This document discusses customer relationship management (CRM) strategies in the airline industry. It explains that CRM aims to acquire new customers, grow existing customers, and retain valuable customers. Data mining and analysis are important for airline CRM to understand customer behavior. The document also outlines e-CRM systems that allow airlines to manage customer relationships online. Specific benefits of implementing a CRM strategy for airlines include improved marketing and service. Challenges include overcoming obstacles like lack of data sharing between departments.

1. DATA MINING
Kapil
Ravi

2. Data mining ( knowledge discovery in database)
 Extraction of interesting (non-trivial, implicit, previously unknown and potentially
useful) Information or patterns from data in large databases.
Alternative Names
 A misnomer
 Knowledge discovery database (KDD)
what is not Data Mining
 Query process
 Expert systems or small statistical programs
WHAT IS DATA MINING

3. Database analysis and decision support
 Market analysis and management
 Target marketing, Customer relationship Management, market basket analysis, cross selling, market segmentation
Risk analysis and Management
 Forecasting , customer Retention, improve underwriting, quality control, competitive analysis
Other applications
Text mining
Stream data mining
Web mining
DNA data analysis
WHY DATA MINING ?

4. DATA MINING MODELS AND TASKS

5. DATA MINING FLOW CHART

7. DATA MINING DEVELOPMENT
•Relational Data Model
•SQL
•Association Rule Algorithms
•Data Warehousing
•Scalability Techniques
•Neural Networks
•Decision Tree Algorithms
•Algorithm Design Techniques
•Algorithm Analysis
•Data Structures
•Similarity Measures
•Hierarchical Clustering
•IR Systems
•Imprecise Queries
•Textual Data
•Web Search Engines
•Bayes Theorem
•Regression Analysis
•EM Algorithm
•K-Means Clustering
•Time Series Analysis
DATA
MINING

8. Privacy
Profiling
Unauthorized use
SOCIAL IMPLICATIONS OF DM

9. Usefulness
Return on Investment (ROI)
Accuracy
Space/Time
DATA MINING METRICS

10. Scalability
Real World Data
Updates
Easy of Use
DATABASE PERSPECTIVE ON DATA MINING

11. Accenture
IBM
Tata Consultancy services
Infosys
Google
DATA MINING SOLUTION COMPANIES

12. CASE STUDY
Airline Industry

13. In the competitive travel industry, customer satisfaction no longer guarantees
customer loyalty . Deregulation, increased parity of products , the availability of
new and diverse direct distribution channels, industry alliances, and many other
factors have combined to force operators in the airline industry to focus on new
differentiators in order to maintain current and develop greater market share .
In response to the new environment, travel providers are undertaking
initiatives centered on identifying, developing and retaining high value profitable
customers, under the overall banner of customer relationship management or
CRM.

14. CRM is a business strategy designed to optimize profitability, revenue and customer satisfaction
To achieve this integration of people, processes and technologies is required in a collective effort to:
1. Acquire new customers through effective marketing campaigns and marketing analysis
2. Grow existing customer base through expanded service offerings that target untapped travel
opportunities
3. Retain most valuable customers by understanding and proactively addressing individual values and
preferences.
WHAT IS CRM

15. Today , more and more airlines are using the Internet to implement e-business applications and CRM
strategy. These applications can be very resource intensive. e-CRM is interest intensified in managing
customer relationship through the Internet.
Establishing and strengthening long-term relationships with airline's customers is the key to success. It's
the focus of a well-structured and coordinated process of customer relationship management.
e-CRM involves far more than automating processes in sales, marketing, and service and then increasing
the efficiency of these processes. It involves conducting interactions with customers on a more informed
basis and individually tailoring them to customers' needs
E-CRM IN AIRLINE

16. There are three primary reasons why CRM has taken hold as rapidly as it has:
1. Competition is fierce;
2. The economics of customer retention are unequivocal;
3. Technology allows airlines to do this more effectively and profitably today.
WHY CRM

17. Planning and implementing business processes across airlines and CRM applications ensures customers are
handled in the most efficient and effective fashion from the beginning to the end of the interaction based on
their real-time value to airlines.
Implementing CRM applications may simultaneously lower the cost of design, implementation, installation,
training, ownership and administration. It also reduces the risk of re-engineering systems at a later date.
Consistent and dynamic processes are built up-front for the customer. This forces the airline to consider each
element in the process design including the network, switch, multi-media management, and the CRM -
ensuring streamlined processes are in place before the customer makes contact.
Create and leverage detailed statistics/metrics and cradle-to-grave reports.
SPECIFIC BENEFITS
TO IMPLEMENTING
A CRM STRATEGY

18. Individual traveler
The travelers company
The person or entity paying for the ticket
The person choosing the airline
The travel agent
Corporate customers
Cargo brokers
WHO IS THE CUSTOMER?

19. The E-mail was responded to immediately, with personalized, valuable information.
Web self-service allowed customer to take immediate action to resolve issue.
Personalization enabled promotion tailored to customer profile - enhancing one-to-one marketing.
The "callback" option was easy to use, enabling the customer to quickly request live support.
The intelligent interaction routing engine immediately connected the customer to the right CSR.
The customer information provided by the CRM application enabled the CSR to provide efficient,
personalized service
BENEFITS FOR THE CUSTOMER

20. Lack of buy-in across the business
Department customer data silos
Unwilling to share
Business processes not mature /clear
Couldn’t reach all touch points
- sales reservations), check in, in-flight were particular problem
OBSTACLES TO CRM

21. In the airline industry , data analysis and data mining are a prerequisite to push customer relationship
management ahead.
Application of data mining in airline business is to work for developing a monitoring system , which is
able to identify trends within customer segments, to discover outliers and to control the quality of the
segmentation model.
Data mining customer value can be improved while considering operational costs in assessing a flight
segment. There is an accounting system, where all kinds of costs are gathered. This information is
available for each single flight. Its task is to find strategies to bundle information about flight activities of
all customers
TOOLS AND TECHNIQUES USED IN
AIRLINE CRM

22. CRM ARCHITECTURE FOR AIRLINE

23. • Provides an understanding of customer behavior and enables airlines to measure results of marketing
and merchandising changes.
• Supports more effective promotions through integration of data between marketing and merchandising
users.
• Provides a single view of customers across the enterprise and across contact points.
• Gives airlines the ability to respond more dynamically and quickly to market demands.
Significance derived from airline e-CRM implementation will allow for new e-business model, based on
the wide availability of information and its direct distribution to end-customers.
CONT…

24. • Directly connect airlines and passengers.
• Support fully digital information exchange between airlines and customers, reduced cost of a customer
contact.
• Suppress time and place limits.
• Support interactivity and therefore can dynamically adapt to customer behaviors.
• To be able to satisfy customers' need, build customer confidence and retention.
• Can be updated in real-time, therefore always up-to-date.
• Enhance airlines competitive advantages over its rivals.
• Profitable and sustainable revenue growth.
CONT…

25. Targeted promotions & campaigns
Leverage existing modules(distressed inventory, dynamic pricing )for acquisition & retention
Availability bias based on existing Revenue Management system
Performance measures to provide feedback
Link to operations- pre- removal & re-accommodation for overbooked flights
CRM : SHORT TERM GOALS

26. Business intelligence module to provide passenger valuation
Revenue management optimization models to consider maximizing expected “value”
Nonlinear programming problem with modified objective function
Stochastic dynamic programming problem
Tracking passenger utility
Pricing and inventory control decisions should consider changes to passenger utility
CRM : LONG TERM GOALS

27. 5 membership tiers –
Platinum
Gold
Silver
Blue plus
Blue
The Dynamic tier ( DTR) system:
DTR evaluates a member Tier based on Tier points and tier JP miles gram of Jet Airways: Jet Privilege
"JET PRIVILEGE"- CUSTOMER LOYALTY
PROGRAM

28. Facility:
Tele check-in
Web check in
Priority tagging
Additional baggage allowance
Guaranteed reservations upto 24 hrs prior to departure
Special partner benefits etc.
THE LOYALTY PROGRAM OF JET AIRWAYS---

29. Airlines realize that an integrated e-CRM strategy will allow them to manage customer
relationships more effectively than ever before, allowing them to build long-term customer
relationships, brand loyalty and repeat sales that result in increased, sustained profitability. The
challenge is how to overcome hurdles, minimize the risk and guarantee results..
The end result is a better bottom line-successful e-CRM can mean millions of dollars in
incremental revenue from increased customer retention, greater revenue per customer, the
ability to cross-sell and up-sell customers, better customer loyalty and greater customer
satisfaction.
CONCLUSION

30. THANK YOU