From my time working in the travel industry, I’ve witnessed airlines’ quest for innovation first-hand, from the intricacies of transforming customer service to optimising operational efficiency,
Group bookings, while a substantial source of revenue for airlines, can often prove to be a double-edged sword with both unique challenges and opportunities. During this article, I’ll delve into six of the major challenges that airlines face with group travel, the impact they have and how we’re helping airlines manage them here at Calrom.
Let’s look at each of these challenges individually:
Transforming customer service
Providing excellent customer service for group bookings is vital – after all, group bookings are fantastic for filling capacity. However, they’re undoubtedly challenging due to the unique complexities and demands that come with accommodating large groups.
Airlines require substantial resources and coordination to provide personalised services, including a multitude of initial quote options, varied and complex amendments, different seating preferences and meal requests. The challenges that a large group booking presents are unique within the industry. In addition, the risk to inventory and revenue if payment and ticketing deadlines are not adhered to is substantial, further increasing the need for resource heavy facilitation processes to mitigate the risk.
Effective communication with group organisers is another essential aspect of providing great customer service – we know how managing enquiries, flight changes and complex requests manually can quickly overwhelm a small team.
Utilising an automated system that keeps group organisers informed with real-time booking updates, schedule changes and important deadline reminders is a great way to provide superior service, without your teams taking the strain.
End-to-end visibility of bookings
Many airlines still manage their group bookings via a manual process or a very outdated system with limited automation. The result? It can be hard for both group customers and the airline to keep track of the same request throughout the whole booking lifecycle – and we all know what it’s like to feel frustrated over a lack of efficiency!
Complex group bookings mean that group organisers need full visibility over their group through all stages of the group booking lifecycle – especially in a challenging group travel market where great customer service is expected. This requirement for visibility is extremely time-consuming for airlines to manually (or semi-manually) facilitate.
So how can airlines get around this?
Even in the most perfect of scenarios, unexpected changes and cancellations are inevitable and that’s when advanced automation with an airline booking system really adds value. With Groups Next Gen, group organisers can self-manage their bookings twenty-four hours a day seven days a week. Calrom’s GNG platform empowers the group organiser with a fully automated end to end set of tools to manage the group booking life cycle, along with the ability to accept or decline schedule changes and process cancellations. This eliminates the back-and-forth emails as all communication is managed through the system, allowing for traceability on any change/cancellation requests.
Pricing and revenue management
It’s well known in the industry that pricing and revenue management departments come up against a lot of complexities when it comes to airline group reservations. Just a few include:
- Demand variability: large passenger numbers and frequently challenging travel arrangements make it difficult to predict group size accurately.
- Group space allocations: it’s a delicate balancing act to allocate group space while leaving enough seats for individual travellers – especially when under or overcommitting can lead to revenue losses.
- Group cancellations: they can be logistically tricky, especially when it comes to deadlines, particularly when revenue management needs to make sure the correct penalties are applied to ensure maximum revenue is retained.
- Contracts with travel agencies or corporate clients: ensuring compliance with various negotiated terms is vital – particularly when balancing your revenue management objectives with quick customer turnaround times.
Why rely on an outdated process that makes it difficult to make informed pricing decisions? If these challenges ring a bell, ask us about Calrom’s revenue management system that accompanies Groups Next Gen.
It’s designed to give you some revenue management controls directly within the system: as an airline, you’ll be able to manage and control the rules applicable to group capacity, enabling you to have flexibility around the capacity you offer to groups.
Leisure groups, religious tours, schools, music groups – the list goes on. With the immense variety of group types come different T&Cs that must be applied to each booking type. Any issues with T&Cs can lead to a loss in revenue directly, or via customer dissatisfaction, so it’s really important to make sure your group organisers are complying with the correct terms from the start.
Special events always come around quicker than we think – is it really four years between each Olympics or World Cup? These tend to have special ad hoc T&Cs for group bookings, as your airline may want to be more restrictive with cancellation or change policies.
Implementing these quickly and within a short time frame needs a lot of attention to detail from the airline and can cause delays to group organisers if they need to be updated manually each time. Wouldn’t it work out better to have a more automated process for updating T&Cs? We certainly think so and that’s why Groups Next Gen has various tools to help you monitor compliance revenue.
Complex requests and changes
MICE, Series and multi-stop requests all contain multiple PNR references, varying itineraries and requirements – coordinating these details can be challenging without an automated system.
Even bookings that start as a ‘basic’ return trip can change throughout the lifecycle with voluntary and involuntary changes, additional passenger requests and split passenger requests.
Ensuring your airline is set up and ready for these changes with a simple process is a great way to avoid the impact of significant operational challenges. From ways to communicate effectively (just a reminder – our automated notifications help you do that without any hassle for your teams) to being able to manage special requests and name changes via a simple spreadsheet upload is invaluable in saving time and therefore, money.
As airlines seek to differentiate themselves, unbundle their service offerings, and subsequently offer individually tailored services to their customers, ancillaries are increasingly becoming a major contributor to overall airline revenues, contributing over $100B of revenue to airlines in 2022 (Statistia, 2023).
More importantly, ancillaries are making up a rapidly growing percentage of overall airline revenues rising from 6% in 2013 to 15% of overall revenue in 2022, so are becoming core to the way all airlines do business with their customer base.
Many airline Groups systems out there aren’t set up to offer ancillary sales for groups, so airlines are missing out on key revenue opportunities. Bundled fares can appear competitive but the inability to split this out restricts the options you have available to offer your customers.
That’s not the case here though: did you know that Groups Next Gen supports the ability to add the full catalogue (provided by your PSS) of airline ancillaries at relevant points during the group booking process? Additional fees for individual passenger ancillaries are rolled up into the overall group financials – making it easy for the group organisers to manage – but can also be determined and managed outside these overall costs if that’s easier from a customer perspective.
Ancillaries that Groups Next Gen supports for airlines include:
- Hold baggage
- Paid seating
- On-board meals
By using Groups Next Gen to offer your full ancillary catalogue to your Groups customers, you’ll be able to leverage a competitive advantage along with opportunities for extra revenue.
Let’s start a conversation
With all its advanced features, Groups Next Gen allows airlines to mitigate the many challenges associated with coordinating group travel. As the travel industry continues to evolve, embracing innovative solutions like Groups Next Gen is essential for ensuring smooth and successful group travel.
If you’d like to invest in Groups software that allows you to make more informed decisions around airline group sales with better functionality, automation and data insights, I’d love to chat with you about your airline’s specific needs. Reach me on Linkedin or get in touch via our contact form.