A growing proportion of Allegiant Air’s revenue comes not from flights, but from additional services such as resort bookings and car rentals. How could it help these new ventures take flight?
Allegiant Air worked with ConvergeOne to build a hybrid cloud analytics architecture that helps it understand customer behavior and develop innovative services to complement its traditional products.
1,000xfaster insight into customer behavior, accelerating analytics from days to seconds
$785,000saved by detecting and blocking unauthorized resellers from Allegiant’s website
15%increase in accuracy of customer data records, enabling better decision-making
Business challenge story
The sky is the limit
Allegiant Air is arguably becoming one of the most innovative and successful airlines in the United States. Its strategy is built on a thorough understanding of its market, and its ability to design products and services that appeal to a customer base of leisure passengers who want the best possible vacation experience. In recent years, Allegiant has made significant investment in diversifying its range of offerings to customers—a strategy that has been highly successful. Today, approximately 30 percent of its revenues come not from flights, but from supplementary services such as hotel bookings, car rentals, and ticket sales for entertainment and attractions.
The company has even begun building its own holiday destinations—it has recently announced a new “Sunseeker Resorts” project, which will be located in Port Charlotte, near Punta Gorda airport. The resort will include a hotel, condominiums, restaurants, bars, shopping, a marina, and a pool that is designed to be the largest in Florida. Bryan O’Neil, Director, Data Architecture at Allegiant Air, explains: “We don’t see these new revenue streams as just add-ons to our core business, we see them as a key part of our core business itself. Today, we’re more than an airline—we’re a full-service travel company. “In fact, I’d go further than that. The only way to succeed with this new business model is to know everything we can about what our customers want, and how we can make their trip as easy, enjoyable and memorable as possible. That means we need as much data about the customer experience as we can get, and we need to be able to analyze and use it to make decisions in as close to real time as possible. As my counterpart at ConvergeOne puts it, we’re not an airline, we’re a big data company with planes!” ConvergeOne is an IBM Business Partner that has been working with Allegiant Air for several years, helping it mastermind the technical transformation required to underpin its new business strategy. G. Lance Teel, Director of Big Data Transformation at ConvergeOne, comments: “Allegiant is one of the most successful companies in an extremely competitive industry. That’s because they excel at bringing together disparate types of data and using it to make subtle but effective tweaks to the way they operate. “As Bryan and I worked together, we realized that to take the next step in Allegiant’s journey, we needed to redesign its architecture to support near-real-time big data analytics. With the projects that Allegiant wants to work on over the coming months, we needed to build a solution that could deliver detailed customer insight in seconds.” Bryan O’Neil elaborates: “Our customers are very tech-savvy: 94 percent of our sales come from online channels, and our mobile app is very popular. By combining mobile and Internet of Things [IoT] technology, we can see when our customers are on their way to the airport, or even how they’re moving through the terminal. That gives us a priceless opportunity to adapt our services to give them the best possible customer experience—but only if we can process the data fast enough to make the right decisions on the fly. That’s why we decided to transform our analytics infrastructure.”
Ascending into the cloud
Allegiant’s existing infrastructure centered around an IBM® Db2® database platform, running on a pair of IBM Power Systems™ servers at the company’s data center. The setup was optimized for transactional workloads, so it provided excellent performance for the company’s flight and hotel booking systems. It also helped to significantly accelerate many analytics processes—for example, Allegiant found that a set of queries that had previously taken two hours could be completed in just ten minutes. To take the next step and enable near-real-time analysis, Allegiant decided to extend the Db2 environment and introduce new big data analytics capabilities. To boost the flexibility and cost-efficiency of this new platform, the company decided to build it in the cloud. Bryan O’Neil comments: “The success we had already achieved was built on IBM’s powerful hardware and innovative software—and we were convinced that IBM was the right strategic choice to help us take the next step. “To build our new platform, we needed a vendor that could provide a broad range of offerings for data and analytics to support mission-critical transactional systems as well as innovative data science exploration. In our opinion, IBM is one of very few vendors with the right credentials across the whole of the data and analytics space.” He adds: “We were also wary of putting all our eggs in one basket, so we decided on a hybrid cloud architecture—and again, we saw IBM as a leader in hybrid cloud. The concept is that our operational systems and data remain on-premises, while our new analytics landscape runs queries against a separate copy of the data in the cloud.” The cloud environment is built using a combination of bare-metal servers and services coordinated through the IBM Cloud platform. IBM Db2 Hosted provides a column-based data store that leverages BLU Acceleration® technology, which is designed to process queries many times faster than a traditional row-based database. “Db2 Hosted has transformed the way we do analytics—it is literally more than a thousand times faster for some analysis tasks,” says Bryan O’Neil. “Instead of waiting hours for a result, we are seeing sub-second response times. “That means that we can build an event-driven analytics platform where we can follow our customers’ journeys as they happen. When they are waiting in line at the airport, we can see what’s happening and potentially intervene to improve their experience of vacationing with us.” To gain this kind of holistic insight into the customer journey, Allegiant needs more than just data from its core transactional systems—it needs to be able to bring in data from other sources, such as mobile apps and IoT devices. To capture and integrate this data, the company is using IBM Cloudant®, a NoSQL data store. “Cloudant gives us a great way to ingest large volumes of data from external sources quickly,” says Bryan O’Neil. “You can throw the kitchen sink at it, and it will capture everything and store it as a JSON document. Then you can figure out what the data is telling you and structure the relevant parts of it for deeper analysis in Db2.” As an example, Allegiant is using data from geo-fencing beacons installed at various points on the route through some of its main airports. When a customer passes one of these beacons, their presence is detected and logged as an event in the cloud analytics environment. By aggregating this data, Allegiant can see how customers are flowing through the airport, how long it takes them to get from the ticket counter to the gate, and whether there are any delays or bottlenecks. If there are any problems, the Allegiant team can work with airport staff to resolve them, or offer gifts to customers to compensate for the inconvenience. Another source of data that Allegiant hopes to leverage in the near future is the Weather Company Data service available via IBM Cloud platform. By building weather insights into its processes, the company hopes to be able to adjust its operations to serve customers better when storms or other adverse conditions cause delays or cancellations. Finally, for big data problems that aren’t amenable to analysis in a traditional data warehouse, Allegiant is looking into technologies such as Apache Spark. At a recent conference, Allegiant, ConvergeOne and IBM presented a demo of a Spark application that uses geolocation data from customer’s mobile apps to predict whether they will make it to the airport in time to catch their flight. Deployed on a global scale, this kind of solution could help smooth out customers’ journeys and give Allegiant more scope to make smarter use of available seats.
With the new hybrid cloud architecture in place, Allegiant believes it has found an ideal combination of robust on-premises systems for its business-critical transactional data, and a highly versatile environment for high-speed analytics in the cloud.<br><br>Among other early successes, the platform has already been used to help the airline protect its direct bookings business from unfair competition. Allegiant realized that competitors were using bots to scrape data from its website and resell seats on its flights—taking revenue away from direct bookings. The Allegiant team built a pattern detection algorithm that could identify these bots and block them from the site. To date, this has preserved over USD785,000 in direct bookings.<br><br>The ability to bring in new sources of data via Cloudant has also helped Allegiant improve the quality of its existing customer data. For example, by comparing zip codes from newly ingested data with zip codes in existing records, the company has been able to increase the accuracy of its customer address data by 15 percent—helping it understand and market to its customers more effectively.<br><br>Looking at the projects Allegiant is currently working on, reacting to real-time insight is a common theme. “The aim is always to get ahead of events, instead of just reacting to them,” says Bryan O’Neil. “If you’re standing in the road and a car is bearing down on you, you can’t afford to wait and read about it in the newspapers tomorrow—you need to get out of the way now.<br><br>“It’s the same in business—you need to seize opportunities when they arise, and deal with problems before they have an impact. The platform we’ve built with IBM and ConvergeOne puts us in a position to track events as they happen, monitor the customer journey at every stage, and respond proactively to help keep our customers on-time and happy.<br><br>“From a technical perspective, the numbers speak for themselves: when analyses that used to take one or two weeks can now be completed in seconds, it’s an impressive statistic. But the important thing is what that thousand-fold improvement means for our business—it gives us the ability to get data to our decision-makers quickly enough for them to make a meaningful difference to each and every customer’s experience of vacationing with us.”<br><br>He concludes: “Looking to the future, our IBM hybrid cloud analytics platform opens up endless possibilities for operational enhancements and monetization. We’re excited about the next steps on our journey, and we’re very confident that IBM and ConvergeOne are the right guides to help us reach our destination.”<br><br>
About Allegiant Air
From America's favorite small cities to world-class destinations, Allegiant makes leisure travel affordable and convenient. Offering low fares, a nonstop, all-jet service, and premier travel partners, Allegiant aims to provide a complete travel experience with great value and without all the hassle. The company operates scheduled and charter services throughout the United States, as well as charter services to Canada and Mexico.
- Cloudant SaaS
- DB2 Advanced Enterprise Server Edition (Loz)
- DB2 for Linux, UNIX and Windows
- Db2 Analytics Accelerator Cloud
- IBM Power System S822
- IBM Power System S822L
- T&T: Customer Loyalty, Sales and Service
- T&T: Operations Planning and Optimization
- T&T: Traveler Core Systems Transformation
- Weather Solutions & IOT Platform
- Power Systems
- IBM Bluemix
- IBM Cloud bare metal servers
Take the next step
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