Airlines to Use Social Media Profiles to Personalize Ticket Prices. Higher Costs?

[Kaleel Sakakeeny]

Will buying an airline ticket soon be as personalized as buying a suit from a sales person? Probably, as trends go.

It's no surprise that airlines want to personalize their relationships to their customers. If they can figure out how, it would be a huge step toward making the ticket-buying process a lot more individualized, and rewarding.

And why shouldn't it be?
After all, buy a book from Amazon or any savvy online retailer, and you're guided to other books you might like based on your reading preference.
Or you're told what other buyers like you have also bought or found interesting.
The personalized shopping experience is made possible by the "big data the companies have acquired about you, your family your tastes and preferences. Information you have provided one way or another during your online experience.

Why can't the airlines create an equivalent purchasing experience?

Hotelmarketing  reports that last October, the International Air Transport Association (IATA)  met to discuss how they could "customize individual fares."

IATA is an airline trade organization representing about 240 airlines and impacts about 87% of all air traffic.
They rolled out a plan called "New Distribution Capacity," or NDC.

It's also attempt to hold on to more of the ticket price by driving travelers to the airlines' own sites, and not have to share revenues with online travel agencies (OTA)  like Orbitz and Travelocity

Typically, fares have been based on more or less objective factors: routes, travel date, when the ticket was purchased, and so on.

Now, with ticket prices pegged to flyers' personal data, airline customers will have to provide personal profile information in order to know what price they'll pay for a ticket.  

One company that truly understand the segmenting and targeting of customers is TrueLens, a social customer intelligence provider. 

CEO and co-founder, Roy Rodenstein, noted that the desire to personalize customer experiences is greater than ever. He said that customers want more relevant and personalized content, and marketers are exploring ways to deliver it. "That's why we're developing technology that provides brands with deep insights into customers' needs, intents and preferences sourced directly from customer expressions in social media."

But Kevin Mitchell of the Business Travel Coalition told Fox News that he thinks these customized fares will result in higher prices, specially for frequent flyers, because they are most likely the class of people the airlines assume will pay more.

And critics are concerned with privacy issues, claiming that this level of intrusion by the airlines is a very slippery slope.

But, and we tend to agree, the airlines respond with the argument that passengers have longed for a more personalized, value-oriented booking process, and that NDC gives passengers more choices. For example a customer may now know which airline serves the kinds of meals he or she prefers, or which airlines has what kind of checked-baggage policy.

For now, the proposal goes before the Department of Transportation, and the public can comment.

image/courtesy traveldailymedia