ENHANCING SERVICE RECOVERY AND ACCURACY OF PREDICTION
People are less likely to be let down if the outcome will be pre-known. This applies to managing disappointed customers who get knocked off due to overbooking. It is all a few communication.
Clients should be well-informed from the terms and conditions for overbooking for each tier of pricing so that they can get ready for the worst-case scenario and not be as shocked and upset if they get knocked off.
If turning away customers is inevitable, priorities should be given to VIPs as disappointing them may imply generating away those who make up for a large portion of revenue for the company.
Effective service recuperation may be costly however essential to pacify dissatisfied customers. Offering a good enticing compensation quantity is more likely to assist. Just like what Delta did recently whenever passengers were compensated US$10, 000 to quit their seats with an oversold flight.
Premier customer care should also be offered to arrange for complimentary reservations to make up for the disappointment. Award of such huge compensation can be minimised if artificial cleverness coupled with big data are utilised in order to predict the likelihood of simply no shows.
Businesses, however , may also love to work with an insurance agency to work out packages in order to minimise risks plus costs arising from this kind of scenarios.
Ultimately, what is crucial would be to manage the customer encounter based on their danger appetite and anticipations. Given the dynamics and complexity from the travel and enjoyment sector, it’s inevitable that some form of overbooking is required to keep the company afloat.
Lau Kong Cheen and Vanessa Liu are both associate professors of the marketing program at Singapore College of Social Sciences’ School of Business.