The Problem – Airlines are losing millions of dollars annually due to revenue leakage
The combination of millions of tickets, fares & conditions and reservation changes continue to pose a huge challenge in auditing of airline tickets. Traditional sales audits are a burdensome necessity that is not working effectively or efficiently for airlines.
Industry surveys suggest that violation levels average between 1% to 3% of ticket sales; for a $2B airline, this can represent $20M-$60M per annum. Most airlines have settled on using outsourced resources to semi-manually audit a sample of tickets to keep a lid on the level of violations. In most airlines, the gross violation recovered through current arrangements and strategy averages some hundredths of 1%, far from the actual leakage levels.
The true level of leakage cannot be ignored by Senior Management and the Board as this contributes straight to the bottom line with impact on earnings per share.
This ultra low level of recovery has led to a “Farming Model” with ongoing violations taken as a fact of life and the auditor being paid a percentage of recoveries.
New Approach Developed – Significant Profit Impact and Deterrence
Our radical approach is founded on a proprietary analytics engine and proprietary expert knowledge algorithms developed specifically for the airline industry.
This allows huge volumes of complex data to be managed to support an audit of 100% of tickets every week, month or quarter.
Moreover, our approach actually deters violations, driving them to zero within several rounds of ADMs.