• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
  6. 6
  7. 7
  8. 8
  9. 9
  10. 10
  11. 11
  12. 12
  13. 13
  14. 14
  15. 15

Relationship Management - investigating in to the application of the frequent flyer programme, a CRM based database and the related strategies in the Airline sector

Extracts from this document...


1.0 Introduction Customer Relationship Management is a management process, which enables organisations to identify, attract and increase the retention of customers by managing customer relationships. This report will be investigating in to the application of the 'frequent flyer programme,' a CRM based database and the related strategies in the Airline sector. Free flight programmes give airlines customer loyalty by knowing who their customers are, through the use of database marketing. It is a key part of CRM strategy ensuring near-term survival and medium and long term revival for airlines. (Siebel 2005a) The report will concentrate on, BA airlines, Virgin Atlantic and the growing BMI company, UK's three key players in the fragmented airline industry. This is due to the variety of market segments their serve to, competing against increased competition, decreased product differentiation, demand and loyalty, with increased price pressures. (Siebel 2005a) 2.0 Market Overview Air travel represents a minor mode of transport for UK travel and tourism industry. (Euromonitor, Sept 2005a) Air transport sales amounted to �9 billion in 2004 (Euromonitor, May 2005a) According to Euromonitor (May 2005b) it is the preferred mode of arrival in the UK accounting for 73% in 2004. It held the largest share of departures at 76% in 2004, with a significant rise of 26% over four years. (Euromonitor, May 2005c) British Airways (BA) is the dominant UK airline; its share by turnover was 52% in 2004 against 54% in 2003. This decline in shares is to the low-cost carriers, who are continuing to grow their share, such as EasyJet and Ryanair. Both airlines hold 16% of the market share between them. (Euromonitor, May 2005d) The second largest operator in the UK is Virgin Atlantic which has increased the value of shares from 10% in 2001 to around 17% by 2004, due to continued investment in new airlines and products. (Euromonitor, May 2005d) British Midland, 'BMI,' holds 5% of the UK airline value and operates over 2,000 flights per week mainly in Europe in addition to their budget flights with the 'bmibaby' brand. ...read more.


Most companies use this technique. ACI holds the following information: * The flight number * Passengers name * Seat number * Flying club number * Gender information * Baggage information Virgin Atlantic's customer recognition programme 'UNIQ', is linked to the ACI system so employees are able to identify passengers who require special treatment. This segmentation method is used for customers travelling on VAA routes.6 The numbers of UNIQ customers are recorded by the premier service team on to the lotus notes database at London Heathrow. This is linked to the CRM database, 'Avenue,'7 which incorporates the sales structure and analyses sales performance. It's used to plan the delivery of products and services that customer's want. Once BA's raw operational data is fed in to the database it is cleaned using proprietary software and a single customer view is created as part of the CRM strategy to understand the customer behaviour. Additional variables added on the database include:8 * Gender * Type of trip * Purpose of trip * Domestic/short European hop/long haul trip Life-stage, Lifestyle and Geo-demographics are used to support the primary data. Data exploration techniques are applied once the database has been cleaned; housed and enhanced, using a strategic communications plan. BA's bespoke value-behaviour segmentation model is used to understand and identify consumer relationships, this requires the customer information, including: * Number of flights they took * The flight destination * Length of trip * Seat Class * Number of people on the booking * Value of transaction BA's ICM and Teradata CRM supports email, direct mail, call centre and web channels, this technology supports e.g. * Online purchase, check in, and loyalty club registration * Value segmentation * Trend forecasting * Rapid campaign creation and implementation * Automated self service, using BA's CEBA (Customer-Enabled BA) * Personalised communication and customer service * Direct email campaign execution * Personalising website 'landing pages' Identification of special events in the year is used to predict forecasts and how the FFP data would be used to compensate for unusual days and/or adverse weather conditions. ...read more.


* Companies can save money by redeeming points for a range of travel products like reward flights, reward flight upgrades and Hotel accommodation. This service is open to a company with five or more travelling employees. * The Loyalty Marketing Lifecycle continues and more promotional activities are created 10.0 Conclusion The CRM not only depends on the database management but also the relationship management strategy and the contacts and communications. (AAI, 2001a) In reality there are many databases used by the companies which are interconnected, it is the ability of the system that can hold and help to translate the data in to useful meaning, which largely depends on the manager's aptitude to use the system to its full potential. It requires cross-communication between the differing managers and staff working around the specific database. Each database is likely to have a specific objective for storing particular information e.g. check in system, inbound calls, promotions etc. Despite analysing each database the core activities surround the inter-relation of the information between these databases. Customer information is segmented in accordance with customer buying behaviour and location, which is important because of their geographically diverse operations. 1 Please refer to Appendix 1 and 2 for graphical representation of CRM's importance within the airline industry and the increased focus on FFP as part of CRM strategy. 2 RFV stands for Recency, Frequency, Value 3 Please refer to Appendix 3-5 for the companies loyalty program benefits 4 Please refer to Appendix 10 for the application forms which the companies ask to fill over their Internet sites. 5 Please refer to Appendix 11 for a comparison of the online booking system and information that is required. 6 Please refer to Appendix 12 for the different headings that fall under UNIQ. 7 This is part of Saratoga's off the shelf package (Saratoga, 2000) 8 This is collected via promotions and campaigns 9 Please refer to Appendix ?? ?? ?? ?? ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Computer Science section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Computer Science essays

  1. Marked by a teacher

    The systems development life cycle (SDLC) is a conceptual model used in project management ...

    3 star(s)

    Visualisation of a design is another benefit. We all know how difficult it is to picture an end-product from a paper specification. By creating prototype models and simulations we can improve our understanding of what is to be developed. Once a prototype has been created for a project, it is easy for everyone to gain a 'sneak

  2. Video Club Database Project

    The following is the data flow of the proposed system. The system to be developed is a customer information system, and is intended to enhance rather than replace the current system of recording music and customers records. If this proves successful, it will be possible at a future date to

  1. Discuss the relationship that exists in the UK between the legal rules that govern ...

    Even in cases where it is not required by law or preferred by The Stock Exchange it is needed to ensure the confidence of stakeholders and shareholders. Good governance is crucial for a company to succeed in the future. The need for corporate governance is highlighted by the corporate failures

  2. Today's competitive global business environment, understanding and managing enterprise wide information is crucial for ...

    According to the FBI, for a computer-related crime to become a federal crime the attacker must be shown to have caused at least $5,000 worth of damage. This is why spammers who access open relay mail servers get way with transmitting their floods of e-mail through other people's mail servers

  1. Different ways of data capture

    up to date copy can be created from the backup copy togeather with the transaction log using a utility program. * Using RAID - These devices use a technology that enables data to be hand written simultaneously to several discs.

  2. Tod's Tyres is a small business that supplies new car tyres to company car ...

    System design Entity relationship diagram... Security and integrity of data Data integrity refers to the correctness of the data; the data held in a computer system may become incorrect, corrupt or of poor quality. For example: * Errors on input * Errors in operating procedure * Program errors * Viruses

  1. Programming Techniques

    A test plan should test all unexpected occurrences. Test Strategies The aim of any test plan is to try and make a program fail. It is to try and find bugs in the program. White box Testing (also known as 'glass box testing')

  2. I have been given the task to design a database for a company called ...

    Sending out questionnaires and analyzing results. 3. Observing current procedures with current system. 4. Examine current business and systems documents and outputs. PROBLEMS OF PRESENT SYSTEM The Present Postquick Parcels postal delivery system has made several specifications, which suggest at what the present system's problems are.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work