Brand Analysis Lufthansa - Brand Management

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    Brand Management - Lufthansa

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    Tongji University Shanghai

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    1. Overview

    Deutsche Lufthansa is a globally operating aviation company that comprises of approximately

    400 companies as well as subsidiaries. Founded in the year 1953 it is currently employing

    around 120.000 people all over the world. Lufthansa's registered office and corporate

    headquarters are located in Cologne. Frankfurt Airport is Lufthansas primary traffic hub, the

    majority of Lufthansas employees (Pilots, ground staff and flight attendants are based there),

    even though the LAC (Lufthansa Aviation Center) is located there. Frankfurt is followed by

    the secondary hub Munich Airport and then Dsseldorf Airport, where the subsidiary

    Germanwings is based. Lufthansa is also one of the five founding members of the Star

    Alliance, the world's largest airline alliance, formed in 1997. It consists of five business

    segments, which encompass the areas of passenger transportation, airfreight and airline

    services: Passenger Airline Group, Logistics, MRO, Catering and IT Services. All of the

    business segments occupy a leading position in their sectors and in some cases are the global

    market leaders.

    a)

    Passenger Transportation

    The Passenger Transportation business segment is the core business activity of Deutsche

    Lufthansa. It operates a network of scheduled flights that carry passengers from one

    destination to another. The airlines belonging to Lufthansa are considered among the best in

    the world. It operates a fleet of more than 650 aircrafts with over 200 destinations in around

    85 countries.

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    This segment includes Deutsche Lufthansa AG, Air Dolomiti, Lufthansa CityLine, SWISS

    and the Eurowings group, including Germanwings and the other brands which are displayed

    in the picture above.

    The destinations in Europe, America and also the Asia/Pacific region belonging to their major

    sales market. The customer base of Lufthansa can be split up in 3 sections which accounting

    for more than 2/3 of the total companys revenue.

    Corporate customers

    Travel agency chains

    Private costumers

    b) Logistics

    Deutsche Lufthansas wholly-owned subsidiary Lufthansa Cargo AG is in charge of airfreight

    and the marketing of air cargo capacities. It serves airfreight product segments, from td.Pro

    the standard segment, to express like td.Flash and some specialized segments. The range of

    Lufthansa Cargo covers over 500 destinations. Lufthansa corporates in his network with 120

    business partners and over 1000 freight forwarders and original dispatchers.

    c) MRO-Services

    The MRO (Maintenance, Repair, Overhaul) is the Lufthansa Technik service which is among

    the worlds leading providers of maintenance repair and overhaul services for commercial

    airlines. Lufthansa Technik is divided into six division, from Overhaul, Engines, Components,

    Maintenance, Landing Gear and Completion. The group operates through 27 MRO

    destinations while serving more than 600 companies are located worldwide and with

    maintenance centers in Frankfurt, Munich and Berlin.

    d) Catering

    With the LSG Service Holding AG (Brand Name: LSG Sky Chefs) Lufthansa is also offering

    catering services and integrated in-flight solutions. It is the worlds largest provider of this

    kind of catering, serving nearly 300 international airlines including all major international

    airports.

    e) IT Service

    The companys Information Technology (IT) services segment provides IT services through

    the Lufthansa Systems group. for the airline and aviation sectors. From Airline Management

    Solutions, Passenger Airline Solutions, Airline Operations Solutions, Industry Solutions and

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    Infrastructure Services for airlines as well as other companies to run services in their

    infrastructure. It serves nearly 180 regular customers principally in the aviation industry,

    logistics service providers, banks and financial service providers, industrial companies and

    public transport operators. Currently, it has operations in Germany and some other foreign

    countries.

    Lastly, Deutsche Lufthansa classifies its geographic segments into six regions namely:

    Europe including Germany,

    North America

    Asia/Pacific

    Middle East

    Central and South America and Africa

    2.

    Brand history

    If you take a deep look into the history of Lufthansa you can trace it back to 1926 when

    Deutsche Luft Hansa A.G. was founded in Berlin. It was renamed into Deutsche Lufthansa in

    1933 and became Germanys flag carrier until 1945, when all services were suspended

    following the defeat of Germany in the Second World War. During the Post-War Era

    Germany put great efforts into create a new national airline. At this point in time the

    Aktiengesellschaft fr Luftverkehrsbedarf (Luftag) was founded on the 6. January 1953 in

    Cologne. So far West Germany hadnt have sovereignty over its own airspace so there was an

    uncertainty when the new airline could become operational. In the beginning of August 1954

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    Luftag finally purchased the name and logo from Deutsche Lufthansa to continuing the old

    tradition of the German flag carrier. Shortly after the acquisition, Lufthansa got approval to

    start scheduled domestic flights in West Germany. Linking the German airports Hamburg,

    Dsseldorf, Frankfurt, Cologne and Munich, soon followed by international flights. In 1987

    Lufthansa, together with Air France, Iberia, and Scandinavian Airlines, founded Amadeus, an

    IT company (also known as a GDS) that would enable travel agencies to sell the founders andother airlines' products from a single system. In 1988 Lufthansa gained a new corporate

    identity, so their fleet, cabins, city offices and airport lounges got redesigned. The now

    biggest and worlds first multilateral airline alliance Star Alliance was founded on May 18,

    1997 by Lufthansa, Air Canada, Scandinavian Airlines, Thai Airways, and United Airlines. In

    the following years, Lufthansa acquired SWISS in 2005, Brussels Airlines, and Austrian

    Airlines in 2009.

    3.

    Brand positioning

    In this paper, I will only concentrate on the main brand Lufthansa which is connected to theairline as itself. Other business segments, which are belonging to the Deutsche Lufthansa AG

    as well, will not be touched in this paper. Lufthansa is positioned as a premium airline in the

    market. They are charging higher prices for their quality product then their competitors. High

    Quality is associated with the brand Lufthansa it links the message better to it, that is why

    Lufthansa can differentiate themselves from their competitors.

    a) Points of Parity

    The Points of Parity of Lufthansa are those associations or particular attribute or Lufthansa

    that can attract the customer easily. Lufthansa as a brand has a reputation as a high quality

    airline, as well as a good reputation for excellent service. Furthermore safety is one of the

    most important concerns of Lufthansa. This Point of Parity is enhanced also from the history

    and background of the airline, based in Germany, so here comes the association with the good

    reputation that products Made in Germany earned in the last century. Good service is also

    associated with Lufthansa as a brand. Its a symbol for a premium airline which offers and

    personal individual service for all their flight guest, starting at economy to the first class.

    Another aspect that customer implies with the brand is the feeling for holiday, exploring

    another place in the world and having a great time. A journey that means flying from one

    destination to another is still something very special even for a lot of people in Germany.

    Arriving at the airport and getting on a plane is really exciting. Lufthansa could manage it

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    over their long tradition to associat