Airline and airport consultantÂ SimpliFlying has compiled responses from 29 low-cost and legacy airlines into its Airline Social Media Outlook 2012.
Despite the relatively small sample size, the report reveals the continued split between those airlines that get social media, using it as a cross-platform tool that generates a measurable ROI, and those who are still working to understand just how it fits into their overall business strategy – and how to measure the return on the social media investment.
Key findings include:
- Over 75% of airlines invest more than 90 person-hours per month- and only 3.4% dedicate less than 10 hours.
- Cross-functional roles are commonplace for social media teams, with 85% employing cross-functional teams.
- Customer service emerging as the most common cross-functional role.
- Business goals of social media investment are: 1) brand engagement 2) customer service 3) revenue.
- The biggest challenge faced by airlines is the insufficient allocation of resources to social media.
- Over 70% of respondents plan to increase their social media budget in the next year, showing an increase over Simpliflying’s 2011 report.
Beyond these percentages, the story is in the details. The research shows an industry still trying to grapple with the benefits of social media, and creating an institutional structure to scale success across the organization.
A full 48% of respondents are still unsure about the ROI of their investment – and with 73% planning on allocating more resources to social in 2013, Â there’s definitely some overlap between those who have no idea what their ROI is and those planning to increase social media budgets in 2013.
So, if these marketing folks have no idea if/how they are making money on social, why are they funneling more money into that channel?
The answer lies in the metrics that the airlines report using to measure ROI: Customer insights/segmentation/targeting, Customer service, Internal performance management, and new product strategies are the most used among the majority of airlines surveyed.
This conversation regarding increased investment in the socia media channel must be tied to ROI goals, so that there is a clear indication of success or failure. In addition, airlines must pay attention to their competition’s performance on social media to ensure appropriate external benchmarking in addition to the internal performance evaluations.
SimpliFlying suggests using a three-pronged approach to measuring ROI: Revenue, Reach and Engagement.
The ability for airlines to have complete and direct access to their customers is one of the core advantages of social media, and is something that appeals greatly to the airlines.
However, this direct access goes both ways. If airlines are not as accessible to their customers on social media as their customers are to them, they stand to lose a great deal of good will.
And, in spite of the trend towards an increased investment in social media next year, the majority of respondents (51.7%) report that “insufficient allocation of resources to social media” as the primary challenge facing them in their social media efforts. Also, almost 65% of airlines facing this challenge are already devoting over 90 person-hours each month to social media.
So, let’s recap: most companies say they do not have enough resources allocated to social media, and therefore are planning to increase investment – even though the channel has yet to prove an ROI for most of these airlines, because most of them aren’t even measuring ROI in a way that confidently allows them to state what said ROI is.
The contradictions of this report confirm that the social media landscape for airlines remains complicated, to say the least. Many airlines are still trying to determine best practices for integrating the channel in a streamlined, consistent and value-generating way internally, while delivering a consistent experience for customers externally.
Forward-thinking airlines have the opportunity to try things in this volatile landscape, and perhaps that is why the majority of airlines are planning to increase investment.
Let’s hope that they see increasing resources as a license toÂ experimentÂ and to truly move towards a “social as unique channel” strategy specifically tailored for its specific advantages – and peculiar pitfalls.