Ahmet Olmustur Speaks On Turkish Airlines’ 10-Year Plan

Over the past 12 years, Turkish Airlines has increased its fleet size nearly sixfold from 55 aircraft to almost 300, enabling it to fly “more countries than any other airline in the world.” BTN transportation editor Michael B. Baker visited the carrier’s headquarters in Istanbul, where a new airport slated to begin a phased opening in a few years will give the carrier the capability to expand even further. Turkish Airlines chief marketing officer Ahmet Olmustur spoke about the airline’s growth plans, particularly in the U.S. corporate segment, as well as upcoming technology and sales staff.

What is your target for corporate sales growth?

We already have 8,000 accounts, and 8 percent of our revenues come from corporate sales. We aim to increase it to 20 to 25 percent in the next five years because we see a lot of potential with Turkish Airlines flying more countries than any other airline in the world. We fly 110. As long as we fulfill the needs of the customers, starting from reservations and sales until the baggage claim, Turkish Airlines can increase our number of corporate accounts in the next five years.

Why do your foresee that growth?

Istanbul has two airports: One is Atatürk Airport, and the other is on the Asian side, called Sabiha Gökçen. [Atatürk] has been a great success, but it hasn’t fulfilled our capacity needs, so the Turkish government decided to make a new one in the northwestern part of Istanbul. Because of the congestion of Atatürk Airport, sometimes we cannot provide as good a product as we dream. With the new airport, we’re going to offer more product than we have today. In the last 10 years, we had a product-centric approach. In the next five or 10 years, we are moving toward the customer-centric approach. That’s why we made an investment on a customer relationship management program. We already made the tender and are in the implementation process of the CRM program. At the same time, we are taking precautions in the customer-appreciation side. To give an example, we’re changing our reservations system, which gives us a headache, because 50 percent of customer complaints are coming from the reservations/sales side. We’re making a big investment on that, so we’re going to have a great one in 2016 and 2017.

Will you switch reservations to a new platform?

Yes. The tender process is going on, so I cannot tell you which one.

What’s the timeline for the new airport?

The first phase will be complete in May 2017, and it will have a capacity of 90 million passengers. [Atatürk] is making only 55 million. The construction company is doing three phases. It will be 2024 or something like that, and it will have a capacity of 150 million passengers per year. Dubai [and] Istanbul will be the biggest airports in the world at that time, unless someone makes a decision to make a bigger airport. We have some pros and some cons because although this airport is congested, this airport works almost 22 hours per day and it’s a very good airport. When we move to a new one, other airlines can increase their frequencies or a new airline can make its hub in [Ataturk]. We’re just powering our muscles to cope with that competition at that time.

How are you targeting U.S. corporate travel?

We fly New York triple daily. We fly Washington, D.C.; Boston; Chicago; Los Angeles; San Francisco; and Houston. Before we complete 2015, we will start Miami flights direct from Istanbul daily with 777s, and we will fly [daily] to Atlanta Hartsfield-Jackson Airport from May 2016, so we’ll increase to nine destinations. Starting from the 2016 summer schedule, maybe we can increase the Washington D.C.; San Francisco; and Los Angeles flights from daily to double daily. That would give us the connection depth throughout the world. We are offering a product in terms of connection from America to Africa. We fly 45 cities in Africa. In terms of destinations, we rank first place in Africa: more cities than any other airline in the world. We’re going to start Maputo, Mozambique, flights this year and start Juba, South Sudan. In the Middle East, we rank No. 2 because we fly every [major] city in the Middle East: Tel Aviv; Dubai; Amman, Jordan; Beirut; and six cities in Iraq. In India, we fly two cities unfortunately at the moment, Mumbai and Delhi, and we’d like to increase the number of destinations. We also offer connection to Central Asia—such as Kazakhstan, Tajikistan, Uzbekistan—and also Russia, especially Moscow. In the Balkan countries, which are so close to Istanbul, such as Bosnia, Romania and Moldova, we can connect American corporate segments to all these destinations.

Other airlines, such as the Persian Gulf carriers, also are pitching for U.S. corporate business, positioning their destinations as connecting points for global business, as have established carriers in Europe. How do you differentiate?

We’d like to increase the customer satisfaction. We’re going to put a dedicated person in all our American stations to work with our corporate segments 24/7 because we know they want that service level. We’re going to make investments in staff to serve our corporate segments in those offices. Our corporate program, which is called the Turkish Corporate Club, offers much more flexibility to all our corporate segments [for example, waiving rebooking fees and giving travelers lounge access and business class baggage allowances even when flying in economy class]. If you’re flying from America to the Middle East and you make a decision to connect somewhere else, when you come to Istanbul, you have dedicated and great service in the lounge. If our customers try Turkish Airlines, they always give good feedback, but the biggest challenge is it’s brand-new, compared with British Airways, Lufthansa and Air France-KLM, which have almost 50 years in corporate segments.

Is your sales staff growing overall?

Our staff is around 4,500. About 2,500 of those 4,500 are at the international offices. As we’re enlarging, almost 15 or 20 percent in terms of available seat kilometers, we’re investing in the sales staff also. Also, we hire the local corporate staff, so in the London office we’re working with British people and in Spain, the Spanish people. In America, we work with a lot of Turkish people because they speak English very well.

In light of Lufthansa’s decision to surcharge for global distribution system bookings, what’s your distribution strategy?

We know what Lufthansa did, and it’s a way, but today, we’re going to follow up the same way we do. We have an in-house reservations system called Troya. We bought it from British Airways maybe 20 years ago. We use it mostly on domestic flights. All domestic flights arise from our own reservations system. Just like the [other airlines], we work with the GDSs all around the world. On the distribution side, instead of focusing on negotiating with GDSs, we’re focusing on our online channels. At Turkish Airlines, only 15 percent of our reservations come from thy.com, so we’d like to increase the proportion of that online channel. That’s where we’re making the investment. From August 2015, we’re going to start with 15 different languages on our website.

How do travel management companies fit into your strategy?

We have contracts with the big four [three for global agreements and local agreements with the fourth]. Also, we organize a lot of meetings so they can show us a path in how to increase corporate business.