As I passed through the US Immigration recently, when the official asked what I’m going to the US for, I replied, “I’m delivering a speech at an airline loyalty conference”. To which he casually exclaimed – “loyalty for airlines? I just go for the cheapest fare man!”. That gave me even more impetus to try and find the answer to the loyalty puzzle at the conference.

In late February, I spoke at the Loyalty11 conference, where a majority of the leading airline loyalty executives gather annually. This year, it was held in Dallas, and I managed to round up some key experts in airline loyalty business – from the stalwart AAdvantage program, to the soon-to-be started AirAsia’s loyalty program. And asked them just one question – what will have an impact on the future of airline loyalty. Here’s what they had to say:
[youtube]http://www.youtube.com/watch?v=w_h8m_sq9EQ[/youtube]

What does the future of airline loyalty programs hold?
Looking through my notes from the conference, here are five indications towards the future (including some quotable quotes from the conference):

“Loyalty is no longer defined by the repeat customer” – Tom Klein – President, Sabre
There are three customer segments: the satisfied customer, the …

After 12,000 votes in just over a week were received, the top 3 most voted airlines made their presentations to the panel of judges before the winners were decided, for the inaugural SimpliFlying Awards in Social Media Excellence for airlines.

These presentations were made at the SimpliFlying-Airline Business ‘Social media for the aviation industry‘ conference held in London on Oct 1, 2010. You can view all the Live activity from the conference here.
Categories and winners

Best Social Media Campaign - Lufthansa’s “innovative” MySkyStatus
Best Use of Social Media for Crisis Management - SAS Scandinavian Airlines - for communication during the #ashcloud chaos
Best Use of Social Media to drive Revenue - Malaysia Airlines’ 72 Hours Merdeka promotion
Simplyflying Hero of the Year - Aurelie Valtat, Eurocontrol’s online communications manager for her social media management of the ashcloud chaos to the aviation industry

View more presentations from Shashank Nigam

Moments from the conference
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Congratulations once again to all the winners, and thanks to the attendees and …

Most of us familiar with AirAsia X know their deep desire to fly in to Sydney, but they’re being hindered by the Malaysian government (Malaysia Airlines’ ex-CEO is in the govt). So to raise the tempo, what does AirAsia X do? They take a leaf out of Virgin Atlantic’s books. Take a look for yourself…. clever, I’d say


This is bound to get the message far-and-wide for AirAsia X, and hopefully they’ll be flying to Sydney sooner than later. It’s good for us, consumers

AirAsia’s India market entry has recently created waves and lots of discussion about what this means for the future of the industry in India, specifically local airlines. I was interviewed by a leading business newspaper in India on this, and here are excerpts from that interview.
How do you think Air Asia permeates a market and wins it? Some interesting anecdotes?
When it comes to new market launches, AirAsia is one of the most innovative, not just in the region, but in the world. And I can say that confidently, having worked with a lot of airlines around the world. They don’t just have advertisements, but connect with the customers at a deeper level, having conversations about topics relevant to them, and yet creating a splash.

Take the recent Mumbai flights launch, for example. Not only was there pomp and show during the first flight, and even Bollywood was invited, at the same time, over the last couple of months, AirAsia built up a lot of interest about Mumbai and India through candid articles on its very popular blog, Planely Spoken, like “Mumbai in 3 days and 2 nights“. On the day of the launch, there was even a …

I have received an enthusiastic response to my article written late last week, about why the social “we”b is about the real-world relationships, just as much as it is about online interaction. In that, I recollected how the best side-effect of Twitter has been the number of highly talented individuals I’ve been able to meet around the world.

I’ve got a bunch of emails, tweets and comments over the last couple of days asking me how this observation applies to airlines. Firstly, let me address why airlines need to have real-world interaction with their online “fans”.

Why is real-world interaction needed to complement social media engagement?
Online interaction is good, because it allows the airline to connect with a lot of people across geographies, and allows those people to connect among themselves too.

Where online engagement falls short is often the creation of a long-lasting emotional bond, which comes only through real-life meetings. Imagine a Facebook fan of an airline, who has never flown them before, but has always taken part in online contests or discussions. Wouldn’t the relationship be cemented only if he flies that …

RyanAir has a new lounge at Stansted. And it’s for real! RyanAir is known for being creative about ancillary revenues. We all know about the much-discussed toilet charge. But did you know that RyanAir has recently opened a new lounge at Stansted Airport? For under 18 bucks, you get breakfast, wifi, sofas and even showers before you board your flight. And the lounge has received some rave reviews as well.Now this is a sort of service I’m sure many wouldn’t mind paying for – because it’s value-added charges, not charges for un-bundling, as is generally the case.AirAsia has a shop in a mall in KLForget about in-flight shopping – that’s old school and increases the aircraft’s weight. AirAsia now has not one, but two “kiosks” in Kuala Lumpur. One is at the LCCT itself, and a new one has come up at Pavillion Mall. They promise even more outlets soon! Here, you can buy AirAsia merchandise like plane models, t-shirts and even hand-bags.…

Let me say this again. I think Air Asia is one of the most innovative airlines in the world today – right up there with JetBlue, Virgin, Singapore Airlines, Southwest Airlines and LAN Airlines. And today they pulled out a trump card – a joint venture with Australia’s Jetstar Airways. You can keep reading the press releases, but here’s the essence of the agreement and how it will benefit the airlines and their customers (you and I!) What the AirAsia and Jetstar “budget alliance” means The most significant difference is the departure from Star Alliance – type marketing or revenue driven alliances. Air Asia and Jetstar have formed a cost alliance, or what I’d call a “budget alliance” (pun intended). Here is the nitty gritty. The airlines will pursue joint procurement of aircraft – This means that they will be able to leverage economies of scale while buying from Airbus. Joint design specifications – since they’re going to order a lot of planes, they can demand from Airbus things like a twin-aisle A320 or more efficient …

At the Aviation Outlook Summit in Sydney early this month, where I delivered a keynote on airlines + social media branding, the first day was mostly doom and gloom whereas the second day was much more up-beat. Not surprisingly, executives from legacy carriers like Qantas, Air New Zealand and the European Commission spoke on the first day, and up-beat executives from rising stars like AirAsia X, Oman Air and Gold Coast Airport spoke on the second day. That got me thinking…are legacy airlines dead? I now believe they are. Here’s why.
1. Legacy airline brands come with legacy baggage
Unions, legacy systems, government bureaucracy, old planes, old workforce, high costs, bankruptcy… these are all words that can be easily associated with Air India, Alitalia, Japan Airlines, Air Canada and many more legacy airlines. And these are all aspects that do not allow these airlines to function efficiently in the current climate.

The airline industry has evolved drastically in the past decade. With each new shock (9/11, SARS, H1N1…) we see new stars emerging, which have streamlined costs, efficient operations and specifically targeted markets they go after. And they beat the hell out of monolithic airlines that legacy carriers have become. Just read …

Image by caribb via Flickr

Air India is losing about $1 billion, on revenues of $3 billion. What’s more alarming is that Air India contributes 10% of global airline losses with just 0.35% of global traffic (stat. from Bangalore Aviation). And the Indian national carrier is still struggling with its merger with the domestic Indian Airlines a couple of years back. Couple that with the global economic crises and a bloated payroll, and you know how much trouble the airline is in.

Being an Indian at heart, I couldn’t help but come up with some ideas to save this once well-regarded Maharaja brand. In fact, I know that when Singapore Airlines began operations, they heavily hired the best from Air India! I’m not sure if Air India can return to its former glory anytime soon, but these ideas should certainly help it get back on track. Or at least, I hope so.
Getting the business plan in order
I frankly feel that Air India has only survived as long as it has due to two …

Starting the first week of July, Malaysia Airlines’ subsidiary FireFly will be starting routes from Malaysia to Singapore. Of course, to get to heart of the matter, I met up with their Head of Marketing, Angelina Fernandez, who sheds light into the makings of this new airline and what makes it special. They call themselves the community airline, and offer free snacks (cookies!!) on-board even flights that last as little as 20 mins (Singapore – Melaka).
What makes FireFly special?
FireFly is being positioned as a community airline, “connecting the ethnically-similar communities spread across South East Asia”, as Angelina explains. Targeted at the business traveler – due to quick turnarounds (they fly ATRs), and proximity to the city center in Kuala Lumpur, as they operate out of Subang Airport. The airline also intends to build on Malaysia Airlines’ schedule through flight timings that are complementary.

For the un-initiated, till recently, Singapore-Kuala Lumpur was one of the most heavily protected air routes in the world. Since liberalization, connectivity has increased multi-fold, with airlines like low-cost AirAsia, Tiger Airways, JetStar Asia and now FireFly sometimes offering prices even lower than the bus fares. Enjoy Angelina’s interview (just 3 mins) and then read on for …