Amadeus provides Alaska Airlines with a new revenue forecasting model
With superior data quality, demand forecasting and scalability, the Amadeus Revenue Management solution will enable the airline to optimize business processes
Alaska Airlines is among the first airlines in the world to benefit from a new revenue forecasting model created by Amadeus - Active Forecast Adjustment (AFA) - which helps airlines adapt their revenue management systems to demand. so fluctuating air travel.
When Alaska Airlines began implementing Amadeus Segment Revenue Management, little did the two companies know of the great challenge they would face. In fact, in the midst of implementation, COVID-19 travel bans were issued around the world. Because revenue management solutions traditionally rely only on historical data to create predictive models, suddenly this crisis made historical data irrelevant. As a result, Amadeus researchers created a new forecasting model to capture the most up-to-date demand patterns.
Unlike the previous model, AFA automatically adjusts predictions across all release dates based on current up-to-the-minute sales data. With the uncertainty of future demand, airlines require a forecasting model that ensures a quick reaction to market changes and increases the adaptation of forecasts while maintaining robustness and stability.
Despite major disruption to operations, the Alaska Airlines and Amadeus teams achieved a timely implementation of a new revenue management system ready to meet new traveler challenges and accelerate the road to recovery.
"When travel volumes changed significantly, we had to quickly adjust revenue management. The implementation stayed on schedule even as we changed course and conducted what are normally weeks of in-person training, in a remote environment," he said. Kevin Ger, Vice President, Revenue Management, Alaska Airlines. “The Amadeus Revenue Management solution with the new prediction model allows us to be more flexible and agile in monitoring the development in the markets and the variation between the planned scenarios and the actual behavior of the passengers. This is critical so that we can adapt quickly and develop our business strategies. "
"Whether creating a new solution for unexpected and drastic market changes, or while adapting our regular training to respond to orders from home, our teams never missed a beat," said Elena Ávila, Executive Vice President, Airlines, Americas, Amadeus. "This has been a highly strategic implementation to demonstrate that any airline with any Passenger Service System can benefit from the benefits of the Amadeus Revenue Management solution. We look forward to continuing to collaborate with Alaska Airlines on their road to recovery."
The revenue management system is now up and running, and the AFA functionality will launch in 4Q 2020, and will be available to Alaska Airlines and the more than 35 global revenue management customers.