How do you build a targeted, personalized, real-time campaign which can dominate the Scandinavian frequent traveler market? For SAS and its EuroBonus program this is a multi-year process and one which Nils Lindhe, Head of the program, presented some of the recent developments and progress during the Loyalty 2015 Conference in Istanbul last week. Personalization is key for the program as it tackles the volume of information and number of members it manages. That effort is especially focused on remaining relevant to its customers while facing significant competition in its home market.
For the pre-trip experience SAS focuses on communications tailored to each member in a “highly segmented, highly personalized” system according to Lindhe. He admits that the number of emails sent is quite high – “on average about 2.5 contacts per week” – and that requires a special level of personalization to actually reach customers rather than simply be seen as spam. Lindhe noted that the company has north of 5,000 different versions of some emails depending on customer segmentation.
The company has defined a customer lifecycle which it uses to help define the process. Communications will start with on-boarding messages focused on education and partner exposure, for example. As a customer travels a bit more the message changes to create greater engagement and real-time messaging. Customers whose activity starts to fade may see a targeted bonus offer to up their travels while those actively traveling will see a variety of messages related to that travel process.
SAS also looks at travel patterns and separates those it considers “frequent flyers” from the occasional customer. The line there is typically drawn around 5 trips annually. Lindhe accurately observes that those traveling less than than are less likely to benefit from the end-to-end full service experience; the loyalty program is less significant for those customers.
At the airport
Once the trip begins SAS takes a different approach to personalizing the trip, one which relies heavily on data warehousing and technology which passengers are already comfortable with. The industry has talked about iBeacons quite a lot in recent months but those beacons require both a significant financial investment in the hardware and also changing some customer behavior patterns to ensure that the beacons are triggered or seen during a trip. SAS has, at least for now, chosen to not go down the beacon path and instead leverage other technology it already has in place. As Lindhe explains,
For us, we don’t really need [beacons] right now because we know when the member is at the airport, is passing security. We’re using the assets, the data we already have. It is more a question of integrating them.
And that integration comes in many ways. For things like departure reminders and flight status information the company leverages the boarding pass scan process at bag drop and security within its main hub airports. Those time stamps help the company keep track of where the passengers are in the flow and, as necessary, send a tickler message to move a bit more quickly. For service recovery, something Lindhe has spoken to at several previous events, the value of the data and the real-time integration is potentially even more valuable.
SAS is trialing a number of service recovery systems now, both proactive and reactive, which it hopes will continue to improve customer satisfaction scores. One example Lindhe highlighted is a new program which kicks in when a EuroBonus member has a delayed flight from an SAS hub. Members are split into three segments and each receives a personalized message depending on the tier/segment. Non-status members or Silver members will simply receive a personalized message apologizing for the delay. For the more frequent traveler the offer needs to be a bit more substantial. Silver members on the cusp of Gold status may receive a one-time offer for lounge access valid for that flight, for example. Members who already have realized Gold or Platinum status already have lounge access so the offers there might be something like a free month pass to Readly or Storytel, two online entertainment content subscription service. These messages are all sent in real-time while the customer is at the airport, via SMS, email or the SAS App.
Read More: SAS Explains Reduced EuroBonus Earn Rates
The above example is what SAS calls proactive messaging. There is also a reactive component which can kick in after the fact. Currently the company is trialing targeted double miles offers for some passengers who have experienced delays, usually for travel in the month following the delay incident. The goal is to keep the customer engaged and sell more seats while providing an incentive which is tailored to the passenger’s typical behavior rather than a generic offer.
Does it work??
So far the service recovery programs are mostly in trial mode so it is unclear just how successful they are so far. But for the messaging segmentation the company says it has seen improved message open rates and more engaged behavior from passengers. Yes, it is early to be drawing conclusions, but so far things are looking pretty good.
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