7 surprising ways that airlines are mining your personal data
By Mark Ross-Smith, April 19 2017
Airlines are becoming smarter at connecting the dots between you, your frequent flyer profile and your online activity – and turning that trail into another source of revenue.
The boffins call it ‘big data’: finding links and correlations between many seperate pieces of information.
And airlines are beginning to realise not only how much of this data they have at their fingertips but how they can mine that rich data-load in ways you might not expect.
Every interaction which frequent flyers have with an airline today is logged, stored and data-mined as a vital new data point to build a clearer picture of who you are and how the airline can micro-target you with everything from ‘personalised' fares to double status credits deals.
1. Search for a flight on the Virgin Australia website, and within days, you'll begin seeing advertisements on other sites you frequently visit. Commonly known as re-targeting, Virgin Australia uses your flight search history combined with local weather information. Is it stormy in Sydney or Melbourne? Here’s a great deal on fares to sunny Queensland!
2. In 2016 Qantas stumped up a multi-million dollar investment in Data Republic, a data exchange platform which allows large organisations to share and exchange data in a secure environment. One example of how this could be used: you call Westpac (also an investor in Data Republic) to cancel a credit card, and the bank knows you are a Qantas Platinum frequent flyer and have a greater affinity to Qantas than to Westpac. Of the many incentives which Westpac might dangle to encourage you to keep your credit card, this tells them that being offered extra Qantas points will have a higher value than waiving the annual fee.
3. Ever wondered why frequent flyer programs offer those attractive bonus point deals or double status credit promotions? Yes, they drive ticket sales… but under the hood, the airline’s business intelligence teams analyse this information to understand which frequent flyers are driven by promotions, and future member-specific marketing material is adjusted accordingly.
4. Most airline loyalty programs run dynamic big data models to accurately predict your response to their marketing promotions. For example: the more you search for an award flight where you can use your frequent flyer points, the more leisure deals you'll start receiving in your email inbox.
Why? Because award bookings are generally linked to holidays rather than business trips, so your profile will temporarily be given a 'member is planning a holiday’ tag.
5. Qantas, Emirates, British Airways, Finnair and United Airlines are testing ways to 'personalise' ticket prices based on who you are and what fares you’re previously purchased. You could end up seeing the same trip as another frequent flyer but at a different price.
If the airline feels you’re likely to pull the trigger on a great deal, the price could be lower; if you’re a safe bet for premium fares, the fare could be higher.
6. Do you earn frequent flyer points using your credit card? While loyalty programs are forbidden from using this information to target new customers, airlines can reverse-engineer your points balance and combine this with socio-demographic information (such as the home address on your member profile) to predict your income, and in turn how much you might spend on flights.
7. Airlines routinely track your current location through channels such as their own smartphone apps and where you are when you open their emails.
Armed with this information, they can create a ‘virtual world map’ to gain insight on where you live and work alongside your frequently-visited destinations around the globe.
This can be used to extract insights such as which competing airlines you’re likely to fly with, allowing for a deeper understanding of what share of wallet the airline has of your business.
Mark Ross-Smith is a leading authority on 'big data' in the travel industry and editor of specialist website TravelDataDaily.com
Qantas - Qantas Frequent Flyer
18 May 2011
Total posts 232
I disagree on point 6.
My wife is a secondary card holder on my CC account and therefore earns no ff points from a CC, however, she did receive an invitation to apply for an AMEX from Qantas, but I didn't.
Simply, Qantas just has to look at all ff accounts, find out which customers over 18 are not earning points via a credit card and then send them an invitation.
24 Apr 2012
Total posts 2441
Sure, that's a simple way to go about it, but if you've ever done a family points transfer between your account and your wife's, Qantas would know the relationship (ditto if you've ever booked a hotel together via Qantas Hotels, have the same mailing address on your accounts, etc.), so could assume you have her as an additional cardholder because she's not earning credit card points of her own... but there's obviously data that suggests a potential to sell even more points if your additional cardholder has her own Qantas credit card too, as she may not necessarily use your additional card for every purchase.
(And then, Qantas can look at how many credit card points you're earning from your existing card to estimate your household income - they already know that x card awards x points per dollar spent, so if you're earning, say, 10,000 points per month via your credit card, you'll have collectively spent x. Some credit cards (such as AMEX) assess household income when you apply rather than personal income, so by estimating that your combined household income is x, the appropriate AMEX card can be suggested - without being too low on the points-earning spectrum or too high as to make it unattainable.)
From the outside, it looks pretty straight forward ("No credit card? Sell them a credit card.), but as Mark has covered in the article, there's a lot going on in the background that most people won't realise. :)
Qantas - Qantas Frequent Flyer
18 May 2011
Total posts 232
Oh believe me, she uses my credit card for every purchase ;)
10 Aug 2015
Total posts 113
Nice conceptual ideas but there is a great disconnect between the "sexy, commercial savy" marketeers who create the campaigns and the "dull, boring nerds" who mine the data. The two groups have such challenged communications that the big data fantasy will never be achieved in marketing centric firms...which is why the nerd centric Googles and Facebooks are racing ahead.
21 Apr 2012
Total posts 3012
We will find a way to beat number 5. What they are proposing is scandalous!
Qantas - Qantas Frequent Flyer
02 Jul 2011
Total posts 1378
I remain of the view that Point 5 won't work.
Qantas - Qantas Frequent Flyer
29 Nov 2013
Total posts 475
True, but there are two other factors to consider:
13 Apr 2017
Total posts 2
It's already here and happening!
02 Dec 2016
Total posts 92
Most 'best price guaranteed' offers are useless. There is usually so much admin to get your case forwarded, and then by the time they review it, the fares/rates have changed.
Business needs to realise people shop, they compare and they purchase. If you want people to buy direct, give them the best price at the time they search. And there is plenty of software that can allow it.
Qantas - Qantas Frequent Flyer
20 Nov 2012
Total posts 68
Using data to personalise offers is still at it's infancy as the marketers are finding out how personalised it can get without freaking people out.
QFF
19 Sep 2013
Total posts 202
Re point 5: Another travel website claimed that if you access an airline fare on an airline website more than once, there is every chance the fare will increase - they know you are interested...
Qantas - Qantas Frequent Flyer
27 Jun 2013
Total posts 22
And don't forget about the cookies being stored when you visit the web sites. If you continually go to say an airline site searching similar trips, they can tell you're interested and prices will reflect that i.e. start to rise. After each search, I always clear my cookies for that reason
10 Aug 2015
Total posts 113
The one other thing that stands out to me, and has done for some years, is that the airlines and commentary on frequent flyer programmes focus on top line revenue growth. The other half would be to identify how you make your frequent flyers become lower cost customers to serve. What are the operational efficiencies that come from frequent flyer passengers? E.g. if they knew on every flight I only ordered a G&T they don't need to carry the inventory of vodka or whisky. Ditto no need to waste time asking me what I would like to drink.
Air New Zealand - Airpoints
04 Sep 2015
Total posts 7
Yes they are already doing this, along with everybody else. And doing it poorly. I've bought tickets to the USA, now I'm targeted with, guess what?, flights to the USA. Bit late and is more annoying that random destinations. They have yet to figure out that I like cheap fares for places in off season and that I never buy their rental car or hotel deals, wish they would hurry up and get it right, before they lose me because of poorly targeted ads.
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