This article is part of our August series about travel and hospitality. Click here for more.
With the summer holiday season in full swing, it’s the busiest time of year for Monarch Airlines. Flying from five U.K. airports to 40 locations in mainland Europe, the low-cost, short-haul carrier’s most popular destinations are in holiday hotspots Spain and Portugal. Monarch currently has 800,000 more passengers booked to fly than at the same point last year and expects to carry up to 7 million passengers this year.
The airline is also gearing up for growth. Further financial investment following a turbulent summer season last year means it is getting ready to take delivery of new aircraft in 2018. New markets, new routes, and a larger package holiday business are all on the itinerary.
As chief commercial officer, Ian Chambers is responsible for revenue generation for the airline, leading on Monarch’s diverse sales channels including direct-to-consumer web and mobile as well as trade. He also oversees marketing and brand, and guiding Monarch on its digital journey. It’s a role he took up one year ago, having previously worked as head of digital and marketing for the airline and led on its brand campaign. In conversation with CMO.com recently we began by asking him how marketing fits into his relatively new strategic role.
Chambers: It’s still a big part of it. At least a third of my time is spent understanding and driving the marketing and brand planning, the advertising and media mix, and working through things like our digital roadmap as well as making sure we have the right things strategically in place to deliver what we need to do in terms of revenue.
From a day-to-day perspective, we have the whole area of revenue optimisation, with a team of analysts who work the flight pricing across all routes and all days, bearing in mind the fluctuations in demand, in pricing from the competition, and optimising for load factor, but also for yield. This team also looks after the retail revenue streams, which are the add-ons to the basic flight price such as hold bags, extra leg room seats, and sports equipment.
The CCO role brings it all together. When you’re in a marketing silo, you can get caught up in some of the more tactical, short-term issues, whereas in this role, I’ve got to keep people motivated and concentrated on some of the longer-term strategic issues like building brand awareness for the future, building awareness of new products, and making sure the technology is moving on at the right pace.
On top of this and vitally important, of course, is network planning: taking a long-term view of where we fly to, and how often we fly there. We can have up to 18 months of flights on sale at any one time, so we’re constantly planning well ahead of the game. We have to bear in mind the changes in the competitive environment, the trends that are emerging, new destinations, and take into account destinations that we can’t fly to, like Sharm El Sheikh, for instance, which was closed back in 2015 and meant we had to redeploy our aircraft to other destinations.
There are a lot of different things that can impact us as an industry—terrorism, which could shut a market overnight, weather impact, and factors such as Brexit, which are looming. We’re very exposed to that as an industry, and so you have to be agile and have the ability to move quickly and change your strategy quite quickly as well.
CMO.com: What about your team structure, have you made any changes as CCO?
Chambers: Yes, since becoming CCO, I’ve changed the structure quite a bit. Previously, the structure was more fractured with less of a focus on things like trade sales. I’ve created a head of distribution and trades sales role, and a leadership team of six individuals who report into me who can basically be my eyes and ears at all times.
CMO.com: How far along is Monarch on its digital roadmap?
Chambers: Like a lot of companies, we have technical debt to cope with, and that’s been our issue for the last two to three years. In my previous role, the key thing was trying to migrate away from old legacy systems and complications that prevented us from moving quickly, or optimising the user journeys as best we could. We’ve been working through that, and we’re much better now, but we’re still on that journey.
We’re bringing in new skills from a digital perspective. Around three years ago, we moved to an agile approach for digital delivery, and we’ve been refining that by training our teams to make our processes more seamless. We’ve also invested in bringing app and front-end development in-house to be more self-reliant. We had a lot of agencies working on different platforms, and it was becoming quite inefficient from a digital perspective.
Mobile is vital, so we’ve been working on the mobile user journey too. Traffic from mobile is growing at about 50% year-on-year, but our conversion rates weren’t great. As soon as we put in place a responsive website across most of our web architecture, we tripled mobile conversion rates. Since then, it’s given us more confidence in our move forward in that direction and to keep optimising. That’s been a key focus, and it will continue to be so.
Personalisation is also something we’ve been trialling, such as remembering people’s airport preferences, previous search data, how many people they were searching for, what destinations, what month—and then using that data to repurpose content to make it easier for customers and more contextual. Even from just those light-touch pieces, we’ve seen some good conversion rate improvements, so a big part of the roadmap going forward is to look at more data-driven personalisation and understand preferences, such as whether they’re a golfer so we could start to push more golf products.
We also want to understand our regular bookers more and feed into our loyalty scheme. The two combine quite nicely together because, to do a good loyalty scheme, you’ve got to have decent data on customers, and, ideally, you need to be personalised around that as well.
We don’t have a market-leading loyalty scheme at the moment. Our Vantage Club hasn’t been invested in over the years, but even in its existing format, it still drives huge business value. It contains a good amount of strong, loyal customers, but what it doesn’t have is the scale it needs. We’ve been building a real strong case to go forward and completely rebuild and replatform the solution. That’s where we’re heading.
CMO.com: And, at the same time, you’re also very focused on customer acquisition strategy, right?
Chambers: Yes, that’s vital for a growing airline like ourselves, but we balance the two. We can’t just focus on one and not the other.
Our customer database is very large, with about 6 million people, and we communicate with them on a very regular basis with personalised messaging. We segment out our very frequent fliers and talk to them slightly differently, and we have very high repeat rates depending on the time of year, but we can’t rely on that. It’s now a case of trying to grow the airline.
As I touched on before, we have digital and technical debt, but we also have some marketing brand debts as well. For the last five or six years, we’ve made little investment in marketing and advertising in the brand itself, so have been working on that for the past couple of years.
We’re repositioning the brand by really understanding who our customers are and what they love about the brand, and then bringing that to life. Last year we had a through-the-line campaign called “Our People Make Us” that included a return to TV. It was a pure brand awareness campaign highlighting how special our people are and how that interaction between our staff and our crew, and the customers they serve, is one of our really big USPs—that’s what we learnt from customers.
It’s been very successful. We managed to move the needle on brand awareness by about 10 percentage points in less than a year and have seen a big lift in the metrics around understanding what the brand’s all about and how we’re unique.
CMO.com: So you’ve very much aligned your marketing perspective with the commercial objectives?
Chambers: One of the main things for us is keeping the focus on marketing. We face a market that’s ultra-competitive, so this year we’ve nearly doubled our marketing spend to make sure we position ourselves, get our fair share, and boost our load factors. We’ve been really focused on driving up the advertising spend in an as efficient way as possible to try and make sure that we’re not outgunned by some of the fierce competition out there. That’s bearing good fruit, and we’re seeing sales already about 20% ahead of the same place last year, about 800,000 more passengers already sold, and our planes will be about 10% to 12% better loaded this year than last year, which is quite a significant increase on a 6 to 7 million passenger base.
A big amount of our focus is now on the actual systems that people book their holidays through, improving that with better mobile experience, and getting better speed out of the systems so that customers aren’t waiting for availability. But also making sure we grow awareness that Monarch does holidays too, we’re not just an airline. That’s going to take further, dedicated investment into positioning as a key holiday player alongside some of the other tour operators out there. So that will be a focus for us over the coming three years at least.