State of Social Business: Airline Industry July 2012

WHITEPAPERThe State of Social BusinessThe Airline Industry 201210 July 2012Deb Wiseman and Anne Bartlett-BraggRipple Effect Group Pty Ltd (ABN: 28 135 533 514)P.O. Box 1227, Woollahra, N.S.W. 1350Suite 1, 50 Stanley Street, Darlinghurst, N.S.W. 2010© 2012 Ripple Effect Group www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 1

Overview“…in the coming years digital channels will reshape more than just marketing and public relations.These channels are set to impact all aspects of business. Today we can see increased use ofdigital channels for customer service and employee engagement as two obvious examples. Butcompanies are also increasingly adopting enterprise communications to increase speed andefficiency of operations. Social networks are being leveraged to make companies innovate andshorten the time it takes to bring a new product or service to market.”1The rapid developments in Social technologies over the last few years, the airline industry hasseen opportunities for Social Media and has increasingly pursued presences across variousplatforms. These presences cover a wide variety of content strategies that simultaneouslyexperience differing levels of customer interaction and engagement.In this study, we reviewed a cross sample of 24 airlines across a spectrum of short-haul, long-haul, low cost and full service airlines from around the world with a focus on the Asia Pacificregion, the world’s biggest economic growth market2, to give an assessment of the industry’s useof the most relevant social networks from a traveller’s perspective.1 Asia-Pacific Corporate Social Media Study 2011, Burson Marstellerhttp://www.slideshare.net/bmasia/burson-marsteller-asiapacific-corporate-social-media-study-20112 ATA Vision 2050 Report, February 2011http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 2

In an industry based on service and experience, it is not enough to create a social presence toonly push content. The study assessed savvy content management as well as engagementacross each platform. The more consistently an airline engaged with the consumer to reachresolution or simply responded to comment, the higher they scored.The study uncovered the most successful airline brands, the weakest and the reasons behindthose placements. The most important finding was that all airlines seem to be failing in meetingbasic consumer expectation within social. When consumers interact with social technologiesthere are expectations on service and experience that can be viewed as an extension of offering.We call this shortfall “The Consumer Gap” and believe there is massive opportunity for airlines toshift social to more than a communications channel and into a viable extension of the business, tobecome socially optimised businesses.Key !ndings • Airlines predominantly use three social platforms- Facebook, Twitter and YouTube. • Airline activity ranges from mere presence, to sales drive, to considered engagement. • The airlines which are more successful, tend to score highly across all the channels they activate in, indicating more confident understanding and with a potentially dedicated social team and strategy. • The number of Facebook likes does not impact on success within the platform. • Multiple Twitter accounts across region and communications purpose (e.g. Customer Service versus Brand) seems to cause confusion amongst consumers, with consumers choosing to approach the most popular accounts when they engage. • YouTube usage is dwindling with increased activity on Facebook. Many videos do still see high viewership figures and these successful videos explore inflight and service experience. These are most likely found via search. • Content sharing across Pinterest and Instagram is left to the most brave of the airlines, which are still finding the best way to use these platforms. Flickr activity may have been quite prevalent at one point, but with the rise of other more widespread channels, activity here has dropped off. • LinkedIn is a tricky medium to balance between recruitment of staff and engaging corporates to fly on a particular airline. Even the airlines which have the recruitment angle right, struggle to find engagement with corporates as potential travellers. • A handful of blogs are still heavily active and include customer submissions in addition to in-house created content. The main purpose of blogs has become to capture any potential searches. Outside of that blogs are not seeing much interaction. • Mobile applications are the future, with travel and mobility going hand in hand. Some airlines are providing booking capabilities and flight information through mobile, a handful more focus on promotion and less on the passenger needs. There is significant potential for airlines to activate successfully within this channel to extend the service and engagement experience. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 3

Assessment criteriaFor this study, we have created specific scales of measurement for each platform to correctlyreflect airline proficiency within the channel. For example, relevant customisation on Facebook isimportant in demonstrating that a brand is making serious effort to develop additional tools thatresonate with their customer. A brand knowing how to engage on Twitter with the relevantconventions and displaying clear YouTube content strategies are all vital in determining thescores for these airlines.The platforms assessed included: • Facebook; • Twitter; • YouTube; • Content sharing across Pinterest, Instagram, Tumblr and Flickr; • LinkedIn; • Blogs; and • Mobile Applications for smart phones.We did not measure Google+ as actual consumer activity is weak in comparison to Facebook.In general, scores reflected the following on a scale on 1 to 10: • 1 to 3: reflects little use of the platform and presence as a placeholder only. • 4 to 6: indicates some more frequent use but no real understanding of how to use the platform to the airline’s advantage. • 7 to 8: indicates more regular postings, engagement and appearance of a considered strategy. • 9 to 10: indicates that an airline is strategically using the platform in a way where both consumer and airline derived value from the exchange. Creating a more social business operation not just social communications messaging platform. This exchange is relevant to each particular platform and appears to close the consumer gap.This data was captured in May 2012.The LandscapeThe nature of the aviation industry calls for high levels of customer service across the traveller’sspectrum of airline experience, yielding a variety of negative and positive sentiment. On thenegative, delays or issues happen often and consumer dissatisfaction is voiced across the socialsphere, not always being handled well and sometimes not at all. On the positive side, mostpeople love to travel and engage with airlines to find the best cheap flights or an even overalltravel experience for booked travel arrangements. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 4

For the 24 airlines we examined on Social most activities are self-serving. Self-promotion isrampant and the airlines that are the most successful are those that choose to combine theirmarketing efforts with strong customer service. We see these airlines offering a combination of: • The deals and promotions that customers want to take advantage of; • Creating fun campaign elements to keep followers interested; and • Handling customer service queries that are both positive and negative.From a snapshot view, there appears to be an overall lack of effort by airlines to meet the socialconsumer needs of engagement vs. broadcast or promotion.The 6 airlines below provide a snapshot of the highest to the lowest scoring performers within thereport. Airline Facebook Twitter YouTube Content LinkedIn Blogs Mobile Total Sharing Apps /10 /10 /10 /10 /10 /10 /10 /70 8 7 8 7 8 8 7 53 8 7 7 5 4 9 6 46 6 7 7 0 6 0 0 26 7 6 4 3 1 3 0 24 2 5 2 1 2 0 4 16 1 1 0 0 1 0 0 3Top performer overview: KLMKLM is well ahead of any other airline. Their strength lies in the ability to incorporate their brandand offering into socialised components. This implies that different elements of the business worktogether to create a cohesive experience for the traveller across the selected social channels.Furthermore, their ability to customise tools to meet a consumer and traveller’s needs reﬂects theirfocus on trying to enrich the traveller experience to build the brand image, over too frequent apush on repetitive marketing messages. This is further demonstrated by the airline’s skill innavigating between brand marketing push, handling customer enquiries and engagingcampaigns. These campaigns are strategically developed to both reinforce the brand messageand to beneﬁt the traveller’s experience. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 5

Their mobile app is one of the most sophisticated in the industry. KLM begins to meet the shift inexpectation that mobile technology provides to consumers by implementing service extensionsthat reshape the business socially. However, there is still opportunity to revolutionise this offeringand provide a more complete service experience through this channel.Mid performer overview: JetstarJetstar places in the middle of the pack because of their level of navigation between promotionalelements and customer service enquiries on Facebok and Twitter. It is a fairly basic engagementwithout much customisation to Facebook providing a one-note experience to the consumer.The remaining activity across channels is poor with activity established as a placeholder andwithout strategy. A blog sits inactive for over a year and YouTube videos market the brand overexperience, reflecting an overall focus that is communications oriented instead of one whichembraces a more social business to benefit customer experience.Jetstar could improve by adding more customisable features to Facebook which support thebrand image and benefit the community. Other platforms, which have little or no activity, shouldbe hidden from public view until a more robust strategy is established. Development of a usefulmobile app would see their score rise further.Low performer overview: UnitedUnited is a large airline and to see their performance at the bottom of the pack is surprising,especially when their key competitors head towards the top of the scale. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 6

United offers no customised features on Facebook and leaves customer queries unanswered.Their Twitter account is more customer service friendly, yet they Tweet out a lot of marketingmessages and news. They have instigated a hashtag “UnitedPlaneChat” which is a novel ideaand should see more success, but reveals more unanswered customer service queries.All other platforms are virtually non-existent aside from a useful mobile app which providesfunctionality for check in, flight status and bookings. This is at a similar level to KLM. If Unitedimproved their service levels on Facebook, understood customer needs on Twitter correctly andbolstered their social business offering, they could easily be one of the leaders in the aviationindustry.ConclusionIt’s good to see a large number of airlines increasingly participating in the Social world andprepared to experiment with the vast array of Social technologies on offer. These technologiespresent significant opportunities for airlines who understand that Social channels are not simply aone-way communication or promotional channel.In a recent CEO C-Suite Study from IBM, more than 70 percent of CEOs expect a change in theuse of social media. Over half of the CEOs interviewed expect social channels to be a primaryway of engaging customers within five years 3. However these CEOs also understand that longterm value is derived when organisations begin to help individual customers achieve their owndesired outcomes 4.Airlines wishing to benefit and profit from the Social world need to develop an integrated andstrategic social business plan. A real opportunity presents itself to drastically shift each airlineaccording to the needs of their traveller, which will deliver strong returns on investment as seen inother sectors embracing holistic social business practices (see our Whitepaper on The State ofSocial Business in Australia 2012: who is achieving strategic results by design). This is the shift tobecome a socially optimised business. Airlines are finding their feet in handling service enquiries across the primary platforms ofFacebook and Twitter. Other platforms become support. However, this “Consumer Gap” presentsthe biggest opportunity within aviation. There are expectations on service and experience that arenot being used as an extension of offering, particularly when the consumer is mobile. Airlinesinstead are still focused on the marketing viewpoint that social has to offer instead of the biggerpicture.For airlines to shift the experience, they need to align internal teams to provide a consolidatedsocial offering to consumers. From the analysis and our own experience to date, this wouldprovide consumers with: • A more holistic experience with the consumer’s airline of choice; • An easier combined data access point for airline staff when assisting consumers with their queries; and • More simplified management systems across a business.3CEO C-Suite Studies. Leading Through Connections. Insights from the Global Chief Executive Officer Study. IBM, 2012http://www-935.ibm.com/services/uk/en/ceostudy.html4 Ibid. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 7

The full report, Social Landscape Review - Airline Industry 2012, with 480 pages of detailedanalysis of social media assets of the 24 airlines listed in the whitepaper, is available for purchaseat A$495.Please email your order to: hello@rippleffectgroup.com www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 8

About the AuthorsDeb Wiseman - Senior Manager Social Business Deb has seven years of experience globally, including time in New York and now back in Sydney with several media, advertising and conversational agencies. She has been responsible for developing new social communications tactics and methodologies for clients across a range of categories. Her approach values simplicity to deliver solid business results through stronger communication plans and more efficient business strategies that are sustainable and outcome focused.Deb’s ability to comprehend a business need paired with consumer outlook informs her capabilityto develop viable recommendations using current trends and technologies. Her previous workincludes global and US brands such as PayPal, KMart, Mentos, Panasonic, American Airlines,Kraft, EMI, Audi, Canadian Club and local brands that include SBS and Telstra. She has guidedand managed projects that take businesses in to new territories that incorporate theunderstanding that company, consumer and platform must come together in a way where allderive value.Deb has a Bachelor of Science from UNSW, a Diploma in Design and the arduous AWARD SchoolDiploma to shape her strong analytical and creative thinking.Anne Bartlett-Bragg - Managing DirectorMEd (Adult Ed), BEd (Adult Ed), Dip HRM, Dip e-Learning, Cert IV TAA, PhD candidate Anne specialises in the creation of innovative communication networks with social media. Her designs are award winners: MentorNet, the first national mentoring program for young women entrepreneurs in 2007 was a finalist in the Forrester Groundswell awards in 2008 and won the LearnX Asia Pacific 2010 Best Mentoring Program. Her design for the Institute of Executive Coachings learning communities won the LearnX Asia Pacific 2010 award for Best use of Social Learning Tools. Anne has an extensive early career background in the travel andhospitality industry and held management positions including National Reservations Manager,Qantas Jetabout Holidays, Executive Assistant Manager, ANA Hotel Sydney, Concierge for theHyatt on Collins Melbourne, and National Marketing Manager for National World Travel franchisegroup.Anne is also a sessional academic at UTS in the Faculty of Arts & Social Sciences where sheresearches, develops and lectures in organisational learning. She is a recognised keynotespeaker at academic conferences, both nationally and internationally. Her papers are publishedin several textbooks and international journals. In addition, Anne is a sought after reviewer ofacademic journals that specialise in social software and communication technologies. She uses her research and studies into the communication aspects of social media to provide aninformed back drop to understanding how people are using new tools and changing traditionalmodels of communication. She constantly challenges organisations to reframe their models ofcommunication, service design, and workforce engagement. Anne is currently in the final stages of completing her PhD which has explored the adult learnersexperiences of developing learning networks through self-publishing technologies such asweblogs. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 9

About Ripple E!ectRipple Effect is a specialist social consulting and development company. We bridge the gapbetween existing IT, marketing, and operations to engage both employees and customers moreeffectively, and help create the kind of network effects and energy that characterise successfulbusinesses and government agencies. We help organisations use smarter, simpler, socialtechnologies to improve business performance, communication and customer engagement. Ourservices include: • Strategic consulting and program management; • Social intelligence - monitoring, audit and analysis; • User experience design; • Software design and development; and • On-going editorial, marketing and user engagement support.We work with clients, many of them household names, across a wide range of industries, fromblue chip multi-nationals and internationally renowned media brands to non-profit organisationsand government bodies.WorkshopsWeve selected some of our most popular workshops and packaged them into a series that canbe customised to suit your context and objectives: • Introduction to Social Business seminar Demystify social business, including examples and insights, opportunities, barriers and risks, while highlighting the benefits of engaging with customers, staff or business partners online. • Head Start workshop Includes the Introduction to Social Business and extends to focus on design and planning your strategy, developing a roadmap for engagement with social media. • Innovation Lab This popular approach uses a combination of visual thinking activities and user- centred design techniques to drive the agenda, providing a hands on method to design opportunities for using social media in your organisation. • Visual Thinking Sessions Communicating effectively across all levels of the organisation in complex business environments is becoming more challenging. Learn how to present your ideas visually on a single page.Each of the options enable your business to expand your knowledge and capabilities, whiledeveloping specific outcomes or next steps. Please contact the Ripple Effect team athello@rippleffectgroup.com for more information any of these packages or an agenda tailored toyour specific requirements. www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 10

Press enquiries: Consulting enquiries:Anne Bartlett-Bragg Deb WisemanManaging Director Senior Manager | Social BusinessM: +61 418 852 581 M: +61 412 405 201annebb@rippleffectgroup.com deb.wiseman@rippleffectgroup.com www.rippleffectgroup.com © 2012 Ripple Effect Group Pty Ltd 11

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State of Social Business: Airline Industry July 2012

by Ripple Effect Group Asia Pacific on Jul 09, 2012

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