American's VP Of E-Business Charts Slow CRM Progress

<B>American's VP Of E-Business Charts Slow CRM Progress</B>

By David Jonas

The airline industry actively is seeking ways to leverage existing loyalty programs to create data warehouses stocked with customer information in order to tailor products and services. But, according to American Airlines e-business leader and customer relationship management expert, development has been slow, despite a desire to use traveler preferences and profiles to provide added value to corporate accounts.

"For us as an airline, to differentiate all levels of services by customer is a relatively new concept, other than what takes place via the AAdvantage program," said John Samuel, vice president of e-business for American Airlines. "And, for now, it is a mistake to get too far ahead of yourself. If a corporate customer has a booking engine or a travel services firm they are working with already, for example, then perhaps we don't talk about bookings-related services and instead talk about supporting services complementary to a contract they may already have with us."

Included are airport club memberships, upgrades, proactive flight notification and other conveniences for high-yield business passengers. "That type of segmentation, while it seems simplistic, is quite useful and, frankly, something the industry has not done a whole lot of before," Samuel said. He added that customer relationship management becomes even more important in dealings with small businesses, a market for which he is bullish but cautious.

"When you look at other industries that have tried to market to small businesses, it seems as if there is too much of a homogenous message, and small businesses almost take offense at being lumped in a broad category called, 'small business,' " Samuel said. "That's what will be most challenging in the B2B effort: the amount of differentiation required to get any attraction at all in that space."

Samuel, however, hinted that a "large effort" related to small-business customers will be rolled out in the months ahead, but did not provide details.

Airports, of course, are key developmental areas for carriers' customer relationship management strategies, and American is installing IP networks to empower gate agents and other front-line personnel with appropriate customer information. "The plumbing is not particularly sexy to talk about, but it is mandatory," Samuel said. "If you don't do that, then you're doing it through Sabre green screens, a pretty limiting environment."

Once the technology and infrastructure are in place, an array of services can be applied throughout the airport experience, up until boarding. But the real trick is helping passengers in times of service disruptions.

"When you ask passengers about points of dissatisfaction, they say it's not necessarily that a flight was delayed, but how it was handled," Samuel said. "In particular, our best customers want to know that if they are an Executive Platinum member, they will get the Executive Platinum level of service. We have a project underway now related to systems operations issues, trying to enhance the services we can offer at those difficult times."

Samuel said American is ahead on a few fronts, "notably data," but acknowledged that other carriers have begun their own CRM development, including integration with revenue management (BTN, March 26), operations and marketing.