to be personalized customized, timely and relevant.”

However, personalization involves capturing and analyzing passenger behavior. This will be a key challenge and the “evolution of business intelligence” is an area SITA hopes to investigate next year.

For the first time, the survey also looked at social media use. The prime airline use for social media will be marketing, followed by customer service, sales, travel planning and passenger processing.

Roughly 90% of respondents expect to promote by social media by 2015 and 63% will use it as a booking channel, four times more than last year.

Although the channel mix may be shifting, airlines’ top three investment priorities remained unchanged. Improving the passenger experience topped the list, followed by cutting the cost of business operations and enabling new revenue opportunities.

In 2012, airlines are planning to spend 1.65% of their total revenues on IT, slightly up from the 1.57% actual spend in 2011. The airlines polled in this year’s survey carry 53% of global passenger traffic.

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