With the rise of modern technologies like artificial intelligence (AI), many industries worldwide are undergoing transformative shifts. One of the major sectors that has the potential to reap the benefits of artificial intelligence is the airline industry. Research indicates that AI’s market share in the aviation market is expected to reach $2 billion by 2025. This industry is known for integrating the latest technologies to enhance customer experience and build a loyal customer base.
A loyal customer base is necessary in the ever-evolving and competitive airline landscape. Beyond providing a consistent revenue stream, a loyal customer base promotes the airline’s brand through positive reviews. This kind of organic promotion improves the airline’s reputation and attracts new clients. However, if airlines cannot provide a positive experience, the customers may churn, meaning they’ll discontinue their services.
This article will cover churn prediction and prevention in the airline industry and the role of AI in building a robust customer base.
What is Churn Prediction and Prevention in the Airline Industry?
Customer churn, in the context of aviation, is a business metric that measures the rate at which passengers cease using an airline’s services over a specified period. It’s a critical metric for airlines to monitor since a high churn rate can create multiple problems. It indicates passenger dissatisfaction, ultimately negatively impacting revenue, brand reputation and overall business performance.
Whereas actively applying churn prevention methods can help airlines to grow. Research indicates reducing churn by 5% can boost profits anywhere from 25% to 125%. Churn prediction not only identifies the customers at the risk of leaving but also the problems that lead to it. Airlines can leverage the power of artificial intelligence to predict and prevent churn effectively to build a solid customer base.
How AI Can Help Airlines to Build a Strong Customer Base
Artificial intelligence can enhance the following aspects of the air travel experience to nurture a robust and loyal customer base:
1. Automating Booking Experience
The process of booking flights is often a tiring experience for travelers. It requires them to navigate various websites, compare prices and select from a list of itineraries. Moreover, the traditional booking process also involves multiple steps like submitting personal and payment information repetitively.
Artificial can simplify this process by analyzing user’s historical data. Based on this, it can provide relevant recommendations that align with traveler’s preferences to create a pleasant and efficient booking experience.
2. Enhancing Safety and Security
Safety and security are very important factors in the aviation industry. However, traditional security measures are often time-consuming, leading to customer frustration. AI-powered solutions can streamline the security process by leveraging applications like machine learning and computer vision. It can create unique identities for individuals, ensuring a swift onboarding process and minimizing the risk of fraudulent bookings. Additionally, it can detect risk and suspicious behavior, contributing to a safer travel environment.
3. Improving Engagement With Chatbots
Airlines often face high customer inquiries, which can overwhelm customer service teams. This issue can be tackled with the help of AI chatbots. These chatbots can provide accurate information in real time and assist customers 24/7. Moreover, these chatbots can record individual user data and offer personalized recommendations to them. For instance, it can inform the user about information like seat upgrade offers or meal preferences, creating a more personalized experience.
Conclusion
Churn prediction and prevention in the airline industry is crucial, and artificial intelligence offers efficient means to accomplish it. AI has the potential to enhance various aspects of the traveler’s journey, ranging from streamlining the booking process to boosting customer engagement. It can also play a pivotal role in optimizing security measures. By harnessing the power of AI, airlines can undoubtedly strengthen their customer base, paving the way for a prosperous future.