Globalisation of offers, shift in sales and distribution channels and use of new technologies
“Lufthansa is off to a flying start again this year,” was the introductory remark made by the airline`s Executive Vice President Sales, Thierry Antinori, at a press conference held at this year`s ITB in Berlin.
In January alone, passenger numbers rose year-on-year by 11.9 per cent to almost 3.5 million. All 7.7 per cent of additional capacity was sold in the marketplace so that the seat load factor improved by 2.7 percentage points to 67.3 per cent. Although for seasonal reasons January is traditionally a weak month, utilisation notably on intercontinental routes reached a very good 71.5 per cent.
The passenger count last year rose by 7.4 per cent to an all-time high of 47 million, reflecting growth in all traffic regions. The capacity increase of 6.4 per cent was again entirely absorbed by a rise of 9.1 per cent in capacity sold. The seat load factor was up accordingly by 1.8 percentage points to 74.4 per cent. Lufthansa maintained its position against European competitors in all traffic regions: Its capacity increase of 6.4 per cent was well above the AEA (Association of European Airlines) average of plus 4.2 per cent. The increase in capacity sold - 9.1 per cent at Lufthansa against AEA growth of 7.5 per cent - tells a similar story.
“These developments convince me that we are pursuing the right course,” commented Thierry Antinori. “Our objective is to remain Number One among the European airlines. To that end, Lufthansa will continue to expand its presence in future-oriented sales channels.”
Amid continuing globalisation both corporate customers` and travel agents` requirements have changed. Lufthansa was quick to recognise this trend and established a Global Key Account Organisation at both its Frankfurt headquarters and key international markets. With the groundwork now in place, Lufthansa in strongly poised to press ahead with this premium business together with its Star Alliance partners. Thierry Antinori, Executive Vice President Sales commented: “It is our target to increase the revenues obtained from our top global corporate accounts by 20% this year.” With the objective of further gaining revenues from small and medium-sized companies, the airline will introduce specialised products and services, like the CorporateFlyway and Partner Plus Benefit. These are to be in place in Germany by the second half of the year, with an expansion into foreign markets planned for 2002.
The wide reaching topic of E-commerce will remain high on Lufthansa`s agenda. In 2001 the airline will seek a more balanced presence in the individual on-line travel segments. The InfoFlyway, the airline`s own website at www.lufthansa.com, will remain at the forefront of the airlines` internet activities. Last year bookings made via the InfoFlyway totalled at around 250,000, an increase of 140 per cent on the previous year`s figure. “Our target in 2001 is to sell more than half a million tickets via our website. Overall, we plan to increase our on-line sales to 25% by the year 2005”, said Thierry Antinori. “To help realise this goal, we attach prime importance to improving the booking functions and strengthening our international presence,” he added.
In line with this strategy Lufthansa will continue to put new technologies to the use of its customers. For instance, as of today the new functionality “Click & Phone” will be added to the Lufthansa InfoFlyway. This service will allow “surfers” to “call for help” so to speak. In case of questions, users will only need to click the new button and an agent from the InfoFlyway support team will call them via the telephone. This service, which is integrated in the Lufthansa Call Center Network, will at first be available to a selected user group, before being offered on a wider scale. In total Lufthansa currently operates eight Call Centers worldwide, allowing customers round-the-clock access to the airline. “Last year we handled more than eleven million calls in our exemplary Call Center Network. For 2001 we expect a further ten percent increase in call volumes and a 60 per cent growth in revenues. With these increases, we will soon need to consider opening a ninth Call Center”, commented Thierry Antinori.
Additionally, Lufthansa is seeking partnerships in the online sector. The key event this year is the launch of the Online-Travel-Portal (OTP), the joint online travel agency which Lufthansa founded together with eight other leading European airlines.
In co-operation with its partners, Austrian Airlines Group and SAS, Lufthansa is now the frontrunner in electronic ticketing - etix® - offering an unparalleled international network of 160 destinations in 40 countries to which passengers can travel without a paper ticket. Moreover, as part of “Check-in evolution” Lufthansa is constantly developing innovative check-in options. Since January 23, Lufthansa has been offering its` First and Business Class passengers at Frankfurt Airport the so called “Priority Check-in” area. Overall the airline has substantially increased the number of check-in counters and Quick Check-in terminals available at Frankfurt. Additionally, since September last year customers may also check-in using WAP-Mobile phones or via the Internet. During the course of this year, Lufthansa will also introduce Quick-Tickets machines, at which passengers can collect pre-paid tickets and at the same time check in for their flight. From Lufthansa`s standpoint, M-Commerce will provide for countless opportunities to facilitate travel for the “mobile” customer. “Our passengers will not only be able to browse through the Lufthansa timetable, check-in for their flights and board the aircraft using either a Palm Top or WAP-Mobile phone, but will also be able to book flights through these means”, said Thierry Antinori, looking into the future.
As for its inflight product, Lufthansa is paying ever-greater attention to the requirements of its international customers. Beside having Asian flight attendants on almost all Far East and southeast Asian routes, the on-board product is being adapted on many routes, taking into consideration the diverse tastes. This is being reflected in reading materials, catering and in-flight entertainment.
The highlight in the alliance sector last year was the expansion of the Star Alliance through the addition of four new members - the Austrian Airlines Group, British Midland, Mexicana and Singapore Airlines. In the forefront this year are efforts to intensify integration within the alliance for the purpose of offering joint customers more efficient and better service. By concluding further regional partnerships with Air China, Air One and Spanair, Lufthansa extended its route network in 2000. In order to improve both its domestic and European network, Lufthansa has agreed a wide reaching co-operation with Eurowings. Complementary to this, is the AIRail project, which brings together Lufthansa, German Rail and Frankfurt airport, with the aim of the high-speed rail link between Frankfurt and Stuttgart becoming a viable alternative to flying on this route.
The summer flight schedules starting at the end of the month, sees Lufthansa serving 349 destinations in 94 countries. Notable in the timetable are improved and new services from Berlin as well as from the Frankfurt and Munich hubs. With the launch of the Berlin - Washington route, Lufthansa is offering its first non-stop intercontinental service from the Federal Capital. Also on offer from Berlin are new connections to London, Dortmund and Venice. From the Frankfurt hub, Lufthansa is laying on daily non-stop flights to Denver and Phoenix, both of which are rarely served in this fashion elsewhere from Europe. Plans are also afoot to expand flights to Shanghai, Buenos Aires and Santiago de Chile. At its` Munich hub, Lufthansa is further improving services in summer with an additional 250 flights weekly. In the forefront are the new intercontinental routes, Munich - Los Angeles, Munich - Sao Paulo, Munich - Hong Kong and Munich - Singapore. New amongst the short to medium-haul routes on offer from Munich is the destination Bordeaux as well as for example flights to Ankara and Tunis. “The new timetable is setting us even farther apart from our European competitors,” remarked Thierry Antinori. “Alone on routes between Europe and Asia, we are the airline with the most attractive offer. Our services to China, for instance, include daily non-stop flights from Frankfurt to Beijing, Shanghai and Hong Kong as well as thrice weekly flights to Hong Kong from Munich.”
Thanks to firmly pursuing its punctuality campaign, Lufthansa made significant progress on that score in 2000. Flight punctuality in every single month of last year improved appreciably on the monthly performance of the previous year. In comparison with other major hub airports, Frankfurt again topped the league of Europe`s most punctual hubs. “With the introduction of the Hub Control Center (HCC) in Frankfurt, we have taken a major step towards improving our transfer quality,” said Thierry Antinori. Through this unit, Lufthansa, Fraport AG, the German Air Traffic Control Services (DFS) and several other partners, centrally coordinate all important aspects of ground operations.