Airline Customer Experience by Rainer Uphoff - 2010 World Ticket Keynote

8/8/2019 Airline Customer Experience by Rainer Uphoff - 2010 World Ticket Keynote

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Sell-More-Seats

Customer ExperienceLeadership: The ultimate strategic

alignment tool


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My name is Rainer Uphoff and I am avi on line


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Lets go!

CustomerExperience

Leadership


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Customer Experience Leadership

What is so new about

Customer ExperienceLeadership?


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Customer is King is not new at all!


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1980s Customer Centric Company

1990s CRM, Loyalty Management

2000s Customer Experience


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RESULTS?


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Surprise!

The customer is less loyal than ever.


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2000: Customer ExperienceManagement (CEM) was born

In the airline industry, thiscoincided with something else

?


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Lets look at aviation history


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1930s 1970sRegulated Environment:

the pilot-CEO is King!


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1970s 2010sDeregulation and Competition:

The CFO-CEO is King!


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And then, something happened:


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Key words slide


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Where is the limit?


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What can we do whenshaving the skull

is no longer anoption

?


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Thetime of the

customer-CEOhas come

!


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Lets remember:1980s Customer Centric Company 1990s CRM, Loyalty Management

2000s


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Lets talk about STRATEGY

Differentiate!

LISTEN, LISTEN, LISTEN

Manage expectations(learn from Ryanair)

Offer VALUE, VALUE, VALUE

Deliver what you promised!


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Differentiate!

Michael Porter:either chose cost leadership or

differentiation strategy.

Some leaders are doing both.


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Differentiate!

Porter: either chose costleadership or differentiation

strategy.

Some are leaders for doing


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Differentiate!

I know, you are a regional carrier.

Is geographical differentiation

enough?

Anybody here wanting to be the

SIA, Jetblue, Ryanair of theregionals?


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Differentiate!

Strategic imperative: regional startup airlinereaches competitive relevance in YEAR 3

Competitionrecognises

opportunity


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Do you know what yourcustomers really want?

Do your surveys say what youwant to hear?

Even family businesses need toLISTEN!


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Social Mediaare EFFICIENT

and FREE

LISTENINGtools.

Are youusing them?


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Manage expectations

Go back to the drawing board!

Perceived service quality Expectation (created)= Value > Profit


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Manage expectations

Learn from Ryanair!

Expectations MUST be thoroughlymanaged.

Otherwise, you have NO CONTROL

over your value proposition.


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Manage expectations

Overpromise:long term problem

Brand equity declines

Underpromise:short term problem

unrealised yield potential


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Passengers-buy through the same bookingsystem (except WorldTickets!)

-are extorted to pay the same fees

-are dispatched by the same

handling agent-fly on the same aircraft


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CFO-CEOs(+consultants) arethe scientists of the

XXI century:They discovered theSERVICE ATOM =theperfect COMMODITY


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Service unbundling and costcutting has COMODITISED air

transportation.

Only COST LEADERS aresuccessful in the commodity

business.

But there is only ONE Ryanair.


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Go back to the drawing board

DESIGN services VALUED bycustomers.

Find IT systems to support thevalue creating processes.

Be INNOVATIVE.


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Which meal do your prefer?

THIS

OR THIS?PRICE:

9 VALUE:!?!

Watch out forAAs practical

jokes onnapkins


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Ancillaryrevenues must

generate VALUE,

not be a TAX


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You LOVE tocheck-in yourbaggage and

appreciate thevalue whenbeing invited topay for thisbeloved service,dont you?


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Fortunately,some airlineshave changed

their mindsetalready fromthinking COSTto thinkingVALUE!


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Repeat with me:

Dont (only) think cost.THINK VALUE!


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Go back to the drawing board

Deliver beyond your promises.


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Lets do it!

( The Customer Experience Journey starts in the WEB! )


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First, get the basics right!

H e y g u y s , w e r e i n 2 0 1 0 !

Q u i r k s W HAT ?

C m o n y o u c a n t a f f o r d t o d o t h a t !


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Second, understand yourcustomer+his/her preferences!

T h a t s s m a r t

.

N G p a x p r e f

e r

c h a t o v e r p h

o n e


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Third, get your organisation ready.

Make the customer your strategic

goal.Gain support from the top.

Obtain buy-in from all stakeholders.


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Without anadequatestrategic

alignment model,you will loseefficiency.

Environment

Strategy

Competencies

Organisation

Process

People

Structure

Culture

are executed by

is supported by

determines aligned


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Fourth: know your corporate silos.

Is maintenance as urgency

driven as the gate agent? Is marketing making promises

that operations cant keep?

Do you even analyse this?


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Fifth: get the metrics right.

Do you know what to measure?

Do you use industry best practicemetrics, such as the NPS?

Do you measure perception gaps?


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Sixth: align the organisationDo you have clear customer

related targets?

Do you link these targets to thecorporate motivation system?

Do you hire the right people and know how to find them?


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Seventh, know and apply the toolsVoice of Customer

Customer Experience Journey Mapping

Service Design

Audits


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Customer Experience Mapping

Scenario 1 We have seen promotions. We need a lowcost flight for aweekend in Prague

Scenario 2 We have a business meeting in Lisbon on 02/11.


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Nice, but

SHOW METHE MONEY!


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Show me the money!

Customer Excellence to strengthenthe organization vs. the FIVECOMPTETITIVE FORCES:

1. Customer negotiation power2. Provider negotiation power3. Threat of New Market Entrants

4. Threat of substitutive products

5. Rivalry among competitors


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Show me the money!

Customer Experience Leadershipis not nice to have.


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Show me the money!

1. Customer negotiation powerGive value: customers will WANT to buy from you

2. Provider negotiation powerGrow, be reliable: providers will WANT to work with you

3. Threat of New Market EntrantsDifferentiate by value: give new entrants a HARD TIME

4. Threat of substitutive products Innovate to solve customers real needs: theyll stay with you

5. Rivalry among competitors If your business is built around the customer, youhave NOTHING TO FEAR


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Show me the money!

Customer-ROI is KING!

Are you able to recognise toxic profits?

Are you computing CEM value creation?

What about customer equity, brand equity, stockholder value?

Think long-term!


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Show me the money!

Without CEM, brand credibility deterioratesand customer equity declines.

This destroys long term value while shortterm cash flow still remains positive.

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Example : 5%yearly decline inbrand credibilitytranslates intoslow cash flowreduction, butcustomer NPVdisaster.


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Show me the money!

And remember: Ancillary Revenues must come

from value you generated.

Otherwise you are charging aTAX.

Who loves the taxman?


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Visit ourpax.com (not theirpax.com)


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Any questions? Thank you!

Email: [email protected]: ruphoff

Blog: www.ourpax.comTwitter: rainerup

Documents

Airline Customer Experience by Rainer Uphoff - 2010 World Ticket Keynote