Balancing compliance and marketing relationships in the air travel industry

If you have flown in and out of the UK in the last couple of years, you might have noticed that you need to provide your passport details well ahead of travel. Yet, you don’t have to do this when you travel between other destinations, say between Lisbon and Paris.

The reason you need to provide that information when you enter or leave the UK is that air carriers are required to do so, by law. They have to transmit your data to the UK Borders Agency (UK BA), which checks the information provided against watch lists. If the UK BA deems that you are a threat to national security, it will alert border staff (e.g., immigration officers) to stop you.

My colleagues Kirstie Ball, Liz Daniel, Sally Dibb, Maureen Meadows and Keith Spiller from the Open University, and myself, have investigated the impact of this requirement on firms in the travel industry. We collected data over a 3-year period, as part of the Taking Liberties project, funded by the Leverhulme Trust.

We found that the impact of this requirement extends well beyond the relationship between the airline and the UK BA. For instance, it impacts the customer experience, as well as the relationships between the carrier and tour operators, travel agents and other partners in the supply chain. Complying with the regulation carries considerable costs for the airlines and those that sell tickets to the public. They have had to implement new IT systems, change processes and retrain staff. Compliance with the regulation is not only compulsory and enforced, but it must take place within the UK BA timeframe and mechanics.

Initially, some firms looked for ways to pass these costs on to the passengers. But competitive pressures in the travel sector led some firms to focus, instead, on improving the customer experience – for instance, some travel agencies will retain the details for regular customers and complete the forms on their behalf.

And some firms are even looking into new revenue streams or business opportunities arising from this regulatory requirement. For instance, if a traveller contacts the call centre with an enquiry about the legal requirement, they try to use that opportunity to develop the relationship with the customer, and maybe even cross sell. Other firms are considering offering ‘pay for fast track’ services.

But just as organisations have started to adjust, the EU challenged the legality of the system. It warned that the principle of freedom of movement within the EU means that European citizens can not be stopped from travelling if they refuse to pass on their personal information. The EU suggested that citizens may opt out of providing that data, but the UK challenged this advice, and the matter is still unsolved. Some experts believe that this big data collection project may very well go the same way of other big (UK) government projects, such as the National Identity Register.

In the meantime, the air travel industry ‘just gets on with it’.

Details of this research are available in a paper that has just been published by the Tourism Management journal – available here (pay wall). A summary report for practitioners is available here (free).

We also presented the preliminary findings of this research at the Academy of Marketing conference:

 

What we haven’t looked at in our research is how these regulatory requirements impact on the behaviour of travellers. For instance, does it change how they buy travel products, or their relationships with travel firms? In your case, did the compulsory data collection change your behaviour?

6 thoughts on “Balancing compliance and marketing relationships in the air travel industry

  1. I hate it when I have to check in for a flight with a ‘new’ airline, the amount of information is quite daunting. On the other hand, if I book with BA (with whom I have a full online profile and account), it is in the system so I don’t have to worry about it, it is done automatically. It can be very painful

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    1. I see. If anything, this requirement accentuated the benefits of the loyalty you already had with BA.

      Thank you for stopping by the site, Ana – where in the world are you now? 🙂

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  2. Balancing compliance and marketing is not only for air travel. It is very similar to any other line of business, take examples insurance and banking which are highly regulated areas. And the balance is not only with market as you mentioned with the cost structure of the products and services these companies provide. in the end it all goes back to the consumer, or else the companies would be out of business, but you can always see this as a marketing opportunity. To be among the first companies to be fully compliant is always a good tool (except when the regulatiosn actually do not benefit the consumers).

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  3. Interesting. I haven’t flown to (or from) the UK recently, but from the flights I took within Europe, I can recall that I had to provide my passport details for all of them. Which actually was not much of a hassle. Just filling in a few fields. But I assume it’s a bit more when I would travel to the UK.
    What I did find interesting, though, is that location and carrier dependent, my passport got checked at security and boarding. Or not. In some cases, they just wanted to see my boarding pass.
    It’s also interesting to see if this has shifted passenger streams to for example the ferries, or the Eurostar.
    Now that I think of it, I did fly to the UK not that long ago. But as you can see from the fact that I thought I hadn’t, because I couldn’t really remember putting in some extra effort, maybe the impact is not that big?

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    1. We always need to show the passport when we are at the airport to prove our identity. But this requirement goes beyond that: it requires the airlines to send that information to the Border Agency before departing. In turn, that requirement means that airlines need to set up systems and processes to collect and transfer that data with plenty of time.

      The law is meant to apply to all modes of transport into the UK. Though, the roll out to ferries and trains has been delayed due to the technical problems faced by the airlines and, I guess, the legal challenge by the EU.

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