Ryanair's Digital Strategy for 2015
Part two of a three part series - Exploring the importance of customer acquisition for Ryanair in 2015
In the first part of this three part series, I explored how Ryanair’s recent focus on digital has helped contribute to their significant growth in 2014. In this installment I explore the importance of customer acquisition for Ryanair in 2015, before I conclude the series with an assessment of the customer retention priorities they should have.
Finally, by way of a disclaimer I am not a Ryanair employee so these opinions are based on my assessments based on the marketing activities I am seeing in the public domain in Jan 2015!
1. The Context
Michael O’Leary, Ryanair’s flamboyant CEO has every reason to be optimistic for 2015 as he contemplates Ryanair breaking the 100m passenger mark. As I outlined in my previous article, Europe’s ‘favourite airline’ carrier has just had a fantastic year. With oil prices as low as $50/ barrel on Jan 10 (although given their fuel hedges this won’t filter down for some time), complemented by a number of governments across Europe reducing air tax on travel (leading to lower ticket prices), Ryanair are well positioned to boost demand further with lower prices. And with a large order of 100+ new, fuel efficient aircraft soon to land and an average fleet age well below most of their competitors the future looks bright.
However, as I outlined in my first piece, it is the successful implementation of a cutting edge digital strategy that has the potential to amplify these gains significantly in 2015.
Am I overstating the importance of digital? I think not. Firstly, given Ryanair attract over 40 million website visitors a month alone, with limited digital activity in many key channels, it illustrates the huge potential that exists as and when they do ramp up efforts. Secondly, eking percentage gains along the conversion path with that volume of traffic will drive significant uplift in value, and finally, an increased focus on engagement, personalization and segmentation will help to drive further gains.These are just some of the reasons why digital can be so important to Ryanair.
So what else does Ryanair need to do in 2015 to support their aggressive growth ambitions?
2. Talent
Ensuring they have the right talent to execute is probably the most important piece of the jigsaw. At first blush the board composition does not exactly inspire confidence, in terms of consisting of ‘digital natives’, with Louise Phelan of PayPal, representing the only noticeable exception and the only one under 50. (This disconnect between the demographics of boards, and their core user market is by no means unique to Ryanair). However, the creation of Ryanair Labs (powered byZartis) gives a greater insight into their capabilities and their digital ambitions here are clear to see.
“We’re building the best digital travel team on the planet. We have the resources to do it. We have the desire to do it. We have forty million people a month already visiting our web site. This is serious.” Ryanair Labs.
As the old adage goes, you can tell a company’s strategy by looking at where they are spending their money rather than what they say in presentations. Thus it seems that the building blocks in terms of talent are being put in place to ensure Ryanair avail of the huge digital opportunity in front of them.
So what should this talent focus on?
3. Customer Acquisition and Conversion
Most digital marketers view their primary goals in terms of acquisition, conversion and retention, and this is a useful lens with which to view Ryanair’s requirements. On the plus side, the huge traffic volumes on the website are every marketing manager’s dream, and would indicate that customer acquisition is not a key challenge. On the flip side, these numbers can represent a marketer’s worst nightmare, as any changes to the website run the risk of having a significant negative effect i.e. the law of unintended consequences. Nonetheless, having traffic levels of the volume Ryanair does, opens a whole host of opportunities in terms of optimization and they have the potential to acquire more aggressively through a host of different routes as I outline below.
Given the sheer volumes, A/B testing needs to be at the core of everything they do (using tools like Maxymiser or Optimizely) to manage the process. Scheduling tests across the different (geographic) sites they run (Ryanair are active in over 30 markets, and engage in 18 different languages) will also expose what combinations of add-ons maximizes conversions. And looking at their current Ryanair.com site, it is clear that optimization opportunities abound.
Online Advertising
Ryanair’s traditional advertising policy has largely focused on owned and earned media (primarily ‘free PR’ generated by Michael O’Leary), and until recently they have largely eschewed paid media forms. As they move away from relying predominantly on free PR, they need to embrace the opportunities afforded by a host of new advertising platforms and marketing tools (ranging from retargeting applications to marketing automation to programmatic advertising solutions).
One of the most attractive elements of digital marketing is the ability to manage and monitor metrics, as well as the ability to test different campaigns at low cost. Selective advertising will likely pay dividends, be that targeting business customers, certain geographic territories e.g. on routes where they go head to head with other airlines, or where advance bookings are low. Integrating these campaigns across a multitude of channels (online and off) will help ensure coherent messaging as Easyjet have managed to good effect. And it looks likely that Ryanair will ramp up activity in time for the peak summer period.
In terms of retargeting, platforms like Criteo can also be deployed to target browsers who have left the site but who are very much in ’search mode’. Similarly, targeting selective sites such as Skyscanner for specific advertising campaigns, is also likely to make sense in certain circumstances e.g. for new routes where there are established competitors who Ryanair want to displace.
Search Engine Optimization (SEO)
Ryanair have not needed to focus on driving traffic to date given the brand recognition they enjoy, and the sheer volume of brand name searches they receive (not to mention all the links they receive from years of articles about O’Leary and his ‘previous’ antics).
Moving forward, Ryanair will need to ensure they appear at the top of the rankings for longer tail search terms (across all geographic territories), rather than concede the space to intermediaries like Google or SkyScanner, or worse still competitors.
The inherent tension between Pay-Per-Click (PPC) and Search Engine Optimization (SEO), and the increased participation by Google in search results will be familiar territory to Chief Marketing Officer, Kenny Jacobs. The SEO/PPC battle essentially helped define the winners and losers in the price comparison website war in the UK (Jacobs was formerly the CMO at MoneySupermarket). In recent years, Google has been pushing more paid results to the top of the results page (particularly on Tablets), as well as returning Google results at the top, displacing organic listings in the process. The net result is that participants increasingly need to ’pay to play’.
Fig 1: Search Results on Google ’Flights Dublin to London’
Thus a company, who had focused hard on an SEO led approach which may have worked well for years, will have seen their advantage dissipate over time as Google tweaked the algorithm. Hence where once a flight search took you off to a third party site, Google now gives you the results on its own page, drawing traffic away from the likes of SkyScanner (See Figure 1). For these reasons alone, I suspect Ryanair will need to dial up both their SEO and PPC activities significantly in 2015. Where once companies like Ryanair could focus exclusively on free traffic (SEO) they now need to add paid search to the mix.
Social Media
While Ryanair have a presence on the main social media sites, to date they have failed to leverage these platforms to any great extent. Activity will ramp up significantly in 2015 for a number of reasons including:
- Branding benefits (keeping the company front of mind) on platforms where a significant portion of their target demographics are active
- The increasingly effective advertising opportunities available on these platforms
- The fact that they are powerful customer service tools, where they can communicate and engage directly with customers rather than just use these tools to ‘broadcast’.
From a pure marketing perspective, platforms like Twitter, Facebook and Instagram are currently being under-utilized, and given the fun element of their brand, and the need for them to start creating a lot more content, Ryanair should have no shortage of creative campaigns they can run.
Replicating campaigns represents the sorts of fun, viral content that they should be capable of creating at low cost. However, their recent Christmas jingle indicates that some of the ’creative’ needs a little further consideration though.
Twitter
Looking at Twitter, their audience of 115,000 followers is less than half the numbers of Easyjet’s and one fifth of British Airways. In terms of Twitter activity, there is currently evidence of a nice mix of customer engagement and promotion. Testing paid-for campaigns (like Easyjet’s cross channel ‘Happy Bums’ campaign) makes obvious sense in terms of a next step.
The recent trap Ryanair fell into with the journalist Ryan Hand tweeting re ‘emotional baggage’ indicates the viral opportunity of the medium (although in this case it was unintentional).
Figure 2: Twitter Exchange Between @RyanHand_ and @Ryanair
In this instance, the response from Ryanair was spot on:
"As the fastest responding airline on Twitter in Europe, we pride ourselves on the speed of our customer service. We apologise for temporary technical difficulties with our sarcasm detector today.” Ryanair Statement to The Independent
Whether they go as far as Virgin Trains though, in terms of the level of service that they provide remains to be seen: The recent episode where a Virgin passenger tweeted “There’s no toilet roll, please send help” and the Virgin response was fantastic. (See link)
Who said social media was a waste of time?
Facebook:
Again Ryanair have not invested any effort in Facebook to date. The contrast between the British Airways page (with 1.6 million likes) and the Ryanair one is stark. It is likely that an improved Ryanair Facebook page will be part of short term developments as they look to amplify the message of ’always getting better’. Paid for Facebook adverts also represent another big opportunity, as the ad platform offers increased sophistication in terms of targeting (as well as the access to a large captive market).
Figure 3: British Airways on Facebook
Figure 4: Ryanair on Facebook
Instagram:
Given the growth in popularity of Instagram, Ryanair should test this platform in 2015. Easyjet is one of the more active airlines in the UK with an active account, and follower numbers in excess of 16,000. As a highly visual medium, with strong engagement, it offers Ryanair the option of further extending their brand, building further awareness amongst a younger ’mobile crazy’ demographic. At the very least, it would be worth having a presence as a defensive measure given the number of SPAM Ryanair accounts on Instagram.
Google +:
The existing Ryanair Google + account is unlikely to generate much traffic at present given the lack of quality content. Again this is likely to change, as content generated for the website is re-purposed and pushed through the various social media channels owned by Ryanair. British Airways is one of the more active carriers on Google + but given the ‘jury is still out’ in terms of Google + as a vibrant platform, this is likely to be a low priority for Ryanair in 2015.
YouTube:
As Ryanair generates more content they will be able to utilize existing channels to better effect. The existing YouTube channel has a more corporate feel at present unlike Paddy Power who are more focused on trying to generate virality. Twitter will also roll out significantly greater video capability in the short term, so media creative can again be re-purposed for the different platforms.
In summary, from the outside it appears there are lots of opportunities for Ryanair to make numerous gains in terms of acquiring customers. While some of these may will likely include ‘paid for’ media, the returns should be significant, and these can be tested at relatively low cost. In the final installment I will look at the opportunities around customer retention and engagement.
Finally, this post was not designed to be exhaustive but with a word count exceeding initial plans I thought I’d focus on some of the more interesting opportunities.
About Author:
Alan Gleeson is a digital marketing strategist based in London, and is currently acting as an Interim CMO at Zartis.com (who power Ryanair Labs).
Follow Alan on Twitter: @alangleeson
This Post Was First Published Here.
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