The Advantages of Loyalty Programms for Customers. A Case Study of the Lufthansa Miles & More Programm

Table of Contents

• 1 Introduction
• 1.1 Research Question and Methodology
• 1.2 Definition of Customer Loyalty and Loyalty Card
• 1.3 Different Types of Loyalty Programs
• 2 Lufthansa’s Miles & More Program
• 2.1 The History of Lufthansa’s Miles & More Program
• 2.2 The Network of Star Alliance
• 2.3 Ways of Earning Miles in Lufthansa’s Miles & More Program
• 2.4 Ways of Spending Miles in Lufthansa’s Miles & More Program
• 2.5 Status Levels for Members of Miles & More
• 2.6 Customer Data Protection and Miles & More
• 3 Frequent Flyer Satisfaction Survey: Lufthansa’s Loyalty Program
• 3.1 The Survey as a Method of Data Collection for Empirical Research
• 3.2 The Design of the Survey
• 3.3 Data Collection of the Survey
• 3.4 Discussion of the Collected Data
• 4 The Most Important Advantages for Frequent Flyers
• 4.1 Free Executive Lounge Access
• 4.2 Free Amenities Attract Frequent Flyers
• 4.3 The Feeling of Being a Special and Important Customer
• 4.4 The Priority Pass as an Alternative Lounge Access Program
• 4.5 The Importance of Collecting Miles is Decreasing
• 5 Suggestions for Improvements to Lufthansa’s Miles & More Program
• 5.1 Change in the Earnings Ratio of Miles
• 5.2 Enhancement of Spending Miles and Reward Value
• 5.3 Introduction of New Benefits for Frequent Flyers of Miles & More
• 5.4 Improvement of Customer Satisfaction with Miles & More

Objectives and Key Themes

This bachelor thesis aims to analyze the advantages of loyalty programs for customers, specifically focusing on Lufthansa's Miles & More program. It investigates the key benefits perceived by customers, explores the program's effectiveness, and proposes improvements to enhance customer satisfaction and loyalty.

• The value proposition of loyalty programs in the airline industry, particularly in the context of competition from low-cost carriers.
• An in-depth analysis of Lufthansa's Miles & More program, including its history, structure, and benefits.
• Empirical findings from a survey of Miles & More frequent flyers regarding their satisfaction and perception of program benefits.
• Identification of the most valued benefits for frequent flyers and areas for program improvement.
• Suggestions for enhancing the Miles & More program to increase customer loyalty and engagement.

Chapter Summaries

1 Introduction: This chapter introduces the research questions driving the thesis: What are the most important benefits of Lufthansa's Miles & More program for customers? How do customers perceive these benefits? Why should Lufthansa invest in Miles & More? And what improvements could enhance its appeal? The chapter establishes the context of increasing competition from low-cost carriers and the need for premium airlines to differentiate themselves. It defines customer loyalty and loyalty programs, differentiating between single-partner and multi-partner programs, and positions Lufthansa's Miles & More within this framework. The methodology of the thesis, employing both literature review and an empirical survey, is detailed.

2 Lufthansa’s Miles & More Program: This chapter provides a comprehensive overview of Lufthansa's Miles & More program. It covers the program's history and its integration into the Star Alliance network, highlighting the advantages and challenges of this partnership. Detailed explanations of earning miles (including the shift from a mileage-based to a revenue-based model) and spending miles (with examples demonstrating the value proposition of different rewards) are presented. The chapter further explores the different status levels within the program, the associated benefits, and the importance of customer data protection in the context of loyalty programs.

3 Frequent Flyer Satisfaction Survey: Lufthansa’s Loyalty Program: This chapter details the methodology and results of an empirical survey conducted among Lufthansa Miles & More frequent flyers. The chapter justifies the selection of an online survey over telephone interviews, describes the survey's design (four parts focusing on demographics, flight behavior, miles usage and satisfaction), and discusses the data collection process (including challenges and limitations). Finally, the chapter presents a detailed analysis of the survey results, providing insights into the demographics of respondents, their satisfaction with the program, their preferences regarding various benefits, and other relevant aspects of their perceptions of Miles & More.

4 The Most Important Advantages for Frequent Flyers: This chapter analyzes the key findings from the survey, focusing on the most significant advantages of the Miles & More program for frequent flyers. It examines the importance of free executive lounge access, the role of free amenities in attracting and retaining customers, and the psychological benefits of feeling valued and appreciated as a loyal customer. The chapter also explores alternative lounge access programs like Priority Pass, comparing their value proposition to that of airline-specific lounges. Finally, it examines the changing importance of accumulating miles, considering the impact of the recent changes in Lufthansa's earning ratio.

Keywords

Customer loyalty, loyalty programs, airline industry, Lufthansa Miles & More, frequent flyer programs, customer satisfaction, empirical research, survey, benefits, lounge access, Star Alliance, revenue-based program, mileage-based program, data protection.

Frequently Asked Questions: Analysis of Lufthansa's Miles & More Program

What is this document about?

This document is a comprehensive preview of a bachelor thesis analyzing Lufthansa's Miles & More frequent flyer program. It includes a table of contents, objectives, key themes, chapter summaries, and keywords. The thesis investigates the advantages of loyalty programs for customers, focusing on the perceptions and satisfaction of Miles & More members. It also proposes improvements to enhance customer loyalty and engagement.

What are the key objectives of the thesis?

The main objectives are to analyze the advantages of loyalty programs in the airline industry, particularly for Lufthansa's Miles & More program; to understand how customers perceive the benefits of the program; and to suggest improvements to increase customer satisfaction and loyalty. The thesis explores the program's value proposition in a competitive market, examining its structure, benefits, and effectiveness through an empirical survey.

What is the methodology used in this research?

The research employs a mixed-methods approach. It involves a literature review to establish a theoretical framework and an empirical survey of Lufthansa Miles & More frequent flyers to gather firsthand data on customer satisfaction and perceptions of the program's benefits. The survey data is then analyzed to identify key advantages and areas for improvement.

What are the key themes explored in the thesis?

Key themes include the value proposition of loyalty programs in the airline industry, particularly in light of competition from low-cost carriers; an in-depth analysis of Lufthansa's Miles & More program, including its history and structure; empirical findings from a survey of Miles & More frequent flyers; identification of the most valued benefits for frequent flyers; and suggestions for enhancing the Miles & More program to improve customer loyalty and engagement.

What are the main findings regarding customer satisfaction with Lufthansa's Miles & More program?

The document previews the results of a customer satisfaction survey but doesn't provide specific numbers or detailed conclusions. The full thesis would contain a detailed analysis of the survey results regarding customer satisfaction with various aspects of the Miles & More program, including the value of earned miles, the benefits of different status levels, and the overall program experience.

What are some suggestions for improving Lufthansa's Miles & More program?

The thesis proposes several improvements, such as changing the earnings ratio of miles, enhancing the value of reward options when spending miles, introducing new benefits for frequent flyers, and improving overall customer satisfaction with the program. Specific recommendations would be detailed in the complete thesis.

What is the significance of the Star Alliance network in the context of Lufthansa's Miles & More program?

The thesis highlights the importance of Lufthansa's Miles & More program's integration into the Star Alliance network. This partnership expands the earning and redemption opportunities for members, providing access to a wider range of airlines and travel options. The impact of this partnership on customer satisfaction and program effectiveness is also analyzed.

How does the thesis address the changing dynamics of the airline industry (e.g., low-cost carriers)?

The thesis acknowledges the increasing competition from low-cost carriers and emphasizes the importance of loyalty programs for premium airlines like Lufthansa to differentiate themselves and retain customers. The analysis considers how the Miles & More program addresses this competitive landscape and what adjustments might be necessary to remain competitive.

What are the key benefits of Lufthansa's Miles & More program highlighted in the thesis?

The thesis explores several key benefits, including free executive lounge access, free amenities, the feeling of being a valued customer, and the various reward options available through the accumulation and redemption of miles. The relative importance of these benefits is assessed through the customer survey and discussed in detail.

What are the keywords associated with this research?

Keywords include customer loyalty, loyalty programs, airline industry, Lufthansa Miles & More, frequent flyer programs, customer satisfaction, empirical research, survey, benefits, lounge access, Star Alliance, revenue-based program, mileage-based program, and data protection.