Understanding the needs and expectations of your customers is
what it's all about. Then you make sure you deliver towards those
needs! If you want to succeed with your ancillary services you need
to fully understand your customer. Focusing your ancillary revenue
strategy on fulfilling customer needs is therefore the key to do
ancillary revenue right.
Focusing on customers' unmet needs or helping them solve a problem
drives growth and ROI. As each individual has very different needs,
knowing your customer is becoming more and more important. As a
marketer or business manager you might think that you know your
customers. Don't assume you do, talk to them, collect information
when you can, get to know them, build rapport and offer the
services that they need, make their world a better place. Your
competitors are probably already doing just that.
What you need to consider when building your ancillary revenue
strategy is that it doesn't contradict with your brand strategy.
Ancillary is ancillary not your core business. Therefore you must
make sure that your ancillary revenue services offers added value
and reduced hassle and not added hassle and increased costs.
According to David Stoyle of Amadeus Airline Consulting a properly
thought-out ancillary revenue strategy includes six steps:
- Define the ancillary scope. Do you want to earn commissions on
sales of other travel components? Sell miles or advertising to
other businesses or offer a cobranded credit card? Do you want to
focus on the passenger, selling lounge access, Internet access,
priority boarding, seat selection, etc.?
- Measure current achievements. How much are you earning on
change fees, extra legroom, excess baggage?
- Set your objectives. Do you have a per-passenger or percentage
of overall revenue target, or are you benchmarking against a
rival?
- Identify your opportunities. Look across all your operations
for opportunities to further develop existing revenue streams as
well as for new opportunities.
- Prioritize your efforts. What ancillary products and services
have the most revenue potential?
- Build a roadmap so that everyone is on the same page. Look at
all the systems that will be affected, and recognize that ancillary
products are sold in many different channels, from online to
onboard.
What you need to do is control the consumer touch points, extend
product and services sold along the chain with customer touch
points in everything from reservation systems to social media and
mobile technology. You need to be on top of what you are selling
and when you are selling it in order to revenue manage the
consumption of the ancillaries and making sure that you always
provide a service and add value. Added value creates a better
travel experience.