Solution: Air France Internet Marketing

Optimizing Google, Yahoo!, MSN, and Kayak Sponsored Search

Ø  Five French airlines merged to form Air France in 1993.

Ø  Launched its first successful flight to the United States in July 1946 between Paris and New York city after second world war.

Ø  Served 185 destinations in 83 countries and its total fleet size stood at 383 aircraft.

Ø  Air France and Netherlands-based KLM  airlines joined forces and created the SkyTeam global alliance.

Ø  Air France developed an approach to aircraft fleet management which was consists of two strategies-
1. Rationalization ( acquiring modern aircraft with similar technical Characteristics)
2. Flexibility (to adjust aircraft delivery dates or change models within a given aircraft family.)

Ø  Air France-KLM continued to grow at the end of 2006-2007.

Ø  At that time global economy grew by 4.9% while airline traffic increased by 6.6%

Ø  Air France revenue grow by 5.1% with increased passenger activity by 5% and  with 73.5 mn  passengers carried.

Travel Industry and E-Commerce:

Ø  Travel industry was one of the earliest to adopt e-commerce into their sales strategies.

Ø  This helped in easy accessibility to the customer and held huge potential for increasing businesses’ sales by vastly increasing their reach.

Ø  E-Commerce emerged as a very fast growing sales medium.

Ø  With the adoption of e-tickets, airlines were better protected from many of the logistical problems.

Ø  travel industry comprised several different types of online service providers-
1. Direct websites (Owned and hosted by the individual airlines)
2. Aggregator websites (offered service beyond flight purchase including hotel and vacation packages)
3. Metasearchers ( Kind of aggregator websites but did not offer transaction services)

Ø  Between 1996 and 2005 the number of consumers going online to research and book travel increased by 263% .

Ø  It was uniquely well suited to online purchasing when compared to other segments of the retail industry.

Ø  According to an estimation in 2005,  32.2 million households in the United States had high-speed Internet connections.

SEM (Search Engine Marketing):

Ø  SEM was a well-known method of marketing in which businesses promoted their products and services through targeted placements on Internet search engine results pages (SERPs).

Ø  This provided a highly targeted space to connect consumers to exactly what they were looking for.

SEM  mainly consists of two things-

1. SEO (Search engine optimization)
    -   It analyzes the structure and content of a business’s Web site to maximize its readability and relevance.

It mainly looks at technological part of the websites like URL address structure, Web server settings,

-       information architecture, site usability, and text content.

-       The goal of SEO was to organically improve a site’s relevancy ranking.

2. Pay-per-click or sponsored search
  -  Businesses bid on keywords for sponsored link listings consisting of a title.

  -  Charges were dependent upon the number of times an ad had been clicked on for a keyword.

  -  Cost-per-click could reduce with volume as the search engine provider determined the ad was  

      more relevant to those keywords.

Ø  The larger search engines allowed for broad, exact, and phrase keyword campaigns to allow advertisers to cast either wide or narrow nets of impressions.

Ø  Geotargeting had become easier now.

Ø  These campaigns were easily measurable due to the availability of some tracking devices on internet.

Ø  In order to improve net revenue campaign had to improve on these following things, cost-per-click reduction, increase in bookings, net revenue, revenue per transaction, return per transaction, overall performance by engine.

Media Contacts and DoubleClick:

Ø  Media Contacts was the global interactive media network of Havas media.

Ø  It provides data driven media solutions.

Ø  Media Contacts worked to form strategic partnerships with a number of research and technology providers in order to gain access to granular data sets.

Ø  DoubleClick was an internet ad service company.

Ø  The company’s main product line was DART enterprise which was a web based search syatem and was integrated with leading search engines like Google, MSN and Yahoo.

Ø  In this specialist were able to define budgets and time frames, as well as select cost per thousand, cost per click, and cost per action pricing models.

 Google:

Ø  Pursued an aggressive growth strategy through new product development, acquisitions and partnerships.

Ø  Generated revenue through
- Highly targeted advertising
- Online search services

Ø  Position of an ad is determined by CPC and CTR

Ø  Uses highly complex mathematical “black box” algorithm.

Ø  Considers more than 500 mn variables and 2bn terms.

Ø  Google Acquired Doubleclick in 2007.

MSN:

Ø  MSN did partnership with other service and content providers in order to drive traffic to MSN.com.

Ø  MSN received revenue from three key sources; Microsoft adCenter, MSN Shopping, and subscription based web service.

Ø  As late as 2006 Microsoft had relied heavily on Yahoo for search-related advertising.

Ø  It had rich customer data gathered through its Internet hosting service.

Ø  Microsoft AdCenter used PPC and CTR

Ø  Differ from Google in order to allow its advertisers to target ads to a particular customer demographic.

Yahoo:

Ø  As the predecessor of Yahoo Search Marketing, commercial Web search services company

      Overture was one of the early pioneers in monetizing the internet search traffic.

Ø  Differentiated in SEM by combining ads with content matching

Ø  Context specific content could be linked to search keywords

Ø  Yahoo’s performance was comparatively less positive

Kayak:

Ø  Differentiate itself in two ways
- As an alternative business model from aggregators
- unique technology architecture

Ø  Provided more exhaustive search including the inventory of 551 airlines and 91,500 hotels.

Ø  Its goal is to find and search every hotel on earth, which it estimates at 300,000 properties. 

Challenges and probable Solutions:

Ø  The Media Contacts team had only a short time to make sense of all of its research and determine a way to optimize future campaigns.

Ø  Use branded or unbranded keywords.

Ø  Broad or focused keywords are more profitable

Ø  Which search engine will deliver the most value

Solutions:

Ø  Using both branded and unbranded keywords can be best suitable option for Media Contacts because it appeared that using branded keywords might bring in more revenue, it was also apparent that unbranded keywords produced a larger percentage of single-click conversions.

Ø  In Internet one should try to adopt multiple strategies at a single time because in this one can easily target their customers according to demographics and can do geotargeting and in the last one should analyze that which strategy has performed well one should focus more on that strategy.

Ø  It is mentioned that typical internet tracking worked by measuring the last keyword clicked, and this keyword was credited for the sale conversion so one should try to focus more on Focused keyword strategy.

Ø  Since air France is working with all top most search engines therefore according to their target customers they should utilize the potential of search engines like on Google they can use the strategy of pay per click and sponsored search because on Google it is difficult to know about the prospective customer.

Ø  While in the case of Yahoo ,MSN and all other social networking websites one can easily advertise according to their target customer and can do the segmentation Demographically, Geogrraphically, time wise and Liking wise, so are very important aspects of any internet advertisement campaign and there are very less chances of loss of money.

Ø  One can utilize its money in a proper and most efficient way and in case of Air France they should try to do affiliation with Aggregator websites and metasearchers in order to increase its reach.

Ø  They can go for affiliate marketing also by doing partnership with other online travel booking sites and can maximize their revenue.