“We see an incredible development in the use of our mobile services”

IN-DEPTH: Interview with Andrea Keipert, product manager - Mobile Services, Lufthansa

One of the intriguing aspects about the utility of mobile phones in the airline industry is the varied approach towards the same.

Is mobile primarily about delivering service at the point of need in a customer’s journey? Would selected selling opportunities come later? In fact, for quite a few in the industry, displaying offers via mobile would be useful but it is still better to focus on click to call to pop customers to call centres rather than forcing them through several stages of mobile booking funnels.

However, a company like Lufthansa is experiencing a different trend.

“Lufthansa introduced mobile booking options three years ago. We see a high level of acceptance from our users. M-commerce plays a key role in our mobile strategy,” says Andrea Keipert, product manager - Mobile Services, Lufthansa told EyeforTravel’s Ritesh Gupta.

Role

Malaysia Airlines recently introduced the world’s first kiosks to sell airline tickets using the Apple iPad. Apple recently sold its three millionth iPad, just 80 days after its introduction in the US. It shows that there is an opportunity for the airlines to capitalise on technology and gadgets for additional sales channels and driving customer loyalty.

The rise of smartphones with browsers which can both display desktop sites and make it easy for users to interact with them has been significant and the industry expects mobile usage to continue to increase as the browsers get better. A company like Google believes that customers will increasingly demand an end-to-end engagement across a range of platforms, and to be able to research, consume and share travel information on whichever device they find most useful at a particular stage of their decision-making process.

So what can one expect from mobile as a channel for travel planning and booking going forward?

“We see an incredible development in the use of our mobile services. Not only the classic near-flight-services like check-in and flight status, but we can see more and more customers using mobile for the whole travel chain including planning and booking process,” said Keipert, who is scheduled to speak at the forthcoming two-day Online Marketing and Social Media Strategies for Travel Summit Europe 2010 (5-6, October) to be held in Prague.

However, some do not believe that gadgets or distribution technology make that much difference in terms of total travel spend worldwide.

However, a business’ performance can be impacted by changes in technology. A simple example is the decline of the brick and mortar travel agencies after the web developed. Now, does that mean if a business does not have a native iPad application, it’s doomed to fail? Doubtful. And on the other hand, if a business spends too much time on the latest/greatest gadget, it could seriously mis-direct resources. It is an interesting dilemma: How much attention / money should one spend on emerging technology? Unfortunately, there are no obvious answers and mistakes can be grievous down the road due to path-dependent development, says priceline’s executive vice president - corporate development, Glenn D. Fogel.

Issues

For long, the industry has indicated that there are two issues that need to change: There need to be more standards over the whole industry so that development is easier and faster, and the network providers need to reduce the data rates especially for roaming but also the flat rates in their home markets as the customers are afraid of unknown cost for the usage of mobile services.

Assessing the situation today, Keipert says the first challenge - standards - and keeping to the standards have become even worse compared to last year.

“For example, Samsung has added a new operating System “Bada” to the already diverse market. Android is used in many different ways which makes it even more complex all the time. The market seems to be further away from standards than ever. This is still the biggest challenge for the mobile development, especially in combination with the demand for apps,” pointed out Keipert.

The second challenge - the costs of flatrates and roaming are improving . Not only in Germany but in many other markets the competition has lowered the prices so that many people do not need to fear the use of mobile Internet or data transfer anymore.

Data-roaming limit

Talking of roaming, the European Union recently finalised new roaming rules, putting a cap on mobile roaming charges.

The decision, valid from 1 July, has been taken in order to ensure that consumers do not end up worrying about accidentally running up huge bills when they connect to the Internet using mobile networks via a phone or computer when abroad in the EU.

Travellers’ data-roaming limit will be automatically set at €50 excluding VAT (unless they have chosen another limit - higher or lower).

Operators will have to send users a warning when they reach 80 percent of their data-roaming bill limit. The operator will have to cut off the mobile Internet connection once the limit has been reached, unless the customer has indicated they want to continue data roaming that particular month. In addition, maximum wholesale prices for data roaming will fall from €1 to 80 cents per MegaByte. The maximum price for making a roaming call will be cut to 39 cents per minute (excluding VAT), instead of the current 43 cents, while receiving a call will cost a maximum of 15 cents per minute (excluding VAT), instead of 19 cents. The cost of making and receiving calls when abroad in the EU will now be 73 percent cheaper than in 2005, when the EU first started to tackle excessive roaming charges.

From the airlines’ perspective, Keipert says this is a big step ahead “as it gives our customers more reliability on their mobile costs if they are using the service abroad”.

Online Marketing and Social Media Strategies for Travel Summit Europe 2010

Andrea Keipert is scheduled to speak at the forthcoming two-day Online Marketing and Social Media Strategies for Travel Summit Europe 2010 (5-6, October) to be held in Prague.

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Or contact:

Gina Baillie
VP Global Marketing & Events
EyeforTravel
London, UK: +44 (0)207 375 7197
gina@eyefortravel.com