Airlines with high cancellation rates gained seven points in market share by daily active users (DAUs) year-to-date, but simultaneously lost just as much market share by new installs. It's not too hard to see what is going on here. Fliers are launching the app to sort out cancellations, then they are moving on to check out the more reliable carriers.
DAUs typically equate to loyal customers. In this case, Spirit, JetBlue, Frontier, Allegiant and Alaska are gaining "Ghost DAUs". The here today, gone tomorrow type.
It's important to distinguish the Ghost DAU because the top 9 U.S. airlines are all increasing DAUs month-over-month. The difference for American Airlines, Delta, United or Southwest (the airlines with the lowest cancellation rates) is in the likelihood of customer retention.
Downloads are also increasing month-over-month since January for all carriers except Spirit, JetBlue and Alaska. Accordingly, the declining growth impacted Spirit in April, when it had its highest rate of cancellations at 10%. This is the same month that the American Airlines app ranked #3 in Spirit's Cross App Usage index for iOS users. Apptopia Cross App Usage ranks the overlapping audiences of one app to another in a given month. Prior to April, American Airlines had not ranked as an app that was used by a significant amount of Spirit app users.
Alaska's growth also dipped the month after its highest cancellation rate. JetBlue downloads have declined from the month prior more than once this year, which tracks along with its consistently high cancellation rate.
The travel industry, which aligns itself with hospitality, understands that although loyalty is built over time, it can break in one instance. The poor customer service goes well beyond the mobile app to an industry hiring issue, but little things to show customers you care goes a long way, and mobile is often the first place customers go to when they want one-on-one service. Similarly, it's one of the first places people go to complain. Review Intelligence is a valuable tool to gain insight into what's broken and what's working, at the mobile level and beyond.
We expect more market share movement among the travel industry leaders during Q3 (which is always the seasonal spike for this market). Catch up on our last benchmark from the Spring Break travel season at the link below.
