Air India aims to double direct sales earnings in 2-3 years: CDTO

Tata Group-run Air India aims to double its ticket sales through direct channels, including its website and app, within the next 2-3 years by enhancing their value proposition to passengers, Satya Ramaswamy, chief digital and technology officer (CDTO), Air India, said on Tuesday.

Moreover, he mentioned that about 270,000 Vistara passengers, who had booked flights for travel after November 12, have been smoothly transferred to Air India’s system, and they’ve all been notified. Vistara will sunset on November 11 and it will be merged into Air India.

Currently, around 25 per cent of Air India's ticket sales occur through direct channels, while approximately 75 per cent are handled via indirect channels such as travel websites like Makemytrip and Ixigo, which charge significant commissions.

“We have recently revamped our website and app, doubling the revenues from direct channels through our mobile app and website. Globally, the revenue split between direct and indirect channels is 50-50, and we aim to reach that level,” he said during a media briefing.

Air India is already investing heavily in digital marketing to boost direct sales and is working on enhancing its website. “We aim to develop the capability to remember your previous choices when you visit our website. You would not need to login at our website to recognise you,” he added.

The airline plans to introduce "one-click booking" on its website and app by December. “Customers will simply enter their itinerary in the search bar (e.g., a ticket from Delhi to Mumbai, departing on October 24 and returning the same evening), and the system will provide the full flight details. All that’s left is one click to complete the payment,” Ramaswamy explained.

“We’ve filed a patent for our one-click booking system, both domestically and globally,” he added.

Air India's artificial intelligence-powered customer service chatbot, AI.g, now resolves 97 per cent of queries independently and has gained such popularity that airlines worldwide, even from as far as the US, are seeking Air India's help in designing similar chatbots, he stated.

AI.g currently handles about 30,000 queries per day and only three per cent of them are being escalated by customers to a human customer service agent.

“We have surrounded the Open AI-supported chatbot with a lot of our information so that it works optimally and focuses on just answering the customer’s specific queries and does not say anything inappropriate. It is ringfenced to our systems and our knowledge,” he said while explaining why AI.g stands out.

In India, many people still prefer booking through travel agents. “We aim to make our platform compelling enough for customers to book directly with us. The younger generation, attracted by the aforementioned advanced technologies, will likely choose to book tickets directly. As more educated and younger travellers fly, and as we expand our fleet, customer behaviour will shift,” he said.

He mentioned that the airline plans to further upgrade its app next year to offer customers options directly within the app in case their flights are disrupted due to fog.

“We will elevate this feature next year. If a flight is disrupted due to fog, you will receive options—such as hotel accommodations—and solutions directly in the app,” he noted.

Air India, which has already spent USD 200 million to revamp its IT systems, is not planning to have a single website and a single app for its low-cost airline subsidiary Air India Express. “However, it remains a possibility,” he added.

Air India is also working on the new in-flight entertainment system. “Sometime in 2025, you will see it on our planes. It will be phenomenal. We are working on software, but then it has to be put on hardware, in collaboration with companies that own that hardware,” he stated.

In July this year, a faulty update by cyber security firm CrowdStrike led to the outage of Microsoft apps and services across the world for several hours. Thousands of flights in India, primarily from IndiGo, were affected due to this issue. Air India’s services were not affected due to this issue, but the airline is considering mechanisms in case such an event in future affects it.

“We are also considering a localised departure system network, which will continue to function at that airport if there is any blackout in the large scale system. This will allow the staff at the airport to issue boarding passes digitally without interruption. However, right now, the focus is working on making a reliable system. We have built a reliable network,” he stated.

In November 2022, the Tata Group began merging Vistara into Air India, 10 months after it took control of the latter from the government through the disinvestment process.

Vistara operates about 2,400 flights weekly and has a fleet of 70 planes. Air India operates about 3,150 flights weekly and has a fleet of about 130 planes.

Tech-powered

1.      Air India plans to introduce "one-click booking" by December for easier ticket purchases.

2.      Its AI-powered chatbot has gained popularity, with airlines worldwide seeking Air India's assistance in developing their own chatbots.

3.      Upcoming app upgrades will provide options like hotel stay directly to customers during fog-induced flight delays.

4.      A new in-flight entertainment system will be introduced on Air India planes in 2025.

5.      Air India is considering a localised departure system to ensure operations during Crowdstrike-like outages.