A "Customer First" Approach to Optimizing Flights

April 28, 2017

Over the past 10 years airlines have generally focused on giving customers more choice regarding what services they pay for and what services are "extra." In reality, this has meant that things that were once free - e.g. bags, meals, etc... - have now been "unbundled" from the fare. The upside for customers is that fares have remained relatively constant in real terms, while airlines have been able to increase their revenues. The downside is that customers sometimes feel as though they are being nickel and dimed.

Volantio believes that there may be ways for airlines and passengers to both benefit at the same time. How? Flights usually contain a mix of passengers who need to be on the particular flight and those who might be flexible with their plans. When a flight has higher demand than expected, flexible passengers might trade their seats on a full flight, to move to to a flight at a different time and receive a bit of compensation. It's the airline equivalent of "trading down in the draft." You trade your #1 pick in the first round for another team's first rounder this year and their first rounder next year.

Best of all, these types of swaps can be made far in advance of departure, increasing customer satisfaction. Customers who need to travel on a flight that otherwise might have been full have the chance to travel on that flight. Customers whose plans are flexible earn a bit of compensation. And the airline can potentially increase their revenue while also increasing customer satisfaction and NPS.

It's important to note that such systems are entirely voluntary, and there is no guarantee for the airline that after they reacquire a flexible passenger's seat that they can actually resell it - the airline takes all the risk, the passengers receive all the benefit.

We believe this could be an important step in the right direction for improving customer satisfaction and revenues for airlines. It will require forward thinking and a willingness to pilot new projects and innovate by the airlines.