Lufthansa counts on business intelligence data

With a focus on generating new business and introducing new customer services, Lufthansa has become increasingly dependent on data and analytics for customer and marketing insights

The Lufthansa Group is a global aviation group with a total
of 540 subsidiaries and equity investments, which in the financial year 2015
were organised into the Passenger Airline Group, Logistics/Cargo, MRO, Catering,
Financial Services and other business segments. All the segments occupy a
leading position in their respective markets. LH Group (Deutsche Lufthansa, Germanwings,
Eurowings, SWISS, Austrian Airlines and other small carriers) is now a
multi-brand organization with over 120,000 employees all over the world. It has
equity interests in Brussels Airlines and SunExpress.

With a focus on generating new business and introducing new
customer services, Lufthansa has become increasingly dependent on data and
analytics for business insights. In fact, it has set up a business intelligence
unit for this purpose. The unit is responsible for acquiring new data sources
that are required for market steering. It integrates those sources into a
commercial data warehouse. It also uses certain tools to analyse that data and
share insights in the organization.

Addressing the media
at Teradata Universe 2017, Heiko Merten, Head of Global Sales Business
Intelligence Applications, Deutsche
Lufthansa AG said, “The aviation industry is moving from transporting people
from point A to B to offering additional services. We are also selling

The airline business is a low margin industry that depends
on passenger volumes. In the highly competitive industry it is customer value
that really distinguishes one airline from another. And this is what Lufthansa
is moving towards.

Three years ago the LH Group launched project SMILE with the
objective of analysing customer behaviour and creating individual offers. 

“We are collecting a lot of data from the website and social
media, and we try to create those patterns. From those patterns we create the
individual offers,” said Merten. “So this is a change in our business model and
in the way we reach out to our customers, more individually and also in a more
automated way.”

Lufthansa has moved from the traditional sales organisation
with account management to a new organisation that reaches out to customers
with personalised offers.

Internally, Lufthansa created centralised BI teams that work
for different commercial units. Merten
designed the requirements and responsibilities of a new interdisciplinary
business intelligence unit for the company’s commercial departments and
incorporated with his team a new performance management system based on
integrated data.

“We are looking at creating standardised reports based on
all the data in the data warehouse. This data comes from different sources and
different airlines and it has to be consolidated in the same data warehouse. So
we need to put in a lot of effort in aligning different definitions for the
same concept. For instance, the different airlines have their own definition of
‘revenue’ and this must be standardised,” he said.

Aligning definitions, different reports and different data
sources from the different airlines in the group is a difficult task for Merten
and his team. There are cultural issues as well.

LH Group has chosen the Teradata Travel & Hospitality
Data Model as critical enabler to set the ground for a new powerful performance
management for the commercial units such as Sales, Revenue Management, Network,
Controlling and Marketing. Besides this LH Group aims to empower business
analysts in terms of Self-Service BI to get new insights and generate
additional revenue sources out of the data.


The writer was hosted in Nice, France by Teradata.

Tags assigned to this article:
lufthansa analytics big data


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