In an age of digital commerce, customer relationship management (CRM) is big business. So much so that in 2017, CRM revenue overtook that of database management systems (DBMS) making CRM the largest software market worldwide, according to Gartner, Inc. This growth, amounting to $39.5 billion with a further 16% predicted for 2018, has been driven in part by GDPR and the need to protect personal data.
Growth is also due to competition in the online sales landscape and the huge advantages that CRM offers to customer-facing (B2C) businesses such as airports. Customers have come to expect a personalised experience in every area of retail and service, and when they don’t get it, they vote with their feet.
What is CRM?
CRM software is a system that by nature enables a business to nurture relationships with customers and prospects, to drive sales and to sustain long-term profitability. The software collates streams of customer data to produce reports and insights that help form better business decisions.
This customer information would previously have been stored in handwritten notes and card index files (like the 1950’s desktop system, Rolodex), but as businesses expand, and as the rise of e-commerce makes complex customer data more available, it has become far too complicated and time-consuming to manage customer relations manually.
The history of CRM
CRM software continues to develop as Cloud and mobile technology advances and customer expectation changes.
How does CRM help B2C operations?
B2C businesses such as airports generally have a large number of customers with relatively small amounts of money changing hands per sale in comparison to B2B businesses.
CRM, as the name suggests, is a customer-centric system. Given the large number of customers, it can become difficult to keep track of the purchase and browsing history, behaviour and preferences of each individual, and it’s functionally impossible to create targeted, personalised e-marketing messaging for each customer without the assistance of technology.
Additionally, having the potential to connect with customers and prospects on an emotional level through targeted marketing and social media posts can have a significant impact on customer acquisition and retention, shifting focus from transaction to interaction. Because most CRM platforms are Cloud-based, they can grow and scale with the business, meaning businesses of all sizes can benefit.
A Capterra survey of CRM users found that the two aspects of business that were significantly impacted by the introduction of CRM were customer retention and customer satisfaction. B2C CRM software makes it possible to build real connections with individual customers, and these connections are the key to the success of a customer-facing business.
How does it work?
A CRM solution takes all of the data from integrated platforms from multiple departments within the business and keeps it organised. Data can come from sales, marketing and customer service departments. The CRM provides accurate, accessible, actionable insights and analytics.
Why do airports need CRM?
Today’s airports are no longer sole infrastructure providers. They supply multiple services to airport visitors of various types. Where for many decades, the main tasks handled by airports involved passenger and baggage handling, passport and security control and smooth flow of aircraft, they now offer a range of products and services.
Think about the millions of people moving through an airport terminal every day. Most passengers will have bought their flight tickets, parking and holiday add-ons through an external airline, travel agency or online parking company, and as a result the airport has little knowledge of these customers. Customer data remains with the external providers and important parking and ancillary revenue opportunities are lost.
However, customer buying behaviour has shifted along with a changing digital landscape and this necessitates a change in IT strategy.
Manchester Airport made just such a change in 2003 when it introduced CRM systems to boost sales and improve customer contact. This software came as part of ongoing initiatives for Manchester, which also developed touch-screen public information kiosks in its new ground transport interchange. The software enabled the logging of all customer activity and informed better decision making for the airport to promote flight routes to airlines, sell retail space and manage relationships.
CRM platforms offer 44% more leads, 45% more customer retention, 52% faster integration of business apps and a 37% increase in sales revenue. CRM also improves operational efficiency, reducing the number of daily decisions required by sales people and significantly cutting their workload.
Targeted marketing communications
Increased competition between airports for business from airlines and with overlapping catchment areas necessitates optimum communication with customers. There are also opportunities to capture revenue from ancillary services such as parking, retail, and food and beverage concessions, which are made possible by getting to know the customer.
A CRM system has powerful segmentation features that can group passengers according to information such as home address, frequency of travel, short or long haul, motivation to travel and average spend. This is useful for sending personalised, targeted, timely communications. For example, a business traveller who always flies 1st class is likely to be interested in a new luxury lounge or parking service. A retired couple travelling to their annual sunshine break on a budget airline might be interested in a special offer for a meal at the airport. In order to give best value, these two customers should not receive the same marketing emails or offers.
Rezcomm Engage comes with a full suite of e-marketing and automation solutions, including segmentation of visitor data according to shared attributes, behaviours or purchase history so that communications can be sent to targeted groups of people. By offering the right product, to the right customer at the right price at the right time, airports have an opportunity to enhance the traveller’s experience whilst simultaneously improving airport revenues.
Airport loyalty programs
A loyalty program allows the airport to gather valuable customer data that might otherwise be lost, offering insights into customer behaviour, buying habits, preferences and value.
Airport loyalty programs are all about retail. Members earn points when they purchase goods and services at the airport. They also have the chance to take advantage of VIP services and special offers at the airport. Rewards differ from one airport to another, but special services like fast-track security and discounts for shopping, airport parking or onward ground transportation are popular amongst loyalty program members.
Rezcomm Engage makes it easy to manage and personalise every customer’s experience with powerful automated marketing tools. Rezcomm’s combined data warehousing, business intelligence (BI) and CRM system allows the airport to set up customer loyalty programs, customer profiles, predict buyer behaviour, increase average spend and drive revenue.
CRM at Allgäu Airport Memmingen
Parking at Memmingen Airport was run through a third-party aggregator. The airport wanted to take control of its own car park bookings in order to grow revenue from parking and improve passenger experience. It was important that the customer experience reflected the airport’s branding and service offering with the facility to engage passengers with ancillary products and services, building strong customer relations.
Memmingen Airport engaged Rezcomm’s e-commerce pre-book parking and CRM service in January 2018 and saw an increase in non-aeronautical revenue in just a few months. Going far beyond parking reservations, the advanced CRM and reporting capabilities moved the airport’s customer relationships and revenue potential to a whole new level. As a result, sales increased through a combination of carefully managed product selection and a smart booking journey.
Thanks to the CRM capabilities integral to Rezcomm Engage, Memmingen has seen record increases in ancillary sales and email marketing click-through rates.
CRM at Exeter Airport
Exeter Airport also wanted to take greater ownership of its pre-book sales and digital engagement, moving away from a system offered by the parking operator that managed its car parks. This meant a more customer-centric approach with greater customer engagement and a user-friendly experience more in keeping with the airport’s brand and identity.
The airport wanted to build a stronger product offering, adding products and services beyond parking, which would in turn improve non-aeronautical revenues. It was decided that the key to recognising Exeter’s earning potential lay in the deployment of an effective digital communication strategy, and this was undertaken using Rezcomm’s fully managed service.
Now the airport is able to provide a fully joined up digital environment for its customers and take control of all its distribution channels including airlines, third party aggregators and re-sellers and travel agents to ensure that the best commercial results are achieved. The reports and analytics functions within Rezcomm’s CRM software have helped influence commercial decisions to maximise revenue and reduce operational inefficiencies and third party vendor costs.
CRM offers so many advantages for airports: A clear competitive advantage, heightened security in the terminal, customer satisfaction and improved operational efficiency. With so much available from Cloud-based solutions such as Rezcomm, it’s a cost effective way for even small airports to reach their full potential.
If you would like to speak to Rezcomm about our integrated data warehousing, business intelligence and CRM software or if you would like help with your airport’s marketing strategy contact the team today.
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