Leveraging Air Travel Performance and Benchmarking Tool Helps Hybrid Travel Agency Accelerate Business Objectives Quicker Than Ever Before



About the OrganizationAbout the Organization:
LBF Travel is a privately held, leading global travel agency offering both consumer-direct websites and call centers to assist leisure and business travelers.

ChallengeChallenge:
LBF needed to prove the success of their new hybrid business model to the airline community, however data from their internal system was incomplete, time consuming to organize, and difficult to correlate with supplier data.

StrategyStrategy:
Leverage ARC’s Agency BI data analytics tool, which offers peer-benchmarking capabilities and unbiased data points, to validate performance and better communicate in supplier reviews

ResultsResults:
The Agency BI tool paid for itself within the first month through enhancing supplier partnerships, uncovering new opportunities, validating business strategies, and alleviating the headache of cleaning data.

Consolidation in the online travel agency (OTA) market has led to increased dominance by a few large online agencies. This, coupled with rising client acquisition costs, has made it especially important for other online players to differentiate themselves through a unique competitive strategy. LBF Travel, a privately held and leading global travel agency, has been able to do just that.

Over the last two years, LBF Travel has executed a strategic business model shift, pivoting from a purely online strategy to a hybrid offline business model. This unique strategy focuses on both consumer-direct websites as well as global call centers, offering offline sales through travel specialists. This shift has allowed LBF Travel to have a bigger footprint and an increased level of support and flexibility for consumers, especially those that prefer to speak directly with a travel agent for a more personalized or complex trip booking. Additionally, the agency’s offline points-of-sale help rollout supplier-branded ancillary content quickly and effectively versus traditional online efforts.

Effective Data Solution Needed

LBF found it difficult, however, to prove the advantage of the new hybrid business model to the airline community, as the value proposition was unclear. The agency needed a way to bring validated data points to the table, showing suppliers that partnering with a hybrid agency was actually more strategic than pure play online travel agencies.

Unfortunately, data from their internal system was already presenting a challenge, requiring a great deal of time to gather, cleanse and organize data in preparation for each airline business review. Additionally, there was limited visibility into internal data after airline tickets were issued, which led to inconsistent numbers between LBF and suppliers. This made reaching a consensus on data points in airline review meetings often difficult and frustrating.

If LBF Travel was going to back its claims and move the needle to improve airline partnerships, the company knew a new solution was needed, as Peter Harders, vice president of strategic partnerships and consumer marketing at LBF Travel said, “We needed an effective, clean, detailed data source, and we needed to solve this problem quickly.”

LBF Travel first looked at rebuilding its own internal engine, but the time it would take to develop and correct data points would be too long. The agency also considered bringing in a third party to analyze the data, but LBF knew that an outside tool offering more insight beyond the internal database would lead to more intelligent conversations.

Finally, LBF reviewed the Agency BI (Business Intelligence) data analytics tool from Airlines Reporting Corporation (ARC), which offered a holistic view of its settled ticketing data and performance metrics, along with peer benchmark comparisons. Peter Harders recalled, “It made the most sense to go with ARC. We saw the Agency BI tool as a customized off-the-shelf product that already embedded the analytical power and benchmarks we were looking for. Plus, we could then have conversations with neutral data points,” he said. “When we say its ARC’s data, it comes with a lot of credibility.”

Value Found Companywide

LBF Travel is now using Agency BI daily, and virtually every department has found value in the tool. Executives look for a high-level snapshot of performance, overall health and productivity of the agency, including how business goals are being met. Marketing reviews the performance and market trends to make promotion adjustments, which has included increasing advertising on routes with high adoption rates and realigning marketing campaigns to support airline partners’ objectives. Finance uses the data during their monthly close process to benchmark results against internal data. And the sales department leverages the tool to ensure tactical promotions put in place are meeting their objectives. Sales is also now able to better establish new relationships with airlines and solidify existing partnerships.

Peter Harders said, “For sales, the tool helps eliminate cold calling. The team is now able to reach out to airlines that we are already doing business with and say, ‘we have a friendship we would like to highlight.’”

“When we say its ARC’s data, it comes with a lot of credibility.”

But the most significant use of the tool has been for the supplier relations team. The team now simply pulls up the Agency BI tool in airline business reviews and all the information either side would want to discuss is right at their fingertips. Since ARC data is unbiased, there is a shared understanding and trust in the numbers communicated. Reviewing the tool’s dashboards allows them to openly discuss what LBF Travel has done for the airline, where new opportunities exist, and how their agency can be a better partner.

Airline reviews are now occurring quarterly, instead of just twice a year, since there is far more to identify and discuss within the tool. With a worldwide view of ticketing activity included, LBF Travel can show they are truly a global travel agency and even share perspective into markets that airlines may not have insight into. LBF’s airline partners have mentioned they appreciate the added insights revealed by Agency BI and in some cases, acknowledge that the data is even better than what they have.

“It has been a smart business move acquiring the Agency BI tool,” explained Peter Harders. “With data that can be trusted by all parties in supplier meetings, we can find common ground in minutes and put together a more consultative approach. If the airline has certain objectives, we can shift marketing or internal communications to help the airline achieve them. We get more and more out of the tool each time we use it, and it has allowed us to accomplish mutual goals quicker than ever before.”

ROI Validated

The data in Agency BI has validated the value of the hybrid model to airlines. As Peter Harders said, “In pulling up the peer benchmarking data available through Agency BI, I can show our sales by carrier are more competitive compared to online players. This assures that airlines do have a need for a hybrid agency that can bring offline sales to the table.” Internally, this has also confirmed to the LBF Travel management team that their business model shift over the last two years was clearly the right decision. In their ROI analysis, LBF Travel has found that the Agency BI tool paid for itself within the first month. The tool has alleviated the headache of cleaning data, enhanced their partnerships, uncovered new opportunities and validated their business strategies. Peter Harders explained, “For the value Agency BI has provided, it is really pennies on the dollar. The cost pales in comparison to the opportunities we have found. It has opened doors left and right for us and helped to solidify relationships. We keep finding ways to be a better partner. It has helped immensely to guide decision making and accelerating both internal and external business objectives.”

“For the value Agency BI has provided, it is really pennies on the dollar.”