Customer Relationship Management: Lufthansa

Project Report from the year 2007 in the subject Business economics - Customer Relationship Management, CRM, grade: 86%, Macquarie University (Graduate Accounting and Commerce Centre), course: MKTG814, Managing Customer Relations (post-graduate unit), language: English, abstract: Lufthansa is Germany¿s aviation flagship company and also one of the major airlines operating on a global scale. Established in 1926, Lufthansa currently is one of the biggest members and also founders of the Star Alliance, the world¿s most important airline cooperation. Divided into five strategic business segments (passenger business, logistics, Maintenance Repair Overhaul, catering and IT services), the following report will focus on the passenger business segment and Lufthansäs activities in terms of customer relationship management (CRM) in this division. Being one of the first airlines to have established a customer loyalty program, Lufthansa successfully runs its frequent flyer concept Miles & More (Lufthansa, 2007).

In a competitive environment like the aviation business, relying on a loyal customer base which generates a major part of the company¿s revenue is one of the key drivers for success. Due to cost pressure in the late 1990¿s and the crisis in the aviation business after the terror attacks in 2001, airlines more than ever before recognized and appreciated the value of a relationship to its important profitable customer segments. Thus CRM strategies have become increasingly relevant for Lufthansa and other airlines.

Lufthansäs CRM strategy in the passenger business segment is concentrated within the Miles & More program. Different statuses of memberships are designed to attend to customers throughout the stages of customer¿s lifetime and therefore represent the value of the customer for the company. Beneath the Miles & More surface, an accurate value chain is required. The value chain contains Lufthansäs Customer Portfolio Analysis, IT and Database Integration, Value Proposition Development and Customer Lifecycle Management. These factors combined enable Lufthansa to create a state of the art CRM system.