How Cathay Pacific focuses on passenger feedback to soar above the competition

Customer experience is everything in the airline industry. From the routes they fly to the booking process and the on-board experience, every touchpoint with customers is an opportunity for airlines to deliver breakthrough experiences that build their reputation and help them stand out in a fiercely competitive sector.

So Cathay Pacific knows it needs to stay on top of its game. Inspired by insights from both experience data (X-Data) and operational data (O-Data), the team leaves no stone unturned in their bid to take the travel experience to new heights, from improving the in-flight food options, to customizing their seats to deliver a better inflight experience.

In our latest Customer Experience Visionaries post, Walter Li, Head of Insights at Cathay Pacific, tells us how the airline is creating breakthrough customer experiences to boost customer loyalty and grow its market share.

If you want to hear more from Walter about Cathay Pacific’s story, he’ll be speaking at this year’s X4 Sydney event - you can register now for free.

On a career in customer experience with Cathay Pacific:

I'm part of a management program in Cathay Pacific where we rotate every three or four years to a new position. I started as Head of Insights in May 2017. That's when our company began this huge transformation process — we had been losing money for a couple of years and we knew we had to change the way we were doing things to compete with the bigger carriers and cater to evolving customer needs. The Insights Team at Cathay was created out of that process.

On harnessing CX to compete with bigger companies:

We're a small team with a small budget. We can't afford big superstars, but what we can do is really figure out the right things to focus on.

To use a sporting analogy, we're like the San Antonio Spurs or the Oakland A's in this case. We're a small team with a small budget. We can't afford big superstars, but what we can do is really figure out the right things to focus on.  It's like “Moneyball” —  you're buying runs, not stars.

the customer experience is where we're going to excel. It's an area where, if you spend wisely, the benefits you reap go up exponentially

We know we're not going to have massive budgets that allow us to sponsor high profile events and teams around the world. We're not going to be able to build brand awareness and consideration purely by spending money on things like that. For us, the customer experience is where we're going to excel. It's an area where, if you spend wisely, the benefits you reap go up exponentially.  We're also confident going down this path because we've always been known for providing excellent service.

In the past, we've done a good job delivering really good service, but we haven't really excelled in using both X- and O-data to assist our decision making. We needed to modernize, and that meant creating an Insights Team that understands the importance of the O-data, while also bringing the X-data component to the business that we haven't had in the past.

On changes inspired by O- and X-data:

One example happened early on in our time using Qualtrics. We brought hot meals back on our Hong Kong-Taipei routes.  This is only a 1.5 hour route, and while we had stopped offering hot food on that route, most of our competitors were still doing it. It may seem like a no-brainer to match their propositions, but we learned that delighting our customers was more than simply offering a hot meal onboard. We needed to offer the right meal and all the services alongside it that customers wanted and, using Qualtrics, we could gather those insights very quickly to create a proposition that stood out from our competitors, rather than simply mimicking them.

On Frequent Flyer programs incentivizing loyalty:

How you define loyalty affects everything from the way you design your loyalty program to the way you measure and track its effectiveness.

The way you define loyalty in an organization is key, because that influences what you’ll focus on and the results you track. Is it just making sure that people fly the same number of flights year after year and give you the same share of wallet? Or do you want to make them advocates for your brand? Are people choosing you because they’re loyal, or because they don’t have many choices?

How you define loyalty affects everything from the way you design your loyalty program to the way you measure and track its effectiveness.

On winning hearts and minds in non-traditional ways:

We run very rigorous testing on our in-flight products — that’s a key customer touchpoint for us. Take our business class products on our B777 fleet, which flies long-haul to the US and a lot of European destinations, as an example. Some airlines will buy a ready-made design from a seat manufacturer and maybe customize the color to match their branding and make some small changes here and there — but by and large the seat remains the same from one carrier to the next. We wanted to offer a different experience on Cathay, so we did a lot of customization based on what we know our business class customers want from the experience.

One of those customizations is a layer of material, added to the back panel of the seat that reduces noise. It means our business class passengers can relax better, because they’re more protected from the noise around them when they’re lounging or sleeping on the flight.

Another change is the airbag that’s traditionally attached to the seatbelt. On our A350 fleet, that’s no longer there, and instead, it’s built into the panel of the seat in front of you. It’s a small thing that most customers won’t notice, but it removes the discomfort associated with those airbags and makes a big difference to the experience for those passengers.

On caring for employees so they care for customers:

Our most loyal customers always say they come back to us, time and time again, because of the service they get from our employees, from the ground staff to the cabin crew and the call center teams.  Within minutes of boarding a flight, customers can already tell if they have a magnificent cabin crew on board who are going to deliver the best service they'll ever get. Those sorts of insights from our customers tell us just how important it is to have the best employees. It can be challenging in an industry where margins are slim, but it’s really important for us when we’re in such a competitive landscape to invest in both our service and our people.

On why Qualtrics is so useful:

Qualtrics enables us to deliver real-time customer feedback to uncover insights that ultimately improve the experience we deliver to our customers. From being able to close the loop with individual customers to analyzing large volumes of X- and O-data to identify improvements we can make to the experience across the board, it helps us put customers at the heart of our decision making.

We use Qualtrics for our post-flight surveys and for pulse checks in our membership program. The tool is quite flexible, so we’ve started testing new ways to deploy it, pushing different trackers at different points in the customer journey. If we understand how people react to these trackers and pulse checks, we can then design the right kind of service recovery module for each moment.

Essential reading:

The Lean Startup is a book that I make my whole team read — I give each member of my team a copy. It’s important for us, because as insights professionals at an airline that's really trying to become super agile and good at learning, it's all about testing things quickly. The Lean Startup methodology helps us do that. When it comes down to it, observing real behavior and using prototypes to test behavior is one of the most effective ways of gathering insights.

Want to learn more about creating great customer experiences?

Qualtrics compiled a reading list based on recommendations from CX leaders like Walter, you can download that here.