How airline revenue analysts find and use events in their load factor assessments
No airline revenue analyst needs to be told events are major catalysts for demand. What matters is how well you include events in your load factor assessments. This comes down to how early and effectively your team identifies the important ones. Most existing forecasting processes identify event-generated demand spikes far too late in the booking curve, when the flights are already past 50% full.
We’ve been working closely with a range of aviation companies for a while now – from mid-size airlines to major national carriers through to a world-leading aviation technology behemoth. And we want to share the huge impact better event visibility has on RASM (revenue per available seat mile).
How to get a bigger slice of the multi-trillion-dollar pie
Events drive more than $2 trillion in commerce every year. But they’re notoriously hard to keep track of on your own. Almost every revenue analyst knows that sinking feeling when they realize one of their routes is selling out fast around a particular date because of an event but they’ve already missed the chance to adjust the fare class or inventory before most of the bookings were snapped up. Advance knowledge is critical.
Most analysts work with an excel list of HSE for their routes (holidays and special events). But this is only a small percentage of the key events – our systems reveal there are thousands of major impact events each month including conferences, expos and concerts.
From reactive to proactive – lead time is key
At the moment, most revenue analysts only become aware of an event 30 to 80 days in advance. For many analysts, the first time they review a flight in detail is after receiving an alert the booking curve is lower or higher than expected.
For the in-demand flights, this often means customers have already snapped up half or more of the relevant bookings. With so many flights to be calibrating the ideal load factor for, most will be focusing on the next month or three, not the batch of flights afterwards.
Of particular interest to airlines are the thousands of large professional conferences and expos held every year. For example, the BIO International Festival generates more than $16 million in seat bookings. It is on the smaller end of the large conference spectrum with only 16,000 attendees, around 6,000 of which are international. It changes location each year, from one major US city to another, so it can be very hard to identify ahead of time if you don’t know of it specifically. And there are at least 20,000 larger conferences very similar to it each year.
Another complicating factor is that many recurring events change location each time they take place – so an analyst may have unearthed a key demand spike on your route, but next time it’ll be on a colleague’s route. This means one team might be updating the inventory management and fare class plans for additional demand that never materializes, while someone else on your team is about to miss the demand spike in its new location. There are more than 5,000 major-impact recurring events each month worldwide.
Getting full event visibility for your routes
Full event visibility for airlines enables teams to understand demand anomalies before they occur, so your team can make changes before it’s too late.
Finding and making sense of all relevant events for your demand is hard. Trust us, our experience of this pain firsthand inspired us to build PredictHQ. And we track more than 20 million events worldwide, and rank them all so you can find the most important ones for your team.
Here at PredictHQ, we’re passionate about enabling our customers to move away from making multi-million dollar decisions based on tedious googling and filling in spreadsheets. On average, it takes around 15 minutes to find and log an event, and those are precious minutes you could be spending steering flights.
We exist to turn your months of searching into minutes. Our demand intelligence API allows users to summon thousands of events for your routes within seconds and is used by leading airlines and aviation technology providers. Layering in our proprietary patent-pending ranks, airlines now have a way to filter and sort these events to ensure the see the most relevant events for them.
Very shortly, we will be launching Aviation Rank™, a unique ranking technology built specifically for the aviation industry.