CEOInterviews.AI#2 Michael Trestl: Zielgerichtete Kundenkommunikation fördert Loyalität

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Manfred Lit0:13

Welcome to Treue Talk, the loyalty podcast about customer retention, powered by CHALA. How difficult is it in the current environment to bind customers to the company? Which successful approaches can be adopted from others? Is the cheapest price the deciding factor, and what role does digitalization play? I am Manfred Lit, and I conduct conversations with exciting personalities and market leaders from the DACH region. Today my guest is Dr. Michael Trestl, since January 2021 on the board of Austrian Airlines as Chief Commercial Officer. He is responsible for network management, revenue steering, purchasing IT, and Austrian Brand Experience. With Michael Trestl, we talk about the challenges of the airline industry, how Austrian takes care of its regular customers, how efficient the customer loyalty program is, and what sets Austrian apart, especially compared to low-cost airlines. I am very pleased to welcome you here today. Welcome, Dr. Michael Trestl! Good day, Dr. Trestl. You were appointed Chief Commercial Officer at Austrian Airlines in January 2021, in a relatively difficult time, exactly when Austria was still largely at a standstill. How did you feel about that?

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Michael Trestl1:40

Yes, that was an incredibly difficult phase that we at Austrian and the aviation industry overall went through during the pandemic. Global restrictions on air traffic brought practically everything to a standstill, and Austrian itself was completely grounded for almost three months — not a single flight except for a few cargo flights to China. When I returned to Austria in 2021 as CEO of AUA, it was a great responsibility, taking on this role when practically no revenue was generated but costs were incurred daily, and we depended on a state-backed rescue loan from KfW and other instruments. That was something special. It made you realize exactly what levers you have to pull. Fortunately, I had a great team that helped me very quickly and purposefully to get into the topics and set the right priorities so that we could manage it well.

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Manfred Lit3:00

I can imagine that wasn't easy. You just said you had a great team — was this team also on site, or did most of them work from home?

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Michael Trestl3:11

Most were indeed working from home. We split the teams into different colors that were not allowed to meet physically to ensure business continuity. On January 2nd, I went to the office to greet everyone, but no one was there. So I sat down at the computer and called everyone to get to know the team. It really showed how important personal contact is to build relationships and trust. I am convinced that works best in person, and it was a huge challenge that personal contact wasn't possible, but we still had to build a trusting working relationship quickly.

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Manfred Lit4:21

How long did it take until you actually saw your team fully live?

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Michael Trestl4:26

I would say a few weeks. We took the liberty of meeting outdoors, going for walks in the park, because it was incredibly important to me to get to know the people, including the wider team and other managers. Especially in that phase when many were working more than usual because the challenge was enormous, it was important to meet personally and build trust quickly.

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Manfred Lit5:07

It was partly very spooky at Vienna Airport and elsewhere. I remember during the first phase of the pandemic, I had my first flight from Vienna to Zurich and walked through a ghost town at the airport. I think on that day only four or five planes flew. You can hardly imagine that today.

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Michael Trestl5:26

Absolutely. I thought the same recently when I walked through Frankfurt Airport on a day when ground staff were on strike. It strongly reminded me of Corona times — the halls were empty, no staff or passengers. But fortunately, Corona is behind us, and planes and airports are full again.

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Manfred Lit6:04

Now let's briefly come to today. Thank God, the situation is completely different. Airlines are making real money again. Everyone wants to make up for the restrictions of Corona. There is a real catch-up effect — people feel they missed something and now act as if there is no tomorrow. Airports are full, planes are booked to the last seat or overbooked. Why is that?

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Michael Trestl6:35

There are several overlapping effects. First, the catch-up effect you mentioned, which still exists. After the Omicron wave in early 2022, demand rose rapidly as travel restrictions fell. North Atlantic and intra-European traffic resumed, leading to an enormous surge in private travel demand. Surprisingly, business travel did not recover as strongly as expected; instead, private demand came back much faster and stronger. By summer 2022 we had an incredibly high demand level that has continued to rise. In 2023, Vienna Airport had record passenger numbers, and Austrian Airlines nearly reached pre-pandemic passenger volumes. Demand recovered very quickly, fortunately, though the pandemic left deep scars in our books.

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Manfred Lit8:35

I can imagine it was partly frightening. At the office at the airport, looking out at all those parked planes was really creepy.

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Michael Trestl8:48

Absolutely. We made videos of the parked planes and shared them on internal channels with employees working from home. Not all planes were in Vienna; some were in deep storage at warmer, dry locations to prevent corrosion. It was an incredibly difficult situation that stirred emotions — the longing for distance, for international business, and to do what we love: connecting people.

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Manfred Lit9:51

You mentioned that business travel hasn't picked up as much as it should. Companies and employees have learned to use Teams and video conferencing. What is your speculation for the future? Will face-to-face meetings increase again, or will we stick to virtual meetings?

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Michael Trestl10:25

Business travel is recovering, but much slower than expected. Many have learned to work virtually, but it doesn't suit every occasion — creative processes and important negotiations are better in person. There is still demand for personal travel, but we believe there is a structural effect that will persist. In some markets, business travel volume is 20-30% below 2019 levels in 2024. Another effect is sustainability: many companies have changed travel policies to favor rail or even cars over air travel, sometimes without sufficient differentiation. These two effects — sustainability and familiarity with virtual tools — are overlapping.

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Manfred Lit12:13

You have Miles & More, a very strong customer loyalty program within the Lufthansa Group. The status levels — Frequent Traveler, Senator, HON Circle — are extremely important to customers. How does Austrian handle this? How important are loyal customers?

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Michael Trestl12:34

Incredibly important. In a relatively small market like Austria, the community is manageable, so loyalty is especially vital. Miles & More is an instrument to manage loyalty, but there are many other factors that strengthen emotional loyalty to the Austrian brand. The different status levels come with amenities like lounge access, priority security lanes, and for HON Circle members, personalized service around the clock. It's a key piece of the loyalty puzzle, but only one piece. It's constantly evolving.

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Manfred Lit14:25

You mentioned that regular customers are very important and Miles & More covers this area well. When I look at prices, there is often a price issue between low-cost and traditional airlines. Would you say customers sometimes look beyond price to maintain or earn status, making price secondary?

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Michael Trestl14:58

Yes, there is a certain price willingness beyond the average, especially if customers can collect points toward status. However, that willingness is not unlimited. Feedback from customer dialogues shows that people are happy to pay more, but there is a limit. Our daily challenge is to find the sweet spot where we don't upset loyal guests while still optimizing revenue. It's a balancing act. In doubt, we put loyalty and the needs of our most loyal guests — especially Senators and HON Circle members — above other arguments.

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Manfred Lit16:28

I'll stay briefly on that before moving on. Since January 1, there is a new status system. There is much debate — some say it's almost impossible to maintain or achieve status, others say it's now easier. What was the reasoning behind the change?

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Michael Trestl16:57

The reasoning was to reduce complexity and to dust off the legacy accumulated over many years. We changed the earning logic to points and made loyalty more dependent on the number of flights rather than on ticket price. Indeed, some people benefit because they can earn points faster, while others who rarely flew but bought expensive first-class tickets now fare worse. The new program needs to be established and may require adjustments, but in principle, the alignment is successful. It's much easier to understand how to earn points now.

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Manfred Lit18:45

Now let's briefly come to the trend in aviation. It's still moving strongly towards low-cost airlines, sometimes with outrageously low prices. Austrian has also reduced services. Where do you see the difference between Austrian and a low-cost airline based in Vienna?

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Michael Trestl19:17

I'll give two perspectives. From the customer perspective, even though Austrian adopted a buy-on-board concept on short-haul economy (common elsewhere but new in Europe), it gave the impression of service reduction. However, the idea is individualization — the old offerings may not have met real needs, while the new range is more targeted. From a business perspective, Austrian is based in Austria and thus subject to higher costs: taxes, fees, social frameworks, and collective agreements. We cannot compete with airlines that base operations in Malta or Poland for tax advantages and cheap labor. We stand by being local and acting sustainably. That means we cannot match some dumping prices. What sets us apart is authentic Austrian hospitality — we care for our guests even in irregular situations. We were among the top three most punctual airlines in Europe last year. Safety is a hygiene factor, but we go beyond the legal minimum.

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Manfred Lit24:14

When you fly privately or with your family, do you fly exclusively Austrian?

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Michael Trestl24:18

I try to stay within the Lufthansa Group when traveling privately, and that usually works. But on some business trips, I deliberately take other airlines to see what they offer — for example, the lounges in Dubai or Istanbul. Then colleagues say, 'That's how it should be for you too,' so I do some product benchmarking. When I fly Austrian, I almost always go to the cockpit and greet the cabin crew to make contact and have a chat.

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Manfred Lit25:23

In 1999, Austrian first sold tickets via the internet. How does digitalization affect customer loyalty?

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Michael Trestl25:30

Very much. The internet and digital media — whether a desktop website or app — have become not only important sales channels but also servicing channels. Many customer inquiries come through the app, chat, and social media. It has become more of a dialogue format. We can differentiate ourselves if we provide targeted answers on these channels. That doesn't always work yet; there is still much to do, especially with chatbots and AI, and the question of where we still need personal interaction.

There is potential to improve targeted customer communication to promote loyalty.

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Manfred Lit26:54

I researched and found that red uniforms were introduced in 1990. For many, they're iconic; for others, a no-go. What's your take?

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Michael Trestl27:15

The red uniform is emotional. There may be modernization, but the red color belongs to Austrian like the Blue Danube waltz. It's iconic and evokes positive feelings.

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Manfred Lit28:35

My friend in Switzerland always brings up the red stockings. Opinions are divided. Last year, you launched a campaign on Austrian hospitality. How's it received?

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Michael Trestl29:31

Very well. The campaign came from a need to regain relevance. It blends Austrian values with modernity and humor. I'm proud of it.

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Manfred Lit31:38

I confirm the feeling of coming home when boarding. You won best staff. How do you keep them motivated?

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Michael Trestl32:13

Our culture of warmth is passed down. The Austrian Spirit and involving employees in decisions keep motivation high.

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Manfred Lit34:58

Everyone has trouble finding staff. How is it at Austrian?

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Michael Trestl35:10

We have challenges for office roles but remain attractive for flying staff. We offer flexibility and competitive pay.

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Manfred Lit37:28

Almost no chance for me to apply. You were at Swiss. How was it as an Austrian in Switzerland?

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Michael Trestl37:56

I felt very good in Switzerland. It's international and flexible. I never tried Swiss German.

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Manfred Lit39:13

Which customers were easier, Swiss or Austrian?

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Michael Trestl39:18

Both are demanding and loyal. Swiss may pay more for premium. Austrians are price-sensitive. Swiss have more national pride.

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Manfred Lit40:47

Do you see the Swiss as more loyal?

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Michael Trestl40:52

Price willingness is higher in Switzerland. In Austria, loyalty stops at a certain price point.

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Manfred Lit42:05

Could Zurich be more shielded from low-cost carriers?

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Michael Trestl42:13

Zurich is capacity-constrained; Vienna has more growth. Low-cost penetration is different in Switzerland.

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Manfred Lit43:20

You studied business and tourism. What led you to airlines?

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Michael Trestl43:30

The global context and dynamism. Every world event affects us. It's never boring.

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Manfred Lit44:46

Many industries struggle. What can the grocery trade learn from Austrian about loyalty?

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Michael Trestl46:04

Reliability and continuity. We stabilized after COVID and deliver consistent product. That builds loyalty.

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Manfred Lit47:49

Reliability anchors customers. That could transfer to other industries.

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Michael Trestl48:38

We were in top 3 punctual in Europe. International guests notice our reliability. It's a value proposition.

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Manfred Lit50:51

What influence do you have on airport operations? Germany has issues.

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Michael Trestl51:13

We have a good relationship with system partners. We prepare together and can be flexible, like hiring students for peak.

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Manfred Lit53:05

Flexibility is key. In Vienna, problems were rare. Thanks for the conversation.

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Michael Trestl53:29

Thank you, it was my pleasure.