The price of loyalty
A major expansion of Qantas' frequent flyer program helps put the airline's reputation en route to recovery.
How much does it cost to fix a once-in-a-generation reputation crisis that is seriously threatening your brand? $120 million, if you are Qantas.
The national flag carrier's chief executive Vanessa Hudson announced today it would spend that much to add 20 million more reward seats from July — that is, seats available for purchase using frequent flyer points. The company described it as one of the biggest expansions of its loyalty program in history.
Of course, it comes after a nightmare period for the carrier, characterised by a series of operational missteps and outright scandals, ranging from delays and cancellations and lost baggage on flights when post-pandemic air travel resumed, to the competition regulator’s claims it sold tickets for “ghost” flights that never existed, to the company’s controversial use of access to its Chairman’s Lounge to influence its standing in Canberra. Nevertheless, the market seemed to like it — Qantas shares had lifted 5% higher to two-month highs at the time of writing.
Qantas Frequent Flyer points have been described as a de facto second currency in Australia. The carrier’s loyalty scheme is the envy of just about every consumer business in the country, with some 16 million members. And its a great business, arguably Qantas' best.
