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The Air France-KLM group has an great reputation when looking at customer experience and the usage of technology to enhance customer experience. Many innovations have led to this customer experience, such as Spencer the robot, the development of electronic bag tags and tracking devices, the use of artificial intelligence to provide customer service channels and the Happy Flow biometric token trails. These are a few examples of the innovation of the Air France-KLM group in the past years (Future Travel Experience, 2017).

What is customer intimacy?

Customer intimacy, means segmenting and targeting markets precisely and then tailoring offerings to match exactly the demands of those niches. Companies that excel in customer intimacy combine detailed customer knowledge with operational flexibility so they can respond quickly to almost any need, from customizing a product to fulfilling special requests. As a consequence, these companies engender tremendous customer loyalty (Treacy and Wiersema, 1993).

Customer intimacy at Air France-KLM

Air France-KLM strives to be the leading airline in customer intimacy. To get there, technology has to play a critical role, but the group knows that the largest impact on the customers’ experience journey can be gathered by customer interaction.

The group is investing in a customer relationship system and customer care and recovery, as part of their strategy. The biggest challenge for the group is to gather all relevant data and make them instantly available, which is difficult with many online and offline touchpoints. The ultimate goal is to ensure that front-line staff have an accurate real-time view of their customers, and on any servicing needs or commercial opportunities (Future Travel Experience, 2017).

Pozas Lucic (VP of innovation) highlighted an example ow how the connected customer relationship management system will benefit the experience of passengers in the near future. Imagine a connecting passenger who is flying Delhi-Amsterdam-Chicago. The passenger is a vegetarian and ordered a vegetarian meal, but by mistake this meal is not on the flight. Currently, new vegetarian meals cannot be created during a flight. With the introduction of the new connected CRM system, crew members can put a message in their devices asking the ground staff to pick the passenger up at the gate and guide them to the lounge where they can provide a vegetarian meal. After that, an automated message will also be sent to adjust the booking details so that it doesn’t happen on the connecting flight and the return flight (Future Travel Experience, 2017).

The success of customer intimacy for Air France-KLM

Air France-KLM was not afraid to differentiate their products and simplify the travel experience. All the innovation led to a 4-star airline quality rating (4 out of 5 stars)(Airlinequality.com, 2017). In Air France-KLM, innovation is everywhere and not just in a single department, which is why the group became successful. The group scores particularly well on the airport service such as the arrival assistance (on the spot recovery), check-in service and transfer service (biometrics and robotics) and the baggage delivery (e-tag and baggage tracker solutions)(Airlinequality.com, 2017).

Air France-KLM set the goal to become the leading airline in customer intimacy. The airline group is determined to simplify the journey, to offer passengers what they want when they need it, and to deliver personalised experiences. While neither the human interaction nor technology can achieve this alone, together they could well redefine the entire Air France-KLM experience (Future Travel Experience, 2017).

References

Airlinequality.com. (2017). Available at: http://www.airlinequality.com/ratings/klm-royal-dutch-airlines-star-rating/ [Accessed 9 Mar. 2017].

Airlinequality.com. (2017). Available at: http://www.airlinequality.com/ratings/4-star-airline-ratings/ [Accessed 9 Mar. 2017].

Future Travel Experience. (2017). Air France-KLM’s customer intimacy strategy: tech and human interaction. [online] Available at: http://www.futuretravelexperience.com/2017/02/air-france-klms-customer-intimacy-strategy/?utm_source=Future+Travel+Experience+Newsletter&utm_campaign=0d54fdd27d-fte_otg_100217&utm_medium=email&utm_term=0_c306aa3edf-0d54fdd27d-89986809 [Accessed 8 Mar. 2017].

Treacy, M. and Wiersema, F. (2017). Customer Intimacy and Other Value Disciplines. [online] Harvard Business Review. Available at: https://hbr.org/1993/01/customer-intimacy-and-other-value-disciplines [Accessed 8 Mar. 2017].

The largest mining trucks in the mining industry can easily handle loads of over 500 tonnes, which means that these trucks need reliable tyres to drive on. The tyres have to be resistant to rocks and possible punctures, since repairs or changes to the tyres are very expensive and time-consuming. Mining Tire Group Kal Tire though they could do much more than simply supplying tyres and providing service for tyres. The company possesses decades of global expertise, that could be used to develop innovative solutions to improve performance and safety (Topf, 2017).

What is customer co-creation?

According to Prahalad and Ramaswamy (2004), co-creation is defined as ‘’the joint creation of value by the company and the customer; allowing the customer to co-construct the service experience to suit their context. In other words, it means that new ideas are produced by the company and the customers working together. Mostly, this increases the customer satisfaction because customers feel the company really listens to their feedback, and uses it to improve their products or services. If customers feel the company is delivering to their specific needs, customers want to be even more engaged with the company (Topf, 2017).

Customer co-creation at Kal Tire

Innovation and R&D manager Nilsson said Kal Tire is asking their customers for feedback as to how it can expand into other areas and become more innovative (customer value proposition) (Topf, 2017). As a result, the Innovation Centre was born in 2015. Kal Tire can develop new tools and processes to increase productivity and safety. Nilsson stated ‘’we are generating ideas from the operations on a regular basis which we then evaluate and see how we can start these ideas”. When looking at innovative servicing, Kal Tire made improvements to service contracts, which are generated from customer feedback or from within.

“Customers are looking for products or solutions that will solve their problems and make their life easier, so customers’ expectations will continue to drive innovation,” Nilsson said. As a result, all members of Kal Tire are encouraged to contribute ideas for projects for the Innovation Centre, in order to promote safety, performance and add value for customers (key resources and process). Finally, this innovation is going to give Kal Tire and their customers a competitive edge (Topf, 2017).

The success of customer co-creation for Kal Tire

Co-creating is very successful for Kal Tire. They use decades of knowledge in the mining/tire industry, to improve customer engagement, as well as customer satisfaction (joint profitability). This structure leads to an influx of new ideas while lowering R&D costs. Currently, the Innovation Centre is comprised of four truck bays with electrical and pneumatic outlets. The Innovation Centre is a way for Kal Tire to develop new tools and processes to enhance customer productivity and safety in the field. Examples include a ram mount tool and a remote-controlled service trolley.

They develop ideas in the Innovation Centre, engineer it, certify it, and perform a three-month field test. After this, the Innovation Centre will get videos, pictures and reports. If successful, Kal Tire will make the new product available to the entire Tire Group. Thus, the feasibility requirement is met since the co-creation concept is implemented and turned out to be successful. The institutional environment is not as relevant, because customers only interact with employees of the Innovation Centre to share ideas (Topf, 2017).

References:

Topf, A. (2017). Customer-centric innovation model a big win for tire supplier | MINING.com. [online] MINING.com. Available at: http://www.mining.com/customer-centric-innovation-model-a-big-win-for-mining-truck-supplier/ [Accessed 4 Mar. 2017].

Prahalad, C. K., & Ramaswamy, V. (2004). Co-creation experiences: The next practice in value creation. Journal of interactive marketing, 18(3), 5-14.