Product and services
Concept
Customer needs are at the heart of product and service development
Due to changes in supply and demand structures, the Lufthansa Group is giving greater consideration to customers’ individual needs and wishes and is seeking to fulfil its commitment to being a premium provider, for its own benefit and for that of its customers. The plan is to build long-term customer relationships through individual appreciation, tailored solutions and personal interactions. The focus is on areas which are highly significant for customers, influence repeat purchases and ultimately contribute to creating value for the Lufthansa Group.
This objective is being pursued via an integrated approach comprising a holistically linked range of physical products such as seating and lounges, attentive service from employees both on board and on the ground and digital solutions throughout the travel chain. The Lufthansa Group factors its customers into its product developments as part of its strong customer focus. The goal is to improve the travel experience particulary in the premium segment, both in-flight and on the ground.
The Lufthansa Group is continuously expanding its product range so it can offer its customers a wider choice of selectable product components, enabling them to customise their travel planning. Besides digital solutions, the focus is also on encouraging interactive and personal dialogue and providing solution-oriented customer services. In designing its range of products and services, the Lufthansa Group has also taken sustainability issues into account to meet the growing demand for more sustainable products. This includes offers designed to compensate or reduce the carbon emissions caused by flights, waste avoidance and a continuously expanding selection of intermodal travel options.
To evaluate and improve its customers’ experience, the Lufthansa Group regularly measures customer satisfaction levels and its recommendation rate, in the form of a net promoter score (NPS). It also uses analytical tools such as customer feedback, trend analyses, market research results and monitoring of the competitive environment for this purpose. Using passenger satisfaction tracking (PST), around 30,000 customer responses are collected every month, providing the basis for evaluating the level of satisfaction throughout the travel chain. Specific issues such as the way irregularities during the journey are handled and how more sustainable travel options are perceived are assessed in depth. For example, the aspects considered include communication and problem-solving in cases of delayed or cancelled flights and baggage irregularities. More than 3,100 participants have already been actively involved in the early stages of product development through a specially created online platform, the Co-Creation Hub, which offers a means of direct dialogue via surveys, workshops and interviews.
Organisational foundations and responsibilities
The Executive Board function “Brand & Sustainability” is responsible for developing an industry-leading travel experience for customers of the Lufthansa Group, promoting more sustainable travel and designing modern digital solutions. Particular emphasis is placed on cross-functional collaboration, transparency and an entrepreneurial mindset.
Since the reporting year, the Brand Portfolio Management & Global Marketing department has been responsible for the Lufthansa Group’s overall brand portfolio and global marketing strategy within the Brand & Sustainability function. The purpose of this is to achieve an appropriate level of differentiation between the Group’s brands. In addition, this department is responsible for marketing activities in all corporate customer markets, as well as those for private customers in all non-home markets. The further development of the loyalty programme at the Lufthansa Group’s passenger airlines also falls within this department’s remit.
Lufthansa Airlines, SWISS, Austrian Airlines, Brussels Airlines, Eurowings and Discover Airlines are independently responsible for the design and implementation of their in-flight and ground product, marketing and top customer management. Representatives from the Executive Board functions “Brand & Sustainability” and “Global Markets & Network” and the airlines’ Chief Commercial Officer functions meet regularly as part of the Customer Commercial Committee to discuss and make decisions on customer-focused topics. They also meet annually to focus on the product project portfolio.
Targets
Raising customer satisfaction is an integral part of the Group’s strategy
Consistently meeting customers’ needs plays a key role in generating a long-term commercial benefit for the Lufthansa Group and its Passenger Airlines. The primary objective of the customer strategy for all passenger airlines in the Lufthansa Group is to increase the level of customer satisfaction and the rate of recommendation. Recognising and fulfilling individual customer needs throughout the travel chain is essential to this.
The level of success in this respect is measured using the net promoter score (NPS), which reflects customers’ readiness to recommend the company. For Lufthansa Airlines, SWISS, Austrian Airlines and Brussels Airlines, an NPS target of 50 was set in the reporting year, while for Eurowings the target is 45.
Measures
Expanding the Group’s product range together with customers to meet the premium ambition
In the reporting year, the Lufthansa Group focused on fulfilling its commitment to being a premium provider, for its own benefit and for that of its customers. It made specific adjustments to its product range to meet customers’ changing needs, providing for greater individuality and enhanced comfort. One important step was the public presentation of a new cabin interior for long-haul flights with Lufthansa Airlines and SWISS. This initiative is based on an overall investment volume exceeding EUR 2.5bn and is aimed at incorporating more than 40,000 new seats into over 140 aircraft. The development process focused on customising the service. In particular, five different seat types were developed for Business Class in order to meet customers’ varying preferences. At the same time, work is under way on the development of a First Class Suite Plus to offer a higher degree of exclusivity.
In the reporting year, the Lufthansa Group also added food and drink options to its in-flight product and broadened the range of entertainment available at Lufthansa Airlines, SWISS and Austrian Airlines. For example, since the reporting year Lufthansa Airlines Business Class customers have been able to select from a new range of six regional and seasonal menus, giving them access to a wider selection of meals. In addition, more children’s podcasts, films and audio programmes were included in the entertainment offer for young passengers.
The Summer Ops Taskforce programme established in the reporting year improved operating processesparticularly during the busy summer months and thus the travel experience for customers. Optimised processes at the airport included, for instance, expanding the self-service area for Economy Class customers in Frankfurt and introducing modern technologies for the automated processing and forwarding of delayed luggage. This accelerated the delivery of luggage for over 500,000 customers in Frankfurt and Munich. This process, which was developed by the Lufthansa Group in collaboration with the airport operator in Frankfurt, was declared a new industry standard by IATA in 2023.
Customer relationships to be strengthened through digital solutions, customer services and personal interaction
In the reporting year, the Lufthansa Group implemented various measures to transform its customer interactions. These were intended to facilitate a shift from a purely transactional focus to an in-depth and more personal customer relationship.
For instance, the portfolio in service centres is being expanded and more automation is being brought into the area of customer service to enable customers to resolve issues themselves. Digital interactions are being reinforced through the Lufthansa Group app, which was introduced in 2023 and has been continuously updated ever since. The Lufthansa Group app and the Travel ID, a personal customer profile, offer customers access to a variety of Lufthansa Group services and the Miles & More programme. The aim is to make it easier for customers to manage their journeys and access information promptly where necessary, particularly in matters relating to baggage or booking changes. This makes it possible to customise offerings and services in line with customers’ personal needs. In the reporting year, this app received a user rating of 4.5 out of 5 stars in the Apple App Store.
Personal interaction with customers was also intensified in the reporting year. Overall, the availability of call centres in the reporting year hit a rate of over 94%, exceeding the 90% target. Waiting times for telephone calls were reduced by 87.5%, with an average waiting time of less than one minute. Written requests were also processed efficiently. For example, the processing time at Lufthansa Airlines has been brought down from around 40 days to a stable three to four days since May 2023.
With its status programme for frequent flyers, which was revised in the reporting year and came into effect from January 2024, the Lufthansa Group has taken a strategic step away from a transactional perspective in favour of an approach prioritising stronger customer loyalty and greater appreciation of all participating customers. The Lufthansa Group promotes customer loyalty by providing a broader selection of new and exclusive offerings and expanding partnerships, as well as offering dedicated options for customers who only make a small number of flights each year. In addition, greater efforts are being made to incorporate sustainability issues into the Group’s customer loyalty programme, such as more sustainable fares being counted towards status and award miles or fundraising campaigns. These measures are intended to support the goal of securing customers’ long-term loyalty and satisfaction.
An expanded offer of more sustainable products
The Lufthansa Group enables its customers to offset the carbon emissions caused by their flight through various offerings throughout the travel chain. These involve voluntary offsetting via climate protection projects and reducing carbon emissions by purchasing sustainable aviation fuel. The Lufthansa Group only uses certified projects for its carbon offsets that meet the highest quality standards, such as the Gold Standard, while for new technologies it also uses Verra and Puro.earth. The new technologies adopted in the reporting year include, for example, biochar, a method of long-term binding of CO2 via pyrolysis. The Lufthansa Group has also joined the carbon removal initiative launched by Airbus. This is seen as a highly promising solution for removing CO2 from the atmosphere. In the case of direct air carbon capture and storage (DACCS) technology, CO2 is filtered out of the air and permanently stored. The Lufthansa Group has signed a contract with Airbus on the advance purchase of verified and permanent emission reduction credits for 40,000 tonnes of CO2 using DACCS technology. The certificates will be available from 2026. Annual purchasing of carbon removal credits for 10,000 tonnes of CO2 over a period of four years has been agreed.
Following successful tests in selected regions in the previous year, Green Fares were introduced throughout Europe in the reporting year. With these fares, 20% of additional carbon emissions are reduced through the use of SAF and the remaining flight-related carbon emissions are compensated via a contribution to high-quality climate protection projects. Only SAF, which meets the quality standards under the European Renewable Energy Directive (RED II), is used. Since the introduction of these fares, the level of demand has developed positively, with around 10% in domestic German traffic and around 3% for flights within Europe. In the autumn of 2023, the Lufthansa Group tested its Green Fares in selected long-haul markets. 10% SAF is used to reduce additional carbon emissions and the remaining flight-related carbon emissions are offset by means of a contribution to high-quality climate protection projects. Subject to positive test results, this product is set to be introduced for all long-haul routes in 2024. In the corporate customer segment, the “Sustainable Corporate Value Fares” were added to the offering in the reporting year. This was in addition to the established “Corporate Value Fares” programme, where emissions from corporate customers’ flights within Europe and domestic flights are automatically offset through contributions to climate protection projects. As with “Green Fares”, in the case of the “Sustainable Corporate Value Fares” offsetting is achieved through a mixture of reducing carbon emissions via SAF and contributions to climate protection projects.
Since 2021, the option of reducing carbon emissions for air transport services has also been available in the logistics business segment. Lufthansa Cargo customers can use the “Sustainable Choice” service to offset individual shipments through a portfolio of climate protection projects or cut down carbon emissions in combination with SAF. Lufthansa Cargo offers global freight forwarders a bulk agreement that allows them to use large volumes of SAF to reduce carbon emissions. Entire charter flights can also be operated on a more sustainable basis. To date, Lufthansa Cargo has completed more than 200 joint flights with one of its customers.
To make the intermodal travel options offered even more attractive, as well as continuously expanding the range of services, all bus and rail connections to and from the Lufthansa Group’s hubs were optimised to simplify the process of switching between different means of transport. For instance, the signage at the largest transfer point, the AiRail Terminal at Frankfurt Airport, was improved in the reporting year. Moreover, customers are provided with comprehensive information during their journey about the transfer process and baggage check-in and collection by means of announcements made on the train and in-flight and via automated notifications in the Lufthansa Group app. ↗ Combined non-financial declaration, Environmental concerns / Climate protection
In addition, various measures were developed and implemented in the reporting year with the aim of reducing in-flight waste, while concepts already established in some areas were expanded to include further airlines. For example, fresh products for sale on the final flight of the day are now also made available for purchase at reduced prices at Lufthansa Airlines and products can be pre-ordered even before the flight. Both of these measures are intended to reduce the volume of food waste. In another development, specific disposable items have been substituted with reusable ones, while disposable plastic packaging has been replaced with materials made from renewable resources. In the reporting year, the Lufthansa Group’s Passenger Airlines managed to cut down their disposable waste, food waste and waste from reusable products.
↗ Combined non-financial declaration, Waste management
Performance indicator
Recommendation rate is below target
The NPS is an indicator which measures the probability of customers recommending a company or brand. For Lufthansa Airlines, SWISS, Austrian Airlines and Brussels Airlines, the NPS was 27 in 2023 (previous year: 33, without Brussels Airlines) and thus below the target of 50. With an NPS of 44 (previous year: 37), Eurowings slightly missed its target of 45.
The reasons for this deviation from the target level primarily relate to irregularities in flight operations and factors such as delayed luggage delivery. Even though the Lufthansa Group’s Passenger Airlines are also dependent on smooth interaction with system partners such as air traffic control, airport operations and baggage handling services providers, this impacts assessments of the Lufthansa Group.
The NPS is a component of the target agreement and the variable remuneration of the Executive Board.