White Paper

Taking Flight:
Customer
Service in the
Airline
Industry

Copyright 2017 Teleperformance SE All rights reserved.

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Taking Flight: Customer Service in the Airline Industry White Paper

Executive Summary

People all around the world are discovering

the value and excitement of travel. Global air
travel is increasing in nearly every market. This
proliferation is due to a combination of factors, But to understand what customers want,
including an increase in the number of routes companies must have deep research across
that airlines fly, and an overall, general decline markets. Teleperformance has undertaken
in airfares. There are now more than 5,000 extensive research about the airline industry

airlines globally . Thus, increased access to across 11 markets to determine customer
flight opportunities has helped the market grow. preferences. The results of this research clearly
And this past positive growth is only expected show that airline performance, as judged by
to continue in the near future as competition To understand what consumers, is not only related to the products
increases and oil prices remain steady. and services provided by airline companies,
customers want, but related to the level of customer services
Because the number of airlines has increased
and customers have more choices than companies must they provide.
ever before, competition among carriers have deep research Airline companies across the world need
remains fierce. Therefore companies must to ensure that their customer services are
make every effort to stand out. Even as the across markets. exceptional. Only by providing the best
number of people flying increases, brands will products and exceptional customer service can
need to meet customer demands in order to companies hope to succeed in this increasingly
differentiate themselves in various markets. competitive segment.
1. Spotlight on on Mexico: Understanding the Mexican Consumer. Mauricio Franca and Jon Weber. LEK Consulting. 2. This analysis of the Mexican market was conducted by the CX Lab during 2015,
1.across eight countries
International (Brazil, Association.
Air Transport China, Colombia, France,
Another Germany,
Strong Year forMexico, theDemand
Air Travel U.K. andinthe U.S.) and combining two different methodologies: 1) The Global CX Survey dedicated the study of customers
2016.
perception across 15 sectors.2) The Benchmark reports dedicated to study the companys offer across 4 different sectors.

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Taking Flight: Customer Service in the Airline Industry White Paper

Good News from the Airline The air travel industry performed very well in
2016. With the establishment of more than 700
Industry new routes, airlines offered a vast number of
opportunities to travelers last year.
As a result of these factors, a record 3.7 billion
passengers flew safely to their destinations in
2016. But other information also shows that
demand for air travel is still expanding.

An average decrease of $44 in return fares helped
make air travel even more accessible for people all
over the world.
The outlook for the air travel industry in 2017
appears nearly as bright. According to the
International Air Transport Association (IATA),
the global airline industry will make a net profit
in 2017 of $29.8 billion. This would be the third
consecutive year (and the third year in the
industrys history) in which airlines will make a
return on invested capital (7.9%) which is above
the weighted average cost of capital (6.9%).

This would be the third

consecutive year in which
airlines will make a return on
invested capital (7.9%) which is
above the weighted average cost
of capital (6.9%).
2. International Air Transport Association. Another Strong Year for Airline Profits in 2017.

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Taking Flight: Customer Service in the Airline Industry
Regional Differentiation
Some regions can expect higher growth in the
next year. In particular, the Middle East and
Asia-Pacific will continue to lead among all
regions, with Revenue Passenger Mile (RPM)
growth of 9 percent and 7 percent, respectively.
In comparison, Africa will enjoy growth in RPM
of 4.5 percent (down 1.3 percentage points
compared to last year) and North America will
see growth of 2.5 percent (down 0.7 percentage
points). Latin America and Europe are both
predicted to see an acceleration in RPM growth
of 0.5 and 0.2 percentage points respectively,
taking both to 4 percent.
According to respondents,
the most important customer
service attributes driving
satisfaction with the
customer service were:
3. Forbes. Middle East to Lead Global Airline Growth this Year.
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Complete or partial external use or reproduction is strictly forbidden.
White Paper
Customer Service
With global travel increasing for the foreseeable future, it is essential that
airlines do everything they can in order to provide the best experiences and
services. The Teleperformance Customer Experience Lab (CX Lab) research shows
that customer services, in particular, play a vital role in whether or not airline
travelers remain loyal.
Our 2016 global survey of airline consumers showed that 71 percent of
respondents contacted customer service in the last 12 months. We found that
customer service accounts for 33 percent of advocacy and loyalty, respectively.
Further, providing a positive customer service experience can have a significant
impact on loyalty intention for customers of the airline industry. Customers
who had a positive customer service experience were 16 percent more likely to
remain loyal in the coming year than those who had not contacted customer
service. Conversely, those who had a negative customer service experience were
24 percent less likely to remain loyal during the coming year than those who had
not contacted customer service.
Waiting Listening Agent
Times Ability Empathy
4
Transforming Passion into Excellence
Taking Flight: Customer Service in the Airline Industry White Paper

9.33
Average loyalty
score of those who Customers who had a
contacted customer
service and had a negative experience
good experience.
when interacting with
Impact of Customer customer service
Services on Loyalty presented
Intention 8.07
Average loyalty
score of those
who didn't contact
customer service.
-24%
loyalty intention
(compared with the ones that did

6.11 not interact).

Average loyalty
score of those who
contacted customer
service and had a
negative experience.

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Taking Flight: Customer Service in the Airline Industry White Paper

Understanding
The airline industry is unique in many aspects, including how people contact
customer service. Unlike most other verticals, email/web form is the most used
Overall 54% of airline
Channel Use
channel for customers to contact airlines' customer service, with voice second,
and chat with a live agent third. There are variations among generations. customers interact
and Preference However, customers have slightly different preferences for channel usage. A using voice and it is the
majority of customers prefer to contact customer service by voice, with email/
by Generation web form second, and chat with a live agent third. All generations prefer voice
interactions to other means of communicating with customer service by a
most preferred channel
significant margin.
across all generations.

Channels used / by generation If you could choose, which would be your favorite channel?
Multiple answer Single answer

60%
54% 54%

28%
16%
7%
58% 57% 58% 62% 52% 50% 52% 57% 7% 12% 15% 19% 61% 55% 54% 54% 27% 29% 30% 27% 4% 7% 6% 7%
Email / Web Form Voice Chat with Live Agent Voice Email / Web Form Chat with Live Agent

Traditionalists Baby Boomers Generation X Millennials Sector Average

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Taking Flight: Customer Service in the Airline Industry White Paper

Customer Service Perception

By Country and Generation The CX Lab research on customer perception looked at three areas across geography and generation.

Satisfaction with Last Contact First Contact Resolution (FCR) Customer Effort
How satisfied were you with your last contact with Were you able to resolve your issue during your How much effort did you personally put forth to
your airlines customer service? first contact with customer service? handle your request (1-5 scale with 5 being a lot of
perceived effort and 1 being little perceived effort).

Traditionalists report a slightly lower FCR than other Traditionalists and Baby Boomers reported exerting
Satisfaction with the last contact with customer
generations (84% vs. a global average of 86%). less effort to have their issues resolved by customer
service is stable across generations, according to our
But, there is strong variation among geographies. service than Generation X and Millennials. Customers
research. However, there is variation by geography,
Customers in China, Russia, and the United States in Colombia, Mexico, and Russia reported exerting
with airline customers in the United States, Brazil,
reported the highest FCR percentage, while the least amount of effort to resolve their issues,
and Colombia more satisfied while French and
customers in France, Germany, and the United Arab while customers in the United Arab Emirates, France,
Italian consumers were less satisfied with their last
Emirates reported the lowest FCR percentage. China, and the UK reported exerting the most effort
contact with customer service. The main reasons
to resolve their issues.
that customers were dissatisfied with their last
contact with customer service were: long time to get
a solution, long wait times to receive a reply, and
didnt receive a resolution to the issue.

8.2 86% 2.3

Sector average - 11 countries

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Taking Flight: Customer Service in the Airline Industry White Paper

The Way Forward

The airline industry is poised for extensive growth

in coming years. With large numbers of airlines
competing around the world it is important to
understand the needs and desires of customers
in various markets. Without such knowledge, it
will be difficult to differentiate, and thus ensure
long-term success. Great variation remains among
different countries and generations in terms of
channel preference and usage, as well as perceived
experiences with customer service.

Teleperformance, the worldwide leader in

omnichannel customer experience management
has almost four decades of experience, and great
understanding of the airline market. With over 217,000
employees across the globe in 75 countries, providing
service in 265 languages, we are where you need
us to be. We are prepared to help you develop and
implement the right omnichannel strategy. Contact us
today to learn more about how we can partner.

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Transforming Passion into Excellence
 About Teleperformance
Worldwide Leader in Omnichannel Customer Experience
We are the worldwide leader in outsourced omnichannel customer experience management.
Teleperformance connects the biggest and most respected brands on the planet with their
customers by providing customer care, technical support, customer acquisition, digital
solutions, analytics, back-office and other specialized services to ensure consistently positive
customer interactions.

About
Teleperformance Customer Experience Lab (CX Lab)
Teleperformances award-winning Customer Experience Lab (CX Lab) is a groundbreaking center
devoted to researching global trends about how companies interact with customers as well as
consumer tendencies and preferences by country, channel, segment, and generation, generating
insights and opportunities for companies to improve their customer experience strategy.

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Transforming Passion into Excellence

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