Lesson from the Airline Industry

Lesson from the Airline Industry

Airlines have learned that on-time departures are important to customers. Obviously, if a flight is delayed, this can lead to missed connections and other complications for customers. To boot, waiting to board a plane that should have taken off two hours before is flat-out not fun. Unfortunately, many airlines have measured this on-time issue by success in meeting the time the plane is supposed to leave the gate, not "wheels up." The result? Some passengers spend several hours waiting for takeoff in the cramped confines of a grounded plane!

Airlines have no desire to reduce gate use. Airports want to get as much use of their runways as they can and often overbook flights. As an engineering friend in the aviation field mentioned to me, you’d think the number of aircraft would be the limiting factor in deciding how many flights can be made. In fact, though, it’s the number of runways and locations to takeoff and land from. The end result is the airlines pack more and more people into the airplanes on time, and the airplanes leave the gate on time. Then, the passengers wait....and the airplane doesn’t take off.

The lesson is don’t become so focused upon one measure of customer satisfaction that it blinds you to common sense and to other factors which will conspire against it.

To get some great examples of "measuring sticks" for your customer retention research, go buy First, Break All The Rules, What The World’s Greatest Managers Do Differently by Marcus Buckingham and Curt Coffman.

Food for Thought
The Return of Investment Factor
The ROI question is more difficult. To measure ROI, you need to know the initial investment for the retention plan. Then, gulp, you need to estimate how many more