APEX Insight: Crowded airports, tight schedules, long journeys and an increased likelihood of flight cancellations, mean air travel disruption during the holiday season can fray tempers. Switchfly developed its Airline IROP Management solution with the aim of turning what many would view as a logistical and financial nightmare into an opportunity to generate customer loyalty. APEX Media spoke to Justin Steele, the company’s vice-president of Product Development to learn more.
Thanksgiving is usually one of the busiest times of year for US airlines and 2017 is shaping up to be no different. According to AAA, nearly four million Americans are expected to fly in the pursuit of family gatherings, roasted turkeys and perhaps a few Black Friday bargains. Airfarewatchdog.com’s annual holiday travel poll (which also includes the December holidays) suggests air travel will be at its busiest since 2013, with 46% of respondents planning to fly, 53% above last year’s levels.
Crowded airports, tight schedules, long journeys and an increased likelihood of flight cancellations, mean air travel disruptions during the holiday season can fray the tempers of even the most patient of passengers. Angry customers aside, for airlines, the cost of rebooking all passengers from a canceled flight in the US has been estimated at $250 per passenger and $4,000 per crew, with the total cost of irregular operations (IROP) for US airlines totaling $8.3 billion annually.
With this in mind, Switchfly developed its Airline IROP Management solution to turn what many would view as a logistical and financial nightmare into an opportunity to boost passenger loyalty and ancillary revenues. It does this by managing the re-accommodation process directly through mobile devices. Passengers can view available hotels on their smartphone and select a room without ever seeing the price or having to approach the airline’s kiosk. According to Switchfly’s newly published report, during the first quarter of 2017, one in three cancelled flights in the US were due to IROPs, with more than three million passengers in need of immediate re-accommodation.
Speaking to APEX Media, Justin Steele, Switchfly’s vice-president of Product Development, said he came up with the idea after flying from London and finding out the second leg of his journey had been canceled during a layover in New York. After waiting several hours, staff at the airline service desk told him that the hotels they used were sold out and gave him a $450 voucher, telling him to find his own hotel.
“I found my own hotel on Expedia for 200 bucks, it wasn’t that far away and I just thought: ‘I just made $250 off this airline just because they didn’t have the proper tools for booking a hotel.’ I just thought that about how much money was probably being lost across that entire airport at that time,” said Steele.
“I think that rather than viewing IROP as an operations or IT problem, airlines need to view this as a passenger experience problem.” – Justin Steele
With airline public relations crises having been one of the defining news themes of 2017, why hasn’t the industry been more proactive in its approach to disruption management? “I think the common answer that everyone says is going to be systems complications, we’re dealing with systems that are decades old. So, implementing a consistent experience across a brand is a little bit difficult. But I think that’s a little bit of a scapegoat. It’s much more to do with the state of mind of the airline. Rather than viewing IROPs as an operations or IT problem, airlines need to view this as a passenger experience problem. When it comes to IROPs they tend to focus on the hard costs until something goes very wrong,” said Steele.
“It’s about turning a negative cost factor into a positive experience.” – Justine Steele
“[Airlines] are not going to be able to completely eliminate IROPs, but they can turn the current process, which is a logistical and financial nightmare into an opportunity to earn satisfaction and loyalty. Once you start doing that, you can start to upsell, cross sell and integrate with their loyalty program and really start to create a true customer experience. It’s about turning a negative cost factor into a positive experience.”
Steele said the feedback from Switchfly’s airline customers about its Airline IROP Management solution has been “very positive” and that some also want to expand its functionality so it can be used to help cabin crew book accommodations: “I think they’re using this more as a customer experience tool, rather than a bottom line for reducing costs and expenses, which is encouraging for me.” Switchfly is planning to launch its Airline IROP Management solution in the second quarter of 2018 with its existing airline customers in the Americas.