I was stumped. As an occasional flyer on airline RyanAir, I’d received a marketing email with this simple headline: “We’re Changing”. It promised lower fares, a better website, allocated seating, and free baggage options. I found myself scrolling to the bottom of the email, looking for the punchline and/or the small print (and indeed, I was expecting both).
You see, RyanAir is a low-cost Irish airline that operates primarily throughout Europe, and is known for offering a “no-frills” service at bargain prices. Of course, lots of airlines offer this type of service; in my budget-conscious backpacking days, I tried and tested a lot of them. JetBlue, Tiger Airlines, Air Asia, Jetstar, EasyJet – you name it, I’ve probably been a passenger at some point!
The key difference between those low-cost airlines and RyanAir, however, has always been their customer service – or complete lack thereof. Confusing and sometimes sneaky online booking experiences, extortionate penalties for minor discretions outside the check-in rules, and an obsession with lowering fares, often at the expense of customer experience…the list could go on. Indeed, a few Google searches will reveal many examples of their marketing antics over the years – and a barrage of customer complaints. Despite all this, the airline had firmly established itself as a profitable player in European aviation, transporting over 81 million people in 2013.
The Marketing U-Turn
Earlier this month, RyanAir CMO Kenny Jacobs announced that he will be overhauling the customer experience. To facilitate this, the company has expanded their marketing team, launched a new website, established a social media presence, and produced new television advertisements to support the change.
So, what prompted this shift? Perhaps in was the September 2013 drop in share price. Possibly the company was motivated by increased competition from other European airlines. Maybe Michael O’Leary, RyanAir CEO, just got fed up with being the bad guy! I don’t know the reason(s) behind RyanAir’s strategic shift, but they’re on their way to becoming a more customer-focused, marketing-driven organisation. And that gets my thumbs up!
RyanAir is an extreme example, but how could your brand and strategy take their strategic shift to heart? What changes can you make to your marketing to enhance the experiences of your own customers.
Here are some of my own tips:
1. Build Engaging Relationships with Your Customers
RyanAir estimates that 40% of their customers are repeat buyers. To improve customer retention, they are naturally looking to improve their customer relationships. It can be 8-10x more expensive to acquire new customers than to sell additional products to ones you already have, which is why focusing on retention, up-sell, and cross-sell is just good business sense.
To be effective at this, you must engage with your customers in a consistent way, across multiple channels. Automate appropriate email conversations so that they are relevant to specific behavioural triggers – such as a website visit or social engagement. If your customer is showing an interest in a specific product/topic category, then ensure your automated email communications reflect that.
When a customer visits your website, personalise their experience with relevant up-sell/cross-sell messages and information. To get more advanced, score your customers based on behavioural activity and inactivity. Of course, scoring based on activity can indicate opportunities for you to up-sell or cross-sell, but scoring based on inactivity can indicate at-risk customers who need your attention. RyanAir has identified a good approach here – building meaningful dialog and relationships with your customers is a key component in improving retention and loyalty. The challenge for most marketers is doing this at scale, which is where automation technology comes in handy.
2. Manage your Customer Data in a Scalable Manner
81 million customers flew with RyanAir last year – that is a lot of customer data to manage. And going back to the previous point, it indicates just how challenging it will be for RyanAir to create relevant conversations with such vast volumes of customers.
Never the glamorous part of marketing, maintaining a clean data set of your customers’ demographic and behavioural information is a requisite to deliver successful campaigns. You must constantly listen to your customers, update your data set, and tailor your multi-channel communications appropriately.
For today’s marketer working in a multi-channel, multi-market environment, scalability of programs is also a key requirement – and using a marketing automation platform is the best way to deliver personalised marketing programs, at an unrivaled scale. Like any technology, it works best when appropriately fueled. And for marketing automation, customer data is the fuel.
3. Become a Marketing-First Organisation
To help RyanAir achieve their new strategic objectives, they have hired a CMO and expanded their marketing team. While they certainly made headlines in the past, this shift in structure seems to acknowledge that structural change was needed to improve customer experience.
Marketing truly is both high-pressure and lightning-paced. I graduated from university in 2006, and even in that short time, the function of marketing has evolved significantly. There’s been an explosion of online and offline channels – including web, email, social, video, e-commerce, and mobile devices. In most companies, the marketing departments “own” these channels in terms of building, sustaining, and growing customer relationships to drive revenue.
Marketing is no longer just about open-rates, click-rates, and database growth. The question for marketers is, “Where and how do you invest your budget for maximum return?” Marketers need sophisticated, scalable tools to effectively engage with customers in real-time across a multitude of channels – and the ability to measure, analyse, report on, and predict revenue.
What do you think of RyanAir’s tactical change in direction? Do you think it’s too late to change customer perceptions and market perceptions of their brand? What is your approach to optimising or improving your customers’ experiences?