Qantas unites loyalty and airline marketing under one CMO as it looks to pandemic recovery

Chief customer officer, Stephanie Tully, details the marketing and brand experiences that have led the airline to restructure its marketing approach and the brand learnings from tough times of the pandemic

Stephanie Tully
Stephanie Tully

Qantas has united its airline and loyalty marketing under one chief marketing officer as part of a restructure of the team geared at better uniting the two sides of the business and improving marketing efficiency.

Speaking at the ADMA Global Forum yesterday, Qantas chief customer officer, Stephanie Tully, confirmed the promotion of Qantas Loyalty CMO, Petra Perry, to group chief marketing officer last month, and following the departure of Jo Boundy.

Perry joined Qantas in 2016 and was promoted to the top marketing job across the Loyalty business in November 2019. She gained customer operations and digital for the division in July 2020. Prior to joining Qantas, Perry earned her marketing stripes with organisations such as Mastercard, Virgin Australia and American Express.

Boundy has now officially taken up the CMO’s post at Commonwealth Bank following Monique Macleod’s promotion to group executive marketing and corporate affairs last August.

Boundy’s significant role in helping Qantas retain brand trust and engagement throughout the pandemic in the face of zero budgets, severely reduced headcount and significant bottom-line pressures saw her recognised with the number 1 spot in the 2021 edition of the CMO50 list.

Tully said the decision to completely restructure the marketing team complemented decisions tied into with more in-house skills development driven by customer, speed and cost considerations.

“Petra Perry is leading a group marketing team, which is really important because there is no difference to our customers in those things but we had acted quite separately,” Tully said. “We have definitely built up our in-house capability because the speed we needed to talk to customers with over the last two years and the content we needed to create… meant doing it internally was the only option from a cost and timing perspective.

“That capability is best-in-class now and has been a big change for us as well.”

Keeping the flying kangaroo brand afloat

In detailing her own experiences as a member of the executive leadership team as well as fellow custodian of the brand during the last tumultuous two years of the pandemic, Tully’s self-proclaimed ‘group therapy session’ at ADMA Global Forum attendees was at times raw, as well as humble. Her presentation came a week after the latest iteration of the Qantas ‘I still call Australia home’ campaign debuted on TV screens and digitally.

When Australia’s borders shut in March 2020, Qantas had turned 99 and was looking forward to a year of celebrations for its 100th birthday. Tully has also recently moved into the chief customer role, overseeing marketing plus call centres, catering, lounges, commercial product development and market research. But she openly admitted she was “meddling a lot” in marketing during the pandemic.

“It was the worst crisis Qantas has held in its our 100-year history. And it’s not over yet,” she told attendees. “But it does feel more optimistic for us now.”

So what was it like being a brand without product for a couple of years? Complicated and unique, Tully said.

“We had so many interesting customer complexities and unforeseen issues to deal with – we have now had 10 million bookings that have changed, cancelled, credited, and we’ve had a lot of refunds,” she said, noting there has been $1 billion in flight credit to manage alone.

In first few months of pandemic, the management team had to focus on keeping the business liquid and was making key decisions to do that. Yet even so, keeping the brand alive in the hearts and minds of customers was recognised as critical to Qantas’ future. Even if the marketing team faced the stark reality of a zero-marketing budget.

“We needed to keep connection with customers, but in many ways, these were good for the business as well,” Tully said.

One example was the decision to keep the Qantas in-flight magazine going, sending it out digitally as well as to top-tier Frequent Flyers as a mechanism for engagement. “This meant we had enough ad revenue coming in so our partner [Medium Rare] could stay in business. It also helped engage in content,” Tully said.

“So there was often a dual purpose to the brand acts we found ourselves doing.”

Tully also said selling-off Qantas’ iconic business class pyjamas and drinks carts were good decisions that were both customer and commercially oriented. Another was the decision to launch ‘flights to nowhere’, departing and arriving in the same airport. These sold out in 15 minutes and not only brought in much-needed revenue, but also got aircrew working.

As also noted in CMO’s profile with Boundy for the CMO50, the Frequent dreamer’ positioning program for the 12 million members in Qantas’ loyalty program again provided a way to keep customers engaged with Qantas.

Earned media clearly became paramount to keeping brand engagement alive given the lack of budget available to the marketing team. This was leveraged when the Boeing 747 made its final farewell flight with a flight path that drew a kangaroo in the sky.

“It was a simple idea that didn’t cost us anything that got huge traction and enables us to keep the brand live,” Tully said. “We were letting our incredible marketing teams across the airline and loyalty come up with some great ideas to do this and keep the brand alive. I’m super proud of their efforts.”

Throughout all of these efforts, voice of customer was critical. Tully said the use of customer insights has grown in the last two years as it guided decisions the leadership team and board were making. Customer voice, sentiment, brand tracking, how Qantas was going in terms of customer trust, NPS and insights around the mood of the nation and what the business could do to help were all presented during daily general management committee meetings as well as fortnightly board meetings.

“Some things we want to leave behind but there’s also lots we want to take with us. One thing we have done well and want to take with us was voice of customer. We stayed as close as we could to our customers,” she said. “There wasn’t one person who wasn’t disconnected from someone, be it loved ones around the world or every in Melbourne. We needed to have empathy for every person’s story. And it wasn’t just physical connection, but also financial hardship people were experiencing.

“Staying close to that, tracking, talking about it then making product decisions based on it and on the fly as we were trying to do things quickly was key.”

For instance, when it first looked like flights would recommence domestically in in May/June 2020, the biggest insight from customers was their fear about health and how to fly safely. In response, Qantas developed its ‘Fly well’ program in hours – and in-house – to build confidence to fly.

Flexibility was a second significant insight and remains key to this day, Tully said. In response, Qantas has put unprecedented levels of flexibility in its system so customers feel safe to fly as well as book.

“We also underestimated how much people care about their Frequent Flyer status – I think we knew it, but it was coming through strongly in the insights. We’ve now extended people’s much well-earned status three times now… so we can stick by you when you weren’t flying… so you felt we were being loyal to you and rewarding your efforts as well.”

Tully said another big lesson to come out of this time for Qantas was that brands do and their actions matter.

“We learnt quickly we could play a role in the broader agenda,” Tully said. “That leadership role, what we stood up for and lobbied for was important to our customers. Allan [Joyce, Qantas CEO] was frequently lobbying to open borders.  

“Then as we moved along the journey, lobbying for vaccination as we knew that was the ticket to start opening up again.”

A resulting vaccination push ad went viral, giving Qantas a first-move advantage and again earning significant media coverage.  

“It is the privilege we play as a national brand that’s more than an airline to the country and many people own a piece of it. We had an opportunity to shift the nation’s view on things, which we didn’t take for granted,” Tully said.

The job ahead

The reality is the pandemic is by no means over. Tully pointed out Qantas is still unable to fly to several key destinations including Hong Kong and China. It remains in balance sheet repair and has only in recent months regained 20,000 of its 30,000 original staff members back.

“There is still a job to do to get Australians confident to book and fly,” Tully said. Brand Australia has also taken a hit, Tully admitted, but saw it as recoverable and saw the removal of testing for inbound travellers as a big step forward.

And she pitched the silver lining and a strong list of things on their way in coming months.

“We have a mantra internally to come back better,” Tully said. “We have used the crisis to transform the business – we have taken $1 billion of cost out, restructured all the components of marketing… started 52 domestic routes, and we’re starting our direct flights to Rome in a couple of months for the first time in a long time.

“Intakes over the last four weeks have been the strongest yet. We have some big fleet decisions to make… we are making sustainability announcements for the team to get excited about. We have come out in a pretty good state, with trust and NPS holding up, but there’s definitely teething issues with restart.

“We need to fix our call centres, and we’re doing a lot on that. There are skill shortages around the country and the world that impact us and we are sorry when we’ve left our customers down.”

More loyalty partnerships and redeemable rewards are also on the cards.

The latest Qantas campaign includes creative recorded in April 2020, as well as real-life footage of reunions across Australian airports in recent months. The longform TVC was produced in partnership with The Monkeys.

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