Following AirAsia’s withdrawal of flights from online travel agent Traveloka, the airline told Marketing Interactive that it will be placing its focus on enhancing its products and services as well as website and mobile app instead.
This comes as online agents are rumoured to be asked by major Indonesia airlines to keep AirAsia’s Indonesia flights out of their platforms, according to Skift‘s sources. The online agents reported by the travel publication include Traveloka, Tiket.com, Panorama Group, Golden Rama Tours & Travel, and Wita Tour.
In response to Marketing Interactive‘s queries, Traveloka PR director Sufintri Rahayu said that she hopes that AirAsia’s withdrawal is “not a permanent decision” and the company is currently discussing with the airline how to “reach the best outcome for all relevant parties.”
She added, “We have always done our best to provide an open and fair online platform for all our airline and travel partners, including AirAsia, to sell their services to our customers. We respect and recognise AirAsia’s position as an important regional airline in Southeast Asia. Our faith and goodwill towards AirAsia remain high as ever.”
Meanwhile, a spokesperson from AirAsia reiterated that it remains “open to dialogue with business partners” but did not comment further on the alleged bans from various online travel agents. Previously, AirAsia Indonesia president director Dendy Kurniawan called Traveloka out for unexplained disappearance of AirAsia Indonesia flights from Traveloka for the second time in the two weeks. He said that the omission of flights has “hurt” cooperation between AirAsia and Traveloka, adding that Traveloka has “not acted in good faith.”
Brand impact and sale for AirAsia
While it remains uncertain how long this saga will last, aviation consultant at CommunicAvia Gerry Soejatman said that it is “unlikely for the withdrawal to impact on AirAsia’s international market”. Even domestically, the impact may not be as high as one would have expected. He explained,
In Indonesia, AirAsia is perceived to be the airline with the strongest direct selling compared with the others, and its customers are generally quite loyal.
And while being on online travel agents’ website is a great form of brand recall and point of sale for many travel brands, Construct Digital’s senior internal digital marketer Jan Mascarina suggested tactical campaigns such as awareness activations can help AirAsia elevate their position in Indonesian consumers’ minds. He said, “One way to do this, aside from aggressive media spending, is to maintain a social media presence that speaks local lingos and understands local trends, in order to connect with the very locals they are trying to win business from.”
In terms of search marketing, AirAsia could consider hijacking competitor keywords. Mascarina said, “AirAsia can bid against searches for competing airlines in the country to keep itself as the first suggestion when users search for airlines.”
He added with 97% of Indonesian search being powered by Google (according to StatCounter), this could present a low-hanging fruit for travellers exploring their options. Moreover, AirAsia could also bid against keyword searches “for the very travel site that it now finds itself at odds with, in order to funnel some of the users from these sites into their own website.” Additionally, AirAsia should find ways to engage and grow their current user base through loyalty or referral programs.
Prantik Mazumdar, managing partner of Happy Marketer, a Merkle Company said if there is one independent airline brand that can fight being dropped from online travel agents’ lists on its own terms, it is Air Asia.
“AirAsia is a pioneer in data-driven digital marketing and have made huge improvements in the recent past in terms of its mobile-first customer experience to drive bookings and multi-touch customer engagement,” he said.
To further battle this challenge, AirAsia will need to invest resources in a multi-prong approach to capture more SEM traffic for generic keywords that are usually bid for by online travel agents. It will also need to run location-based dynamic ads to achieve higher relevance and click through rates. An added focus will be needed to improve conversion rates and cost per acquisition through tactical tweaks on landing pages and drive higher bookings through it’s existing customer base by targeting them through personalised offer emails or through custom audience ad messages on social media.
“AirAsia will also need to now create more local destination related content independently or through syndicates that improve its SEO rankings; experiment with dynamic pricing to improve its average revenue per booking metric and beyond digital, you may also see them innovate through better bundled offerings and new partnerships with hotel chains and new age digital businesses in Indonesia,” he added.
We have all seen that Tony Fernandes and his team relish a good challenge and I’m sure they will take this head on.
He added that this could turn out to be a great imperative for AirAsia to further build on it’s own internal full stack marketing capability and reduce it’s reliance on online travel agents.
Industry players contacted by Skift said that one reason for airlines to exert pressure on travel agents may be because they “want to increase fares due to high fuel costs and AirAsia isn’t playing ball.” The article also said that several consumers have take their frustration about rising domestic airfares to an online petition, which has collected near to 400,000 signatures. In an update, it said that the Indonesian National Air Carriers Association and Transportation Ministry have since responded and brought the prices down on some flight routes.
“Airlines usually sit together to discuss their challenges, but not to set prices, that would be illegal. The Indonesian Competition Commission is looking into those allegations,” Soejatman said.