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05/10/11

Leveraging the swarm

Traditional CRS solutions were developed by the airlines to manage airline inventory, and make it available to the consumer. By the 1970’s, the airlines gave birth to Global Distribution Services (GDS) to serve a much larger market upon realization that the GDS model is much more efficient and cost-effective than taking reservations over the telephone.

With the Internet, consumers now have a secondary, or for many a primary channel for shopping for airline inventory. The airlines need to understand that OTAs (Online Travel Agencies) and metasearch engines tend to become more of the place where leisure consumers dream and not buy. And, therefore the question arises, how can an airline generate demand for its own product and create brand loyalty?

In the CRS, GDS and OTA/metasearch models, all transactions are singular. Namely, there is a one-to-one relationship between the buyer and the seller. Today, we are becoming a human swarm linked by digital social networks. Airlines, big or small, need to invest in technology to link to the digital ecosystem to create their own swarm. Selling through your own swarm transforms a relationship from one-to-one to one-to-many.

  • Swarms are highly connected
    • 80% of students and professionals are part of a digital social network
    • 40% post to them regularly
  • Swarms move fast
    • Human digital swarms follow simple rules, and are leaderless
    • Swarms move quickly
  • Swarms flock to the same place – think loyalty
    • Amazon outperforms its nearest competitor many times over
    • Every 2 out of 3 searches is on Google
    • People rely on their own swarm to guide their decision

Leveraging the swarm creates powerful bonds not only for the current transaction, but also for future transactions. We are just beginning to understand the factors that influence the swarm, but some companies have already taken the plunge into understanding their swarm:

  • Southwest Airlines uses Twitter to interact with their customers and offers travel advisories
  • JetBlue offers Twitter and Flickr based customer service and discussion boards
  • Virgin America offers a Facebook profile for reservations, check-in, and discussions

Virgin America’s (VX) Facebook profile creates a swarm by encouraging their customers to engage with one another. This allows the VX swarm not only to build a relationship with the airline, but with other passengers too. Virgin America gets it.

A comprehensive swarm strategy involves a three-pronged approach:

  1. Listen & Track
    1. Sentiment Analysis – Helps determine the attitude of a speaker or a writer with respect to some topic. Newer techniques involve Natural Language Processing and Real-time Analysis
    2. Sophisticated Profiles – Passenger Profiles that not only involve travel preferences, but also information on the passenger’s swarm, behavior, posts, likes, dislikes, etc.
  2. Involve in Business Process
    1. Post to social networks – for discussions, feedback, and customer services
    2. Invite suggestions – for passenger amenities, and better service
  3. Link to your Swarm
    1. Form “similar” networks – create your own swarm
    2. Create Influencers – by creating your own swarm, cultivate influencers. This is critical because swarms move fast, are highly connected, and flock to the same place

The key benefits of a swarm strategy include:

  • Increased customer retention and confidence
  • Helps companies respond to trends impacting business
  • Identifies consumers that influence others

Conclusion

I see a new era for the future of airline distribution: one that will take us from viewing consumers as singular to swarms of engaged brand advocates. This era will leverage social networks, newer technologies, and real-time analysis. Traditional distribution works and has its own place. But at the same time, engaging with a swarm creates powerful attraction beyond the current transaction. Swarming today helps travel suppliers, distributors and subscribers build a powerful ecosystem with an enormous reach. Facebook today has more information on user profiles and preferences than the leading CRS and GDS.

The swarm ecosystem has its roots in digital technology and consumer behavior. There is data (likes, dislikes, opinions, friends, followers, etc.) available within social media that travel companies will increasingly utilize as it targets new channels of direct marketing and distribution. The potential and reach that swarming can create is unmatched and unparalleled within the travel industry. The environment is right for travel companies, especially low cost carriers, to invest and innovate in social media technology. I see airline swarms as a standard for a globally interconnected world.

What is your swarm strategy?

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