Qantas invests $25m in customer loyalty program overhaul

Airline says the changes to its Frequent Flyer membership program are the biggest in its 32-year history and aimed at retaining value in the face of a rapidly expanded offering

Qantas will offer more than 1 million extra rewards seats, a new lifetime qualification and tiered Points Club for non-flying spenders as part of a $25 million investment into its Frequent Flyer loyalty program.

The ASX-listed airline said changes announced today to its customer loyalty program represent the biggest overhaul in its 32-year history and are about shaking up the way members are recognised and rewarded.

Among the new offerings, which will be rolled out over the 12 months, are 1 million additional rewards seats available annually on Qantas and new partner airlines, as well as up to a 10 per cent reduction in the number of points required for international economy Classic Rewards seats.

Qantas is also cutting back additional costs associated with flights booked with points, which it says will bring down return flight costs by an average of $200. At the same time, the airline is hiking up the points required for upgrades in premium cabins.

Another key change is a new tiered Points Club program, aimed at better rewarding members who earn the majority of their points off a plane and on non-flight transactions. Notably, 35 per cent of all credit card transactions in Australia are made on a Qantas or Qantas Frequent Flyer co-branded credit card.

Called ‘Points Club’, the initiative includes two tiers, with entry gained based on a member passing an annual points-earned criteria of 150,000 points earnt on the ground. Due to launch later this year, the Points Club will provide access to member-exclusive offers and discounts across Qantas as its partners.

Qantas is also introducing a new Lifetime Platinum Status, a means by which of recognising its most loyal flyers over and above existing Lifetime Gold and Silver tiers. To get there, members will need to accrue 75,000 status credits. The new Lifetime tier will be introduced in September.

Qantas Group CEO, Alan Joyce, said the ambition is to strengthen the value for its 12.7 million Frequent Flyer members. The group expects the $25m invested into the program will be paid back through stronger engagement with the loyalty offering.

“The Qantas Frequent Flyer program has always been about rewarding customers for their loyalty. These changes are about making it easier for members to access those rewards and help to keep them highly engaged, which in turn is good news for our business as whole,” he said.

“We know the majority of our members want to use their points to take a dream trip overseas, so we are adding more reward seats including First, business and Premium Economy, to places like London, Los Angeles, Tokyo and Singapore as well as slashing carrier charges.”

Joyce justified the increase in points required for business class seats on all flights, noting it was the first increase in 15 years and based on product improvements.

Qantas Loyalty CEO, Olivia Wirth, said extensive research into the habits and behaviours of loyalty program members informed the latest changes.

“There’s a lot about the Qantas Frequent Flyer program that our members tell us they love. But there are also areas of the program that have increasingly come under pressure as a result of rapid expansion,” she commented.

Over recent years, Qantas has extended out from its core Frequent Flyer offering through a host of adjunct programs such as

“What we’re announcing today is all about investing more into the heart of our program, the member experience.”

Over recent years, Qantas has extended the reach of its loyalty program platform, launching new offerings like the Acquire program for small and media businesses, as well as Qantas Golf Club. It’s also now boasts of more than 300 affiliate partners, as well as a growing ecommerce portal.

“Australians love earning Qantas Points and that momentum has seen us expand our number of retail partners and extend into new areas like financial services and insurance. The result is that people have lots of opportunities to earn points, so this overhaul is about making sure they have more opportunities to use them,” Joyce added.

Commenting on the overhaul, customer loyalty consultant, Adam Posner, noted valuable and substantial changes in response to many of the pain points members have been experiencing, such as accessing rewards seats.

“It’s fascinating to see that they are now overtly rewarding ‘frequent buyers’ in addition to ‘frequent flyers’ with the introduction of their new ‘Points Club’,” the CEO and founder of Directivity and The Point of Loyalty author told CMO. “This is brings to life a visible recognition of where many members earn points - on transactions not travel.   

“It will also motivate members to spend more with credit cards linked to Qantas Frequent Flyer and if you have a QFF credit card, I am sure that means more revenue.”   

Posner rated the changes looking from the outside in as “a solid revamp”.  

“With 12.7 million members and Australia’s second currency, there are sure to be a fair few delighted members,” he added. 

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia. 

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Latest Videos

Conversations over a cuppa with CMO: Craig Davis

​Leadership resilience, startups scaling up, marketing best practices, customer insights - these are just a few of the topics we manage to explore in the latest episode of Conversations over a Cuppa with CMO featuring Craig Davis.

More Videos

Thank you for sharing your knowledge. Definitely bookmarked for future reading! Check this website https://a2designlab.com/ with lots of ...

Ryota Miyagi

Brene Brown: What it takes to be a brave leader right now

Read more

Well said! It is high time to look into the cultural values and beliefs of the audience before serving with the ads. If it is against the...

Praveen Kumar

The X factor in multicultural media planning and buying - Digital advertising - CMO Australia

Read more

I completely agree with you. High-quality customer service only strengthens loyalty to the company and helps to increase sales and increa...

Natali

Mercer CMO: How B2B brands can achieve customer love

Read more

I can imagine Google just not providing hits for these business.They need Google more than Google needs them.What about all the other sea...

Michael Hackett

Google hits out at ACCC draft code of conduct for news media negotiations

Read more

As always, Brene Brown makes critical points here! Check out http://belongingbuilders.po... for more information about a new, four-month ...

Belonging Builders

Brene Brown: What it takes to be a brave leader right now

Read more

Blog Posts

Life beyond the cookie: 5 steps to mapping the future of marketing measurement

​There’s no denying there’s been a whirlwind of response to the imminent demise of the third-party cookie from all parts of the industry. But as we’ve collectively come to better understand the implications, it’s clear this change is giving the digital advertising industry the opportunity to re-think digital marketing to support core industry use cases, while balancing consumer privacy.

Natalie Stanbury

Director of research, IAB Australia

Ensuring post-crisis success

The COVID-19 pandemic has exposed brands’ CX shortcomings and a lack of customer understanding. Given ongoing disruption, customer needs, wants and expectations are continually changing, also causing customers to behave in different ways. Just look at hoarding toilet paper, staple and canned food, medicinal and cleaning products.

Riccardo Pasto

senior analyst, Forrester

A few behavioural economics lesson to get your brand on top of the travel list

Understanding the core principles of Behavioural Economics will give players in the travel industry a major competitive advantage when restrictions lift and travellers begin to book again. And there are a few insights in here for the rest of the marketing community, too.

Dan Monheit

Co-founder, Hardhat

Sign in