Awa Management by lethalinterjec


									4COMMERCE                                                                      CASE STUDY
 Customer Insight Solutions

                 America West Airlines and Bill Me Later®:
                 On Course to Increasing Online and Call-Center Sales

                  A      n important issue facing America West Airlines
                  (AWA) is that as an established carrier of 20 years               Organization: America West Airlines
                  offering Global Distribution Systems to its customers
                  as a distribution option, it must compete with start-up           Industry: Airline
                  carriers that are using the Internet almost exclusively in
                  combination with a call center they manage themselves             Challenge: The number one objective at
                  to distribute their product at lower costs. America               America West Airlines’ (AWA) primary objective
                  West’s goal therefore is to achieve direct distribution           was to become the premier low-cost carrier in
                  through its call centers and Internet to realize the              the United States by developing its brand of
                  same level of penetration as the low-cost start-ups               services as well as its network scope and scale.
                  reduce costs and improve customer service. Offering               In 2004, finding new ways to leverage the web
                  I4 Commerce’s Bill Me Later as a secure, convenient,              and call-center channels to increase sales, reduce
                  deferred payment alternative is an important aspect of            costs and meet customer demands was an
                  driving online and call-center sales.                             important aspect of this strategy.

                                                                                    Solution: Launch I4 Commerce’s Bill Me
                  Bill Me Later: Improves Service
                                                                                    Later®‚ payment option for tickets purchased
                  and Increases Sales
                                                                                    online and through call centers. Combine the
             ,, and its call-center
                                                                                    core Bill Me Later product with its “no payments
                  reservations 1-800 number are critical components to
                                                                                    for 90 days” deferred billing promotion, and
                  its competing more effectively as a low-cost operator
                                                                                    allow AWA FlightFund members to earn valuable
                  in the United States by directly distributing product.
                                                                                    miles for using Bill Me Later when booking
                  AWA management undoubtedly understands that the
                                                                                    online. Participate in Bill Me Later Network
                  web and call center are its most affordable ways to
                                                                                    Marketing to promote AWA and drive additional
                  get product out there and to book passengers. The
                                                                                    cross-use sales.
                  company needed to focus on increasing customers’
                  use of establishing these channels as a more effective
                                                                                    In Summary: America West Airlines serves
                  distribution means. One of the most effective ways
                                                                                    domestic as well as international destinations to
                  they identified to improve use of these channels was
                                                                                    Canada and Mexico and now Costa Rica, with
                  to provide consumers a payment method other than a
                                                                                    plans to expand. Today’s airline industry in the
                  credit card.
                                                                                    United States is bare knuckles competition — no
                       Dion Flannery, Vice President of Scheduling and
                                                                                    question about it. Maintaining efficiency and low
                  Route Planning for America West Airlines, describes the
                                                                                    costs is crucial to the ability of America West to
                  airline’s decision to use alternative payments to improve
                                                                                    continue offering customers what they expect
                  service, lower costs and drive incremental sales:
                                                                                    — low fares combined with amenities and an
                       “Alternative payment methods are very important              extensive route network.
                  for us,” says Flannery. “We recognize that there are still
                  a substantial number of people out there who don’t
                  want to use their credit card over the Internet. There       may not even complete the transaction. If a customer
                  are people who won’t purchase online if they don’t have      is not comfortable with a credit card, we must offer
                  an alternative payment method. In fact, they’ll seek         them another option. We see this as a way to drive
                  out other ways to complete a transaction, or worse yet,      incremental sales.”
     AWA management saw Bill Me Later as a complement to services              Good Business Sense and Integration Ease
it offered through and aggressively pursued the                      From a technology aspect, Bill Me Later brought a couple of
payment alternative as a solution:                                             things to the table that were very appealing to AWA. Management
     “Bill Me Later represents freedom of choice,” says Flannery. “For         describes the Bill Me Later technology as very unique, functionality
folks not comfortable using a credit card online, Bill Me Later really         not seen before by AWA, and very attractive; technology that married
provides a conduit that allows them to get online and complete                 very well with conventional wisdom and integrated easily with AWA’s
a transaction with peace of mind, and settle up on their terms at              overall road map.
perhaps a later date. So there’s a lot of appeal in that arrangement.”               Joe Beery, Senior Vice President, Chief Information Officer at
                                                                               America West summarizes Bill Me Later’s appeal from the technology
A Cutting-Edge Program                                                         standpoint:
to Help Beat Competition                                                             “Bill Me Later understands that payments are a 24/7 mission-
     America West Airlines began offering Bill Me Later as an                  critical application. Their technology people are highly qualified
alternative payment option in 2004 to great success. In early 2005,            and actually know the business very well. We’re moving very, very
AWA launched a customized promotional financing program, using                  fast in an industry that’s highly competitive. Having somebody who
Bill Me Later, which included AWA’s FlightFund frequent flyer awards.           really understands the technology as well as the business was very
Under this program, customers using Bill Me Later to purchase tickets          important to us. Bill Me Later brought both of those aspects to the
could defer payment for 90 days. This meant customers could buy                table.”
their tickets for travel, take the trip and not worry about paying for 90            “America West Airlines,” says Beery, “is always looking for
days. Members of FlightFund who selected the Bill Me Later payment             innovative new ways to accomplish three things: One is to service
option while booking travel at received one                our customers better. Two is to improve our costs. And three
mile for every dollar spent. In addition, members earned 1,000 elite-          is to improve our revenue and in terms of technology, add new
qualifying miles for their first purchase made within a three-month             functionality very, very quickly by adding technology that can be
period.                                                                        changed very quickly. Bill Me Later definitely meets this criteria.”
     “FlightFund members earned valuable miles towards award
travel while enjoying the convenience of the Bill Me Later payment             About Bill Me Later
option,” says Travis Christ, Vice President, Marketing for America West
                                                                                     Bill Me Later®, developed by I4 Commerce, is a credit-based
Airlines. “We’re pleased to be the first airline to offer the opportunity
                                                                               payment solution designed to meet the needs of today’s multi-
for deferred payments and for our loyal FlightFund members to earn
                                                                               channel retailers. Bill Me Later’s unique combination of convenience,
bonus miles simply by using this cutting-edge program.”
                                                                               security and flexibility at the point of sale improves the overall
                                                                               buying experience online and via the telephone. Retailers offering
A Critical Solution to Help Reduce Costs                                       Bill Me Later experience higher sales, lower transaction costs and a
     From a business standpoint, apart from giving consumers better            streamlined integration.
choices to complete transactions online, Bill Me Later is described by               I4 Commerce has strategic alliances for merchant distribution
AWA as “a critical solution to helping reduce costs.”                          with the largest payment companies in the industry, including First
     Christ says that AWA management is encouraged by the results              Data Corporation and Paymentech. Through these alliances, Bill Me
of the partnership with Bill Me Later so far and looks forward to a            Later can be offered by over 70% of merchants leveraging the same
long-lasting, mutually beneficial relationship:                                 scaled infrastructure that manages credit card transactions.

     “To other merchants considering Bill Me Later, I would say that if
you are interested in giving your patrons and customers choices and            For more information, visit
if you value giving them choices as a way to improve the product you 
are offering, then you must consider Bill Me Later.”

                                                                                                             Customer Insight Solutions

                                 9690 Deereco Road            •   Timonium, MD 21093              •     ph 443.921.1900      •    fax 443.921.1986

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