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Free Report: Airlines and Direct-Channel Booking: Cutting out the Middle Man

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As airlines seek to reclaim profits and acquire new customers, they must face complex relationships with OTAs and metasearch engines. In this position paper, we consider how performance marketing, search-engine optimization, and renewed attention to content can drive direct-channel conversions — sparing airlines steep third-party commissions and fees while growing loyalty and market share among new and existing segments of their consumer base.

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  • This is not a useful report like most Skift Reports, rather it is mostly marketing sizzle with little insightful content
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Free Report: Airlines and Direct-Channel Booking: Cutting out the Middle Man

  1. 1. Airlines and Direct-Channel Booking: EveryMundo + Skift Present: special report As airlines seek to reclaim profits and acquire new customers, they must face complex relationships with OTAs and metasearch engines. In this position paper, we consider how performance marketing, search-engine optimization, and renewed attention to content can drive direct-channel conversions — sparing airlines steep third-party commissions and fees while growing loyalty and market share among new and existing segments of their consumer base. skift.com everymundo.com If you have any questions about the report please contact trends@skift.com. Skift Team + EveryMundo Cutting Out the Middleman
  2. 2. Airlines and Direct-Channel Booking: Cutting Out the Middleman SKIFT REPORT 2015 3 About Us EveryMundo: Performance Marketing Solutions EveryMundo empowers airlines to drive conversions in the direct channel and own their customers. Leveraging the EveryMundo Solution Suite, airlines can rapidly deploy performance landing pages for every route, leverage dynamic fare and flight information, access real-time business intelligence, and efficiently run multi-chan- nel performance marketing campaigns at scale. EveryMundo provides the expertise and support to enable airlines to deploy infrastructure and optimize performance marketing efforts. • airTRFX® provides the performance online infrastructure airlines need to im- prove conversion in the direct channel, outcompete the OTAs in search, and own their customers: a page for every destination and route, in every language and every country. • FareNet™ allows an airline to capture valuable fare and flight information in real time for performance marketing and business intelligence – without affecting page performance or additional calls to the GDS. • FareWire™ empowers airlines to leverage FareNet™ to deploy dynamic, per- formance content modules, such as a low fare calendar, outside of airTRFX® or even on third-party/affiliate sites. • KWDS® scalably generates perfectly structured SEM campaigns for airlines, comprising millions of keywords and thousands of SEM ads covering every conceivable combination of your routes and destinations in every language your customers speak. • EveryMundo eCommerce Services comprise assessments, strategic planning, and full-blown execution of multi-lingual SEM campaigns, SEO strategies, ana- lytics implementation/repair/enhancement, multichannel attribution modeling, conversion optimization strategies, and tag management services. EveryMundo will empower you to take back the direct channel, drive revenue and own your customers. For more information, visit everymundo.com or call us at +1 305.375.0045
  3. 3. Airlines and Direct-Channel Booking: Cutting Out the Middleman SKIFT REPORT 2015 4 Executive Summary Airlines are leaving revenue on the table when it comes to attracting new and loyal custom- ers, especially in the context of their relationships with online travel agencies and metase- arch engines. The dual nature of the relationship that airlines share with online travel agencies and metase- arch engines stands to divert ‘non-brand-loyal’ buyers. That is, OTAs’ and metasearch en- gines’ flight-comparison functionality promotes on-site decisions at those outlets, deflecting consumers from direct-channel interactions and preventing airlines from fully tapping the consumer segment for a future loyal customer base. While airlines are not likely to give up the benefits they enjoy from third-party booking outlets, they stand to capture more revenue, acquire more customers (and then retain them), and minimize margin-decreasing commissions and fees (some $132 billion, in 2014, by re- cent estimates) by strengthening their online site architecture and search-engine best prac- tices compliance. Key to increasing direct-channel customer loyalty and conversions are performance-market- ing strategies, search-engine optimization, and other approaches that reach and retain airline customers throughout both the search and post-intent phase of their trip planning. Airlines need to identify where flight searches begin, for travelers, and how paid and organic search impact the process. By tapping the 60%–70% of consumers that respond to organic search results, and the 20%–30% that click on paid placements, case studies suggest conversion rate increases occur, though their exact percentage can vary widely. Airline leadership describes the avenues to these results as consisting of several components. One is a balanced partnership with OTAs and metasearch that emphasizes lower com- missions and fees. Another is to reach consumers with the deeper access to inventory that direct-channel can offer. Optimizing on-site content for search impacts this effort considerably. Structural, technical and organizational elements communicate relevance to search engines, which improves rankings thereby driving traffic. Responsive design and conversion-oriented content drives conversion. The combination of these things – direct acquisition and a positive, fully-branded purchase experience – contribute to creating loyalty and a long-term relationship. In this position paper, airline and performance marketing leaders look at the factors that can turn the direct-channel into a one-stop, every-time resource for travelers in pursuit of their next ticket purchase — airlines can actively seek not only new traffic and conversions, but also repeat and loyal customers.
  4. 4. Airlines and Direct-Channel Booking: Cutting Out the Middleman SKIFT REPORT 2015 5 About Skift Skift is a travel intelli- gence company that offers news, data, and services to professionals in travel and professional travelers, to help them make smart decisions about travel. Skift is the business of travel. Visit skift.com for more. Executive Summary 4 Introduction: direct-channel and airlines 6 A brief history of airline booking technology The impact of competitor/partner relationships 7 Seeking a better balance, optimizing search 7 Customer acquisition and airlines: search and the ‘non-brand-loyal’ consumer 9 Where flight searches begin 10 Airlines and search engine results 11 Winning direct-channel customers: search, loyalty, and revisiting approaches to content 13 Reaching non-brand-loyal customers via search 14 Modeling direct-channel/third-party balance 15 Communicating the value of direct channel 16 Airline website content: dynamic content and other considerations 17 Insights and strategies 18 Endnotes 19 EveryMundo empowers airlines to acquire customers and drive revenue through their direct channel 20 About Skift 21 Table of contents
  5. 5. What Millennials Want in Meetings SKIFT REPORT 2015 6 Introduction: Direct-channel and airlines Airlines and Direct-Channel Booking: Cutting Out the Middleman SKIFT REPORT 2015 Online travel agencies (OTAs) occupy at least two key roles in the airline eco- system: they are partners, and they are competitors. They are partners in all the ways that OTAs supply transaction-based ser- vices — ones that eventually lead to airline revenue (but not always in optimal ways). They constitute a network of partnerships that, whatever consider- ations of commissions and fees may be the case, airlines cannot ignore. They are also competitors, however, particularly in the realm of customer acquisition and retention. OTAs and metasearch engines threaten to divert conversion-ready travelers away from airlines’ websites, where direct-channel bookings provide a more ideal conduit to revenue, one with- out most, if not all, of the third-party fees and commissions that negatively affect profits. How this dual dynamic — partner and competitor — has come to be is very much intertwined with the story of online travel planning. It is rooted in the intersection of technology and commerce and it is critical to the consideration of how airlines can better capture customers.

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