How to Get Started with Performance Marketing in the Airline Industry
The digital revolution has forever changed the way travelers search for and book flights. Consequently, it has also transformed how airlines advertise and sell their services. With the rise of omnichannel marketing, airlines now have the incredible potential to reach and engage more passengers, more frequently. Today, airline marketers can gather campaign data 24/7 and measure results in real-time. While in the past, attribution was nearly impossible, data transparency now enables airline marketers to optimize their campaigns for better performance. And that's why it's called "performance marketing".
What Is Performance Marketing in the Airline Industry?
Performance marketing in the airline industry refers to online campaigns where airlines pay marketing companies or advertising platforms for specific results achieved, such as clicks, bookings, or loyalty program sign-ups.
Unlike traditional and organic marketing, performance marketing is specifically used to drive actions and track and measure those actions, all while attributing the ROI of each asset, campaign, or activity.
While major airlines can spend millions on branding, most carriers need to focus on the bottom line to stay profitable. Performance marketing puts power back in the hands of the airline. You determine the action, then pay when that action has been completed – whether it's a flight booking, loyalty program registration, or click-through to a promotional offer.
How is Airline Performance Marketing Different?
In most traditional forms of advertising, airlines pay a fee upfront for ad space independent of performance. That could mean hundreds of thousands of dollars spent without ever seeing a booking. With performance marketing, airlines only pay when the measure for success (conversion, action, or transaction) has been met.
Airline performance marketing vs brand marketing
In an increasingly competitive market, standing out is a challenge, and that's why brand awareness is crucial for airlines. There are many ways to increase brand awareness, such as social media campaigns, native advertising, and content marketing. Some of these may actually fall under the umbrella of performance marketing because they are measurable and airlines only pay for specific actions.
For example, native ads can be a powerful way to boost airline brand awareness by exposing target audiences to relevant, top-of-funnel content that addresses their travel needs and sparks interest in your airline's services.
Airline performance marketing vs affiliate marketing
Affiliate marketing is a subset of performance marketing, as it is entirely driven by metrics and goals. In the airline industry, an affiliate marketer (such as a travel blogger or online travel agency) promotes the airline's services, with the goal of driving traffic, clicks, and bookings to the airline's website. The affiliate receives payment only for actions taken, such as clicks, bookings, or loyalty program sign-ups.
Airline performance marketing vs programmatic marketing
Programmatic marketing is an automated method of buying ad space, targeting the most relevant audience at the best possible price. For airlines, this could mean showing ads for last-minute weekend getaways to young professionals browsing travel sites on a Thursday evening. Programmatic is an essential tool for airline performance marketing, as it enables carriers to buy better placements at scale and maximize their ROI.
How to Measure Airline Performance Marketing?
A defining element of performance marketing is ROI (return on investment) – every activity and action is measured, reported, and analyzed against pre-defined KPIs. This is how campaign results can be understood and optimized toward improving performance.
Here are some of the key metrics and KPIs commonly used in airline performance marketing:
Cost per Booking (CPB)
Revenue per Booking (RPB)
Booking Conversion Rate
Cost per Mile (CPM)
Revenue per Available Seat Mile (RASM)
Customer Acquisition Cost (CAC)
Customer Lifetime Value (CLV)
Airline Performance Marketing Types
Performance marketing in the airline industry has evolved thanks to new technology and changing traveler behaviors. Today's performance-driven world is all about "reaching the right travelers on the right device at the right time."
Search engine marketing (SEM) is crucial for airlines, as it allows them to place paid ads on search engine results pages when potential customers are actively searching for flights or travel information.
Native advertising is another effective tactic for airlines. These ads blend seamlessly with the content on travel websites and blogs, providing valuable information to potential travelers without disrupting their browsing experience.
AI and ChatGPT for Airline Performance Marketing
AI has revolutionized airline performance marketing by providing unparalleled opportunities for optimization and personalization. Many performance marketing tools used by airlines are based on AI, analyzing vast amounts of data to support more precise targeting at scale.
ChatGPT and similar AI tools can be used by airline marketers to quickly generate and test multiple variations of ad copy, create personalized travel itineraries, or even assist in customer service chatbots.
How to Build an Airline Performance Marketing Strategy
Establish your campaign goals (e.g., increase bookings, boost loyalty program sign-ups)
Choose your digital channels (e.g., search engines, social media, travel websites)
Create and launch the campaign
Measure and optimize your campaign
Handle potential pitfalls (e.g., brand safety, compliance issues, privacy regulations)
Benefits of Performance Marketing for Airlines
Precise tracking and optimization of marketing efforts
Lower risk compared to traditional advertising methods
ROI-focused campaigns that continually move towards better results
Airline Performance Marketing Examples
Delta Air Lines - Personalized email campaigns based on traveler behavior and preferences
Southwest Airlines - Social media retargeting ads to re-engage website visitors
JetBlue - Affiliate marketing program with travel bloggers and influencers
In the airline industry, where margins can be tight and competition fierce, performance marketing allows carriers to measure everything from brand awareness to booking rates down to a single ad. As advertising becomes more transparent, airlines are looking beyond branding to build marketing strategies with proven ROI. Performance marketing was born from this need and is only becoming more sophisticated and advanced over time. So jump into performance marketing today, and begin reaping the benefits of tracking, measurement, and optimization for your airline's ROI.