First Published on 28th April 2016
Making innovation and digitalisation an integral part of any corporate’ DNA is a major exercise. Ai’s Ritesh Gupta interacts with Bornemann to know how Lufthansa is setting a prime example of being customer-centric.
A minor glitch or an unpleasant moment at the airport can spoil a business trip or a holiday with a family. Travellers intend to be in control, to gain easy access to information as they embark on a journey.
Let me share a couple of examples.
Last week I flew from Barcelona to New Delhi via Amsterdam. My flight was booked by my office in the U. S via Delta. So I was forwarded a confirmatory email from Delta. On the day of travel, I also received an email from KLM to check-in. Apparently, the first leg of my travel (Barcelona-Amsterdam) was operated by Transavia. I tried to check-in, but I couldn’t. Also, the KLM site didn’t facilitate my check-in for Amsterdam-New Delhi flight. The point here is if a traveller is clicking on given links, originating from the email, then the task needs to be completed.
Also, as I arrived at the Amsterdam Schiphol Airport, the screen didn’t show the gate for the next flight initially. I took few steps and asked the KLM staff available at a particular gate just where I was looking at the screen. She told me “F3”. This gave me ample time to relax, even as the screen didn’t flash the gate for another half-hour.
So there are many areas of flying, right from dreaming to planning to booking to physically travelling to sharing the journey, where airlines are looking at facilitating a personalised, simplified experience.
I say simplified as at times gaining access to mundane information isn’t easy. As for personalised, airlines are digging deeper to ascertain the profile, travelling pattern etc. of a traveller to drift away from generalised information.
Making it simple, personalised
Singapore-based Frank Bornemann, Head of Marketing, Loyalty Programs and Provider Management APAC, Lufthansa German Airlines explains how the group is focusing on doing the same.
“Passengers tend to be anxious…at times nervous (as we physically travel or even start our journey). So right piece of communication in a timely manner (considering the context, location) can help,” says Bornemann. Here a mobile app can be of immense help, but even then the lack of easy access to free Wi-Fi at certain airports can hinder the plan. In order to combat this, the Lufthansa group is banking on the beacon technology. This way Lufthansa can share details about boarding, departure time and gate number via smartphones. Also, to display information on the luggage carousel number for arriving passengers and expected waiting time. In fact, the group is going beyond routine flow and looking at refining the experience as it strives to drive digitalization with diligence.
Bornemann referred to the testing of services at the Munich airport when passengers are within a certain proximity of a location, for instance, an offer for entry into the Business Lounge for €25. Bornemann says this message would be delivered to a flyer present in the vicinity of a lounge. It would be sent if the passenger doesn’t have automatic lounge access through customer status or booking class.
Another utility-oriented feature is electronic baggage receipt on the app. So one doesn’t need to roam around for a screen or check among 10 or so carousel for luggage. The service results in knowing the baggage carousel. This service is currently available at several airports in Germany, and Milan, with plans to expand in the future.
Setting up right processes
The organization is currently in the process of rolling out a slew of digital initiatives, with focus on being precise with what to offer to customers, matching the need/ intent, the location etc.
It needs to be highlighted the Lufthansa group introduced seven fields of action or its “7 to 1 – Our Way Forward” strategic plan in 2014. Two of the initiatives are - innovation and digitalisation, and customer centricity and quality focus. The group is digitizing the entire air travel chain. A major initiative is the SMILE program, taking a closer look at processes and products more intensively from a customer perspective.
The industry is gearing up to stitch up data across channels and combine fragments to create a single identity of a traveller. Today there is talk of probabilistic and deterministic methods of identifying a digital user, but it’s a work in progress. Of course, airlines are assessing their own sources of data and systems to capitalize on the prowess of the company-owned digital assets. Lufthansa, for example, is evaluating how to make the most of its 80 databases available within the organization. “Many of our current database systems do not yet “talk to each other” because they were commissioned a long time ago, based on previously relevant needs,” shared Bornemann. Such first party data obviously can lay a strong foundation for personalisation, but it’s not as straightforward as it seems considering the fact that one has to respect the data protection laws, mentioned Bornemann. As per the German laws, there could be several different levels of permission that need to be approved by users before one can act on a certain set of data to send them other offers or promotions.
Bornemann indicated that the organization has aligned its operations over the years to gain a strong foothold in the arena of customer centricity. “Whilst the relevant data is available, we have been working in departmental silos for decades and as a result created systems and databases that are not yet talking to each other. We at LHG have created a central project team on a very high level addressing exactly these issues and making this our priority to underline our brand core “enriching travel experience”,” he said.
Being savvy with devices, tech and content
A lot is happening in the world of ad tech, analytics, ecommerce, mobile technology etc.
Bornemann finds all of this “very exciting”, and adds “through digitalization it is possible to address the needs of travellers better than ever”.
Today travel marketers are working out ways to make the most of available content and make it an integral part of an organization.
For instance, a European carrier is working on plans to set up a virtual content store to personalize information and offers via various in-house communication channels like apps, newsletters, app pop-ups, pre-check-in messages etc. And this will be delivered in the most relevant format. “It is of course very challenging to merge all data points, apply the right algorithms and have the right text and visual components come together to create a seamless flow of information to our customers,” shared an executive.
For its part, Lufthansa group is also making steady progress on similar projects, but the team isn’t in a position to comment yet.
Areas of improvement
It is not tough to analyze gaps where airlines tend to struggle when we think from the perspective of a traveller. So which areas of flying tend to disappoint in terms of loyalty – right from planning to travelling?
Bornemann the industry at large is falling short when it comes to “personalisation to individual needs”. He added, “Airlines have so much data available to address individual needs, but yet they usually blast offers to all customers in newsletters, apps, social media etc.”
It is still challenging for airlines to act on real-time operational data to improve upon their FFPs. “At the moment it is very challenging but in the future we are going to address exactly this point, which will help us to differentiate us from competitors and enrich our customers journey, which should result is loyalty beyond the classical FFPs,” acknowledged Bornemann.
Sometimes it is easy to get swayed with what technology or a new concept can do for the organization. Being customer-centric is fine, but it can also result in “information overkill,” cautioned Bornemann. “It is very easy to blast everything to everybody, but respect for our customers time is crucial to break through the communication clutter and build trust.”
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