CRM & Loyalty Strategies for Travel

Over the decade of 2000-2010, the airline industry has seen a reduction in demand. This decline has increased competition in the industry, and necessitated the streamlining of business processes. Some airlines were forced to fold; those that were able to adapt successfully used CRM, or customer relationship management, to create loyalty strategies. These strategies helped to retain customers and attract new ones. Ultimately, loyalty strategies are designed to increase the switching costs for their customers.
  1. Frequent Flier Programs

    • Frequent flier miles have been around for decades; these are the original customer loyalty programs. Frequent flier miles are based on the concept that, as customers fly on an airline, they gain mileage. Once a certain amount of mileage has been accumulated, customers can exchange the earned miles for rewards.

      Frequent flier programs have since evolved to incorporate other perks as well. If customers fly frequently enough, they are eligible for perks such as airline club memberships, priority standby flying and free seat upgrades. Airline clubs are exclusive; you must be a member to enter. Once members are inside, they find luxurious chairs and free Internet connections; some clubs even have beds and conference centers for long layovers.

      Airline companies have realized the need to partner with other airlines in a synergistic relationship. A carrier that mainly flies in North America might partner with airlines that are based out of countries in which they have only one destination. Miles earned on any of the airline's partners become transferable to any airline within the partnership. This motivates customers from other countries to use partner airlines when they are traveling abroad.

    Service Improvement Programs

    • Customer service plays an integral role in customer loyalty programs within the airline industry. Providing value and dependable service separates the successful airlines from those that are forced to fold.

      Service begins on the ground. Making the check-in process as easy as possible for the customer is the most important part. Having enough agents running the check-in booths is important to reduce wait times in the lines. Making self-check-in and online check-in available is another strategy that has reduced wait times at the airport while also enhancing the customer's options.

      In the air, small things that improve customer comfort are the driving factor behind customer loyalty. Offering a beverage service, substantial snacks and increased legroom are all strategies that have been used to add value to the customer's experience. Having enough flight attendants to serve passengers in a timely manner is also important.

      After landing, the most important aspect becomes luggage. Having the airlines lose his luggage is a traveler's worst nightmare. To gain an advantage, airlines have attempted to reduce the time between when the airline lands and when the luggage hits the conveyor belt. They have also focused on lost luggage rates and improved luggage retrieval times. If the luggage is lost, they will fly it to your location on the next available flight, and then drive it to where you are.

    Flight Improvement Programs

    • Improving the efficiency of flights has served to help both the airlines and their passengers. Airlines have strayed from the hub-and-spoke organization pattern, and started focusing on more direct flights between smaller airports. This helps passengers because it helps keep flight costs low while saving them traveling time as well; layovers at the major hub and extra time in the air are avoided.

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