QuestionHow customer loyalty is encouraged and maintained in British Airways and how customer relationships established?
AnswerCustomer loyalty forms the most basic component of any growing organisation. Palmer and Bejou (2014) highlights that customer loyalty is the stepping stone of any successful firm, indicating that a new customer is three times costlier than a returning consumer. This rule applies directly on the highly competitive aviation industry. Singh (2014) states that returning customers form more than 60% of a commercial airline’s business and hence ensuring customer loyalty is a key goal of commercial airlines. British Airways, one of the pioneers of commercial airlines have developed bespoke loyalty programs to ensure consumers return to travel with them. BA Annual Report (2015) states that British Airways has introduced a unique loyalty program that goes beyond air travel and allows its members and frequent flyers to be part of an ‘executive club’. In order to provide a bespoke level of customer relationship, British Airways has a dedicated helpline for their top tier members and a relationship manager to help passengers that belong to the top tier of their loyalty club. BA Annual Report (2015) states that British Airways ensures a loyal customer base by utilising cross Atlantic partnerships as well as key strategic partnerships in Asia Pacific. This allows the firm to ensure that customers keep returning to the airline over and over again.
ReferencesBA Annual Report (2015) http://www.iairgroup.com/phoenix.zhtml?c=240949&p=irol-reportsannual Palmer, A. and Bejou, D. (2014) "Retrospective: service failure and loyalty: an exploratory empirical study of airline customers", Journal of Services Marketing, Vol. 30 Iss: 5, pp.480 - 484 Singh, A. (2014)"Competitive service quality benchmarking in airline industry using AHP", Benchmarking: An International Journal, Vol. 23 Iss: 4, pp.768 - 791
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